judgement:
Appeal No. 2376 of 1966.
355 356 Appeal from the judgment and order dated January 18, 1963 of the Madhya Pradesh High Court in Miscellaneous Petition NO. 267 of 1962.
R.V.S. Mani, E.C. Agarwala and P.C.
Agarwala,.for the appellant.
B. Sen, M.N. Shroff for I.N. Shroff for the respondent.
Shelat, J. Prior to December 17, 1947 the appellant was serving as an Overseer in the Public Works Department of the Central Provinces and Berar Government.
On December 17, 1947 he was suspended from service and prosecuted under section .161 of the Penal Code.
The trial resulted in his conviction but that was set aside in appeal on the ground that no proper sanction for prosecution was obtained.
He was again prosecuted on the same charge but the Special Judge trying him quashed the chargesheet on the ground that the investigation had not been carried out by the proper authorities.
In revision the High Court of Nagpur held that the Special Judge was in error in so holding but recommended that the prosecution should not be proceeded with as nearly 10 years had gone by since it was launched against the appellant.
Following the recommendation the prosecution was dropped but a departmental inquiry was held on the same charges.
The Inquiry Officer found the appellant not guilty but the Government disagreed with that finding and served a notice to show cause why he should not be dismissed.
By an order dated December 5, 1960 the Government held that the charges against the appellant were not proved beyond reasonable doubt.
It also held that the suspension and the departmental inquiry "were not wholly unjustified".
The order then directed that the appellant should be reinstated in service with effect from the date of the order and retired from that, date, he having already attained superannuation age on September 5, 1952 and that the entire period of absence from duty should be treated as period spent on duty under F.R. 54(5) for purposes of pension only, but that he should not be allowed any pay beyond what he had actually received or what was allowed to him by way of subsistence allowance during the period of his suspension.
On a representation made by him against the said order hav ing been rejected the appellant filed a petition under article 226 of the Constitution in the High Court of Madhya Pradesh for quashing the said order and for an order directing the Government to treat the period of absence from duty as period spent on duty under cl. 2 of the said Fundamental Rule and to revise the pension payable to him under that clause.
The High Court dismissed the petition but granted certificate to file this appeal and that is how this appeal has come up before us.
357 Fundamental Rule 54 on the interpretation of which this appeal depends is as follows: "(1) When a Government servant who has been dismissed, removed or suspended is reinstated; the authority competent to order the reinstatement shall consider and make a specific order , (a) Regarding the pay and allowance to be paid to the Government servant for the period of his absence from duty; and (b) whether or not the said period shall be treated as a period spent on duty , (2) Where the authority 'Mentioned in sub rule (1) is of opinion that the Government servant has been fully exonerated or in the case of suspension, that it was wholly unjustified, the Government servant shall be given the full pay and allowances to which he would have been entitled, had he not been dismissed, removed or suspended as the case may be.
(3)In other cases, the Government servant shall be given such proportion of such pay and allowances as such competent authority may prescribe.
Provided that the payment of allowances under clause (2)or clause (3) shall be, subject to all other conditions under which such allowances are admissible.
Provided other that such proportion of such pay and allowances ' all not be less than the subsistence and other allowances admissible under Rule 53.
(4) In a case falling under clause (2), the period of absence from by shall be treated as a period spent on duty for all Purposes.
(5) In a case falling under clause (3) the period of absence from duty shall not be treated as a period spent on duty,unless such competent authority specifically directs that it shall be so treated for any specified purpose.
Provided that if the Government servant so desired, such authority may direct that the period of absence from duty shall be converted into leave of any kind due and admissible to the, Government servant.
" On behalf of the appellant two points were urged before the High Court; (1) that before passing the impugned order the appellant ought to have been given a reasonable opportunity to show cause against the action proposed and (2) that it was clause 2 and not clause 5 which applied to his case.
The High Court rejected both the contentions and, as aforesaid, dismissed the petition.
358 Counsel for the appellant canvassed the same contentions before us.
Mr. Sen on behalf of the State.
however, argued that F.R. 54 does not in express terms lay down a duty on the part of the authority to give an opportunity to show cause to the government employee and therefore the question would be whether the Rule imposed such a duty by necessary implication.
He urged that the Rule cannot be said to lay down such duty by implications inasmuch as the impugned order is only a consequential order.
That it was passed following a departmental inquiry held against the appellant during the course of which opportunity to show cause was already afforded.
He contended that the only duty laid down by FR. 54 was that the Government should, consider whether the appellant was fully exonerated and in case of suspension whether such suspension was wholly unjustified and that once the authority formed the opinion that it was not so cls. 3 and 5 would apply.
The Government having formed the opinion that the suspension was not wholly unjustified clans 5 applied and the impugned order was not liable to be challenged.
The first question which requires consideration is whether there was a duty on the competent authority to afford an opportunity to the appellant to show cause before that authority formed the opinion as to whether he was fully exonerated and whether his suspension was wholly unjustified.
Under F.R. 54 where a Government servant is reinstated, the authority has to consider and make a specific order (i) regarding pay and allowances payable to him for the period of his absence from duty and (ii) whether such period of absence should be treated as one spent on duty.
The consideration of these questions depends on whether on the facts and circumstances of the case the Government servant had been fully exonerated and in case of pension whether it was wholly unjustified.
If the authority forms such an opinion the Government servant is entitled to full pay and allowances which he would have been entitled to had the order of dismissal, removal or suspension, as the case may be, not been passed.
Where the authority cannot form such an opinion the Government servant may be given such proportion of pay an allowances as the authority may prescribe.
In the former case the period of absence from duty has to be treated as period spent on duty for all purposes and in the latter case such period is not to be treated as period spent on duty.
But the authority has the power in suitable cases to direct that such period of absence shall be treated as period spent on duty in which case the government servant would be entitled to full pay and allowances.
It is true that the order under FR. 54 in a sense a con sequential order in that it would be passed aft an order of reinstatement is made.
But the fact that it is a consequential order does not determine the question whether the government servant has to be given an opportunity to show cause or not.
It is also true 359 that in.
a case where reinstatement is ordered after a departmental inquiry the government servant would Ordinarily have had an opportunity, to show: cause.
In such a case, the authority no doubt ,would have before him the entire record including the explanation given by the government servant from which all the facts and circumstances of the case would be before the authority and from which he can form the opinion as to whether he has been fully exonerated or not and in case of suspension whether such suspension was wholly unjustified or not.
In such a case the order passed under a rule such as the present Fundamental Rule might be said to be a consquential order following a departmental inquiry.
But there are, three classes of cases as laid down by the proviso in article 311 where a departmental inquiry would not be held, viz., (a) where a person is dismissed, removed or reduced in rank on the ground of conduct which has led to his conviction on a criminal charge, (b) where the authority empowered.
to dismiss or remove person or to reduce him in rank is satisfied for reasons to be record in writing that it is not reasonably practicable to hold such an inquiry; and (c) where the President or the Governor as the case may be is satisfied, that in the interest of security of the State it is not expedient to hold such inquiry.
Since there would be no inquiry in these classes of cases the authority would not have before him any explanation by the ' government servant.
The authority in such cages would have to consider and pass the ' order merely on such facts which might be placed before him by the department concerned.
The order in such a case Would be ex parte without the authority having the other side of the picture.
In such cases the order that such authority would pass would not be a consequential order as where a departmental inquiry has been held.
Therefore, aft order passed under Fundamental Rule 45 is not always a consequential order nor is such order a continuation of the departmental proceeding taken against the employee.
It is true as Mr. Sen pointed out that F.R. 54 does not in express terms lay down that the authority shall give to the employee concerned the opportunity to show cause before he passes the order.
Even so, the question is whether the rule casts such a duty on the authority by implication.
The order as to whether a given case falls under cl. 2 or cl. 5 of the Fundamental Rule must depend on the examination by the authority of all the facts and circumstances of the case and.
his forming the opinion therefrom of two factual findings; whether the employee was fully exonerated and in case of suspension whether it was wholly unjustified.
Besides, an order passed under this rule would obviously affect the government servant adversely if it is one made under cls.
3 and 5.
Consideration under this rule depending as it does on facts and circumstances in their entirety, passing an order on the basis of factual finding arrived at from such facts and circumstances and such an order resulting in pecuniary loss to the government servant must be held to be an objective rather than a subjective function.
360 The very nature of the function implies the duty to act judicially.
In such a case if an opportunity to show cause against the action, proposed is not afforded, as admittedly it was not done in the present case, the order is liable to be struck down as invalid on the ground that it is one in breach of the principles of natural justice.
In the State of Orissa vs Dr. (Miss) Binapani Devi and others(1) this Court held that an order fixing the date of birth of the government servant concerned there and declaring that she should be deemed to have retired on a particular date on the basis of the date so determined without giving an opportunity to show cause against the action proposed was invalid on the ground that the determination was in violation of the principles of natural justice.
It was there observed: "The State was undoubtedly not precluded, merely because of the acceptance of the date of birth of the first respondent in the service register, from holding an inquiry if there existed sufficient grounds for holding such enquiry and for refixing her date of birth.
But the decision of the State could be based upon the result of an enquiry in a manner consonant with the basic concept of justice.
An order by the State to the prejudice of a person in derogation of his vested rights may be made only in accordance with the basic rules of justice and fairplay.
The deciding authority, it is true, is not in the position of a Judge called upon to decide an action between contesting parties, and strict compliance with the forms of judicial procedure may not be insisted upon.
He is however under a duty to give the person against whom an enquiry is held an opportunity to set up his version or defence and an opportunity to correct or to controvert any evidence in the possession of the authority which is sought to be relied upon to his pre judice.
" We find that the High Court of Maharashtra has also taken in V. R. Gokhale vs State of Maharashtra(2) the same view which we are inclined to take of the nature of function under R. 152 of the Bombay Civil Service Rules, 1959, a rule in terms identical to those of F.R. 54 before us.
In our view, F.R. 54 contemplates a duty to act in accord ance with the basic concept of justice and fairplay.
The authority therefore had to afford a reasonable opportunity to the appellant to show cause why cls.
3 and 5 should not be applied and that having not been done the order must be held to be invalid.
(1) ; (2) I.L.R. 361 The appeal is allowed and the High Court 's order is set aside.
The competent authority is directed to consider the question de novo after giving to the appellant a reasonable opportunity to show cause against the action proposed against him.
The respondent will pay to the appellant costs of this appeal as also the costs of the petition in the petition in the High Court.
G.C Appeal allowed.

summary/full:
The appellant was an Overseer in the Public Works Department of the Central Provinces and Berar Government.
In 1947 he was suspended from service and prosecuted under section 161 I.P.C. Ultimately, on orders from the High Court, the prosecution was dropped.
In a departmental enquiry also the appellant was exonerated, By an order dated December 1960, the Government held that the suspension of the appellant and the ' departmental enquiry against him "were not wholly unjustified".
The order then directed that the appellant should be reinstated in service with effect from the date of the order and retired from the date, he, having already attained superannuation age on September 5, 1952 and that the entire period of absence from duty should be treated as period spent on duty under F.R. 54(5) for purposes of pension only, but that he should not be allowed any pay beyond what he had actually received or what was allowed to him, by way of subsistence allowance during the period of his suspension.
The appellant filed a petition under article 226 of the Constitution contending that F. Rule 54(2) governed his case and not F. Rule 54(5).
The High Court decided against him but granted him certificate to appeal to this Court.
It was contended on behalf of the appellant that before deciding which rule applied to his case the Government should have given him an opportunity to be heard.
The respondent urged that in passing a consequential order a hearing is not necessary.
Held: An order passed under F R. 54 is not always a consequential order nor is such order necessarily a continuation of the departmental proceeding taken against the employee.
[359E F] Consideration under F.R. 54 depending as it does on facts and circumstances in their entirety, passing an order on the basis of factual finding arrived at from such facts and circumstances and such an order resulting in pecuniary loss to the Government servant must be held to be an objective rather than a subjective function.
The very nature of the function implies the duty to act judicially.
In such a case if an opportunity to show cause against the action proposed is not afforded, as admittedly it was not done in the pre sent case, the order is liable to be struck down as invalid on the ground that it was one in breach of the principles of natural justice.
State of Orissa vs Dr. (Miss) Binapani Devi and Ors. ; , relied on.
[359H; 360A B] V. R. Gokhale vs State of Maharashtra, I.L.R. [1963] Bom.
537, approved.


judgement:
Appeals Nos.
1003 and 1004 of 1964.
Appeals by special leave from the judgment and order dated January 7, 1963 of the Bombay High Court, Nagpur Bench in Civil Revision Applications Nos. 294 and 295 of 1962.
section T. Desai, G. L. Sanghi and O. C. Mathur, for the appel lant (in both the appeals).
C. B. Agarwala, section K. Gambhir and Ganpat Rai, for respondent No. 1 (in both the appeals).
R. N. Sachthey, section P. Nayar for R. H. Dhebar, for the res pondent No. 3 (in both the appeals).
The Judgment of the Court was delivered by Sikri, J.
These two appeals, by special leave, are directed against the judgment of High Court of Judicature at Bombay (Nagpur Bench), dated January 7, 1963, allowing two Civil Revision applications Nos. 294 of 1962 and 295 of 1962, filed by Paramsukhdas, a respondent before us.
The High Court, by this judgment, quashed orders dated April 9, 1962, in the Land Acquisition Cases No. 189 of 1961.
and No. 190 of 1961 (as amended subsequently on July 6, 1962) and remitted the matter to the Court of the Civil Judge, Akola, for a fresh decision on merits with advertence to the remarks in the judgment.
The High Court further directed that Paramsukhdas be allowed to be impleaded as a non applicant in the two proceedings and all parties will be allowed to amend their pleadings or make fresh pleadings with respect to the alleged compromise as filed before the High Court in Special Civil Application No. 232 of 1960.
Mr. section T. Desai, the learned counsel for the appellant, con tends: (1)That the High Court has no jurisdiction under section 115.
to interfere with the orders of the Civil Judge, dated April 9, 1962; 364 (2) That Paramsukhdas, respondent No. 1, is not a person interested in the compensation and is not entitled to be impleaded as a party to the references under section 18 of the Land Acquisition Act, 1894, (I of 1894) hereinafter referred to as the Act , (3) That, if at all, no revision but appeal lay to the High Court.
Before dealing with the above contentions it is necessary to state the relevant facts.
Sunderlal, appellant, owned some land (field No. 22) in Monza Umari, Taluq and District Akola.
This field had been leased to Khushal Singh under a registered lease for 5 years commencing from April 1, 1954.
The field was acquired by the Government.
The Land Acquisition Officer made his award on January 30, 1960, and assessed the total compensation at Rs. 26,105.58, and apportioned the amount equally between Sunderlal and Khushal Singh.
On February 17, 1960, the Land Acquisition Officer noted the following regarding Khushal Singh: "2.
Khushalsing s/o Tolaram (a) According to letter No. 154 / 60 of 15th February 1960 from the Court of Civil Judge (Sr.
Dn.) Khamgaon, and the attachment order issued by that Court, in C.S. No. 4 B/1958, the amount to be paid to Khushalsing Tolaram be kept in Revenue Deposit.
(b) One Sunderlal minor guardian father Madanlal Harjimal, of Akola, has presented an objection petition against this payment.
" Sunderlal filed an application for reference under section 18 of the Act, claiming more compensation and also complaining in regard to the apportionment of the amount of compensation between him and Khushal Singh.
According to him, Khushal Singh was not a protected tenant and his period of lease having expired, he was not at all entitled to any portion of the amount of compensation.
A reference under section 18 was made on June 27, 1961, and this reference was numbered Land Acquisition Case No. 189 of 1961.
Khushal Singh also applied for a reference and he claimed enhancement of compensation and challenged the basis of apportionment adopted by the Land Asquisition Officer.
The Collector made the reference and it was numbered Land Acquisition No. 190 of 1961.
Before we deal with what happened before the Civil Judge, it is necessary to give some facts about the litigation between Sunderlal and Khushal Singh. 'On July 21, 1956, Sunderlal filed a suit (Civil Suit No. 133 B of 1956) against Khushal Singh for rent due on January 1, 1955, and January 1, 1956, in the, Court of Civil Judge, Akola.
On July 22, 1957, the Civil Court referred the matter to the Revenue Court under section 16 A of the Berar Regulation of Agricultural Leases Act, 1951.
On July 25, 1958, the Sub Divisional Officer, Akola, answered the reference 365 Revenue Case No. 79 of 1957 58) holding that Khushal Singh was not a protected lessee.
On appeal, the Deputy Collector.
Akola, held, on October 8, 1959, that Khushal Singh was a protected lessee.
The Bombay Revenue Tribunal confirmed the order of the Deputy Collector on March 22, 1960.
Sunderlal filed a petition before the High Court under article 226 of the Constitution.
It was numbered Special Civil Application No. 232 of 1960.
On February 8, 1961, a compromise petition (Civil Application No. 163 of 1961) was filed in the High Court, in Special Civil Application No. 232 of 1960.
It was stated in.
the compromise petition that Khushal Singh did not wish to dispute Sunderlal 's contention that the land was leased for horticulture purposes and that he had not acquired the status of a protected lessee, as defined in the Berar Regulation of Agricultural Leases Act, 1951.
Khushal Singh further stated that he had no objection to the quashing of the orders of the Bombay Revenue Tribunal dated March 22, 1960, and of the Deputy Collector dated October 8, 1959.
On March 11, 1961, Paramsukhdas filed an application (Civil Application No. 246 of 1961) in the High Court in Special Civil Application No. 232 of 1960, claiming to be heard.
He alleged that he had obtained a decree against Khushal Singh and started execution proceedings for Rs. 20,013/ and the amount of Rs. 13,644.27 ordered to be paid to Khushal Singh as compensation had been attached by him for the satisfaction of his decree.
He alleged that Khushal Singh and Sunderlal had mala fide entered into an agreement and had filed a compromise application asking for quashing of the orders of the Revenue Courts with the sole object of setting at naught the attachment and execution of his decree.
He prayed, therefore, for leave to appear in the case as a party vitally interested.
He further prayed that the compromise application should not be entertained and, should be dismissed in the interest of justice.
It appears that on March 20, 1961, this application came up for hearing before the High Court.
Paramsukhdas, however, took three weeks ' more time from the High Court, which was granted to him.
It further appears that Paramsukhdas withdrew the said amount of Rs. 13,644 27 towards satisfaction of his decree.
On April 18, 1961, he filed another application (Civil Application No. 365/61) wherein he stated that he had withdrawn the amount and alleged that he was now an interested party, and, therefore, he should be joined as a party.
On the same date, his Advocate, Mr. Sohoni gave an undertaking in the following terms: "Mr. Sohoni undertakes to hold the moneys withdrawn 'by his client subject to the orders of this Court 'on this application." On August 3, 1961, the High Court disposed of Civil Applica tion No. 163 of 1961, Civil Application No. 246 of 1961 and Civil Application No. 365 of 1961.
The High Court held that in L/S5SCI 10 366 the circumstances "we do not consider it advisable to proceed in this matter ourselves.
The parties will be at liberty to file the compromise petition in the Civil Court where proceedings are pending on reference under section 18 of the Land Acquisition Act." The High Court, in order to safeguard the interests of the parties, kept these proceedings pending till the decision on the, compromise petition by the Civil Court.
The compromise petition was directed to be returned to Sunderlal.
On September 18, 1961, Sunderlal and Khushal Singh filed applications for compromise in both the Land Acquisition references.
Paramsukhdas filed applications under 0.
XXII r. 10, read with section 151, C.P.C., praying that his name be substituted or added as an applicant.
He alleged that the compromise was fraudulent and that Khushal Singh was abandoning the case, and as an attaching creditor, he was entitled to be added a party to the case.
Both Khushal Singh and Sunderlal objected, and by two orders dated April 9, 1962, the Civil Judge rejected the applications of Paramsukhdas.
He framed the issue: "Whether Paramsukhdas can be permitted to be substituted or added as a party to these two references." He held that admittedly Paramsukhdas had not approached the Land Acquisition Officer in the proceedings in which the award was passed on January 30, 1960.
He had not appeared before the Land Acquisition Officer as a person interested in the land or the compensation that would be determined by the authorities.
He further held that under the circumstances Paramsukhdas was not one of the persons interested in the acquired land before the Collector, and he also could not be one, of the persons interested in the objections under section 20.(b) of the Act.
After referring to Manjoor Ahmad vs Rajlaxmi Dasi (1) and Abu Bakar vs Peary Mohan Mukherjee (2), he hold that the scope of the reference under section 18 was limited and new questions not covered by the reference could not be entertained.
He reviewed his orders on July 6, 1962, but nothing turns on that in the present appeals.
Paramsukhdas filed two revisions, Nos. 294 and 295 of 1962, before the High Court on June 30, 1962.
On August 22, 1962, Sunderlal filed an application for withdrawal of Special Civil Application No. 232 of 1960.
The High Court, on September 24, 1962, ordered: "Allowed, main petition dismissed as withdrawn.
No costs.".
Before the High Court a preliminary objection was raised in Civil Revisions Nos. 294 and 295 of 1962, that revisions were not competent because appeals lay against the orders of the Civil (1) A.I.R, 1956 Cal, 263.
(2) I.L.R. 367 Judge.
The High Court overruled this objection.
Regarding the ,claim of Paramsukhdas to be added as a party, the High Court ;held that his application showed that he was not claiming any interest in the lands themselves but was only claiming an interest in the compensation for the land which had been deposited in the Court for payment to the persons concerned, and as such was a person interested, as defined in section 3 (b) of the Act, and he.
would, therefore, be entitled to claim that he should be allowed to join as a party.
Mr. Desai contends that an attaching creditor is not interested in the amount of compensation as compensation.
His interest, he urges, is only to get moneys belonging to the judgment debtor in enforcement of his rights, and accordingly he is not entitled to be made a party to the reference under section 18 of the Act.
He further contends that the Court in hearing a reference under section 18 of the Act can only deal with an objection, which has been referred and cannot go into any matter beyond the reference.
He con cludes: if this is so, even if Paramsukhdas is ordered to be added a party he would not be able to challenge the compromise between Sunderlal and Khushal Singh.
The learned counsel for the respondent, Mr. C. B. Agarwala, controverts these submissions.
,He says that Paramsukhdas is a person interested in the objection within section 20, and is a person affected by the objection within section 21 of the Act.
He also relies on 0.
XXII r. 10(2), C.P.C., which is made applicable by section 53 of the Act.
Before examining the authorities cited at the Bar, it is necessary to examine the scheme and the provisions of the Act insofar as they are relevant to the question of determination of compensation, the question of apportionment of the compensation, and the question as to the persons who are entitled to be heard.
Section 3(b) defines the expression "person interested" as follows: "the expression person interested includes all persons claiming an interest in compensation to be made on account of the acquisition of land under this Act, and a person shall be deemed to be interested in land if be is interested in an easement affecting the land.
" It will be noticed that it is an inclusive definition.
It is not necessary that in order to fall within the definition a person should claim an interest in land, which has been acquired.
A person becomes a person interested if he claims an interest in compensation to be awarded.
It seems to us that Paramsukhdas is a "person interested" within section 3(b) of the Act because he claims an interest in compensation.
But before he can be made a party in a reference it has to be seen whether he comes within s, 20(b) and s.21 of the Act.
L/S5SCI 10(a) 368 The scheme of the Act seems to be to first deal with persons who are interested in land.
These persons are heard under section 5A of the Act.
The ordinary meaning of "the person interested in land" is expanded by section 5A(3), for the purposes of this section, to include a person who would be entitled to claim an interest in compensation.
It would be strange to come to the conclusion that the Legislature is keen that a person claiming an interest in compensation should be heard before the land is acquired but is not interested in him after the land is acquired.
On the contrary, it follows from section 5A(3) that a person claiming an interest in compensation would be one of the persons whose interests are meant to be safeguarded.
It appears from sections 6 to 10 that a person claiming an interest in compensation is not expressly mentioned.
But in section 11 he is expressly mentioned, and it is directed that the Collector shall inquire into respective interests of the persons claiming the compensation and shall make an award.
Section 12 makes the award final and conclusive as between persons interested, i.e., including persons claiming an interest in compensation.
Under section 14 the Collector has power, inter alia, to summon the parties interested.
Under section 18 any person interested can claim a reference.
A person claiming an interest in compensation would also be entitled to claim a reference.
After a reference is made the Court is enjoined under section 20 to determine the objections, and serve, among others, all persons interested in the objection.
A person claiming an interest in compensation would, it seems to us, be a person interested in the objection if the objection is to the amount of compensation or the apportionment of compensation, and if his claim is likely to be affected by the decision on the objection.
Section 21 restricts the scope of enquiry to a consideration of the interests of the persons affected by the objection.
But it does not follow from section 21 that there is any restriction on the grounds which can be raised by a person affected by the objection to protect his interests.
The restriction that is laid is not to consider the interests of a person who is not affected by the objection.
Section 29 deals with apportionment of compensation, if there is agreement, and section 30 enables the Collector to refer disputes as to apportionment to the Court.
From the above discussion it follows that a person claiming an interest in compensation is entitled to be heard under sections 20 and 21 of the Act.
The provisions of the Act, including sections 20 and 21, do not prescribe that his claim to an interest in compensation should be "as compensation", as urged by Mr. Desai.
This is really a contradictory statement.
For, a fortiori, he has no interest in land, and compensation is given for interests in land.
He can never claim compensation qua compensation for what he claims is an interest in the compensation to be awarded.
This is not to say that a person claiming an interest in compensation may not claim that the compensation awarded for the acquired land is low, if it affects his interests, 369 In the view we have taken we are supported by some autho rities.
Shah, J., speaking for the majority in Grant vs State of Bihar,(1) observed: "The right of the State of Bihar arose on May 22, 1952 when the title to the land vested in it by virtue of the notification issued under the Bihar Land Reforms Act.
There is nothing in the Land Acquisition Act which prohibits the Collector from making a reference under section 30 for determination of the title of the person who has since the date of the award acquired a right to the compensation.
If after a reference is made to the Court the person interested dies and his title devolves upon another person, because of inheritance, succession, insolvency, forfeiture, compulsory winding up or other form of statutory transfer, it would be open to the, party upon whom the title has devolved to prosecute the claim which the person from whom the title has devolved could have prosecuted.
In Promotha Nath Mitra vs Rakshal Das Addy(2) it was held that a reference made by the Collector under section 30 of the Land Acquisition Act at the in stance of a proprietor of land may be prosecuted by the purchaser of his rights after the award at a revenue auction.
If the right to prosecute a reference by a person on whom the title of the person interested has devolved be granted, there is no reason why the right to claim a reference of a dispute about the person entitled to compensation may not be exercised by the person on whom the title has devolved since the date of the award.
The scheme of the Land Acquisition Act is that all disputes about the quantum of compensation must be decided by resort to the procedure prescribed by the Act; it is also intended that disputes about the rights of owners to compensation being ancillary to the principal dispute should be decided by the Court to which power is entrusted.
Jurisdiction of the Court in this behalf is not restricted to cases of apportionment, but extends to adjudication of disputes as to the person who are entitled to receive compensation, and there is nothing in section 30 which excludes a reference to the Court of a dispute raised by a person on whom the title of the owner of land has, since the award, devolved.
" In Golap Khan vs Bholanath Marick(3) an attaching creditor was directed to be made a party to the reference under the Land (1) ; (2) (3) 370 Acquisition Act, before the Civil Court.
Mookerjee, J., observed: "The petitioner was entitled to be added as a party, not under Rule 10, but on the ground that he was a person interested in the subject matter of the litigation and that no order ought to have been made for its disposal without any opportunity afforded to him to establish his claim." In Siva Pratapa Bhattadu vs A.E.L. Mission(1) an attaching creditor was held to be a person interested within section 3(b) of the Act.
Mr. Desai relies on Manjur Ahmed vs Rajlakshmi(2) but in that case the point decided by the Court was different.
It was held there that if a party to a land acquisition proceeding before the Collector had not obtained a reference under section 18 of the Act, its representative could not do indirectly what they did not do directly, i.e. they could not be added a party in a reference pending at the instance of other parties in order that the nil award against the party might be reversed and in order that they might be awarded a share of the compensation money.
Here no such point has been raised.
It has not been urged before us that Paramsukhdas was a party before the Collector and that having not applied for a reference under section 18 he is now debarred from being added as a party.
The case of Gobinda Kumar Roy Chowdhury vs Debendra Kumar Roy Chowdhury(3) was also decided on the same lines.
Similar view was reiterated in Mahammad Safi vs Haran Chandra(4).
Both these cases had followed Abu Bakar vs Peary Mahan Mukerjee(5).
Maclean, C. J., observed as follows in Abu Bakar vs Peary Mohan Mukerjee(5).
"If we read that section in connection with section 20 and section 18, I think it is impossible to avoid the conclusion that the Legislature intended that all that the Court could deal with was the objection which had been referred to it; and this seems to be a view consistent with commonsense and with the ordinary method of procedure in civil cases.
The zemindar here could, if he liked, have raised the objection as to the whole com pensation for the trees being given to the tenants, but he did not do so.
He must, therefore, be taken to have accepted the award in that respect; and it would be little less than dangerous if we were to hold that the Judge to (1) A.I.R. 1926 Mad. 307.
(2) A.I.R. 1956 Cal. 263.
(3) C.W.N. 98.
(4) (5) 371 whom only one objection was referred could go into all sorts of questions and objections which had not been referred to him.
" These three cases are distinguishable inasmuch as they are dealing with the cases of persons who having a right to seek a reference failed to claim that reference but ought to raise the point in a, reference made at the instance of another party.
The case of Karuna Sindhu Dhar vs Panna Lal Paramanik(1) also does not assist the appellant.
The High Court held in that case that as Rajmohan never claimed the entire compensation money before the Collector, the Land Acquisition Judge was not entitled to vary the awards by a declaration that Rajmohan alone was entitled to get the compensation.
It seems to us that Paramsukhdas was clearly a person in terested in the objections which were pending before the Court in the references made to it and that he was also a person whose interest would be affected by the objections, within section 21.
He was accordingly entitled to be made a party.
In the result we uphold the order made by the High Court in this respect.
Mr. Desai says that at any rate direction should be given that Paramsukhdas should not be entitled to challenge the compromise entered into between Sunderlal and Khushal Singh.
We are unable to accept this submission.
Paramsukhdas is entitled to raise all points to protect his interests which were affected by the objections.
It is also in the interest of justice that there should not be multifarious proceedings and all points arising which are not expressly barred under section 21 should be gone into by the Court.
This leaves only the two points regarding the jurisdiction of the High Court.
In our view, the High Court is quite right in holding that the orders of the Civil Judge, dated April 9, 1962, were not awards within section 54 of the Act.
The awards had still to be made.
If no appeal lay, then the revisions were competent and the High Court was right in entertaining the revisions because the Civil Judge had either refused to exercise jurisdiction vesting in him or had acted with material irregularity in the exercise of his jurisdiction.
In the result the appeals fail and are dismissed with costs in favour of Respondent No. 1; one hearing fee.
Y.P. Appeal dismissed.

dataset_name: IN-Abs

summary/full:
The land of the appellant was acquired under the Land Acquisition Act, 1894 and the compensation was apportioned between the appellant and his lessee.
The appellant claimed that be was entitled to the whole of the compensation while his, lessee claimed a larger share.
At their instance, references were made to the Civil Court under section 18 of the Land Acquisition Act, But, before the references were made, the respondent, who was a decree holder against the lessee, attached the lessee 's share of the compensation amount in execution of his decree.
Subsequently the respondent withdrew the lessee 's share of the compensation amount in execution of his decree.
The appellant and his lessee, filed a compromise petition before the Civil Judge and the respondent also applied to be impleaded as party to the References.
The Civil Judge dismissed the respondent 's applications.
The respondent thereupon, filed revision petitions in the High Court.
The High Court, held: (1) that the respondent was a person interested in the compensation within the meaning of section 3 (b) of the Land Acquisition Act and was therefore entitled to claim that he should be allowed to join as a party; and (ii) that the revision petitions were competent.
In appeal, this Court, Held: (i) The respondent was a 'person interested ' within section 3(b) of the Act, because, he was claiming an interest in the compensation.
He was also interested in the objections which were pending before the Court in the references made to it and was a person whose interest would be affected by the objections.
within section 21 of the Act.
Accordingly, he was entitled to be made a party.
[367H; 371C D] The definition of 'Person interested ' in section 3 (b) is an inclusive definition and in order to fall within it it is not necessary that a person should claim an interest in the acquired land.
It is sufficient if he claims an interest in the compensation to be awarded.
A person claiming art interest in the compensation would be a person interested in the objections to be determined under section 20 of the Act, if the objection is to the amount of compensation or the appor tionment of compensation, and if his claim is likely to be affected by the decision on the objection.
Under section 21 the interest , of a person who is not affected by the objection are not to be considered but if he is affected, there is no restriction on the grounds which can be raised by him to protect his interest.
Therefore, a person claiming an interest in the compensation is entitled to be heard under Ss. 20 and 21.
The sections do not prescribe that his claim to an interest in compensation should be as 'compensation '.
A person who has no interest in land can never claim compensation qua compensation, for what he claims is an interest in the compensation, to be.
363 awarded.
That is not to say that a person claiming an interest in the compensation may not claim that the compensation awarded for the acquired land is low, if it affects his interests.
[367G H; 368D H] Grant vs State of Bihar ; , followed.
Golap Khan vs Bholanath Marick, , Siva Prasad Bhattadu vs A.E.L. Mission, A.I.R. 1926 Mad.
307 approved.
Manjoor Ahmed vs Rajlaxmi Dasi, A.I.R. 1956 Cal.
263 Abu Bakar vs Peary Mohan Mukherjee, I.L.R. , Gobinda Kumar Roy vs Debendra Kumar Roy Mahammad Safi vs Haran Chandra and Karuna Sindhu Dhar vs Panna Lai Paramanik , distinguished.
(ii) The High Court was right in holding that the orders of the Civil Judge were not awards within the meaning of section 54 of the Land Acquisition Act; and as they were not awards and no appeals lay, the revisions were competent and the High Court was justified in interfering as the Civil Judge refused to exercise a jurisdiction vested in him.
[371F]


judgement:
Appeals Nos. 187 and 188 of 1953.
Appeals under article 132 of the Constitution of India from the Judgment and Order, dated the 29th August, 1952, of the High Court of Judicature at Madras in Writ Petitions Nos. 21 and 41 of 1952.
K.V. Venkatasubramania Iyer (A. N. Rangaswami and.
section K. Aiyangar, with him) for the appellant.
M. Seshachalapathi for the respondent.
V.K. T. Chari, Advocate General of Madras (V. V. Raghavan, with him) for the intervener (State of Madras).
T. R. Balakrishna lyer and Sardar Bahadur for the intervener (State of Travancore Cochin).
Nittoor Sreenivasa Rao, Advocate General Of Mysore (Porus A. Mehta, with him) for the intervener (State of Mysore).
Lal Narayan Sinha (B. K. P. Sinha, with him) for the intervener (State of Bihar).
March 11.
The Judgment of the Court was delivered by DAS J.
These two appeals arise out of Writ Petitions Nos.
21 'and 41 of 1952, filed in the High Court of Judicature at Madras under article 226 questioning the validity of the Madras General Sales Tax Act (IX of 1939) and of the Turnover and Assessment Rules framed under that Act.
1119 The petitioners are tanners carrying, on business in Eluru, West Godawari District, which is now part of the newly created State of Andhra.
They make large purchases of untanned hides and skins and after tanning them in their tanneries they export the tanned hides and skins or sell the same to local purchasers.
In the High Court the appellants impugned the Act and the rules on the following grounds : I (a) The Provincial Legislature had no power under the Government of India Act of 1935 to enact a law imposing a tax on purchasers; (b) The liability to pay tax on sales is thrown on the purchaser not by the statute but by the rules.
This is an unconstitutional delegation by the legislature of its functions to the executive and the imposition of ,the tax is accordingly illegal; (c) The Act has become void under article 14 of the Constitution, as it singles out for taxation purchasers in some trades and is, therefore, discriminatory; and (d) The rules framed under the Act are inconsistent with the provisions enacted in the body of the Act and are void.
The High Court repelled each of the aforesaid grounds except that under item (d).
It held that rule 16(5) was ultra vires in that it offended against section 5 (vi) of the Act and dismissed their applications.
Hence the present appeals by the appellants under the certificate granted by the High Court that it was a fit case for appeal to this court.
Learned advocate appearing in support of these appeals has not pressed the objection under item (b) but has insisted on the remaining grounds of objection.
In our opinion the decisions of the High Court on those grounds are substantially well founded and correct.
On the question of legislative competency the learned advocate drew our 'attention to entry 54 in List II of the Seventh Schedule to the Constitution of India and argued that this entry clearly indicated that entry 48 in List II of the Seventh Schedule to the Government of India Act, 1935; under which the 145 1120 impugned Act was passed, was much narrower in its scope and could not be read as authorise in a the making of a law with respect to taxes on the purchase of goods.
This argument appears to us to be fallacious, for the intention of the Constituent Assembly as expressed in entry 54 in List II of the Seventh Schedule to the Constitution cannot be a guide for ascertaining the intention of a totally, different body, namely, the British Parliament, in enacting entry 48 in List 11 of the Seventh Schedule to the Government of India Act, 1935.
Further, we agree with the High Court that entry 48 in List II of the Seventh Schedule to the Government of India Act, on a proper construction, was wide enough to cover a law imposing tax on the purchaser of goods as well and that the Constituent Assembly in entry 54 of List II in the Seventh Schedule to the Constitution accepted this liberal construction of the corresponding entry 48 and expressed in clearer language what was implicit in that corresponding entry.
The next point urged by the learned advocate was founded on article 14 of the Constitution.
The appellants ' grievance is that the impugned Act singles out for taxing purchasers of certain specified commodities only but leaves out purchasers of all other commodities.
The principle underlying the equal protection clause of the Constitution has been dealt with and explained in Chiranjitlal Chowdhury vs The Union of India (1) and several subsequent cases and need not be reiterated.
It is well,settled that the guarantee of equal protection of laws does not require that the same law should be made applicable to all persons.
Article 14, it has been said, does not forbid classification for legislative purposes, provided that such classification is based on some differentia having a reasonable relation to the object and purpose of the law in question.
As pointed out by the majority of the Bench which decided Chiranjitlal Chowdhury 's case, there is a strong presumption in favour of the validity of legislative classification and it is for those who challenge it as (1) [1950] S.C.R. 1121 unconstitutional to allege and prove beyond all doubt that the legislation arbitrarily discriminates between different persons similarly circumstanced.
There is no material on the record before us to suggest that the purchasers of other commodities are similarly situated as the purchasers of hides and skins.
The majority decision in Chiranjitlal Chowdhury 's case(1) clearly applies to the case before us and there is no getting away from the position that the appellants before us have not discharged the burden of proof that, according to the majority decision, was upon them to do.
Lastly, the learned advocate urges that rule 16(5) clearly contravenes the provisions of section 5(vi) of the Act.
This sub rule has been held to be ultra vires by, the High Court and, indeed, the learned Advocate General of Madras did not in the High Court, as before ,us, dispute that rule 16(5) was repugnant to section 5(vi).
That sub rule, however, affects only unlicensed dealers and the appellants who are admittedly licensed dealers are not affected by that sub rule.
Further, it has not been suggested before us that the appellants were ever called upon to pay any tax on purchase of hides or skins in respect of Which tax had been previously paid by some prior purchaser.
That sub rule is clearly severable and cannot affect the validity of the rules which may otherwise be within the ambit of the Act.
Our attention has not been drawn to any other infirmity in the rules.
In the premises there is no substance in these appeals which must, therefore, be dismissed with costs.
Appeals dismissed.
Agent for the respondent and for the interveners, States of Madras, Mysore and Bihar: R. H. Dhebar.

summary/full:
Held, that the Madras General Sales Tax Act (IX of 1939), is not ultra vires the Government of India Act, 1935 as entry 48 in List II of the Seventh Schedule to the Government of India Act, 1936 was wide enough to cover a law imposing 'a tax on the purchaser of goods as well as on the seller.
Held, also that inasmuch as there was nothing to suggest that the purchasers of other commodities were similarly situated as the purchasers of bides and skins in the present case the Act 1118 was not void under article 14 of the Constitution on the ground that the impugned Act singles Out for taxing purchaser of certain specified commodities only but leaves out purchasers of Mother commodities.
Article 14 does not forbid classification for legislative purposes provided such classification is based on some differentia having a reasonable relation to the object and purpose of the law in question.
Rule 16(5) framed under the Act contravenes the provisions of section 5(vi) of the Act but this sub rule is severable and does not affect the validity of the rules which may otherwise lie within the ambit of the Act.
Chiranjit Lal Chowdhury vs The Union of India ([1950] S.C.R. 869)relied upon.


judgement:
Appeal No. 440 of 1966.
Appeal by special leave from the order dated May 30, 1964 of the Central Government Labour Court, Dhanbad in Application No. L.P. 123 of 1962.
H. R. Gokhale, C. A.,Chopra, P. C. Bhartari, land 0.
C. Mathur, for the appellant.
Janardan Sharma, for the respondent.
The Judgment of the Court was delivered by Vaidialingam, J.
This appeal, by special leave, by the appellant Bank, is directed against the order, dated May 13, 1964, of the Central Labour Court, Dhanbad, rejecting an application, filed by the Bank, under section 33(2)(b), of the (Act XIV of 1947) (hereinafter called the Act), and declining to grant approval of the action taken, by the Bank, by way of discharging the respondent workman, from the Bank 's services.
The respondent was, at the material time, the Assistant Ac countant, at the main Office of the Bank, at Calcutta.
In view of certain serious irregularities, noticed by the Bank, in respect of the work of the respondent in the Current Accounts Department and, in particular, in current account ledgers Nos. 4 and 6, by order dated March 8, 1961, the respondent was suspended, with immediate effect.
He was also informed that the charges against him would be communicated, in due course.
By a further communication, dated March 13/14, 1961, the respondent was required to offer his explanation, in respect of four allegations made in the said communication.
The main allegations were that, in respect of ledger 'accounts Nos. 4 and 6, standing in the names of Messrs. Commercial Bureau and Messers Evergreen Paper Syndicate and Messrs. Gokul Chand Radharam, respectively, overdrafts had been allowed, by the respondent, from time to time, without obtaining the sanction of the authorities competent to allow overdrafts.
The other allegations were to the effect that the respondent, who was charged with the duty of supervising both these ledgers.
did not bring to the notice.
of the authorities the said irregularities, that must have come to his knowledge, and that the pass book of ledger No. 4 was missing.
The respondent sent a reply, dated March 17, 1961, wherein he has admitted that, in the course of discharge of his routine duties and responsibilities, in good faith and honestly, he had granted overdrafts to the parties referred to, by the Bank, temporarily, in excess of their credits or limits, without reference to the higher authorities.
He also admitted that it was a blunder on his part and that he should not have done so.
He offered an explanation to, the effect that he was led to believe in the credit worthiness of the individuals, because of their long association with the Bank and also because of the fact that, on prior occassions, overdrafts 253 had been granted to them, in excess of permissible limits.
He also stated that the Bank had not been put to any financial loss because of his having granted the overdrafts; but, he again admitted his negligence, in not strictly abiding by the Bank 's rules, when he made the overdrafts.
He, however, added that his conduct had always been guided by good faith and honesty.
This Was the answer, regarding the main allegations, contained in the Bank 's letter, dated March 13/14, 1961.
He also stated, regarding the other minor allegations, that it was not his duty to report about the debit balances, which was the function of the ledger keeper, and that he was not also responsible for the loss of the pass book, of ledger No. 4.
He wound up his explanation by stating that his conduct, in making the overdrafts, without obtaining the sanction of the higher authorities,, was an omission which had been, unfortunately, committed by him, and he expresed regret for the same and requested the management to excuse him, accepting his explanation.
The appellant Bank was not satisfied with the explanation offered by the respondent, and communicated a charge sheet, on June 3, 1961.
The main charges related to the overdrafts, paid by the respondent, in ledger Nos. 4 and 6, without obtaining the permission of the proper sanctioning authority.
The Bank also informed the respondent that he would, be given a further opportunity to explain his conduct, in relation to those matters, and defend himself in the enquiry which would be held by the Agent of the Bank, on June 20, 1961, at 3.30 p.m.
The respondent again sent a reply, dated July 11, 1961, to the charge sheet served on him.
In this reply also, he admitted that, in the course of discharge of his routine duties and responsibilities, he had allowed the parties, mentioned in the charge sheet, to overdraw, in excess of their credits, without reference to the higher authorities, and that it was a blunder on his part which he should not have committed.
But, he again reiterated that he, in good faith and bona fide, was led to believe about the credit worthiness of the parties, who had long association, with the Bank.
He also emphasized, here again, that the Bank had not been put to any financial loss, because of his conduct.
He again admitted that this act of permitting the parties concerned to overdraw, in excess of their limits, without reference to the sanctioning authorities, amounted to negligence, but his conduct was perfectly bona fide and honest.
He also offered explanation, on the minor alle gations, to the effect that it was the duty of the ledger keeper to give the figures regarding the overdrafts and that he had not done any mis reporting to the higher authorities.
Finally he made a plea that he had been serving the institution for over 20 years without any blemish, and the unfortunate omission, done by him, in the matter of not taking the sanction of the higher authorities, might be excused, accepting his expression of regret, 254 The inquiry proceedings (conducted by the Agent, who was the Inquiry Officer), produced before the Labour Court, shows that the respondent was examined in the first instance.
After eliciting answers regarding the duration of his employment, in the institution, and as to the nature of the work he was discharging, he was asked about the charge sheet served on him, as well as the explanation, furnished by him.
The respondent has categorically answered to the effect that he has understood the charge sheet and that he does not want to add anything more to the explanation that he has already submitted.
This answer must have reference to the explanation, furnished by him, on June 20, 1961, in answer to the charge sheet, wherein he has admitted his mistake in sanctioning the overdrafts, to the parties concerned, with out obtaining the sanction of the appropriate authorities.
But, inasmuch as he has stated, in his explanation, that on prior occasions also overdrafts have been allowed beyond the permissible limits, certain questions were put to him, in respect of those matters.
The respondent, no doubt, appears to have stated that some of the cheques, issued to the parties concerned, have been initialled by an Officer of the Bank, Mr. Bhatena.
The respondent, again, squarely admitted, in his answers, that he has committed a blunder in granting advances, on his own responsibility, of about Rs. 87,000.
He has also admitted that he did not make any reference to the Agent, when passing the cheques, regarding the accounts of Messrs. Evergreen Paper Syndicate or Messrs. Gokul Chand Radharam.
During the course of the inquiry, the respondent was allowed to search the records concerned, and trace, if possible, any cheques that may have been initialled by Mr. Bhatena, and no such cheque could be traced.
Inasmuch as three other officers, whose conduct was being enquired into, had made certain statements against the respondent, the latter was asked as to whether he wanted to examine, or cross examine those persons; and the respondent very clearly stated that he did not like to cross examine anybody.
The Management then examined Mr. Bhatena and Mr. Savkar, two Officers of the Bank, in the presence of the respondent.
It is also seen that the respondent has also put certain questions to those two witnesses; and he has also stated that he has no further questions to be put to them.
At the conclusion of the recording of the evidence, it is seen that the respondent finally made an appeal to the Enquiring Officer to consider his case sympathetically, at the same time admitting his acts of omission, in the discharge of his duties.
He has also expressed his gratitude for the patient hearing that has been given to him during the inquiry.
The Enquiry Officer, in his report, dated November 10, 1961, has, after referring to the nature of the enquiry conducted by him, 255 found the respondent guilty of the main charges of having permitted the parties concerned, to obtain overdrafts, beyond the permissible limits, without having obtained the sanction of the appropriate authorities.
In this connection, the Enquiry Officer has referred to the fact that these allegations have been admitted by the respondent.
Regarding the other minor allegations, that the respondent caused other officers to record debit balances incorrectly, and the loss of the pass book relating to ledger No. 4, the respondent was exonerated.
The Enquiry Officer was of the view that the offence committed by the respondent, of which he had, been found guilty, was very serious which merited dismissal; but, in view of the long number of years of service put in by the respondent and as no loss has resulted to the Bank itself, he held that the respondent should be discharged from service.
The Bank communicated the order of discharge, by its letter, dated June 27, 1962, enclosing a pay order for Rs. 472.70 being the wages for one month, viz., July 1962.
The respondent, who had a right to file an appeal, against this order of discharge, based upon the finding of the Enquiry Officer, does not appear to have had recourse to any appeal, but, on the other hand, filed a representation, dated July 11, 1962, before the Managing Director of the appellant Bank.
Even in this representation, he has not, in any manner, attacked the enquiry proceedings, nor the findings recorded by the Enquiry Officer.
On the other hand, he again admitted his fault in having permitted, overdrafts, to the parties concerned, without obtaining the sanction of the appropriate authorities after expressing regret for his conduct.
He also stated that the Bank had not suffered any financial loss, because of his conduct.
Having due regard to these circumstances, he made a plea for mercy being shown to him, by cancelling the order of discharge and permitting him to resume his duties in the Bank.
The Managing Director, by his communication, dated September 17, 1962, rejected the representation made by the respondent, and declined to reinstate him in the Bank 's service.
In the meanwhile, inasmuch as an industrial dispute was pending before the National Industrial Tribunal, the appellant had filed, an application, before the said Tribunal, on March 17, 1962, under section 33(2) of the Act, seeking approval of the action taken against the respondent, on the basis of the recommendation of the Enquiry Officer.
This application was transferred to the Central Government Labour Court, Dhanbad, on April 18, 1962.
in the objections, dated September 2, 1963, filed by the respondent before the Labour Court, for the first time he raised the plea that in view of the advice given by the officers of the Bank, he sent replies admitting his guilt regarding the allegations made against him, by the Bank.
He also raised the plea that the overdrafts, that were given by him, to the parties concerned, were 256 really due to oral orders given by the then Agent and the Superintendent, on telephone.
He also raised the plea that he was not allowed to represent his case, through the Union, before the Enquiry Officer, nor was he allowed to cross examine the persons making allegations against him.
We have elaborately referred to the matters, mentioned above, because the question, that arises for consideration, in this appeal, is as to the correctness of the view of the Labour Court, that the domestic enquiry conducted by the Bank, as against the respondent, is not fair and that principles of natural justice have been violated.
The Labour Court, by its order under attack.
has held that the domestic enquiry, conducted by the Bank, is not proper and that rules of natural justice have not been observed; and, in consequence, it has declined to grant the approval, sought for, by the Bank.
At this stage, it may be mentioned that the Labour Court has held in favour of the management, that it has complied with the proviso to section 33(2)(b) of the Act, as interpreted, by this Court, in its decision in Strawboard Manufacturing Co. vs Gobind(1).
That is, it has held that the action of the Bank, by way of discharge, payment of wages and making of the application for approval, have been taken as part of the same transaction.
For coming to the conclusion that the inquiry proceedings are violative of the rules of natural justice, the Labour Court has given three reasons (i) in the inquiry, the respondent has been examined, even in the first instance, and he was cross examined, to elicit points in support of the charges; (ii) the respondent was not allowed to crossexamine witnesses; and (iii) the respondent was prejudiced, in his defence, as he had to conduct his defence without the assistance of the Union, during the enquiry.
There can be no controversy that the principles of natural justice must be observed, in the conduct of a domestic enquiry, and the workman, concerned, must be allowed reasonable opportunity to defend himself.
It has also been held, by this Court, that rules of natural justice require that the workman, proceeded against, should be informed clearly of the charges levelled against him; witnesses should be normally examined in the presence of the employee, in respect of the charges; if statements, taken previously and given by witnesses, are relied on, they should be made available to the workman concerned the workman should be given a fair opportunity to examine witnesses, including him self in support of his defence; and the Enquiry Officer should record his findings, based upon the evidence so adduced.
So far as grounds Nos. 2 and 3, given by the Labour Court are concerned, it is clear from the record of the enquiry proceedings, that the respondent was permitted to put questions to Mr Bhatena and Mr. Savkar, who were examined, during the enquiry (1) [1962] Supp. 3 S.C.R. 618.
257 We have also referred to the fact that the Enquiry Officer has recorded that the respondent has stated that he has no further questions to be put to them.
We have also referred to the fact that the inquiry proceedings show that the respondent was specifically asked as to whether he wanted to examine or cross examine the three other Officers, whose conduct was also under enquiry, and who had made certain statements against the respondent; but the respondent categorically stated that he did not like to examine or cross examine any of those persons.
The respondent has not stated, even in the representations made by him to the Managing Director, that he was not given any opportunity to cross examine the witnesses produced in the inquiry.
Again, even in his evidence before the Labour Court, the respondent has categorically stated that he has not made any request, in writing, for being represented by the Union, at the inquiry.
Apart from the fact that he has no such right, even factually it is seen that he made no such request.
Therefore the findings of the Tribunal that the respondent was not permitted to cross examine the witnesses during the domestic enquiry, and, that he was prejudiced in his defence because he was not permitted to have the assistance of the Union, are both erroneous.
Then the question is as to whether the inquiry proceedings can be considered to have been conducted in violation of the rules of natural justice, inasmuch as the respondent was examined, even in the first instance.
We have already indicated that, as a fact, it is borne out by the records that the respondent, so far as the inquiry against him was concerned, was examined, in the first instance, and Mr. Bhatena and Mr. Savkar, were examined later.
According to the Labour Court, the object of the management, in examining the respondent, in the domestic enquiry even in the first instance, was to have the charges substantiated by statements got out of the mouth of the employee, rather than to examine witnesses for the Bank, in support of the charges.
It is the further view of the Labour Court that the respondent has been, so to say, cross examined, just to elicit points in substantiation of the charges.
These circumstances, according to the Labour Court, violate the principles of natural justice and, as such vitiate the domestic enquiry.
In this connection, the Labour Court has relied upon certain observations, contained in the judgment of this Court in Associated Cement Co. Ltd., vs Workmen(1) viz.: "It seems to us that it is not fair in domestic enquiries against industrial employees that at the very commencement of the enquiry, the employee should be (1) , 661. 258 closely cross examined, even before any other evidence is led against him." and draws the inference that under no circumstances should a workman, whose conduct is the subject of disciplinary proceedings, by a domestic tribunal, should be examined, in the first instance.
We are of the opinion that no such conclusion could be drawn from the decision, referred to above.
In that case, it will be Seen ', the management had charge sheeted one Malak Ram, with disorderly behaviour when a cinema, show was being given.
Malak Ram, at all stages, stoutly denied his having taken part in any hooliganism or rowdyism, as alleged by the management.
Under those circumstances, instead of adducing evidence, in the first instance, regarding the allegations made against Malak Ram, in the domestic enquiry, the management commenced the proceedings, with a very close examination of Malak Ram himself.
The nature of the questions put to him also clearly indicated that the worker was being cross examined, and answers sought to be elicited in support of the allegations made by the management.
This Court, in coming to the conclusion that the conduct of an enquiry, in that manner, constitutes a very serious infirmity, made the ob servations, quoted above.
Therefore, it will be seen, that in that case, when the workman concerned was totally denying the allegations made against him, it was the duty of the management to let in evidence, in the first instance, to substantiate its allegations, and permit the workman to cross examine those witnesses and also permit him to let in independent evidence, in defence of his plea; and this Court emphasized that the normal rule to be followed, in such, enquiries, is, as stated above.
In the case before us, we have already referred to the various proceedings that have taken place, from which it will be seen clearly that the workman was ' at all stages, admitting the truth of the allegations made against him, by the management.
In his communication, dated March 17, 1961, as well as, in his reply, to the charges, made by him on June 20, 1961, he has `categorically admitted that he has committed a mistake in permitting the constituents concerned to overdraw, without obtaining the sanction of, the appropriate authorities.
Even when the enquiry proceedings began, he had stated that he had nothing more to add, in respect of the charges framed against him.
When once the workman himself has, in answer to the charge levelled against him, admitted his guilt, in our opinion, there will be nothing more for the management to enquire into.
That was the position in the case before us.
Therefore, we are not inclined to agree with the reasoning of the Labour Court that when there has been an admission ' of guilt, by the respondent himself, it can still be stated, that there is a violation of the principles of natural justice merely because of the fact that the workman was examined, in the first instance.
Nor, are we impressed with the further view, expressed by the Labour Court, that the way in which answers 259 were elicited from the workman, showed that there has been a cross examination, by the management, to obtain points in substantiation of the charges.
We have gone through the entire examination of the respondent at the domestic enquiry, and we are satisfied that there is no such infirmity.
In fact, the question of the management trying to obtain answers to support the charges, does not arise at all, in this case because the respondent has consistently admitted his guilt, at all stages.
On the other hand, the nature of the questions put to the respondent clearly indicate that the management, when once the workman had, admitted his guilt, was only giving him an opportunity to explain his conduct or to refer to circumstances, if any, which could be taken into account in extenuation of his conduct.
The management had also permitted the respondent to put questions to the other two witnesses, examined during the enquiry, viz., Mr. Bhatena and Mr. Savkar.
We must, however, emphasize that the rules of natural jus tice, as laid down by this Court, will have to be observed, in the conduct of a domestic enquiry against a workman.
If the allegations are denied, by the workman, it is needless to state that the burden of proving the truth of those allegations will be on the management; and, the witnesses called, by the management, must be allowed to be cross examined, by the workman, and the latter must also be given an opportunity to examine himself and adduce any other evidence that he might choose, in support of his plea.
But, if the workman admits.
his guilt, to insist upon the manage ment to let in evidence above the allegations, will, in our opinion, only be an empty formality.
In such a case, it will be open to the management to examine the workman himself, even in the first instance, so as to enable him to offer any explanation for his conduct, or to place before the management any circumstances which will go to mitigate the gravity of the offence.
But, even then, the examination of the workman, under such circumstances, should not savour of an inquisition.
If, after the examination of the workman, the management chooses to examine any witnesses, the workman must be given a reasonable opportunity to cross examine those witnesses and also to adduce any other evidence ' that he may choose.
Having considered the enquiry proceedings, in its entirety, in this case, we are satisfied that there has been no violation of the rules of natural justice.
Therefore, it follows that the order of the Labour Court, refusing to grant approval, as asked for, by the management, is erroneous and, as such, it is set aside.
In the result, the appeal is allowed , but parties will bear their own costs in this appeal.
G.C. Appeal allowed.

summary/full:
The respondent who was an employee of the appellant bank was charged with issuing unauthorised overdrafts to a constituent.
A domestic enquiry was held against him.
In two written explanations before the enquiry he admitted, the allegations against him and only pleaded extenuating circumstances.
At the enquiry he was examined in the first instance; having again admitted his fault he was asked certain questions by the Enquiry Officer in respect of the extenuating circumstances pleaded by him.
Two more witnesses were then examined by the Enquiry Officer.
Finally, according to the latter 's report the respondent was discharged.
In proceedings under section 33(2)(b) of the the Labour Court, Dhanbad held that the enquiry was bad for violation of natural justice inasmuch as the respondent had teen examined before other witnesses and was unduly cross examined.
The bank appealed by special leave.
Held: The rules of natural justice as laid down by this Court have to be observed in the conduct of a domestic enquiry against a workman.
If the allegations are denied by the workman the burden of proving the truth of those allegations will be on the management; and the witnesses called by the management must be allowed to be cross examined by the workman and the latter must also be given an opportunity to examine himself and adduce any other evidence that he might choose, in support of his plea.
But if the workman admits his guilt, to insist upon the management to let in evidence about the allegations will be an empty formality.
In such a case it will be open to the management to examine the workman himself, even in the first instance, so as to enable him to offer any explanation for his conduct, or to place before the management any circumstances which will go to mitigate the gravity of the offence.
But, even then, the examination of the workman, under such circumstances, should not savour of an inquisition.
If, after the examination of the workman the management chooses to examine any witnesses, the workman must be given a reasonable opportunity to cross examine those witnesses and also to adduce any other evidence that he may choose.
[259D F] In the present case the respondent in his written explanations had admitted the charges and therefore there was no violation of natural justice in first examining him.
The questions put to him were not unfair.
The Labour Court was wrong in not giving approval to his discharge.
[258F; 259A, G] Associated Cement Co. Ltd., vs Workman , distinguished.
Strawboard Manufacturing Co. vs Gobind, [1962] Supp.
3 S.C.R. 618, referred to.251 252