judgement:
ivil Appeal Nos.
248 251 of 1976.
(Appeals by Special Leave from the Judgment and Order dated 28 11 1975 of the Andhra Pradesh High Court in Writ Petitions Nos.
1195 1198/75).
CIVIL APPEALS Nos.
934 936 of 1976.
(Appeals by Special Leave from the Judgment and Order dated 28 11 1975 of the Andhra Pradesh High Court in Writ Petitions Nos.
3931, 3944 and 4029/75).
CIVIL APPEALS No. 693 of 1976.
(Appeal by Special Leave from the Judgment and Order dated 28 11 1975 of the Andhra Pradesh High Court in Writ Petition No. 6790/74).
Soli Sorabji and K.J. John for the Appellant (CAs 248 251/76).
A. Subba Rao for the Appellant (CAs.
934 936/76).
Babul Reddy and K.J. John for the Appellant (CA.
693/76).
Niren De, Attorney General for India, P.P. Rao, D.V. Sastry and T.V.S.N. Chari for the Respondents (in CAs.
248 251/76 and CAs.
934 936/76).
T.V.S.N. Chari for the Respondent (In CA No. 693/76).
The Judgment of the Court was delivered by JASWANT SINGH, J.
This batch of appeals by special leave which are directed against three separate judgments of the High Court of Andhra Pradesh at Hyderabad dismissing three sets of writ petitions Nos.
1195 to 1198 of 1975,3931, 3944 and 4929 of 1975 and 6790 of 1974 filed by the.
appel lants to challenge certain orders of the sales tax authori ties made in respect of re determination of their ' turnover for certain years under the Andhra Pradesh General Sales Tax Act, 916 1957 (hereinafter referred to as 'the Act ') shah be disposed of by this judgment, as they raise a common question as to whether the excise duty deposited directly in a State treas ury or a sub treasury by the purchasers of the Indian made foreign liquor called 'Indian liquor ' before removing the said liquor from a distillery and the countervailing duty remitted directly to a State Treasury or a sub treasury by the purchasers of the aforesaid specie of liquor before removing it from a bonded warehouse can properly be said to form part of the turnover of .he manufacturer and of the owner of the bonded warehouse respectively and as such liable to sales tax under the Act.
The circumstances which have given rise to these appeals lie in a short compass and may be briefly stated: The appel lants in the first two sets of Appeals Nos. 248 to 251 of 1976 and 934 to 936 of 1976 carry on the business of manu facture of 'Indian liquors ' in their distilleries estab lished in Andhra Pradesh under licences issued to them by the Commissioner of Excise under the Andhra Pradesh Excise Act, 1968 (Act 17 of 1968) and the rules made thereunder and sell their finished products to the wholesale dealers who in turn sell them to retail dealers.
Under Rule 76 of the Andhra Pradesh Distillery Rules, 1970 removal of any liquor manufactured or stored without prepayment of the excise duty specified in rule 6 is forbidden.
Rule 77 of the Rules prohibits issue of any liquor until its quantity and strength have been duly verified by the distillery officer.
Rule 579 of the Rules authorises the distillery officer on payment of excise duty to grant a distillery pass for remov al of the liquor fit for human consumption to the persons specified in the said rule including a person holding a licence for sale of liquor by wholesale or retail.
Under Rule 81 of the Rules, every application for a distillery pass for removal of liquor has to be addressed in writing to the distillery officer and has to be accompanied by a challan in original for payment of excise duty therefor and a general or special permit for the purpose of removal of the liquor.
Rule 82 of the Rules enjoins the distillery officer upon tender of cash payment of excise duty by the applicant to fill up the challan for presentation with the cash at a treasury or sub treasury of the district in which the distillery is situate, and the applicant for distillery pass to present the treasury receipt in token of his having made payment of the duty where after the distillery officer has to affix the said receipt to the counterfoil of form D 6.
Rule 83 of the Rules casts responsibility upon an applicant for a distillery pass to, make a correct calcula tion and full payment of the excise duty upon the liquor desired to be removed.
Rule 84 of the Rules requires, the distillery officer to issue the liquor under a pass in form D 6 sending a duplicate ' thereof to the Excise Superintend ent of the district of destination on being satisfied that the applicant is entitled under the Rules to remove the liquor and has made payment of the requisite excise duty.
Accordingly every buyer of the Indian liquor from either of the 'appellants ' distilleries during the years in ques tion obtained the distillery pass for release of the liquor after making payment of the excise duty and presented the same at the concerned distillery whereupon bill of sale or invoice was prepared by the distillery showing the price of the liquor.
The said bill did not include 917 the excise duty paid by the buyer.
The appellants ' books of accounts also did not contain any reference regarding the excise duty paid by the purchasers in the manner stated above.
The appellants paid the sales tax in full as per final assessments made by the sales tax authorities under the Act.
it appears that after the completion of the assessments of the sales tax under the Act for the years in question, the Commercial Tax Officer felt that there had been a failure to include the excise duty paid on the aforesaid liquors vended by the appellants in their taxable turnover.
Accordingly, acting under the provisions of section 14(1) of the Act, the Commercial Tax Officer issued notices in February, 1975 to the appellants in the afore said first two sets of appeals to show cause why the assess ments be not reopened.
Aggrieved by the said action of the Commercial Tax Officer, the appellants filed writ petitions Nos.
1195 to 1198 of 1975 and 3931, 3944 and 4929 of 1975 in the High Court of Andhra Pradesh challenging the said notices which, as already stated, were dismissed by the High Court.
The appellant in Appeal No. 693 of 1976 is a firm which is a licensed wholesale dealer in liquors and owner of a bonded warehouse under the Andhra Pradesh Indian Liquor (Storage in bond) Rules, 1969 where it stores or deposits Indian Liquors such as whisky, brandy.
gin etc.
imported by it from various States outside the State of Andhra Pradesh without prepayment of countervailing duty or other fee and issues the same according to the rules to its customers.
The modus operandi of the appellant is that it makes a bill for the value of the liquor required by an intending purchaser, who thereafter pays the requisite countervailing duty in his own name and the Excise Officer incharge of the bonded warehouse grants him a pass entitling him to remove the liquor from the warehouse.
According to the appellant, it gets only the price of the liquor from its buyers.
For the assessment year 1971 72, the Commercial Tax Officer, Hydera bad III by its order dated August 16, 1972 included the amount representing the countervailing duty paid by the purchasers in respect of the Indian liquors in bond which was not included in the bills of sale issued by the appel lant.
On appeal, the Assistant Commissioner by its order dated March 26, 1973 deleted from the turnover of the appel lant the item pertaining to the excise duty paid directly by the purchasers holding that the excise duty so paid by the purchasers did not, in the circumstances, form part of the turnover of the appellant.
Sometime thereafter, the Sales Tax Appellate Tribunal by its order dated August 5, 1974 passed in T.A. Nos. 331 of 1973 and 5 of 1974 upheld the assessment made under similar circumstances by the Commer cial Tax Officer, Vijayawada, on the turnover of M/s Shaw Wallace & Co. Thereupon the Deputy Commissioner, Commer cial Taxes, Hyderabad by virtue of the power vested in him under section 20 of the Act issued the impugned notice dated October 9, 1974.
to the appellant calling upon it to show cause why the order passed by the Assistant Commissioner, Commercial Taxes on March 26, 1973 should not be set aside and the original assessment order of the Commercial Tax Officer dated August 16, 1972 restored.
The appellant was also required to file objections and adduce evidence in support thereof within 7 days from the date of receipt of the impugned notice, 918 Aggrieved by the notice, the appellant flied a petition being petition No. 6790 of 1974 before the High Court of Andhra Pradesh.
seeking issue of an appropriate writ, order or direction declaring that the appellant was not liable to pay sales tax on excise duty paid by the purchasers in their own names and restraining the Deputy Commissioner, Commercial Taxes, Hyderabad, respondent in the appeal from taking further proceedings in pursuance Of the said notice.
The said petition having been dismissed, the appellant has, as already stated, come up in appeal to this Court.
At the hearing of these appeals, Mr. Sorabji and the other counsel appearing on behalf of the appellants have assailed the aforesaid Judgments and orders of the High Court by urging in the first instance that the view taken by the High Court about the nature and character of excise duty and countervailing duty is not correct.
They have also after trying in vain to argue for considerable length of time that on the true construction of the Andhra Pradesh Excise Act, 1968, the Andhra Pradesh Distillery Rules, 1970, the Andhra Pradesh Foreign and Indian Liquor Rules, 1970 and the Andhra Pradesh Indian Liquor (Storage in bond) Rules, 1969, a manufacturer of Indian liquors and an owner of a bonded warehouse are not primarily responsible for payment of the excise duty or countervailing duty, as the case may be, contended that a manufacturer and owner of the bonded ware house are not solely responsible for payment of the said duties and a purchaser of the liquor who obtains a distill ery pass or a werehouse pass and transport permit is also legally responsible for payment therefor and if he does pay the duty, it is something which he does in discharge his own statutory liability and not something which he does for or on behalf or for the benefit of the manufacturer or the owner of the bonded warehouse.
They have alternative ly contended that on a true construction of the expression 'turnover ' as defined in section 2(1) (s) of the Act, the determinative factor is the total amount set out in the bill of sale as consideration for the sale of the liquor and since the excise duty or the countervailing duty was direct ly paid by the purchasers to the excise authorities and did not at all form part of the consideration for the sale of the said liquor as set out in the bills of sale, it was not permissible for the sales tax authorities to assess the turnover by roping therein something which was not set out in the bills of sale as consideration for the sales.
They have lastly contended that in any event as the excise duty or the countervailing duty was at no time charged by the appellants for anything done in respect of the liquors sold but was charged by the excise authorities before removal of the liquors under the Andhra Pradesh Excise Act, 1968 and the rules made thereunder, it could not constitute a part of the turnover and taxed under the Act.
Although some controversy was sought to be raised by counsel for the appellants regarding the nature and charac ter of the excise duty and countervailing duty but as rightly pointed out by the learned Attorney General, the matter has been put beyond doubt by the decisions of this Court.
In R.C. Jail vs Union of India(I) after a review of the authorities bearing on the matter, it was held by this Court as follows : (1) [1962] supp.
3 S.C.R. 436.
918 'The excise duty is primarily a duty on the production or manufacture of goods produced or manufactured within the country.
Subject always to the legislative competence of the taxing authority, the said tax can be levied at a convenient stage so long as the character of the impost is not lost.
The method of collection does not affect the essence of the duty but only relates to the machinery of collection for administrative convenience.
" Again In re Sea Customs Act(1) it was ob served: "The question with respect to excise duties was considered by this Court in the case of Amalgamated Coal fields Ltd. vs Union of India (A.I.R.
After considering the previous decisions of the Federal Court In re.
The Central Provinces and Berar Sales of Motor and Lubricant Taxation Act (1939 F.C.R. 18); The Province of Madras vs M/s Boddu Paidanna and of the Judicial Committee of the Privy Council in Governor General in Council vs Province of Madras , this Court observed as follows at p. 1287: "With great respect, we accept the principles laid down by the said three deci sions in the matter of levy of an excise duty and the machinery for collection thereof.
Excise duty is primarily a duty on the produc tion or manufacture of goods produced or manufactured within the. country.
It is an indirect .duty which the manufacturer or producer passes on to the ultimate consumer, that is, ultimate incidence will always be on the customer.
Therefore, subject always to the legislative competence of the taxing authority, the said tax can be levied at a convenient stage so long as the character of the impost, that is, it is a duty on the manufacture or production, is not lost.
The method of collection does not affect the essence of the duty, but only relates to the machinery of collection for administrative convenience.
" This will show that the taxable event in the case of duties of excise is the manufacture of goods and the duty is not directly on the goods but on the manufacture thereof.
We may in this connection contrast sales tax which is also imposed with reference to goods sold, where the taxable event, is the act of sale.
Therefore, though both excise duty and sales tax are levied with reference to goods, the two are very different imposes; in one case the imposition is on the act of manufacture or production while in the other it is on the act of sale.
In neither case therefore can it be said that the excise duty or sales tax is a tax directly on the goods for in that event they will really become the same tax.
It would thus appear 'that duties of excise partake of the nature of indirect taxes as known to standard works on economics and are to be distinguished from direct taxes like taxes on property and income." (1) ; 919 It is, therefore, clear that excise duty is a duty on the production or manufacture of goods produced or manufac tured within the country though as observed by one of us (Khanna, J.) in A.B. Abdul Kadir & Ors.
vs State of Kerala(1) laws are to be found which impose a duty of excise at stages subsequent to the manufacture or production.
The position with regard to the nature and character of countervailing duty has equally been made clear in a number of decisions of this Court.
In Kalyani Stores vs The State of Orissa & Ors.(2) which was followed in M/s Mohan Meakin Breweries Ltd. vs Excise & Taxation Commissioner, Chandigarh & Ors.
(2), Shah, J. (as he then was) observed: "This brings us to the consideration of the meaning of the expression "countervailing duties" as used in Entry 51, List 1I of the Seventh Schedule to the Constitution.
The expression "countervailing duties" has not been defined in the Constitution or the Bihar & Orissa Act 2 of 1915.
We have, therefore, to depend upon its etymological sense and the context in which it has been used in Entry 51.
In its etymological sense, it means to coun ter balance; to avail against with equal force or virtue; to compensate for something or serve as an equivalent of or substitute for: see Black 's Law Dictionary, 4th Edn.
This would suggest that a countervailing duty is imposed for the purpose of counterbalancing or to avail against something with equal force or to compensate for something as an equiva lent.
Entry 51 in List II of the Seventh Schedule to the Constitution gives power to the State Legislature to impose duties of excise on alcoholic liquors for human consump tion where the goods are manufactured or produced in the State.
If also gives power to levy countervailing duties at the same or lower rates on similar goods manufactured or produced elsewhere in India.
The fact that countervailing duties may be imposed at the same or lower rates suggests that they are meant to counterbalance the duties of excise imposed on goods manufactured in the State.
They may be imposed at the same rate as excise duties or at "a lower rate, presumably to equalise the burden after taking into account the cost of transport from the place of manu facture to the taxing State.
It seems, therefore, that countervailing duties are meant to equalise the burden on alcoholic liquors imported from outside the State and the burden placed by excise duties on alcohol ic liquors manufactured or produced in the State.
If no alcoholic liquors similar to those imported into the State are produced or manufactured, the right to impose counter balancing duties of excise levied on the goods manufactured in the State will not arise.
It may, therefore, be accepted that countervail ing duties can only be levied if similar goods are actually produced or manufactured in the State on which excise duties are being levied.
" (1) [1976] 3 s.c.c. 219.
(2) ; (3) ; 921 Having seen that a provision can be inserted in the excise law for collection of the excise duty at a stage subsequent to the manufacture or production of the excisable article, we shall now proceed to examine the main contentions raised by counsel for the appellants.
We have first to see as to how far the contention of counsel for the appellants that apart from a manufacturer of Indian liquors and an owner of a bonded warehouse (who in our opinion cannot but be regard ed as primarily responsible for payment of excise duty and countervailing duty respectively in view of sections 21, 28 & 65 of the Andhra Pradesh Excise Act, 1968, and rules 3, 4, 5, 6, 67 & 76 of the Andhra Pradesh Distillery Rules, 1970, and condition No. 9 of the Distillery Licence granted under rule 5 of these Rules; rules 5 & 10 of the Andhra Pradesh Indian Liquor (Storage.
in bond) Rules, 1969, conditions Nos. 7 & 10 of the licence granted in form B.W. 1 under rule 5(2).
the phraseology of the application for receipt of liquor into the bounded warehouse prescribed by rule 9(2) and the terms of the counterpart agreement required to be executed by a licensee of an Indian liquor bonded warehouse under rules 3(2) and 5(2) of these Rules) the buyers of the said liquors are also liable under the law for payment of the aforesaid duties can be sustained.
For a proper deter mination of this question, it is necessary to recall the provisions of the Andhra Pradesh Distillery Rules, 1970 which have been set out in the earlier part of this judg ment.
The said rules particularly rules 79, 81, 82, 83 and 84 lend a good deal of support, in our opinion, to the contention of counsel for the appellants and make every intending buyer of the Indian liquor liable for payment of the excise duty before obtaining the distillery pass and lifting the quantity mentioned therein from 1he distillery.
Accordingly agreeing with counsel for the appellants we hold that intending purchasers of the Indian liquors who seek to obtain distillery passes are also legally responsible for payment of the excise duty which is collected from them by the authorities of the Excise Department.
The position in regard to the countervailing duty is not,however dear though rule 10(1) of the Andhra Pradesh Indian Liquor (Storage in bond) Rules, 1969 and rules 5(2) and 17 of the Andhra Pradesh Foreign and Indian Liquor Rules, 1970 enable the intending buyers of Indian liquors to remove the same from a bonded warehouse on payment of the said duty, to the excise authorities.
This is not, however, sufficient to dispose of the matter.
The real and pivotal question that requires to be determined is whether the excise duty or the countervailing duty, as the case may be.
paid directly to the excise authorities of the State or deposited directly in the State exchequer in respect of the Indian liquor by the buyers thereof before removing it from any of the aforesaid dis tilleries or the warehouse can be said to form part of the taxable turnover of the appellants as according to section 5 of the Act which is the charging section sales tax is required to be paid by the appellants on their turnover of the year.
It will be useful at this stage to advert to the definitions of the words 'turnover ' and 'sale ' as given in clauses (s) and (n) of sub section (1) of section 2 of the Act.
Shorn of unnecessary details, these definitions run as under: 922 "turnover" means the total amount set out in the bill of sale (or if there is no bill of sale, the total amount charg ed) as the consideration for the sale or purchase of goods (whether such consideration be cash, deferred payment or any other thing or value) including any sums charged by the dealer for anything done in respect of goods sold at the time of or before the delivery of the goods and any other sums charged by the dealer, whatever be the description,name or object thereof . .
. . . . "sale" with all its grammatical varia tions and cognate expressions means every transfer of the property in goods by one person to another in the course of trade or business, for cash, or for deferred payment, or for any other valuable consideration. .
In the instant case, it is not disputed that excise duty or countervailing duty paid directly to the excise authorities by the purchasers of Indian liquors before removal thereof from the distilleries or the bonded warehouse on the strength of the distillery and warehouse passes was not included in the bills of sale as the consideration for the sales, but 1hat alone, according to the Attor ney General, is not determinative of the matter.
He has invited our attention to the second part of the definition of the word 'turnover ' as set out above and has strenuous ly urged that as in addition to the price of the liquor set out in the bills of sale as consideration for the sales, other sums charged by the dealer at the time of or before the delivery of the goods also form part of turnover, and according to the well estab lished canon of construction, a taxing stat ute has to be interpreted reasonably so that there is no evasion of the tax, the phrase 'any sums charged by the dealer ' occurring in the aforesaid definition of the word 'tur nover ' must be 'construed as meaning any item of expense including the excise duty or the countervailing duty to which the buyers were put by the manufacturers of the liquors or the owner of the bonded warehouse.
We find our selves unable to accept the construction sought to be put by him as it is opposed to the plain meaning of the said phrase.
It will be advantageous here to refer to the decisions of this Court in.
A.V. Fernandez vs The State of Kerala(1) where Bhagwati, J. speaking for the Bench after quoting the observations made by Lord Russell of Killowen in Inland Revenue Commissioners vs Duke of Westminster(2) which were approved by the Privy Council in the Bank of Chettinad vs Income Tax Commissioner(3) observed: "It is no doubt true that in construing fiscal statutes and determining the liability of a subject to tax one must have regard to the strict letter of the law and not merely to the spirit of the statute or the substance of the law.
If the Revenue satisfies the Court that the case fails strictly within the provi sions of the law, the subject can be taxed.
If, on the other hand, the case is not covered within the four corners of the provisions of the taxing statute, no tax can be (1) ; (2) [19361 A.C.I, 24.
(3) A.I.R. 1940 P.C. 183. 923 imposed by inference or by analogy or by trying to probe into the intentions of the legislature and by considering what was the substance of the matter.
We must of necessi ty, therefore, have regard to the actual provisions of the Act and the rules made thereunder before we can come to the conclu sion that the appellant was liable to assess ment as contended by the Sales Tax Authori ties.
" Bearing in mind the principle set out in A.V. Fernan dez 's case (supra) the phrase 'any sums charged by the dealer ' has to .be understood in its ordinary popular sense.
So construing the phrase, it means "what is demand ed and collected or received by the dealer." In the instant cases, the excise duty or the countervailing duty has, as already stated, not been charged or received by the dealer but has been charged by the excise authorities and deposited directly by the buyers of the liquor in the State exchequer.
It is, therefore, difficult to hold that excise duty or ' countervailing duty was charged by the appellants.
The reason for inclusion of tax or a duty in the turn over was explained in two decisions of this Court bearing the same cause title viz. Messrs George Oakes (Private) Ltd. vs The State of Madras & Ors.
(12 S.T.C. 476) and (13 S.T.C. 98).
In the first of these cases, it was observed : "Under the definition of turnover the aggre gate amount for which goods are bought or sold is taxable.
This aggre gate amount includes the tax as part of the price paid by the buyer.
The amount goes into the common till of the dealer till he pays the tax.
It is money which he keeps using for his business till he pays it over to Government.
Indeed, he may turn it over again and again till he finally hands it to Government.
" In the other decision, Hidayatullah, J. (as he then was) said: "In laws dealing with sales tax, turn over has, in England and America also, been held to include the tax.
The reason for such inclusion is stated to be that the dealer who realises the tax does not hand it over forth with to Government but keeps it with him, and turns it over in his business before he parts with it.
Thus, the tax becomes,for the time being, a part of the circulating capital of the tradesman, and is turned over in his business.
Again, it was said that the price paid by the purchaser was not so much money for the article plus tax but a composite sum.
Therefore, in calculating the total turnover, there is nothing wrong in treating the tax as part of the turnover, because "turnover" means the amount of money which is turned .over in the business." In the instant cases, the excise and countervailing duties did not go into the common tills of the appellants and did not become a part of their circulating capital.
We are, therefore, of the view that the 9 1338SCI/76 924 Sales Tax authorities were not competent to include in the turnovers of the appellants the excise duty and the counter vailing duty which was not charged by them but was closed by and paid directly to the excise authorities by the buyers of the liquors as stated above.
The Full Bench decision of the High Court of Andhra Pradesh in The Government of Andhra (Now Andhra Pradesh) vs East India Commercial Co. Ltd.(1) relied upon by the Revenue is clearly distinguishable.
In that case, it was the actual collection of certain sums as dharamam or charity by the dealer from the purchasers on the occasion of the sales that made the learned Judges to hold that they constitute part of the turnover.
In Messrs George Oakes (Private) Ltd. 's case (supra) also, the tax in question was collected by the registered dealer.
We have, therefore, no hesitation in holding that the excise duty and the countervailing duty paid directly by the buyers of the Indian liquors as stated above did not consti tute a part of the turnovers of the appellants.
For the foregoing reasons, we allow the appeals and set aside the impugned judgments and orders.
In the circum stances of the case, we leave the parties to pay and bear their own costs of these appeals.
P.B.R. Appeals al lowed.
(1) 8 S.T.C. 114.

summary/full:
Section 2(1)(s) of the Andhra Pradesh General Sales Tax Act, defines 'turnover" to mean the total amount set out in the bill of Sale as the consideration for the sale or purchase of goods including any sums charged by the dealer for anything done in respect of goods sold at the time of or before the delivery of the goods.
The appellants in the first two sets of appeals are manufacturers of Indian liquors.
A buyer of Indian liquor from the distilleries pays, in the first instance, the excise duty in the Treasury and obtains a distillery pass for the release of liquor.
On presentation of the distill ery pass an invoice is prepared by the manufacturers showing the price of liquor.
Neither invoice.
nor the account books of the manufacturers show the excise duty paid by the purchasers.
Under the system in vogue in the second set of appeals, the appellant who is the owner of a bonded warehouse pre pares a bill for the liquor required by the purchaser who pays the countervailing duty in the Treasury in his own name and obtains a pass from the excise authorities for the removal of the liquor from the warehouse.
In both the, cases the Sales Tax Authorities included the excise duty in the taxable turnover of the appellants.
The High, Court dismissed the writ petition of the appel lants impugning the orders of the Sales Tax Officers.
Allowing the appeal, HELD: (1) Excise duty and countervailing duty paid directly by the buyers for the Indian liquors did not con stitute a part of the turnovers or, the appellants.
[924 C] (2) The phrase 'any sums charged by the dealer ' occur ring in the definition of 'turnover ' has to be understood in its ordinary popular sense.
So construed, it means what is demanded and collected or received by the dealer.
[923 B] In the instant case the excise duty or the countervail ing duty has not been charged or received by the dealer but has been charged by the excise authorities and deposited directly by the buyers of the liquor in the State exchequer.
It cannot be said that the excise duty or the countervailing duty was charged by the appellants.
In M/s. George Oakes (Private) Ltd. vs The State of Madras & Ors., this Court held in relation to the definition of turn over that the aggregate amount includes the tax as part of the price paid by the buyer; the amount goes into the common till of the dealer till 'he pays the tax; it is the money which he keeps using for his business till he pays the tax; it is the money which he keeps using for his busi ness till he pays it over to Government; it becomes a part of the circulating capital of the tradesman and is turned over in his business.
Secondly the price paid by the pur chaser was not so much money for the cause turnover means the amount of money which is turned over in the busi ness.
[923 E G] 915 In the instant case the excise and the countervailing duties did not go into the common tills of the appellants and did not become a part of their circulating capital.
The Sales tax authorities were not competent to include in the turn overs of the appellants the excise duty and the countervail ing duty which was not charged by them but was charged by and. paid directly to the excise authorities by the buyers of the liquors.
[924 A] A. V. Fernandez vs The State of Kerala ; followed.
R.C. Jail vs Union of India [1962] Supp.
3 S.C.R. 436, Sea Customs ACT ; , A B. Abdul Kadir & Ors.
vs State of Kerala , Kalyani Stores vs The State of Orissa & Ors. ; & M/s Mohan Megkin Brewaries Ltd. vs Excise & TaxatiOn Commisisoner, Chandigarh & Ors. ; referred to.
Messrs George Oakes (Private) Ltd. vs The State of Madras & Ors.
(122 S.T.C. 476) and (13 S.T.C. 98) referred to and distinguished.
The Government of Andhra (now Andhra Pradesh) vs East India Commercial Co. Ltd. (8 S.T.C. 114) distinguished.


judgement:
: Criminal Appeal No, 385 of 1976.
(From the Judgment and Order dated 22 12 1975 of the Gujarat High Court in Crl.
Appeal No. 180/74) N.N. Keswani & Ramesh N. Keswani for the appellant.
K.H. Kazi & M.N. Shroff for the Respondent.
The Judgment of the Court was delivered by BHAGWATI, J.
This appeal, by special leave, is directed against an order passed by the High Court of Gujarat setting aside the acquittal of the appellant and directing that he, along with other accused, be retried not only for the of fence of consumption of liquor of which he was acquitted but also for the offence of possession of liquor punishable under section 66(1)(b) of the Bombay Prohibition Act, 1949.
The question arising for determination is a short one, but in order to appreciate it, it is necessary to state the. facts giving rise to the appeal.
The appellant, original accused No. 2, was at all mate rial times working as District Health Officer in District Amreli in the State of Gujarat.
He was, according to the prosecution, found of liquor and whenever he used to go out of Amreli in connection with his duties, he used to partici pate in drinking parties.
On 3rd August, 1972, he visited Kodinar, a town situate in the District of Amreli and late in the evening of that day, he attended a drinking party which was arranged by accused No. 1 in his agricultural farm situate at a place called Ghantwad about 50 Kms.
away from Kodinar.
Besides accused Nos. 1 and 2, six other persons who were arraigned as accused Nos.
3 to 8 were also present at the drinking party.
On receiving information about the drinking party, the District Magistrate and the District Superintendent of Police along with other police officers and panch witnesses raided the agricultural farm where the drinking party was in progress.
The raid was carried out at about 00.30 hrs.
after midnight and on seeing the police, the appellant and the other accused tried to run away but they were apprehended.
The raiding party, also found five glasses and two empty bottles, all smelling of liquor, twelve empty soda water bottles and one full ' bottle con taining liquor and these articles were seized by the raiding party in the presence of the panch witnesses and the panch nama was prepared.
The appellant and the other accused were thereafter taken to the Amreli hospital where their blood was taken by the Civil Surgeon for the purpose of carrying out 874 the necessary test for determining the presence of alcohol.
The analysis of the blood revealed that, in the case of the appellant, the concentration of alcohol in the blood was more than 0.05 per cent weight in volume while in the case of the other accused, it was less than 0.05 per cent.
On these facts, the appellant and the other accused were charge sheeted before the Judicial Magistrate, Kodinar.
The charge against accused No. 1 was that he possessed as well as consumed liquor in contravention of the provisions of the Act and was, therefore, guilty of offences punishable under section 66(1)(b), while the charge against the other ac cused, including the appellant, was that they were guilty of consuming liquor in contravention of the provisions of the Act and were hence liable to be punished for the offence under section 66(1) (b) of the Act.
The learned Judicial Magistrate accepted the evidence in regard to the concentra tion of alcohol in the blood of the accused, but taking the view that breaches of certain rules in the Bombay Prohibi tion (Medical Examination and Blood Test) Rules, 1959 were committed in taking the blood of the accused, the learned Judicial Magistrate acquitted the accused including the appellant of the offence of consuming liquor under section 66 (1 ) (b).
The learned Judicial Magistrate also acquitted accused No. 1 of the offence of possessing liquor under section 66(1)(b) on the ground that it was not proved by the prosecution beyond reasonable doubt that he was in posses sion of liquor.
The State preferred two appeals against the order of acquittal passed by the learned Judicial Magistrate.
Both the appeals were heard by a Single Judge of the High Court any they were disposed of by a common judgment.
The High Court did not examine whether the order passed by the learned Judicial Magistrate acquitting the appellant and the other accused of the offence of consuming liquor was right or wrong nor did it consider whether the acquittal of ac cused No. 1 for the offence of possessing liquor was correct or incorrect.
But, taking the view that there was no dis tinction between the case of accused No. 1 on the one hand and that of the appellant and accused Nos. 3 to 8 on the other so far as the charge of possession of liquor is con cerned, the High Court held that, on the material on record, the learned Judicial Magistrate should have flamed a charge against the appellant and accused Nos.
3 to 8 not only for the offence of consuming liquor but also for the offence of possession of liquor as in the case of accused No. 1.
The High Court observed: "Whenever "Drinking Parties" are detect ed by the police, it is the imperative duty of the prosecution to allege that all the partic ipants of the same are charged with the "possession" of liquor in contravention of the provisions of law contained in Sec.
66(1 )(b) of the B 'bay Prohibition Act, 1949.
It may be emphasised that in such cases, "possession" of liquor does not only necessarily mean actual, physical or conscious possession of the owner or the occupant of the premises".
In such cases of "Drinking Parties", it is always open to a participant to stretch his hand and to take the liquor in question for his own use and consumption.
But, in all such cases of 875 "Drinking Parties", the Court must be satis fied that the attendant circumstances should clearly indicate that the accused persons are the participants in a "Drinking Party".
In the case before me, why should the accused persons, during the night hours, having gath ered together go to a distant farm house ? Why should they be found with the aforesaid articles ? Why should they create a situa tion as a result of which a constable had to jump over a wall ? Why should they try to run away when they Were apprehended by the respon sible officers for Amreli ? In such circumstances, it is the duty of the prosecution to see that all the partic ipants are charged with the commission of the offence viz. of possessing liquor in contra vention of the provisions contained in Sec.
66(1)(b) of the B 'bay Prohibition Act, 1949.
" The High Court, on this view, set aside the order of acquittal in 'its entirety without examining its correctness and remanded the case to the learned Judicial Magistrate with a direction to try the appellant and the other accused not only on the charge of consuming liquor but also on the further charge of possession of liquor.
Accused Nos. 1 and 3 to 8 did not challenge the correctness of this order made by the High Court, but the appellant impugned it by prefer ring the present appeal with special leave obtained from this Court.
The impugned Order made by the High Court consists of two parts.
One part set aside the order of acquittal and directed retrial of the appellant on the charge of consuming liquor while the other directed that the appellant and accused Nos.
3 to 8 'should also be tried on the further charge of possession of liquor.
The appellant attacked both parts of the Order and the contention urged by him in sup port of the appeal was a two fold one.
The first limb of the contention was that the order setting aside the acquit tal of the appellant for the offence of consuming liquor and directing retrial of the appellant for that offence was improper, since it was not competent to the High Court in appeal to set aside the order of acquittal and direct retri al, unless it_found that the acquittal was wrong.
Here in the present case, the High Court did not even consider whether the acquittal of the appellant was correct or not and without finding that the acquittal was erroneous, pro ceeded to set aside the acquittal and direct retrial.
This, according to the appellant, was impermissible for the High Court to 'do and it was said that the order setting aside the acquittal must, therefore, be reversed and the acquittal restored.
The second limb of the contention related to that part of the impugned order which directed that the appellant and accused Nos.
3 to 8 should be retried not only on the charge of consuming liquor but also on the further charge of possession of liquor.
The argument of the appellant under this head of contention was that in the appeal, the High Court was confined merely to a consideration of the question whether the acquittal of the appellant for the offence of consuming liquor was right or wrong and it was, not compe tent to the High Court 6 1338SCI/76 876 to frame a new charge for possession of liquor and direct trial of the appellant and the other accused on such now charge.
These were the twin grounds on which the order made by the High Court was challenged on behalf of the appellant.
Now, there can be no doubt that there is great force.
in the first part of ' the contention of the appellant.
The learned Judicial Magistrate acquitted the appellant of the offence of consuming liquor.
The State preferred an appeal against the acquittal and manifestly, in this appeal, the acquittal could not be set aside unless the High Court, on a consider ation of the evidence, came to the conclusion that the acquittal was wrong.
It was not competent to the High Court to set aside the acquittal without finding that it was erroneous.
The High Court, however, did not even care to examine whether the acquittal was right or wrong, but merely because it took the view that a further charge should have been framed against the appellant and accused Nos.
3 to 8, it set aside the acquittal and directed retrial of the appellant and the other accused.
This was plainly and indubitably wrong and the: order setting aside the acquittal must, therefore, be quashed.
But from that it does not necessarily follow that the acquittal must be restored.
The High Court having failed to consider the merits of the acquittal,.
the matter would have to go back to the High Court for the purpose of deciding whether on the evidence on record, the acquittal was justified or not.
The appeal being directed against the correctness of the acquittal, the High Court would have to determine whether on merits, the acquittal should be maintained or reversed.
We must, there fore, quash that part of the order of the High Court which set aside the acquittal of the appellant for the offence of consuming liquor and remand ' the case to the High Court for disposing of the appeal against the acquittal of the appel lant on merits.
That takes us to the second limb of the contention directed against the order of retrial on the further charge of possession of liquor.
It is true that originally when the case was tried before the learned Judicial Magistrate, there was no charge against the appellant and accused Nos.
3 to 8 for the offence of consuming liquor and the appeal of the State was also directed 'only against their acquittal for ,the offence of consuming liquor.
But there can be no doubt that if, while hearing the appeal, the High Court found that, on the material before .him, the learned Judicial Magistrate should have framed a further charge against the appellant and accused Nos.
3 to 8 but he failed to do so, the High Court could certainly direct the learned Judicial Magistrate to frame such further charge and try the appel lant and accused Nos. 3 to 8 on such further charge.
The High Court could legitimately in the exercise of its juris diction, set right the error committed by the learned Judi cial Magistrate in not flaming a proper charge.
Here, the High Court, on a consideration of the material which was before the learned Judicial Magistrate, came to the conclu sion that this material warranted the framing of a further charge against the appellant and accused Nos.
3 to 8 for possession of liquor and it, therefore, directed that the case should go back to the learned judicial Magistrate and he should try the appellant and accused Nos.
3 to 8 on 877 such further charge.
The High Court clearly had jurisdic tion to make such an order.
But then, the complaint made on behalf of the appellant was that the material before the learned Judicial Magistrate did not justify the framing of a charge against the appellant and accused Nos.
3 to 8 for possession of liquor and hence the order directing their trial on such further charge was not justified.
This is, however, a complaint on facts and we do not see any reason why we should, in the exercise of our extra ordinary juris diction under Article 136 of the Constitution, entertain such a complaint.
It is true that there are certain obser vations made by the High Court which are a little too wide but it cannot be gained that even a person who participates in a drinking party can in conceivable cases be guilty of the offence of possession of liquor.
Suppose a person is found at a drinking party and he has a glass with him with liquor in it at the time when the raid is carried out, would it not be correct to say that he was at the relevant time in possession of liquor ? The liquor in his glass would be liquor in his possession.
But at the same time it would not be correct to say that merely because a participant in a drinking party can stretch his hand and take liquor for his use and consumption, he can be held to be in possession of liquor.
The question is not whether a participant in a drinking party can place himself in possession of liquor by stretching his hand and taking it but whether he is actu ally in possession of it.
Possession again must be distin guished from custody and it must be conscious possession.
If, for example, a bottle liquor is kept by.
some one in the car or house of a person without his knowledge, he cannot be said to be in possession of the bottle of liquor.
It can not, therefore, be laid down as an absolute proposition that whoever is present at a drinking party must necessarily be guilty of the offence of possession of liquor and must be charged for such offence.
Whether an accused is in posses sion of liquor or not must depend on the facts and circum stances of each case.
Here in the present case, the prose cution will have to establish at the trial by leading satis factory evidence that the appellant and the other accused were in possession of liquor as else the prosecution on the charge of possession of liquor will fail.
The order direct ing trial of the appellant and the other accused for the offence of possession of liquor must, therefore, be main tained, but we think it would be desirable if this trial is taken up after the disposal of appeal by the High Court in regard to the acquittal of the appellant for the offence of consuming liquor.
We accordingly allow the appeal in part and reverse that part of the 'order of the High Court which set aside the acquittal of the appellant for the offence of consuming liquor and remand the case to the High Court for disposing of the appeal against the acquittal of the appellant on merits, but so far as the other part of the order directing trial of the appellant and the other accused on the charge of possession of liquor is concerned, we do not see any reason to interfere with the same and we accordingly reject the appeal in so far as it is directed against that part of the order.
S.R. Appeal partly allowed.

dataset_name: IN-Abs

summary/full:
Section 66(1)(b) of the Bombay Prohibition Act 1949 makes any person liable for punishment on conviction for the offence of "consuming, using, possessing or transporting any intoxicant or hemp." Section 66(2)(b) prescribes a statutory limit of 0.05 percentage of alcohol in the veinous blood taken from the accused.
In summary case Nos. 798 and 799 of 1972 before the Judicial Magistrate 1st Class, Kodi nar, Gujarat State, the appellant/accused No. 2 along with six others was charged with consumption of liquor while accused No. 1, the owner of an agricultural farm, where a drinking party took place was charged with the offence of possessing liquor.
h spite of the fact that the percentage of alcohol present in the veinous blood taken from the body of accused No. 2 was more than the statutory limit, in view.
breaches of certain statutory rules, in Bombay Prohibi tion (Medical Examination and Blood Test) Rules, 1959, the appellant/accused No. 2 was acquitted along with accused 3 to 8 in whose cases the percentage was less than the statu tory limit.
Accused No. 1 was also acquitted for lack of evidence on the charge of possession of liquor.
In the State appeal, taking the view that in a drinking party there should always be a further charge of possession of liquor, the High Court without examining the correctness of the findings of fact leading to the acquittals, set aside the orders of acquittal in respect of all and 'ordered retrial.
On appeal by special leave, the Court, HELD: (i) In a State appeal against acquittal, the acquittal should not be set aside unless the High Court on a consideration of the evidence.
comes to the. conclusion that the acquittal was wrong.
In the instant case, the High Court did not even consider whether the acquittal of the appellant was correct or not and without finding that the acquittal was erroneous proceeded to set aside the.
acquit tal and direct retrial.
It 'was not competent to the High Court to set aside the acquittal without finding that it was erroneous.
Setting aside the acquittal order and ordering retrial merely because.
it took the view that a further charge should have been framed against the appellant and accused No. 3 to 8 was plainly and indubitably wrong.
[876 B D] (ii) If while hearing an appeal, the High Court, finds that, on the material before it, a further charge should be framed, the High Court can legitimately, the exercise of its jurisdiction set right the error committed by the trial court in not framing a proper charge.
[876 G H] 873 (iii) In the exercise of extra ordinary jurisdiction under Article 136 of the Constitution, the Supreme Court would not ordinarily entertain a complaint on facts.
[877 B] (iv) Possession is distinguishable from custody and it must be conscious possession.
Whether the accused is in possession of liquor or not must depend on the facts and circumstance of each case.
[877 D]


judgement:
Appeal No. 154 of 1976.
(From the Judgment and Order dated 16 12 1975 of the Judicial Commissioner 's Court, Goa, Daman and Diu in Election petition No. 2/74).
V.M. Tarkunde and Shri Natgin for the Appellant.
Hardayal Hardy, S.K. Mehta and P.N. Puri for the Respondent.
The Judgment of the Court was delivered by KHANNA, J.
This appeal by Dr. Wilfred D 'Souza is against the judgment of learned Judicial Commissioner Goa whereby be dismissed.
election petition filed by the appel lant to declare the election of Francis Menino Jesus Ferrao respondent to the Goa Legislative Assembly to be void and to declare instead the appellant to be duly elected.
The appellant and the respondent were the two candi dates who sought election to the Goa Legislative Assembly from Benaulim Assembly constituency in the by election caused by the death of Vassuudev Garmalkar.
Polling took place on June 9, 1974 and the counting of votes on June 10, 1974.
After the first count, the Returning Officer found that the total number of valid votes cast in favour of the appellant was 4,656 and of those cast in favour of the respondent was 4,654.
234 ballot papers were rejected.
The respondent then applied for recounting of the votes and the said application was granted.
As a result of recounting, it was found that the appellant had secured 4,651 valid votes, while the respondent had secured 4,652 valid votes.
Seven ballot papers were rejected.
It may be mentioned that at the time of recounting 234 votes which had been earlier rejected in the first count were not taken into account.
Soon after the recount the appellant made an application for a second recount.
This application was granted and the recount took place on the following day, i.e., June 11, 1974.
As a result.of the second recount the appellant was found to have secured 4,650 valid votes while the respondent was found to have secured 4,652 votes.
One ballot paper was rejected.
At the time of second recount the ballot papers which had been rejected at the time of the initial counting and the first recount were not taken into account.
In the result the respondent was declared elected.
The appellant thereafter filed the present petition on July 15, 1974.
Besides the ground with which we are concerned in this appeal, the appellant challenged the election of the re spondent on the following two grounds: "(1) that in the first and second recount the Returning Officer illegally accepted .in favour of the returned candidate, some votes which he ought to have rejected, and rejected some votes in favour of the appellant which he ought to have accepted under law; (2) that the failure of the Returning Officer to re scrutinize the rejected votes in the first and second recounts is illegal" In respect of the above two grounds, objec tion was taken by the respondent that there was non compliance with the statutory require ments of section 83(1)(a) of the Representa tion of the People Act, 1951 (hereinafter referred to as the Act) inasmuch as the appel lant had not set out the material facts re garding those allegations.
Learned Judicial Commissioner as per order dated March 22, 1975 held that the appellant had failed to give material particulars in respect of the said two grounds.
The petition in that respect was held to have not disclosed a cause of action.
It was also held that the appellant was not entitled to an order of the court for re counting the polled votes.
The appellant, it may be stated, filed a petition seeking spe cial leave of this Court against the above order but that petition was dismissed on July 31, 1975.
The only ground which survives and with which we are concerned in this appeal is given in para 9 of the petition.
The same reads as under: "The petitioner further submits that the scrutiny and counting of the tendered votes is absolutely necessary in this case, consid ering the fact that the respondent has been declared the returned candidate after securing in his favour only 2 votes more than the petitioner and the fact that the tendered votes are 10, and that the non counting of such votes may materially affect the result of the election, in so far as it concerns the respondent, by the improper reception of votes originally polled by persons other than those who tendered their votes.
The petitioner, therefore, submits that the votes initially and improperly received should be removed and the tendered votes should be accepted and counted instead.
" The appellant accordingly asserted that the result of the election of the respondent had been materially affected by the improper reception, refusal and rejection of votes.
Prayer made by the appellant was that the 'election of the respondent be declared void and the appellant be declared to be duly elected.
The petition was resisted by the respondent, and in reply to para 9 of the petition the respondent submitted that no recount was justified 945 or required in law merely because of the returned candidate having secured only two votes more than the defeated candi date.
The respondent denied that the tendered votes were cast by genuine voters.
Issue No. 7 which is the only issue relating to the allega tion in para9 reads as under: "Whether the petitioner proves that the vote or votes were initially improperly received, and should be removed and in their place tendered vote or votes should be taken into account.
" The Judicial Commissioner in his order dated March 22, 1975, while holding that no material particulars had been given in the petition in respect of the other two grounds of the election petition, found that regarding the allegation about tendered votes material facts had been given and a cause of action had been disclosed.
An application was filed on April 4, 1975 after the above order on behalf of the appellant praying for a direc tion to the District Election Officer to send all the papers mentioned in rule 92 of the Conduct of Election Rules, 1961 to the court.
In reply to that application the respondent stated that the court should, before sending for the said papers, call upon the appellant "to make out a prima facie case by undertaking to examine all the persons who have cast the tendered votes and producing some of them and proving that they had cast the tendered votes and that they are the true votes." Learned Judicial commissioner after refer ring to the case of Rameshwara Nand vs Madho Ram(1) and some other cases, passed order dated September 11, 1975, the material part of which reads as under: "In the present case the tendered votes are only ten and I see no reason why the petitioner should be allowed to break the principle of secrecy, particularly because the necessity of knowing for whom the voters have cast their vote does not arise now.
The petitioner will have to establish his case before he succeeds in this petition.
He will have, therefore, to produce all his evidence before the counting is done.
I therefore order that the petitioner shall produce before the Court all the evi dence on which he relies.
I also order that the District Election Officer be asked to produce the election papers mentioned in rule 92(2) of the Conduct of Election Rules, 1961 before this Court.
" The appellant thereafter examined two witnesses, Joa quine Rodrigoes (PW 1) and Vina Farnandes (PW 2).
These two witnesses, according to the appellant, had marked tendered ballot papers at the time of polling.
Trunks containing election papers were also sent to the court by the Election Registration Officer.
As the keys of those trunks were not available, those trunks were broken open in the presence of the parties.
A Panchnama of the packets contained in those (1) A.I.R. 1968 Punjab 173.
trunks was then prepared.
Some of the packets having connection with the tendered ballot papers were opened after the conclusion of the evidence of the two witnesses examined by the appellant.
The case was thereafter argued and the election petition was dismissed.
In the judgment under appeal, learned Judicial Commissioner examined the evidence of the two witnesses produced by the appellant.
According to the testimony of these two witnesses, when they went to the polling booth, they were told that someone else had already cast their votes.
When these witnesses stated that they had not .voted, they were each given a paper for marking in favour of the candidate of their choice.
They then marked that paper and handed over that paper to the persons present there.
Learned Judicial Commissioner took the view that the evidence of these witnesses did not relate to tendered ballot papers but to the ordinary ballot papers.
The appel lant as such was held to have failed to prove his case.
In the result, the election petition was dismissed.
In appeal before us, Mr. Tarkunde on behalf of the appellant has argued that the evidence of the two witnesses examined on behalf of the appellant relates to the tendered ballot papers marked by them and that the finding of the Judicial Commissioner to the contrary is not correct.
As against that, Mr. Hardy on behalf of the respondent has canvassed for the correctness of the view taken by the Judicial Commissioner.
Before dealing with this aspect of the matter, we think it opposite to deal with the legal position relating to tendered votes.
Rule 42 of the Conduct of Election Rules, 1961 relates to tendered votes and reads as under: "42.
Tendered votes. (1) If a person repre senting himself to be a particular elector applies for a ballot paper after another person has already voted as such elector, he shall, on satisfactorily answering such ques tions relating to his identity as the presid ing officer may ask, be entitled, subject to the following provisions of this rule, to mark a ballot paper (hereinafter in these rules referred to as a 'tendered ballot paper ') in the same manner as any other elector.
(2) Every such person shall, before being supplied with a tendered ballot paper, sign his name against the entry relating to him in a list in Form 15.
(3) A tendered ballot paper shall be the same as the other ballot papers used at the polling except that (a) such tendered ballot paper shall be serially the last in the bundle of ballot papers issued for use at the polling sta tion; and 947 (b) such tendered ballot paper and its counterfoil shall be endorsed on the back with the words 'tendered ballot paper ' by the presiding officer in his own hand and signed by him.
(4) The elector, after marking a ten dered ballot paper in the voting compartment and folding it, shall, instead of putting it into the ballot box, give it to the presiding officer, who shall place it in a cover spe cially kept for the purpose." Perusal of the above rule makes it clear that the occasion for marking tendered ballot paper would arise if a person representing himself to be a particular elector applies for a ballot paper after another person has already voted as such elector.
The person so applying would then be ques tioned regarding his identity by the presiding officer and, in case he gives satisfactory answer, he would be supplied a tendered ballot paper which would then be marked by the aforesaid person.
Such person is also required to sign his name against the entry relating to him a list in form 16.
The tendered ballot papers shall be the same as other ballot papers used at the polling, except that it would be serially the last in the bundle of ballot papers issued for used at the polling station.
The words "tendered ballot paper" have to be endorsed on the back of the tendered ballot paper and its counterfoil by the presiding officer in his own hand and has to be signed by him.
The tendered ballot paper, it is further provided, is not to be put in the ' ballot box but is to be kept in a separate cover.
According to clause (6) of rule 56 of the Conduct of Elec tion Rules, no cover containing tendered ballot papers shall be opened at the time of the counting of the votes and no such tendered ballot papers shall be counted.
The Represen tation of the People Act, 1951 as well as the above rules are, however, silent on the point as to what use would be made of the tendered ballot papers and how they would affect the result of the election.
Learned counsel for the parties are, however, agreed that such tendered ballot papers, even though excluded from consideration at the time of counting of votes after the poll, can be taken into account in proceedings to challenge the validity of the election of the returned candidate provided certain conditions are fulfilled.
We agree with the learned counsel for the parties in this respect, and find that this position of law is supported by two English decisions, Borough of St. Andrews(1) and The Stepney Divi sion of the Borough of Tower Homlets(2) as also by.two Indian decisions, Kalicharan Singh vs Ramcharitar Rai Yadava & Ors(3) and A.K. Subbarava Gounder vs
G. Palanisami Gounder & Ors.(4) Before, however, a tendered ballot paper can be taken into account during the proceedings of election peti tion, evidence would have to be led on the following two points: (1) The person who cast the initial vote as a voter on a particular serial number in the electoral roll was someone other than the genuine voter mentioned at that number.
(1)4 Omelly & Hardcastle 32, (2) Omelly & Hardcastle 34.
(3) (4) (2) It was such genuine voter who marked the tendered ballot paper.
So far as the first point is concerned, the evidence of the genuine voter that he had not cast such initial vote would normally and in the absence of any circumstance casting doubt regarding its veracity be sufficient.
Once the above two points are proved, the following consequences would follow: (a) The court would exclude the vote initially cast by the person other than the genuine voter from the number of votes of the candidate in whose favour it was cast; and (b) The court would further take into account the tendered ballot paper in favour of the candidate in whose favour it is duly marked.
It may also be mentioned that the proper occasion for scrutinising tendered ballot papers would normally arise only when the difference between the number of votes polled by the candidate declared elected and his nearest rival is so small that there is a possibility of that difference being wiped out and the result of election being thus materially affected if the court takes into account the tendered ballot papers and excludes from consideration the corresponding votes which were cast by persons other than the genuine voters.
The present election petition would have to be decided in the light of the legal position set out above.
We have been taken through the evidence on record and are of the view that the evidence of the two witnesses examined by the appellant is sufficient to prove that their evidence relates to tendered ballot papers.
Each of these witnesses has deposed that when she arrived at the polling booth, she was told that someone else had cast her vote.
When these witnesses persisted that they had not cast their votes, each of them was supplied with a paper which she marked.
Both the witnesses were emphatic that they had not.
put their votes in the ballot box and that they handed them over to the persons present at the polling booth.
A very significant circumstance which shows that the evidence of these witnesses relates to tendered ballot papers and not to the ordinary ballot paper is the fact that there is actual reference to them in Form No. 15 which relates to list of tendered votes.
The packet containing Form No. 15, it needs to be mentioned, was opened after the close of the evidence of these two witnesses.
The name of Joaquina Rodrigues is mentioned in Form No. 15.
The fact that the name mentioned in the electoral roll is Rodrigues Joaquina Domingos and not Joaquina Rodrigues is not very material because the name of the father of the witness is Domingos.
So far as Vina Fernandes (PW 2) is concerned, Form No. 15 does not mention her name but only gives the serial number of the tendered ballot paper.
The counterfoil of the tendered ballot paper however, makes it clear that it re lates to serial No. 244 of electoral roll, part No. 12.
The said serial number of the electoral roll pertains to Vina Fernandes.
It 949 appears that some of the formalities which were required to be observed in connection with tendered ballot papers were not complied with by the presiding officer, e.g., he did not note on the back of the counterfoil of the tendered ballot paper that it related to tendered ballot paper.
The parties, however, cannot be made to.
suffer because of any such omission on the part of the presiding officer.
The evidence of the two witnesses examined on behalf of the appellant can also not be discarded on the ground that they have not deposed about their having affixed two thumb impressions instead of one thumb impression.
As mentioned above, the reference to those two voters in Form No. 15 relating to tendered ballot papers goes a long way to show that it were these two witnesses who marked the tendered ballot papers.
Their evidence also shows that they did not cast the initial votes which were cast in their names.
Learned Judicial Commissioner in this case did not record any evidence on behalf of the respondents and pro ceeded to decide the cast after the evidence of the witness es of the appellant had been recorded and after the box containing the relevant necessary papers had been opened and those papers were examined.
In view of the fact that the appellant has adduced prima facie proof in respect of two of the ten dered ballot papers, the Judicial Commission er, in our opinion, should now call upon the respondent to adduce his evidence.
The evidence of the respondent would be confined not merely to the two tendere ballot papers in respect of which the appellant has adduced evidence but can also relate to some or all of the other eight tendered ballot papers in respect of which the appellant has not adduced any evidence After the said evidence is examined, learned Judicial Commissioner would decide the matter in the light of the legal position relating to tendered ballot papers as set out above.
We accordingly accept the appeal, set aside the judgment of the learned Judicial Commissioner and remand the case to him for fresh decision after recording the evidence of the respondent in accordance with law as ex plained above.
The parties in the circumstances shall bear their own costs of the appeal.
We are conscious of the fact that the election matters should be dis posed of as soon as possible and that the remand of the case would have the effect of further prolong ing the matter, yet looking to the face of the case, we find no escape from the conclusion of remand.
Learned Judicial Commissioner, we are sure, would try to expedite the dispos al of the case.

summary/full:
Rule 42, Conduct of Election Rules, 1961, shows that the occasion for marking tendered ballet paper would arise if a person representing himself to be a paticular elector ap plies for a ballot paper after another person has already voted as such elector.
The person so applying, would then be questioned by the presiding officer regarding his identi ty, and in case he gives a satisfactory answer, he would be supplied a tendered ballot paper which would then be marked by such person.
has to sign his name against the entry relating to him in a list in Form 15, prescribed under the Rules.
The tendered ballot paper shall be the same as other ballet papers used at the polling, except that it would be serially the last in the bundle of ballot papers issued for use at the polling station.
The words 'tendered ballot paper ' have to be endorsed on the back of the ten dered ballot paper and its counterfoil by the presiding officer in his own hand and has to be signed by him.
The tendered ballot paper is not to.
be put in the ballot box, but is to be kept in a separate cover.
According to r. 56(6) no cover containing tendered ballot papers shall be opened or counted at the time of the counting of the votes.
But even though the tendered ballot papers are thus excluded at the time of counting they can be taken into account in proceedings to challenge the validity of the election of the returned candidate provided, ( 1 ) the person who cast the initial vote as a voter on a particular serial number in the electoral roll was someone other than the genuine voter mentioned at that number; (2) it was such genuine voter who marked the tendered ballot paper; and (3) the difference between the number of votes polled by the candidate declared elected and his nearest rival is so small that there is a possibility of that difference being wiped out and the result of the election being materially affected.
In such a case, the Court would exclude the vote initially cast from the number of votes of the candidate in whose favour it was cast; and take into account the tendered ballot paper in favour of the candidate in whose favour it is duly marked.
In the present case, the appellant and respondent were two candidates for election to a Legislative Assembly, and the respondent was declared elected having secured just two votes more than the appellant.
The appellant challenged the respondent 's election and contended that there were ten tendered votes and that they should be counted, after remov ing the votes initially and improperly cast.
At the trial of the election petition, the appellant examined on his behalf two witnesses, who had, according to the appellant, marked tendered ballot papers at the time of the polling.
The trial court however, took the view that the evidence of the two witnesses did not relate to tendered ballot papers but related to ordinary ballot papers, and dismissed the election petition.
Allowing the appeal to this Court, and remanding the case to the trial Court HELD: (1) The evidence of the two witnesses of the appellant is sufficient to prove that their evidence relates to tendered ballot papers.
Even though some of the formal ities which were required to be observed in connection with the tendered ballot papers were not complied with by the presiding officer, as for example, he did not note on the back of the counterfoil of the tendered ballot paper that it related to tendered ballot paper, the parties cannot 943 be made to suffer for such an omission.
The evidence of the two witnesses cannot also be discarded on the ground that they have not deposed about their having affixed two thumb impression instead of one.
[948 F G] (2) In view of the fact that the appellant has adduced prima facie proof in respect of the two tendered ballot papers the trial court should now call upon the respondent to adduce his evidence.
The respondent 's evidence need not be confined to the two tendered ballot papers but may relate to some or all of the other eight tendered ballot papers in respect of which the appellant has not adduced evidence.
The trial court should thereafter decide the matter in the light of the legal position.
[949 D] Borough of St. Andrews (4 Orielly & Hardcastle 32), The Stepney Division the Borough of Tower Homlets (4 Orielly & Hardcastle 34), Kalicharan Singh vs Ramcharitar Raj Yadava & Ors.
and .4.
K. Subharava Gounder vs
G. Pala nisami Gounder & Ors.
referred to.


judgement:
Appeal No. 870 of 1968.
(From.the Judgment and Order dated 22.11.1967 of the Madhya Pradesh High Court in Second Appeal No. 436/64.
G.L. Sanghi and D.N. Misra for the appellant.
P.H. Parekh (amicus curiae) for the respondents.
The Judgment of the Court was delivered by KRANNA, J.
This appeal by special leave is against the judgment of the Madhya Pradesh High Court affirming on second appeal the decision of the trial court and the first appellate court whereby suit for possession of the land in dispute had been decreed in favour of the plaintiff re spondent against the defendant appellant.
Laxmi Dayal died in 1952 leaving the lands in dispute and some other properties.
He was succeeded by his two widows, Shantibai and Bindumati.
In 1954 Chandanbai, widow of brother of Laxmi Dayal, filed civil suit No. 34A of 1954 against Shantibai and Bindumati in respect of the property left by Laxmi Dayal.
During the pendency of that suit, a deed of partition was executed by Shantibai, Bindumati and Chandanbai, as a result of which each one of them was stated to have become full owner of the property which fell to her share.
The partition deed was got registered and necessary mutation entries were made in accordance with that deed.
On September 8, 1955, Shantibai made a will of the property which fell to her share as a result of partition,.
in favour of the plaintiff respondent.
The suit filed by Chandanbai was disposed of on February 18, 1956 in terms of partition deed dated January 13, 1955.
Shantibai died on May 29, 1956.
The respondent filed the present suit against Bindu mati defendant appellant for possession of the land in dispute on the allegation that he (the respondent) had taken possession of the land in dispute in pursuance of the will executed in his favour by Shantibai.
The appellant was stated to have relinquished her right of survivorship in the land which fell to the share of Shantibai.
The appellant, it was further pleaded, had taken forcible possession of the land in dispute.
The suit was resisted by the appellant on the ground that she had not relinquished her right of survivorship in the land which fell to the share of Shantibai.
Shantibai, it was further averred, had no right to dispose of the said land by will.
The trial court accepted the contention of the respondent and decreed his suit.
The decision of the trial court was affirmed on appeal by the first appellate court and by the High Court in second appeal.
The first question which arises for consideration in this appeal is whether the appellant relinquished her right of survivorship in the property which fell to the share of Shantibai as a result of the deed of partition dated January 13, 1955.
In this respect we find that each 990 of the three executants stated in that deed that none of them would have any right or claim over the property that fell to the share of other shareholders in partition.
it was further stated in the deed: "Every shareholder may get the property fallen to her share, mutated and may take possession thereof and thus may become abso lute owner thereof. 'Every shareholder may get her name separately mutated in Patwari 's papers.
She may sell it.
If other sharehold er claim it, it will be contrary to law . .
By taking our respective share from the entire property in the parti tion we become separate from the entire property.
" When she came into the witness box, the appellant admitted that their object in making the partition was that they would be able to dispose of their separate lands in any way they liked.
The appellant also stated that as a result of partition, each one of the executants of the deed of partition became exclusive owner of the property that fell to her share.
In the face of the recitals in the deed of partition and the admissions made by the appellant in the witness box, we find no reason whatsoever to disturb the finding of the courts below that the appellant had relin quished her right of survivorship in the property which fell to the share of Shantibai.
Sanghi on behalf of the appellant, however, contends that it is not permissible in Hindu law for a widow to give up her right of survivorship in the property which fails to the share of the co widow even as a result of an agreement.
This contention, in our opin ion, is devoid of force and runs counter to the decision of this Court in the: case of Karpagathachi & Ors.
vs Nagarathipathachi.(1) As observed in that case, "under the Hindu law as it stood in 1924, two widows inheriting their husband 's proper ties took together one estate as joint tenants with rights of survivorship and equal benefi cial enjoyment.
They were entitled to en force a partition of those properties so that each could separately possess and enjoy the portion allotted to her, see Dhuowan Deen Dobey vs Myna Baee(2), Gauri Nath Kakaji vs Gaya Kuar(3).
Neither of them could without the consent of the other enforce an absolute partition of the estate so as to destroy the right of survivorship, see Commissioner of Income tax vs Smt.
Indira Balakrishna(4).
But by mutual consent they could enter into any arrangement regarding their respective rights in the properties during the continuance of the widow 's estate, and could absolutely divide the properties, so as to preclude the right of survivorship of each of the portion allotted to the other see Ramakkal vs Ramasami Naichan (5),, Sudalai Ammal vs Gomathi Ammal(6).
Likewise, two daughters succeeding to their father 's estate as joint (1) ; (2) (3) (1928)L.R. 55 I.A. 299.
(4) ; ,517.
(5) Mad, 522, (6) , 991 tenants with rights of survivorship could enter into a similar arrangement, see Kailash Chandra Chuckerbutty vs Kashi Chandra Chuck erbutty (1), Subbammal vs Lakshmanu Iyer(2), Ammani Ammal vs Periasami Udavan.(a) Such an arrangement was not repugnant to section 6(a) of the .
The interest of each widow in the properties inherited by her was property, and this property together with the incidental right of survivorship could be lawfully trans ferred.
Section 6(a) of the prohibits the transfer of the bare chance of the surviving widow taking the entire estate as the next heir of her hus band on the death of the Co widow, but it does not prohibit the transfer by the widow of her present interest in the properties inher ited by her together with the incidental right of survivorship.
The widows were competent to partition the properties and allot separate portions to each, and inciden tal to such an allotment, each could agree relinquish her right of survivorship in the portion allotted to the other.
" There is nothing in the decision of Smt.
Indira Balakr ishna (supra) which stands in the way of any mutual arrange ment between the cowidows, the effect of which would be to preclude the right of survivorship of each to the portion allotted to the other.
The question which actually arose for decision in that case was whether the three widows of a deceased person could have the status of an association of persons within the meaning of section 3 of the Indian In come tax Act, 1922.
This question was answered in the negative.
While discussing this question, this Court observed that though the widows take as joint tenants, none of them has a right to enforce an absolute partition of the estate against the other so as to destory the right of survivorship.
The question as to whether the right of survivorship could be relinquished as a result of mutual agreement did not arise for consideration in that case.
This question was dealt with in the case of Karpagathachi (supra) and it was held after noticing the decision in Smt.
Indira Balakrishna 's case (supra) that such relinquishment of the right of survivorship was permissible as a result of mutual arrangement.
Lastly, it has been argued by Mr. Sanghi that even though Shantibai became entitled to dispose of during her life time the property which fell to her share as a result of the deed of partition, she could not bequeath the same by means of a will.
This submission too.
is devoid of force, and we agree with Mr. Parekh who argued the case amicus curiae that the power of Shantibai to make a will in respect of the property in dispute was co extensive with her power to transfer it inter vivos.
The question as to what effect the will would have on the right of the male rever sioner, if any, of Laxmi Dayal need not be gone into in this case.
So far as Bindumati appellant is concerned, we have no doubt that in the light of the arrangement contained in the deed of partition dated January 13, 1955 she cannot resist the (1) cal.
(2) , (3) (1923) 45 M.L.I. 1. 992 claim of the plaintiff respondent who is a legatee under the will of Shantibai.
To hold otherwise would be tantamount to permitting the appellant to assert her right of survivor ship in the property which fell as a result of partition to the share of Shantibai even though the appellant has relin quished such right of survivorship.
The appeal consequently fails and is dismissed.
As no one appeared on behalf of the respondent, we make no order as to the costs of the appeal.
P.H.P. Appeal dismissed.

summary/full:
One Lakshmi Dayal died in 1952 leaving behind two wid ows, appellant and Shantibai.
In 1954, Chandanbai widow of brother of Laxmi Dayal filed a suit against the appellant and Shantibai in respect of the. properties left by Lakshmi Dayal.
During the. pendency of the said suit, the appel lant, Shantibai and Chandanbai executed a partition deed alloting different properties to each one of the widows.
The partition deed was registered and necessary mutation entries were made.
The suit filed by Chandanbai was dis posed of in terms of the Partition Deed.
In September.
1955, Shantibai made a will in favour of the respondent and she died on 29 5 1956.
After her death, the appellant took forcible possession of the suit land from the respondent.
The respondent, therefore, filed a suit against the appel lant for possession of the land in dispute.
The Trial Court, the first Appellate, Court and the High Court in Second Appeal came to the conclusion that the appellant had relinquished her right of survivorship in lands which fell to the share of Shantibai and, therefore, decreed the respondefts suit.
In an appeal by Special Leave the appellant contended: 1.
The appellant did not relinquish her right of survivorship.
It is not permissible for a Hindu co widow.
to give up her right of survivorship even by an agreement.
Even if right of survivorship can be given up during the lifetime of the widows con cerned, the property could have been trans ferred inter vivos but could not have been disposed of by a will.
Dismissing the appeal, HELD: 1.
It is clear from the Partition Deed and the evidence of the appellant herself that she had relinquished her right of survivor ship.
The findings of all the courts below to the effect that the appellant relinquished her right of survivorship are correct.
[990 B C] 2.
It is permissible under Hindu Law for a co widow to relinquish by agreement her right of survivorship ' in the property which falls to the share of the other widow.
[990 G] Karpagathachi & Ors.
vs Nagarathipathachi ; followed.
Bhuowan Deen Doobey vs Myna Baee ; Gauri Nath Kakaji vs Gaya Kaur (1928) LR 55 IA 299 re ferred.
Commissioner of Income Tax vs Smt.
Indira Balakrishna ; , 517 distinguished.
Ramakkal vs Ramasami Naichan Mad.
522, Sudalai Ammal vs Comathi Ammal ; Kailash Chandra Chuckerbutty vs Kashi Chandra Chuckerbutty Cal.
339; Subbammal vs Lakshmana Iyer ; Ammani Ammal vs Perissemi Udayan re ferred to. 3.
The power of a co widoW to execute a will in respect of the property falling to her share in the partition with the other co widows is co extensive with her power to trans fer it inter vivos. 989