judgement:
ivil Appeal No. 1638 of 1987.
From the Judgment and Order dated 28.11.1986 of the Karnataka High Court in C.R.P. No. 365 of 1984.
S.B. Bhasme and A.S. Bhasme for the Appellant.
R.S. Hegde and S.N. Bhat for the Respondent.
The Judgment of the Court was delivered by KANIA, J.
This is an appeal from a judgment and order of a learned Single Judge of the Karnataka High Court.
Only a few facts are necessary to appreciate the contro versy raised before us.
476 The appellant herein was the plaintiff in Original Suit No. 103 of 1981 in the Court of 2nd Additional Civil Judge, Belgaum.
It was the case of the appellant in the plaint that on July 16, 1976 the respondentdefendant entered into an agreement in his favour for sale of the suit property com prising a shop and a bhatti room situated at Kirloskar Road, Belgaum City for a sum of Rs.20,000.
The appellant paid to the respondent as part consideration a sum of Rs.5,000 and pursuant to the agreement for sale the appellant was put in possession of the suit property.
The sale agreement provided that the registered sale deed was to be executed by the respondent after securing a No Objection certificate or permission from the competent officer as required under the Karnataka Urban Land Ceiling Act and within one month of the grant of such permission.
The respondent received the No Objection or permission as aforesaid on March 31, 1981 but failed to execute the registered deed of sale as provided under the said agreement.
Hence, on 30th June, 1981, the appellant filed the present suit.
It may be observed here that in the plaint, there was no specific averment that the appellant was and had always been ready and willing to perform his part of the said agreement.
The respondent filed a written statement raising several contentions and inter alia raised the contention that the suit was not maintain able for non compliance with the provisions of section 16(c) of the .
The issue as to whether the suit was not maintainable on the aforesaid ground was directed to be tried as a preliminary issue.
At this stage, the appellant applied for leave to amend the plaint by incorporating an averment in the plaint that the appellant was and had always been ready and willing to perform his part of the said agreement.
The learned Additional Civil Judge before whom the said application was made, rejected the same.
A revision petition was preferred by the appellant against the judgment of the learned Additional Civil Judge to the High Court of Karnataka but the said revision peti tion was dismissed by a learned Single Judge of the said High Court as aforesaid.
The learned judge took the view that the application for amendment was filed beyond the period of limitation and the application could not be grant ed as a vested right of the respondent would be disturbed by allowing the said amendment.
It is the correctness of this decision which is challenged before us.
In the leading case of Pirgonda Hongonda Patii vs Kal gonda Shidgonda Patil and Others, ; a Bench comprising three learned Judges of this Court laid down the principles which should govern the question of granting or disallowing amendments.
It was held by this Court that all amendments ought to be allowed which 477 satisfy the two conditions: (a) not working injustice to the other side, and (b) of being necessary for the purpose of determining the real questions in controversy between the parties.
Amendments should be refused only where the other party cannot be placed in the same position as if the plead ing had been originally correct, but the amendment would cause him an injury which could not be compensated in costs.
It is merely a particular case of this general rule that where a plaintiff seeks to amend by setting up a fresh claim in respect of a cause of action which since the institution of the suit had become barred by limitation, the amendment must be refused; to allow it would be to cause the defendant an injury which could not be compensated in costs by depriv ing him of a good defence to the claim.
In L.J. Leach & Co. & Anr.
vs Messrs Jardine Skinner & Co., ; another Bench comprising three learned Judges of this Court held that it is no doubt true that courts would, as a rule, decline to allow amendments, if a fresh suit on the amended claim would be barred by limita tion on the date of the application.
But that is a factor to be taken into account in exercise of the discretion as to whether amendment should be ordered, and does not affect the power of the Court to order it, if that is required in the interests of justice.
If these principles are to be followed, there is little doubt that the learned judge was in error in rejecting the application for amendment made by the appellant.
In the present case no fresh cause of action was sought to be introduced by the amendment applied for.
All that the appel lant sought to do was to complete the cause of action for specific performance for which relief he had already prayed.
It was only that one averment required in law to be made in a plaint in a suit for specific performance in view of the provisions of sub section (c) of section 16 of the was not made, probably on account of some over sight or mistake of the lawyer who drafted the plaint and that error was sought to be rectified by the amendment applied for.
There was no fresh cause of action sought to be introduced by the amendment and hence, no question of caus ing any injustice to the respondent on that account arose.
Learned counsel for the respondent placed strong reli ance on the decision of this Court in Ouseph Varghese vs Joseph Aley and Others, In that case, a suit for specific performance was filed by the plaintiff on the basis of an alleged agreement with the first defendant.
The defendant denied the agreement and went on to state that just before his death her husband had agreed to sell to the plaintiff 478 Item No. 1 of the suit property less one acre of paddy field for a sum of Rs. 11,000 but due to the illness of her hus band, the sale in question could not be effected.
After the written statement to this effect was filed, no application for amendment to the plaint was made.
The Trial Court de creed the suit.
In the appeal, the High Court did not accept the agreement pleaded by the plaintiff, but granted a decree on the basis of the agreement set out in the written state ment.
It was held by a Bench comprising two learned Judges of this Court that the agreement pleaded by the defendant was wholly different from that pleaded by the plaintiff.
The plaintiff did not plead either in the plaint or at any subsequent stage that he was ready and willing to perform the agreement pleaded in the written statement and hence, no decree on the basis of that agreement should have been passed in his favour as done by the High Court.
The Court held that it was well settled that in a suit for specific performance, the plaintiff should allege that he is ready and willing to perform his part of the contract and in the absence of such an allegation in the plaint, the suit is not maintainable.
In our opinion, this case does not lend any support to the argument of the learned counsel for the respondent, as in the present case there is no question of any decree being passed on the basis of any agreement other than the one pleaded by the appellant in the plaint.
In the result, the judgment and order passed by the learned Single Judge are set aside.
The appeal is allowed.
The amendment applied for by the appellant is allowed.
The amendment to be carried out by the appellant at his own expense within eight weeks of a certified copy of this order being received by the Trial Court.
The Trial Court shall thereafter give time to the respondent to file a supplemen tary written statement, if so advised, and dispose of the case on merits according to law.
There will be no order as to costs of the appeal.
G.N. Appeal allowed.

dataset_name: IN-Abs

summary/full:
For selling an immovable property, respondent entered into an agreement with the appellant.
Appellant paid part of the consideration and he was put in possession of the property.
Since the respondent failed to execute the regis tered sale deed, the appellant filed a suit.
There was no specific averment in the suit that the appellant was and had always been ready and willing to perform his part of the agreement.
Respondent contended inter alia that the suit was not maintainable for non compliance with the provisions of Section 16(c) of the .
This issue was directed to be tried as a preliminary issue.
At that stage, the appellant applied for leave to amend the plaint by incorporating an averment that he was always and had been ready and willing to perform his part of the agreement.
The trial court rejected the application.
The revision petition filed in the High Court was dis missed.
The High Court took the view that the application for amendment was filed beyond the period of limitation and cannot be granted, as a vested interest of the respondent would be disturbed.
This appeal is against the judgment of the High Court.
Allowing the appeal, this Court, HELD: 1.1 Amendments should be refused only where the other party cannot be placed in the same position as if the pleading had been originally correct, but the amendment would cause him an injury which could not be compensated in costs.
It is merely a particular case of this general rule that.
where a plaintiff seeks to amend by setting up a fresh 475 claim in respect of a cause of action which, since the institution of the suit, had become barred by limitation, the amendment must be refused; to allow it would be to cause the defendant an injury which could not be compensated in costs by depriving him of a good defence to the claim.
Courts would as a rule, decline to allow amendments, if a fresh suit on the amended claim would be barred by limita tion on the date of the application.
But that is a factor to be taken into account in exercise of the discretion as to whether application for amendment should be granted and does not affect the power of the Court to order it, if that is required in the interest of justice.
[477A D] 1.2 In the present case, no fresh cause of action was sought to be introduced by the amendment applied for.
All that the appellant sought to do was to complete the cause of action for specific performance and add an averment which required to be added in view of the provisions of sub sec tion (c) of Section 16 of the .
There was no fresh cause of action sought to be introduced by the amendment and hence, no question of causing any injustice to the respondent on that account arose.
[477E F] Pirgonda Hongonda Patil vs Kalgonda Shidgonda Patil and Ors., ; and L.J. Leach & Co. and Anr.
vs Messrs Jardine Skinner & Co., ; , relied on.
Ouseph Varghese vs Joseph Aley & Ors., , distinguished.


judgement:
Appeal No. 481 of 1957.
Appeal by special leave from the judgment and order dated December 12, 1955, of the Punjab High Court (Circuit Bench) Delhi, in Civil Writ Application No. 11 D of 1955.
Gurbachan Singh and R. section Narula, for the appellant.
C.K. Daphtary, Solicitor General of India, H. J. Umrigar and T. M. Sen, for respondents Nos. 1 to 4.
Dr. J. N. Banerjee and P. C. Agarwala, for respondent No. 5. 1958.
September 30.
The Judgment of the Court was delivered by DAS C. J.
The facts material for the purpose of disposing of this appeal by special leave are shortly as follows: The appellants, before us claim to have been dealers in foreign liquor since 1922 and to have, before the partition of the country, held licenses in forms L 1, L 2, L 10 and L 11 at Amritsar, Sialkot and Multan.
The appellants allege that in 1945 they had also secured a license in Form L 2 in respect of some premises in Chawri Bazar, Delhi, but that the operation of the said license had to be suspended on account of the unsuitability of the Chawri Bazar premises.
Then came the communal riots in the wake of the partition of the country and that license could not be renewed.
ln 1951 the appellants applied to the Chief Commissioner, Delhi, (exhibit 1) for licenses both in Forms L 1 and L 2 in respect of Karolbagh or at any place in Delhi.
On May 17, 1951, the Home Secretary to the Chief Commissioner by letter (exhibit 2) conveyed to the appellants the sanction of the Chief Commissioner to the grant to them of license in Form L 2 in respect of Karolbagh, Delhi.
This license has ever since then been renewed from year to 1427 year.
In 1954 a vacancy arose in respect of a license in Form L 2 on account of the closure of the business of Messrs. Army and Navy Stores of Regal Buildings, New Delhi, which held such a license.
Accordingly on January 21, 1954, the appellants submitted an application (exhibit 4) to the Deputy Commissioner for the grant of a foreign liquor license in Form L 2 in the aforesaid vacancy.
In that application the appellants stated, inter alia, that they were " prepared to operate it in such a part of Delhi as may be determined by the authorities ".
Not having received any reply for nearly 3 months and apprehending that interested persons were endeavouring to cause hindrance in the matter of the granting of the license to them on the plea that the appellants had no premises in Connaught Place, the appellants, on March 11, 1954, wrote a letter (exhibit 5) to the Chief Commissioner in which, after pointing out that Karolbagh where they had their L 1 license was in New Delhi, the appellants stated: " In any case, we have already made it clear in our application which we made to the Deputy Commissioner, Delhi on the 21st January, 1954, that we are prepared to operate this license in any locality which the authorities might deem proper ".
This letter was acknowledged by the Personal Assistant to the Chief Commissioner who, on March 15, 1954, stated (exhibit 6) that the " application No. Nil dated 18 3 1954 on the subject of grant of foreign liquor license in Form L 2 " had been forwarded to the Home Secretary, Delhi State, for disposal.
Exhibit 7 to the petition is an important document.
It is a letter dated May 21, 1954, addressed by the appellants to the Excise and Taxation Commissioner stating that " with a view to avoiding any possible objection as to locality etc., we have secured suitable premises also in the Connaught Place area, New Delhi, in which area has occurred a vacancy on account of the surrender of this license by Messrs. Army and Navy Stores ".
The letter concluded with the request that early orders be passed oil their application.
On July 30, 1954, the appellants wrote a long letter (exhibit 8) to the Chief Commissioner claiming justice in the matter of their 1428 application for the L 2 license.
In the second paragraph of that letter it was stated: ,It is now being acclaimed by the party concerned and their friends that they have succeeded in removing the only obstacle that stood in the way of their getting the said L 2 license by so arranging matters that our application has been kept back by the Excise Commissioner and that only five or six other applications of firms without much merit in them have been forwarded to you in order that they might have a smooth sailing as against those applicants ".
The appellants prayed that the Excise Commissioner might be directed to forward all records concerning the case to the Chief Commissioner so that the latter might be able to arrive at a just conclusion and they asked for a hearing to explain their claim fully.
A copy of this letter appears to have been endorsed to the Excise Commissioner on August 13, 1954, by the Under Secretary, Finance.
The Excise Commissioner then wrote a letter No. 295/C/54 dated August 31, 1954, to the Under Secretary, Finance, a copy of which was produced by the learned Solicitor General at the hearing before us.
In this letter the Excise Commissioner explained why the application of the appellants was not considered by him to be a good and proper one and stated that reasons why, according to him, the applications of two , other applicants, including Messrs Gainda Mall Hem Raj (respondent No. 5), should be given the preference.
In the penultimate paragraph of this letter of explanation it was stated: " In the end it may also be added that the applicant has no premises in New Delhi and as such he had no claim.
The license in Form L 2 is granted in respect of certain premises.
" The conclusion was that "under the circumstances there is no force in the application of Messrs. Ghaio Mall and Sons.
" It is apparent that the Excise Commissioner did not remember that the appellants had, by their letter (exhibit 7) of May 21, 1954, addressed to him, stated that they had secured suitable premises also in the Connaught Place area, New Delhi.
Be that as it may, on September 11, 1954, the appellants wrote another letter (exhibit 9) to the Chief 1429 Commissioner pressing their claim.
In this letter reference was made to their letter to the Excise Commissioner of May 21, 1954, (exhibit 7) in which it had been stated that the appellants had secured suitable premises in the Connaught Place area in New Delhi.
A copy of this letter was sent to the same Under Secretary, Finance, to whom the Excise Commissioner had written his letter of August 31, 1954, alleging that the appellants had no premises in New Delhi.
Exhibit 9A is the postal acknowledgment by the Under Secretary, Finance, of the letter containing the copy of the appellants ' letter but it does not appear from the record that the Under Secretary, Finance, thought it necessary to remind the Excise Commissioner that the appellants were maintaining that they had secured suitable premises in New Delhi.
This was followed by a letter (exhibit 10) from the appellants to the Excise Commissioner intimating that an application had been made to the Collector on September 11, 1954, for a change of their premises for L 1 license from Karolbagh, New Delhi to H. 32 Connaught Circus, New Delhi.
Although this letter had been written in connection with the change of L 1 license,, it certainly did specify that the appellants had secured the premises H 32 Connaught Circus.
The personal Assistant to the Excise Commissioner replied (exhibit 11) that the matter was under consideration.
There was a reminder (exhibit 12) sent to the Excise Commissioner on December 8, 1954, about the change of L 1 license from Karolbagh to Connaught Circus.
It appears from papers, for the first time produced before us at the hearing of this appeal, that on September 3, 1954, a note was put up by the Under Secretary, Finance, before the Finance Secretary, Shri section K. Mazumdar.
At the forefront of this note we find the following statement: " The applicants (Messrs. Ghaio Mall and Sons) have no premises in Connaught Circus.
For these reasons, if for no other, their claim has to be rejected.
" The note concluded with the recommendation that, in case it was decided that the vacancy should be filled, the recom mendation of the Excise Commissioner should be accepted, that is to say, the L 2 license should go to 1430 Messrs. Gainda Mall Hem Raj (Respondent No. 5).
On September 8, 1954, the Finance Secretary simply endorsed the file to the Chief Minister who, on September 14, 1954, recorded the following order on the file: " Commissioner 's recommendation may be accepted ".
There is nothing on the record produced before us to indicate that the matter was sent up to the Chief Commissioner or that his concurrence was obtained under section 36 of the Government of Part C States Act (No. 49 of 1951).
On December 14, 1954, the Under Secretary, Finance, wrote to the Excise Commissioner a letter which was for the first time produced at the hearing before the High Court and to which detailed reference will be made hereafter.
On January 15, 1955, the appellants were informed that the change applied for by them in respect of their L 1 license had been allowed.
The appellants were not told anything about the rejection of their application for L 2 license, but evidently they came to know that the L 2 license, for which a vacancy had arisen on account of the closure of Messrs. Army and Navy Stores, had been granted to Messrs. Gainda Mall Hem Raj (respondent No. 5).
On December 24, 1954, the appellants wrote severally to the Home Secretary (exhibit 14) Finance Secretary (exhibit 15) and the Under Secretary, Finance (exhibit 16) asking for a copy of the order or orders granting license to Messrs. Gainda Mall Hem Raj and/or rejecting their own application for L 2 foreign liquor license.
Three postal acknowledgments (Exs.
16A, 16B, 16C) relating to those three letters are on the record.
The appellants got no reply from any of them.
Not having received any reply the appellants on December 21, 1954, moved the Punjab High Court (Circuit Bench) under article 226 for appropriate writs or orders, but as it was not then quite clear whether the order granting the license to Messrs. Gainda Mall Hem Raj had actually been made, the Circuit Bench summarily dismissed that writ application as premature.
There were proceedings taken by the appellants to obtain leave to appeal first from this Court under article 136 which was adjourned sine die and then from the High Court under article 133, but it is not necessary 1431 to go into further details of those proceedings.
After the appellants had definitely ascertained that the L 2 license had been granted to Messrs. Gainda Mall Hem Rai, the appellants, instead of proceeding with their application for leave to appeal to this Court, filed a fresh writ petition in the High Court (Circuit Bench) out of which the present appeal has arisen.
In the present writ petition the appellants have impleaded 7 respondents, namely, (1) The State of Delhi, (2) The Chief Minister, Delhi, (3) The Excise and Taxation Commissioner, Delhi, (3 A) Secretary, Delhi State, (3 B) Under Secretary, Finance, (4) The Chief Commissioner, Delhi and (5) Messrs. Gainda Mall Hem Raj.
The principal ground , urged by the appellants in support of this petition are that the ap plications of the appellants and of the other applicants had never been placed before the Chief Commissioner who, under r. I of Ch.
5 of the Delhi Liquor License Rules, 1935, framed under section 59 of the Punjab Excise Act (Punjab I of 1914), as extended to Delhi, was the only competent authority empowered to grant L 2 license for wholesale and retail vend of foreign liquor to the public and that the Chief Commissioner had never applied his mind to the applications and did not in fact make any order and that respondents Nos. 2 and 3 had purported to exercise jurisdiction and power which were not vested in them by law and that their decision, if any, had not received the con currence of the Chief Commissioner, as requiried by the proviso to section 36 of the Government of Part C States Act.
The appellants pray for the issue of appropriate writs, orders or directions (a) quashing and setting aside the order of granting L 2 license to respondent No. 5, (b) directing the respondent No. 4 (the Chief Commissioner) to hold proper enquiry regarding suitability of premises etc., to hear both the parties and to decide the application of the petitioner before taking tip the application of the 5th respondent.
There is a prayer in the nature of a prayer for further and other reliefs and there is the usual prayer for costs.
182 1432 A Written statement verified by the affidavit of Shri.
section K. Majumdar, the Finance Secretary, has been filed on behalf of respondents I to 4.
In paragraph 5 of that written statement it has been averred that all the applications including the appellants ' application were in fact considered; but it is significant that it has not been stated by whom the applications had been considered.
Messrs. Gainda Mall Hem Raj have filed an affidavit only stating that they had been informed that the Chief Commissioner had sanctioned the grant of the license to them.
The appellants, with the leave of the High Court, filed a consolidated affidavit setting out facts including the fact that although they had written to the Home Secretary, the Finance Secretary and the Under Secretary, Finance, asking for a copy of the order granting the license to Messrs. Gainda Mall Hem Raj, no copy of the order or even a reply to the letters had been received.
In reply to the consolidated fresh affidavit an affidavit affirmed by the Finance Secretary (Shri section K. Majumdar) has been filed.
In paragraph 13 of this affidavit it has been stated that, since no appeal lies against the order of the Chief Commissioner, the question of supplying a copy of the order to the appellants does not arise.
Statements of this kind cannot but leave an impression in the mind of the Court that the respondents were not squarely dealing with the case made by the appellants, but were evading the production of the order of the Chief Commissioner which it was obviously insinuated not to have been made at all.
In order to compel the respondents to produce the original order, if any, the appellants made an application to the High Court supported by an affidavit.
Paragraph 2 of the petition which was quite precise reads thus: " 2.
That with reference to paragraphs 7 & 8 of the written statement and paragraphs 10 and 11 of the affidavit of the Finance Secretary it is submitted that the respondents have not filed any proper return to the rule issued by the Court inasmuch as the original order sought to be quashed with nothings etc., which led to those orders have been withheld by the 1433 respondents.
The respondents have not even stated that the Chief Commissioner, Delhi, who is admittedly the only competent authority for the grant of an L 2 license passed any orders himself.
The replies are evasive.
It is not stated who considered the application of the petitioner i.e. whether it was a clerk who was doing the noting or whether the Collector or the Finance Secretary or the Chief Minister who did it.
" On this application the High Court on April 11, 1955, made the following order: Let the order rejecting the petitioners ' application be brought to court by an officer or official of the department concerned.
" The Finance Secretary filed a reply paragraph 3 of which was in the term , following: " 3.
That I have carefully gone through the relevant papers.
The case of the petitioner was considered along with that of other applicants and it was finally decided to issue the license in favour of Messrs. Gainda Mall Hem Raj.
It was not considered necessary to send an intimation of rejection to all those who had not been granted the license in question.
There is therefore no specific order rejecting the petitioner 's application as ordered to be produced by the Hon 'ble Court.
" Although it was obvious what order of the Chief Commissioner the appellants were insisting on being produced, the respondents were prompt in taking advantage of the wording of the High Court 's order directing the production of the order rejecting the appellants ' application and stated that there was no specific order rejecting the appellants ' application.
This is nothing short of what may be called swearing by the card.
The deponent overlooks the fact that the order granting the license to Messrs. Gainda Mall Hem Raj was in effect tantamount to a rejection of the appellants ' application.
The appellants moved the High Court again on August 8, 1955.
After stating how the respondents were evading the real issue, the appellants in paragraph 5 of the petition categorically 1434 stated that their case was that the Chief Commissioner, Delhi, the competent authority, had not passed any order sanctioning the license in favour of Messrs. Gainda Mall Hem Raj and prayed that the respondents be directed to file the original record of the case including the actual sanction for the grant of the license to Messrs. Gainda Mall Hem Raj.
On August 19, 1955, the Court ordered the relevant records to be called for.
The only thing the respondents could, at long last, produce before the High Court was the letter of the Under Secretary, Finance, to the Excise Commissioner dated December 14, 1954, to which reference has already been made.
Learned Solicitor General appearing for respondents 1 to 4 pointed out that the order which is sought to be quashed was the grant of L 2 license for the year 1954/1955 which has long expired and suggested that the writ petition and consequently the appeal had become infructuous.
It appears that the usual practice in such matters is that once a license in Form L 2 is granted by the Chief Commissioner, it is almost automatically renewed by the Collector from year to year, unless, of course, the licensee is found guilty of breach of any excise rule and that in such cases of renewal there arises no question of vacancy entitling any outside competitor to apply for a license in Form L 2.
That being the position and this is not in dispute it is vitally important for the appellants that we should consider the validity of the grant of the L 2 licence for 1954/1955 to Messrs. Gainda Mall Hem Raj, for in case of our holding that the order granting the same was a nullity on account of its not having been made by the competent authority, the vacancy caused by the closure of business by Messrs. Army and Navy Stores will still remain to be filled up and the appellants will yet have a chance of having their application considered by the competent authority.
We accordingly proceeded to hear the appeal on merits.
The principal question urged before us, as before the High Court, is whether the Chief Commissioner of Delhi made any order under r. 1 of Ch.
5 of the Delhi 1435 Liquor License Rules, 1935.
It is significant that although the Chief Minister, the Excise Commissioner, the Secretary of Delhi State, the Under Secretary, Finance, and the Chief Commissioner have been impleaded in the present proceedings as respondents Nos. 2, 3, 3A, 3B and 4 respectively and although they or at least some of them could have deposed to the material facts of their own personal knowledge, none of them ventured to file an affidavit dealing with the categorical statement of the appellants that no order had at any time been made by the Chief Commissioner for granting the L 2 license to Messrs. Gainda Mall Hem Raj or rejecting the appellants ' application.
Instead of adopting the simple and straight forward way these respondents have taken recourse to putting up the Finance Secretary to give obviously evasive replies which are wholly unconvincing.
It is needless to say that the adoption of such dubious devices is not calculated to produce a favourable impression on the mind of the court as to the good faith of the authorities concerned in the matter.
We must also point out that when a superior court issues a rule on an application for certiorari it is incumbent OD the inferior court or the quasi judicial body, to whom the rule is addressed, to produce the entire records before the court along with its return.
The whole object of a writ of certiorari is to bring up the records of the inferior court or other quasi judicial body for examination by the superior court so that the latter may be satisfied that the inferior court or the quasi judicial body has not gone beyond its jurisdiction and has exercised its jurisdiction within the limits fixed by the law.
Non production of the records completely defeats the purpose for which such writs are issued, as it did in the present case before the High Court.
We strongly deprecate this attempt on the part of the official respondents to bye pass the court.
We are bound to observe that the facts appearing on the records before us disclose a state of affairs which does not reflect any credit on the administration of the erstwhile State of Delhi.
We must, however, say, in fairness to the learned Solicitor General, that he promptly produced 1436 the entire records before us during the hearing of this appeal.
As already stated the principal question, on which arguments have been addressed to us, is whether the Chief Commissioner had made any order for granting the L 2 license to Messrs. Gainda Mall Hem Raj.
The High Court answered the question in the affirmative on two grounds, namely, (1) that the Finance Secretary had made an affidavit stating that the decision regarding the grant of the license to Messrs. Gainda Mall Hem Raj had been taken by the Chief Commissioner, and (2) that the learned Solicitor General stated in specific terms that the matter had in fact been decided by the Chief Commissioner.
On the facts as they now emerge it appears to us that the High Court was under some misapprehension on both these points.
We have already summarised all the statements and affidavits affirmed by the Finance Secretary and it is quite clear that the only thing that he did not say was that the Chief Commissioner had considered the applications or made any order.
The learned Solicitor General, with his usual fairness, also informed us that except relying on the letter of December 14, 1954, lie did not say that the Chief Commissioner had taken any decision in the matter.
This being the position we are free to go into the matter and come to our own decision thereon.
The records, including the documents now produced before us, do not show that the applications had ever been placed before the Chief Commissioner.
There is nothing in the files showing any order or note on the subject made or signed or initialled by the Chief Commissioner.
What transpires is that the Excise Commissioner (respondent No. 3) had by his letter dated August 31, 1954, recorded the reasons why the appellants ' applications could not be entertained, one of the reasons being that they had no premises in the Connaught Place area in New Delhi, that a note was then put up by the Under Secretary, Finance, on September 3, 1954, suggesting that the appellants ' application should be rejected, if for nothing else, for their not having any premises in New Delhi (which 1437 according to the appellants was not a correct statement in view of their letters referred to above) and that the L 2 license should be granted to Messrs. Gainda Mall Hem Raj, that the Chief Minister on September 14, 1954, made an order on the file accordingly and finally that the Under Secretary, Finance, wrote the letter 'dated December 14, 1954, to the Excise Commissioner intimating that the Chief Commissioner had been pleased to approve the grant of the license to Messrs. Gainda Mall Hem Raj.
There is nothing on the record to show that the concurrence with the order of the Chief Minister was obtained from the Chief Commissioner.
The inexorable force of the aforesaid facts, now appearing on the record, inevitably led the learned Solicitor General to concede that, on the records as they are, it is not possible for him to say that the Chief Commissioner had actually made the order, but he contends that, in view of the letter of the Under Secretary, Finance, dated December 14, 1954, the fact that the Chief Commissioner had made the order could not be questioned in any court.
In other words the learned Solicitor General submits that that letter embodies the order of the Chief Commissioner and the court cannot be asked to go behind it and enquire whether the Chief Commissioner had in fact made the order.
In order to succeed in this contention the learned Solicitor General has to satisfy us that this letter is the embodiment of the Chief Commissioner 's order and that it has been duly authenticated.
On the second point he is clearly right, for under a rule 'Made on March 17, 1952, by the then Chief Commissioner, in exercise of powers conferred on him by section 38(3) of the Government of Part C States Act (49 of 1951), an Under Secretary is also a person competent to authen ticate an order or instrument of the Government of Delhi.
The only question that remains for us to consider is whether the letter in question is the order of the Chief Commissioner.
The letter on which the entire defence of the respondents rests is expressed in the following words: 1438 "DELHI STATE SECRETARIAT, DELHI STATE No. F. 10(139)/54 G A & R Dated the 14th December, 54.
From Shri M. L. Batra, M. A., P. C. section, Under Secretary Finance (Expenditure) to Government, Delhi State.
To Shri Dalip Singh, M. A., 1.
R. section, Commissioner of Excise, Delhi State, Delhi.
Subject: Grant of L 2 License.
Sir, With reference to your letter No. 295/C/54 dated the 31st August, 1954, on the above subject, I am directed to say that the Chief Commissioner is pleased to approve under Rule 5. 1. of Delhi Excise Manual Vol.
11 the grant of L 2 ' license to Messrs. Gainda Mall Hem Raj, New Delhi, in place of the L 2 License surrendered by Messrs. Army & Navy Stores, New Delhi.
Necessary License may kindly be issued to the party concerned under intimation to this Secre tariate.
Yours faithfully, (Sd.).
M. L. Batra, Under Secretary, Finance (Exp.) to Government, Delhi State." In the first place it is an inter departmental com munication.
In the second place it is written with reference to an earlier communication made by the Excise Commissioner, that is to say, ex facie, it purports to be a reply to the latter 's letter of August 31, 1954.
In the third place the writer quite candidly states that he had been " directed to say " something by whom, it is not stated.
This makes it quite clear that this document is not the order of the Chief Commissioner but only purports to be a communication at the direction of some unknown person of the order which 1439 the Chief Commissioner had made.
Indeed in paragraph 7 of the respondents ' statement filed in the High Court on February 2,1955, this letter has been stated to have " conveyed the sanction of the Chief Commissioner of the grant of license to the 5th respondent ".
A document which conveys the sanction can hardly be equated with the sanction itself Finally the document does not purport to have been authenti cated in the form in which authentication is usually made.
There is no statement at the end of the letter that it has been written " by order of the Chief Commissioner ".
For all these reasons it is impossible to read this document as the order of the Chief Commissioner.
Learned counsel for Messrs. Gainda Mall Hem Raj relied on our decision in Dattatreya Moreshwar Pangarkar vs The State of Bombay (1).
In that case there was ample evidence on the record to prove that a decision had in fact been taken by the appropriate authority and the infirmity in the form of the authentication did not vitiate the order but only meant that the presumption could not be availed of by the State.
That decision did not proceed on the correctness of the form of authentication but on the fact of an order having in fact been made by the appropriate authority and has thus no application to the present case where it is conceded that the Chief Commissioner had not in fact made or concurred in the making of an order granting the license to Messrs. Gainda Mall Hem Raj.
In the view we have taken it is not necessary for us to consider whether the action taken under the Excise Act and the rules thereunder was a judicial or an executive action, for even if it were of the latter category the letter of December 14, 1954, cannot be treated as an order properly authenticated to which the presumption raised by article 166 of the Constitution will attach.
For reasons stated above we hold that there was no valid order granting the L 2 license to Messrs. Gainda Mall Hem Raj and that in the eye of the law the vacancy arising on the closure of the (1) ; 183 1440 business by Messrs. Army and Navy Stores still remains unfilled.
The applications of the appellants and other applicants were for a grant of L 2 license for 1954/ 1955.
That year has gone past and accordingly in the changed circumstances we direct the Chief Commissioner to fill up the vacancy caused by the closure of the business by Messrs. Army and Navy Stores by inviting applications from intending licensees including the appellants and Messrs. Gainda Mall Hem Raj and granting the same to the most suitable party.
We, therefore, accept this appeal, reverse the order of the High Court and issue a mandamus to the effect aforesaid and also direct the respondents Nos.
1 to 4 to pay the appellants ' costs of this appeal and of the proceedings in the High Court out of which this appeal has arisen.
Messrs. Gainda Mall Hem Raj are to bear their own costs throughout.
Appeal allowed.

summary/full:
The appellant firm, an unsuccessful applicant for a license for vending foreign liquor in New Delhi for the year 954 1955, moved the High Court under article 226 of the Constitution for a writ of certiorari quashing the order granting the license to a rival applicant and impleaded the Chief Minister, the Excise Commissioner, the Secretary and the Under Secretary, Finance, of the State of Delhi, as it then was, as parties to the application.
Its case in substance was that the applications made for the grant of the licence were never placed before the Chief Commissioner who alone was the competent authority to grant it under Ch.
5, r. i of the Delhi Liquor License Rules, 1935, framed under section 59 Of the Punjab Excise Act (Punj. 1 of 1914), as extended to Delhi, and no order granting the license was ever made by him.
The said opposite parties respondents, although repeatedly called upon by the High Court to do so, did not produce the entire records and filed evasive affidavits and eventually produced a letter written by the Under Secretary, Finance, to the Excise Commissioner intimating that the Chief Commissioner had made the order for granting the license to the rival applicant and maintained that the order had in fact been made by the Chief Commissioner.
The High Court, under a misapprehension of fact and of the true nature and effect of that letter written by the Under Secretary, Finance, to the Excise Commissioner, held that the order had in fact been passed by the Chief Commissioner.
The production of the entire records in the 1425 Supreme Court made it clear, and the respondents also conceded, that the applications were never placed before the Chief Commissioner, nor any order granting the said license was ever made by him.
What had happened was that upon an order made by the Chief Minister on the file in accordance with a note put up by the Under Secretary, Finance, the latter wrote a letter to the Excise Commissioner in reply to a previous one of his, that the license might be granted to the said rival applicant.
That letter, on which the High Court had relied, was in the following terms, With reference to your letter No. 295/C/54 dated the 31st August, 1954, on the above subject, I am directed to say that the Chief Commissioner is pleased to approve under Rule 5. 1. of Delhi Excise Manual Vol.
11 the grant of L 2 license to Messrs. Gainda Mall Hem Raj, New Delhi, in place of the L 2 License surrendered by Messrs. Army & Navy Stores, New Delhi.
Necessary license may kindly be issued to the party concerned under intimation to this Secretariate ".
There was nothing on the record to show that the Chief Commissioner had ever concurred in the order made by the Chief Minister on the file.
Held, that the attempt of the official respondents to by pass the Court must be strongly deprecated, and the order of the High Court must be reversed.
When a superior Court issues a rule on an application for a writ of certiorari, it is incumbent upon the inferior Court or the quasi judicial body, to whom the rule is addressed, to produce the entire records along with the return so that the superior Court may satisfy itself that the inferior Court or the quasijudicial body has not exceeded its lawful jurisdiction.
Non production of such records, as in the instant case, must defeat the purpose which the writ has in view.
Held, further, that in view of the undisputed practice that such a license, once granted by the Chief Commissioner, was almost automatically renewed by the Collector year to year, it could not be said that the writ application and the appeal had become infructuous on the expiry of the period of the license in dispute and it was only proper that the appeal should be heard on merits.
In the facts and circumstances of the case it was impossible to hold that the letter of the Under Secretary embodied the order of the Chief Commissioner or that the Court could not be asked to go behind it.
The letter was clearly a communication of the sanction and could not be equated with the sanction itself.
Although an Under Secretary was competent to authenticate an order made by the Chief Commissioner, the letter in question did not purport to be made in the name of the Chief Commis sioner and therefore the letter could not be treated as a properly 1426 authenticated order to which the presumption raised by article 166 of the Constitution could properly attach.
Dattatreya Moreshwar Pangarkar vs The State of Bombay, , held inapplicable.


judgement:
Civil Appeal No. 1216(N)of 1975.
WITH Civil Appeal Nos.
509 641(N) of 1977.
From the Judgment and Order dated 26.2.1975 of the Karnataka High Court in W.P. No. 371 of 1975.
A.S. Nambiar and M. Veerappa for the Appellant.
K.N. Bhat, Vineet Kumar and K.M.K. Khan, for the Re spondents.
The Judgment of the Court was delivered by M. FATHIMA BEEVI, J.
1.
These connected appeals by special leave arise from the common judgment of the High Court of Karnataka.
The Writ Petitions filed by the respond ents against the appellant, the Corporation of the City of Bangalore were allowed and the resolution dated the December 30, 1974 passed by the Corporation levying octroi on certain additional items under Section 98 of the City of Bangalore Corporation Act, 1949 (shortly stated as 'the act ') was declared as invalid.
Section 98 of the Act requires the Corporation before passing any resolution imposing a tax or duty for the first time to publish a notice in the Official Gazette and in the local newspapers of its intention and inviting objections.
The Corporation may, after considering the objections, if any, received within the period specified determine by resolution to levy the tax or duty.
On the recommendation of the Standing Committee to levy octroi on certain new items of goods the appellant published a notice as contemplated under Section 98(1) of the Act inviting objections from the public and the said notice was published in the Gazette dated 17 9 1974.
Several objections were received in pursuance of the said notifica tion.
The subject was included in the supplementary agenda at the meeting held on 30 12 1974.
It was taken up as Item No. 146 and the resolution was passed unanimously.
The Commissioner thereafter issued notification.
446 4.
The respondents challenged the validity of the reso lution on the ground inter alia that there had not been consideration of the objections before passing the resolu tion and, therefore, the mandatory provision under Section 98(1) was violated.
The High Court in allowing the Writ Petitions has taken the view that what is contemplated trader the statute is a real consideration of the objections and not a mere pretence and since the time was too short there was no opportunity for such consideration and on account of non consideration of the objections to the pur posed levy the condition precedent for the passing of the resolution was not satisfied and therefore, the resolution is invalid.
The learned counsel for the appellant submitted that the objections have been placed on the table after the Commissioner had prepared a note of the several objections analysing the nature of the objection, setting out the legal conditions regarding the levy and containing the answers to the objection, distributed cyclostyled copies of the note before the meeting, and the subject was taken up and passed unanimously.
The text of the resolution it is submitted indicated that there was proper application of mind by the council.
Relying on the decision of this Court in Municipal Board, Hapur vs Raghuvendra Kripal and Others, the learned counsel maintained that the High Court should not have ventured into the question of the manner in which consideration was given to the item in the agenda and the presumption that the statutory authority has followed the prescribed procedure should prevail.
It was also pointed out that the Mayor of the Corporation and one of the councillors have filed affidavits affirming that the objections along with the note were placed on the table and the objections were taken note of before reaching the deci sion.
The respondents ' learned counsel submitted that con sideration of the objections is a condition precent for imposition of the levy and the High Court having been satis fied of the non compliance with this mandatory requirement, has rightly invalidated the tax.
The admitted facts are that the resolution had been passed on 30 12 74 after placing the objections on the table and, distributing notes of the Commissioner, analysing the objections and containing answers to the same.
The subject was in the urgent agenda and the record of proceedings revealed that the resolution had been passed unanimously 7.
Taxation in order to be valid must not only be authorised by a statute, but also be levied or collected in strict conformity with the 447 statute which authorises it.
Where a condition precedent is laid down for statutory power being exercised it must be fulfilled before a sub ordinate authority can exercise delegated power.
When the statute requires that delegated power may be exercised on fulfilment of certain conditions precedent, the Court would presume the regularity of the order including the fulfilment of the condition precedent.
It is for the party who challenged the legality to show that the condition precedent was not in fact complied with by the authority.
The Municipal Administration is coordinated to secure the vital interest of the general public.
It is the function of the representative body to ascertain the local opinion and decide thereon before imposition of the tax.
It has, therefore, to be assumed that local representatives who had taken note of the objections received in pursuance of the notice published have consciously reached the decision.
Once it is clear that there had been consideration of the objec tion, it is not for the Court to examine the manner in which the legislative will had been indicated.
We shall only refer to the recent decision of this Court in Sundarjas Kanyalal Bhatija & Ors.
vs The Collector, Thane, Maharashtra & Ors., Judgments Today "It must be noted that the functions of the Government in establishing a Corporation under the Act is neither executive nor administra tive.
Counsel for the appellants was right in his submission that it is legislative process indeed.
No judicial duty is laid on the Gov ernment in discharge of the statutory duties.
The only question to be examined is whether the statutory provisions have been complied within they are complied with, then, the Court could say no more.
In the present case the Government did publish the proposal by a draft notification and also considered the represen tations received.
It was only thereafter, a decision was taken to exclude Ulhasnagar for the time being.
That decision became final when it was notified under Section 3(2).
The Court cannot sit in judgment over such deci sion.
It cannot lay down norms for the exer cise of that power.
It cannot substitute even "its juster will for theirs.
" The Court has no jurisdiction to examine the validity of the reasons that goes into the decision or the motive that induced the delegated authority to exercise its powers.
No judicial duty is laid on the authority in discharge of the statutory obligations and, therefore, 448 the only question to be examined is whether the statutory provisions have been complied with. 9.
In The Swadeshi Cotton Mills Co. Limited vs The State of U.P. and Others, ; this Court held that: "Where a condition precedent has to be satis fied before a subordinate authority can pass an order, (executive or in the nature of subordinate legislation), it is not necessary that the satisfaction of the condition should be recited in the order itself, unless the statute requires it, But it is desirable that it should be so mentioned for then the pre sumption that the condition was satisfied would immediately arise and the burden would be on the persons challenging the order to show that the recital is not correct.
Even when the recital is not made in the order, it will not become void ab initio and only a further burden is cast on the authority pass ing the order to satisfy the court by other means, e.g. by filing an affidavit, that the condition precedent was satisfied.
In Gopal Narain vs State of Uttar Pradesh & Another, ; , this Court held that: "There is a presumption, when a statutory authority makes an order for imposition of tax, that it has followed the prescribed procedure.
The said presumption is not in any way weakened by the long acquiescence in the imposition by the residents of the locality.
Nonetheless no tax shall be levied or collect ed except in accordance with law.
If it is not imposed in accordance with law, it would infringe the fundamental right guaranteed under article 19(1)(f) of the Constitution.
While the long period of time that lapses between the imposition of the tax and the attack on it may permit raising of certain presumptions where the evidence is lost by efflux of time, it cannot exonerate the statutory authority if it imposes a tax in derogation of the statuto ry provision.
The High Court was not justified in assuming from the time factor alone that there could not have been a consideration of the objections.
It is not the function of the Court to probe into the details of the discussions and the deliberations before legislative will is seen 449 expressed by passing the resolution.
The connotation of the word 'consideration ' occuring in sub section (1) of Section 98 comprehends 'taking note of ' or 'paying heed to ' depend ing upon the nature of the subject.
It may be open to the councillors to express their views even within the limited time available.
No standard can be prescribed in such mat ters.
When it is shown that the council had the opportunity to consider the objections received, it has to be deemed, that they had taken note of the same before reaching a decision.
We are, therefore, of the view that the High Court has committed an error in assuming on account of the shortage of time alone and that there had been non compliance with the requirements under the statute.
We set aside the judgment of the High Court and allow the appeals.
In the circumstances of the case we make no order as to costs.
T.N.A. Appeals allowed.

summary/full:
The City Corporation of Bangalore invited objections from the public to the proposed levy of octroi on certain items.
In a meeting of the Corporation after placing the objections on the Table and circulating the Notes of the Commissioner analysing the objections, a unanimous resolu tion was passed levying the octroi.
The respondents challenged the validity of the Resolu tion contending that it was passed in violation of Section 98(1) of the City of Bangalore Corporation Act, 1949.
The High Court declared the Resolution invalid holding that because of shortage of time, the condition precedent for passing the resolution i.e. real consideration of the objections was not satisfied.
Hence these appeals by the Corporation.
Setting aside the judgment of the High Court and allow ing the appeals, this Court, HELD: 1.
Taxation in order to be valid must not only be authorised by a statute, but also be levied or collected in strict conformity with the statute which authorises it.
Where a condition precedent is laid down for statutory power being exercised it must be fulfilled before a sub ordinate authority can exercise delegated power.
When the 444 statute requires that delegated power may be exercised on fulfilment of certain conditions precedent, the Court would presume the regularity of the order including the fulfilment of the condition precedent.
It is 1or the party who chal lenged the legality to show that the condition precedent was not in fact complied with by the authority.
[446H; 447B] 2.
The Municipal Administration is coordinated to secure the vital interest of the general public.
It is the function of the representative body to ascertain the local opinion and decide thereon before imposition of the tax.
It has, therefore, to be assumed that local representatives who had taken note of the objections received in pursuance of the notice published have consciously reached the decision.
Once it is clear that there had been consideration of the objec tion, it is not for the Court to examine the manner in which the legislative will had been indicated.
[447C D] 3.
The Court has no jurisdiction to examine the validity of the reasons that goes into the decision or the motive that induced the delegated authority to exercise its powers.
No judicial duty is laid on the authority in discharge of the statutory obligations, and, therefore, the only question to be examined is whether the statutory provisions have been complied with.
[447H; 448A] 4.
The High Court was not justified in assuming from the time factor alone that there could not have been a consider ation of the objections.
It is not the function of the Court to probe into the details of the discussions and the delib erations before legislative will is seen expressed by pass ing the resolution.
The connotation of the word 'considera tion ' occuring in sub section (1) of Section 98 comprehends 'taking note of ' or 'paying heed to ' depending upon the nature of the subject.
It may be open to the councillors to express their views even within the limited time available.
No standard can be prescribed in such matters.
When it is shown that the council had the opportunity to consider the objections received, it has to be deemed, that they had taken note of the same before reaching a decision.
[448H; 449A B] Municipal Board, Hapur vs Raghuvendra Kripal and Others, ; Sundarjas Kanyalal Bhatija & Ors.
vs The Collector, Thane, Maharashtra & Ors., [1989] 3 Judg ment Today 57; Swadeshi Cotton Mills Co. Limited vs The State of U.P. and Others, ; ; Gopal Narain vs State of Uttar Pradesh & Another, ; , followed.


judgement:
ivil Appeal No. 1372 of 1987.
From the Judgment and Order dated 29.1.1986 of the Rajasthan High Court in Spl.
Appeal No. 336 of 1984.
J. Sorabjee, Roxena Swamy, Sushil Kr.
Jain and L.C. Agarwala for the Appellant.
Anil Dev Singh, Hemant Sharma, C.V.S. Rao, Mrs. Sushma Suri (N.P.) and Ms. A. Subhashini (N.P.) for the Respond ents.
The Judgment of the Court was delivered by VENKATARAMIAH, CJ.
The question for consideration in this appeal is whether an establishment which is manufactur ing carpets is subject to the (Act XIX of 1952) (here inafter referred to as 'the Act ').
The appellant is a part nership firm carrying on the business of 419 manufacturing and selling carpets in the State of Rajasthan at three factories belonging to it.
When steps were taken to direct the appellant to comply with the provisions of the Act by the Regional Provident Fund Commissioner the appel lant contested the applicability of the Act on the ground that the establishment owned by it was not manufacturing 'textiles ' included in Schedule I to the Act.
The Regional Provident Fund Commissioner after giving opportunity of being heard to the appellant passed an order on 27th July, 1979 holding that the business of manufacturing carpets carried on by it made the Act applicable to the appellant as carpets were textiles.
Aggrieved by the said order the appellant filed a petition under section 19A of the Act before the Central Government.
The Central Government passed an order on 4th May, 1981 holding that the appellant 's establishment was engaged in the manufacture of 'textiles ' and accordingly the order of the Regional Provident Commis sioner was upheld.
The appellant thereafter filed a petition under Article 226 of the Constitution before the Rajasthan High Court (Jaipur Bench).
The High Court by its order dated 15th October, 1984 dismissed the writ petition.
The appel lant then appealed to the Division Bench of the High Court and the Division Bench of the Rajasthan High Court dismissed the appeal on 29th January, 1986.
This appeal by special leave is filed against the order of the Division Bench of the High Court of Rajasthan.
The only point urged before us by the learned counsel for the appellant is that the products, namely, carpets which are being manufactured by the appellant did not come within the meaning of the expression 'textiles ' described in Schedule I to the Act and hence the Act was in applicable.
Clause (a) of sub section (3) of section 1 of the Act pro vides that subject to the provisions contained in section 16, the Act applies to every establishment which is a facto ry engaged in any industry specified in Schedule I and in which 20 or more persons are employed.
The relevant part of Schedule I to the Act reads thus: "Any industry engaged in the manufacture of any of the following, namely: Cement.
Cigarettes.
Electrical, mechanical or general engineering products.
Iron and Steel.
Paper.
Textiles (made wholly or in part of cotton or wool or jute or silk, whether natural or artificial . . 420 Clause (d) of the Explanation contained in Schedule I to the Act reads thus: "(d) the expression "textiles" includes the products of carding, spinning, weaving, fin ishing and dyeing yarn and fabrics, printing, knitting and embroidering.
" It is not disputed that was material with which the carpets are made is wool which is one of the materials mentioned in the Schedule, namely, textiles made wholly or in part of cotton or wool or jute or silk, whether natural or artificial.
The activity of manufacturing carpets is generally understood as the weaving of carpets and the man who is engaged in such activity is popularly known as a 'carpet weaver '.
Weaving means to form a fabric by interlac ing yarn on a loom.
It also means the method or pattern of weaving or the structure of a woven fabric.
The warp means yarn arranged length wise on a loom.
The fabric which is woven includes the weft which means yarn woven across the width of the fabric through the length wise yarn.
Thus the activity of the weaving involves passing of the weft through the warp.
While doing so even if there are any knots in the yarn still the activity is weaving.
The mere fact that there is knotting of the yarn, the fabric which is ultimately produced does not cease to be a textile fabric.
The fact that the Handicrafts Board has issued certificate under the Import Trade Control Policy Handbook of Rules that carpet is a product of handicrafts does not in any way improve the matter.
Even then the carpets do not cease to be textiles.
That certificate is not enough since we are very clear that the activity of making carpets though it involves knotting, in substance, amounts to weaving and the carpet is a fabric which is woven.
Thus it comes within the meaning of the expression "textiles:" as explained in clause (d) to the Explanation of Schedule I to the Act.
We are, therefore on the view that the establishment in question comes within Schedule I to the Act.
In Porritts & Spencer (Asia) Ltd. vs State of Haryana, ; this Court held that the concept of 'textiles ' is not a static concept.
It has, having regard to newly developing materials, methods techniques and process es, a continually expanding content and new kinds of fabric may be invented which may legitimately without doing any violence to the language be regarded as textiles.
The word 'textiles ' is derived from Latin 'texere ' which means 'to weave and it means woven fabric.
When yarn, whether cotton, silk, woollen, rayon, 421 nylon or of any other description made out of any other material is woven into a fabric what comes into being is a 'textile ' and is known as such.
Whatever be the mode of weaving employed, woven fabric would be 'textile '.
What is necessary is no more than the meaning of yarn and weaving would mean binding or putting yarn together by some process so as to form a fabric.
A textile need not be of any partic ular size or strength or weight.
The use to which it may be put is also immaterial and does not bear on its character as a textile.
The fact that the 'dryer felts ' are used only as absorbents of moisture in the process of manufacture in a paper manufacturing unit, cannot militate against 'dryer felts ' falling within the category of textiles, if otherwise they satisfy the description of textiles.
It is not necessary to refer to the other decisions cited before us in this case.
The non inclusion of knotting in the Explanation to Schedule defining 'textiles ' is, therefore, immaterial.
No other point was pressed before us in this case.
We, there fore, hold that the Regional Provident Fund Commissioner, the Government of India and the High Court were right in holding that the establishment of the appellant came within the scope of the Act and the appellant was liable to comply with the requirements of the Act in all respects.
The ap peal, therefore, fails and it is dismissed.
G.N. Appeal dismissed.

summary/full:
The appellant is a partnership firm carrying on business of manufacturing and selling carpets in the State of Rajas than.
It owns three factories.
When the Regional Provident Fund Commissioner took steps to direct the appellant firm to comply with the provisions of the , the appellant con tested the applicability of the Act on the ground that it was not manufacturing textiles included in Schedule I of the Act.
The Regional Provident Fund Commissioner held that the business of manufacturing carpets carried on by the appel lant included textiles and that the Act was applicable to the appellant.
Aggrieved by the said order, the appellant approached the Central Government under section 19A of the Act, which upheld the order of the Regional Provident Fund Commission er.
Thereafter the appellant moved the High COurt under Article 226 of the Constitution.
The writ petition was dismissed.
The appellant preferred an appeal to the Division Bench of the High Court and that appeal was also dismissed.
This appeal, by special leave, is against the order of the Division Bench.
Dismissing the appeal, this Court, HELD: 1.1 The activity of manufacturing carpets is generally understood as the weaving of carpets and the man who is engaged in such activity is popularly known as a 'carpet weaver '.
Weaving means to form a fabric by interlac ing yarn on a loom.
It also means the method or pattern of weaving or the structure of a woven fabric, [420B C] 418 1.2 Though there may be knotting of the yarn, the fabric which is ultimately produced does not cease to be a textile fabric.
The fact that the Handicrafts Board has issued certificate under the Import Trade Control Policy Handbook of Rules that carpet is a product of handicrafts does not in any way improve the matter.
Even then the carpets do not cease to be textiles.
That certificate is not enough since it is very clear that the activity of making carpet though it involves knotting, in substance, amounts to weaving and the carpet is a fabric which is woven.
Thus it comes within the meaning of the expression "textiles" as explained in clause (d) to the Explanation of Schedule I to the Act.
[420D F] 1.3 The non inclusion of knotting in the explanation to Schedule defining 'textiles ' is, therefore, immaterial.
[42ID] Porrits Spencer (Asia) Ltd. vs State of Haryana, ; , relied on.
The Regional Provident Fund Commissioner, the Govern ment of India and the High Court were right in holding that the establishment of the appellant came within the scope of the Act and the appellant was liable to comply with the requirements of the Act in all respects.
[421D]


judgement:
ivil Appeal No. 4879 of 1989.
From the Judgment and Order dated 12.11.1986 of the Andhra Pradesh High Court in W.P. No. 16535 of 1986 P. Rama Reddy and A.V.V. Nair for the Appellants.
C. Sitaramaiah, Jagan Rao, D.R.K. Reddy and T.V.S.N. Chari for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
Leave granted.
This is an appeal from the judgment and order of the High Court of Andhra Pradesh dated 12th November, 1986.
The appellants challenged the validity of an amendment to the Schedule to the Andhra Pradesh General Sales Tax Act, 1957 (hereinafter called 'the Act ').
The appellants are dealers in tamarind in Parvathipuram in Srikakulam district, a border district in Andhra Pradesh.
They had purchased tama rind from the State of Orissa paying tax there and incurring expenditure in bringing the said goods to Andhra Pradesh for the purpose of sale.
Under the Act, tamarind was item 14 of Second Schedule and was subjected to sales tax at the point of first purchase in the State irrespective of whether it was purchased within the State or outside the State.
The subject matter of challenge in this application under article 226 of the Constitution before the Andhra Pradesh High Court, was the validity of an amendment to the Schedule to the Act modifying the point of taxability of tamarind in question.
Prior to the amendment tamarind was taxable as mentioned hereinbefore at the first purchase point, being item No. 14 in Schedule II to the Act.
The entry therein read as follows: "Description of Point of levy Rate of tax the goods 14.
Tamarind (2014) At the point of 4 paise in first purchase the rupee.
in the State.
" 425 By virtue of the amendment, the said entry was amended.
Tamarind which is purchased within the State, was retained in IInd Schedule while tamarind purchased outside the State was transferred to 1st Schedule.
After the amendment, item No. 14 in Schedule II and item 170 in Schedule I stood as follows: "SECOND SCHEDULE section No. Description of goods Point of levy Rate of tax 14.
Tamarind when put At the point of 4 paise in chased within the first purchase the rupee.
State.
in the State.
FIRST SCHEDULE section No. Description of Goods Point of levy Rate of tax 170 Tamarind when At the point 4 paise in obtained from out of first sale the rupee.
side the State.
in the State.
" It appears that the result of the said amendment was that tamarind purchased outside the State, was taxable at the point of first sale in the State.
It was contended before the High Court that the said amendment brought about a discrimination between tamarind purchased within the State i.e. one produced within the State, and the tamarind pur chased outside the State i.e. produced in other States; and that the incidence of tax was more on the tamarind purchased outside the State.
It was contended that it violated clause (a) of article 304 as also article 14 of the Constitution.
Clause (a) of article 304 states that notwithstanding anything contained in article 301 or article 303, the legislature of State may by law impose on goods imported from other States or the Union Territories any tax to which similar goods manufactured or produced in the State are subject, so, however, as not to discriminate between goods so imported and goods so manufactured or produced.
The question is whether as a result of the said amendment, there has been any infraction of clause (a) of article 304 of the Constitu tion.
We are unable to 426 accept the contention that there was any such discrimina tion.
The High Court in the judgment under appeal has so held.
We are of the opinion that the High Court was right.
Both the tamarind purchased within, and outside, the State is taxed uniformly.
On behalf of the appellants, reliance was placed on Firm A.T.B. Mehtao Majid and Co. vs The State of Madras, 14 STC 355, wherein on an analysis of the relevant provisions it was held that the provisions of rule 16(2) of the Madras General Sales Tax [Turnover and Assessment] Rules, 1939 (substituted in the place of the old rule w.e.f.
1st April, 1955) discriminate between hides and skins imported from outside the State and those manufactured or produced inside the State and as such contravened the provisions of article 304(a) of the Constitution, and therefore were invalid.
It was reiterated by this Court that taxing laws can be re strictions on trade, commerce and intercourse, if they hamper the flow of trade and if these are not compensatory taxes or regulatory measures.
It was further held that sales tax on hides and skins imposed under the Madras General Sales Tax Act, 1939 and the rules framed thereunder could not be said to be a measure regulating any trade or compen satory tax levied for the use of trading facilities.
The similarity contemplated by article 304(a) is in the nature of the quality and kind of the goods and not with respect to whether they were already the subject of tax or not.
There this Court was dealing with rule 16 of the relevant Madras rules.
Sub rule (a) of rule 16 provides that in case of untanned (raw) hides and/or skins, the tax u/s 3(1) of the Act was to be levied from the dealer who is the last pur chaser in the State.
Sub rule (2) which was in two parts, dealt with tanned hides and skins.
Clause (i) of sub rule (2) provided that in case of hides and skins tanned outside the State, tax shall be levied upon the dealer who in the State is the first dealer.
Clause (ii) provided that in case of tanned hides and skins which have been tanned within the State, the tax u/s 3(1) shall be levied upon a person who is the first dealer in such hides or skins.
The proviso, howev er, declared that if the dealer proved that he had already been taxed under sub rule (1) on the untanned hides and skins, he shall not be subjected to tax under sub rule (2).
It was held by this Court that this rule inevitably brought about a discrimination in the quantum of tax because while the tanned hides and skins which were imported from outside the State and were sold within the State, were taxed at a higher rate, the hides and skins tanned within the State and sold within the State, are taxed at a lower rate by virtue of the proviso.
It was, indeed, found that there was a substantial variation between the prices of tanned and untanned goods.
This Court pointed out that by virtue of the proviso, the tax on 427 the latter category was, in fact, on the purchase price of the untanned hides and skins though ostensibly the rate of tax under sub rule (2) was the same Hence, the mischief of discrimination was brought about by the proviso which said that if hides and skins are taxed within the State at raw (untanned) stage, they shall not be taxed again at the tanned stage.
But in view of the facts involved in the instant case, we are unable to accept that the principles of the said decision have any scope of application to the facts of instant case.
In the instant case the tamarind purchased within the State and outside the State, are taxed at the same rate.
But the point of taxability has necessarily to be different in both the cases.
In case of tamarind purchased within the State i.e. produced within the State, the tax is levied at the point of first purchase, and in case of im ported tamarind i.e. purchased outside the State, the tax is levied at the point of first sale in the State.
It was contended by Mr. P. Rama Reddy, learned advocate for the appellants, that tax in case of imported tamarind would be more because its price will include freight charge and other State taxes.
Hence, it was submitted that the sales tax will also be more.
That may be so but it cannot be said to be the effect of what law has amended.
Tamarind will be imported only when it can be sold in the market here at the same price as the tamarind produced within the State.
Only when after bearing the other ' State tax and freight charges, if it is able to compete with the locally produced tamarind, it will normally be imported from outside the State.
If there is any difference in prices because of market conditions and other factors, that cannot be said to be due to discrimination prohibited by clause (a) of article 304 of the Constitution.
In order to ensure this, it would be necessary that imported goods must always be taxed at a lower rate than the corresponding goods within the State because of freight and other charges.
That cannot be so.
The High Court observed that tamarind is an agricultural produce and that is why it was put in Second Schedule i.e. to say, purchase point, but where it was imported and sold within the State, there was no reason to tax it at the sale point.
We are of the opinion that the.
High Court was 'right.
It was contended on behalf of the appellants before the High Court that imported tamarind which had suffered tax at the first sale point, will again be taxed at the purchase point when purchased within the State, which would amount to double taxation.
Once the imported tamarind is taxed at the first sale point under the First Schedule, there is no occasion for taxing it over again at the sale point under the Second Schedule.
The idea of both the Schedules is to tax only at one point 428 though the point of taxability may be different under dif ferent Schedules.
Our attention was drawn on behalf of the appellants to a decision of this Court in Indian Cement Ltd. & Ors.
vs State of Andhra Pradesh & Ors., 69 STC 305.
There this Court was concerned with Andhra Pradesh General Sales Tax Act.
It appears that in exercise of its powers u/s 9(1) of the Act, the State Government had passed a notification on January 27, 1987 reducing the rate of sales tax on sale of cement from 13.75% to 4% in respect of cement manufactured by cement factories situated in the State and sold to manufac turing units situated within the State for the purpose of manufacture of cement products such as cement sheets, asbes tos sheets, cement flooring stones, cement concrete pipes, cement water and sanitary fittings, concrete poles etc.
On the same day the State Govt.
had passed another notification u/s 8(5) of the reducing the rate of tax on inter State sale of cement to 2% with or without Form C.
On February 28, 1987 the State of Karnataka passed a similar notification reducing the rate of tax on inter State sale of cement from 15% to 2%.
The petitioners, of whom some were manufacturers of cement having their manufacturing units in Tamil Nadu and others, were stockists having places of business in the States of Karnataka, Kerala and Tamil Nadu, filed writ petitions before this Court challenging the validity of these notifications on the ground that these created trade barriers and directly im pinged upon the freedom of trade, commerce and intercourse provided for in article 301 of the Constitution of India.
It was held that the variations in the rates of local and inter State sales tax affected free trade and commerce and created a local preference, which was contrary to the scheme of Part XIII of the Constitution of India; and as such the notification were bad.
This decision was rendered in the peculiar facts of that case.
While the principle enunciated by the Court in the said decision there can be no dispute that taxation was a deterrent in some cases, against free flow of trade, and as a result of favourable or unfavourable treatment by way of taxation, the course of flow of trade gets regulated either adversely or favourably, and that if the scheme of Part XIII guarantees has to be preserved in the national interest, it is imperative that the provisions of article 301 must be strictly complied with, we are of the opinion that the ratio of the said decision in the facts and circumstances of this case would not be relevant.
In our opinion, the provisions of the Constitution should be strictly complied with not only with the letter but also with their spirit.
Part XIII of the Constitution has to 429 be dealt with the other provisions of the Constitution.
Our attention was drawn to the observations of this Court in M/s Associated Tanners, Vizianagaram, A.P. vs C.T.O., Vizianaga ram.
A.P. & Ors., ; It was reiterated there that the effect of an imposition of tax may work differently upon different dealers, namely, those who import goods and those who purchase the goods locally.
That effect cannot be said to arise directly or as an immediate effect of the imposition of tax.
It cannot be said that there was any violation of clause (a) of article 304 of the Constitution.
We are of the opinion that in the instant case the difference, in rates, if any, between the imported tamarind and locally produced tamarind is not as an immediate or direct result of the imposition of tax.
The decision of this Court in Weston Electronics & Anr.
vs State of Gujarat & Anr.
, ; dealt, in our opinion, with an en tirely different situation and for the purpose of the in stant controversy, cannot be of any assistance.
Mr. C. Sitaramiah, appearing for the respondents, drew our attention to Rattan Lal & Co. & Anr.
vs The Assessing Authority & Anr., ; wherein this Court had reiterated that when a taxing State is not imposing rates of tax on imported goods different from rates of tax on goods manufactured or produced, article 304 has no application.
So long as the rate is the same article 304 is satisfied.
In the instant case the tax is at the same rate and, hence, tax cannot be said to be higher in the case of imported goods.
When the rate is applied the resulting tax may be somewhat higher but that does not contravene the equality contemplat ed by article 304 of the Constitution.
In the facts and the circumstances of the case, there is no ground to complain about the breach of article 14 of the Constitution.
In the aforesaid view of the matter, we are of the opinion that the High Court was right in the view it took and this appeal must fail.
The appeal is accordingly dis missed.
In the facts and the circumstances of the case, however, we make no order as to costs.
P.S.S. Appeal dismissed.

summary/full:
Under item 14 of Second Schedule to the Andhra Pradesh General Sales Tax Act, 1957 tamarind was subjected to sales tax at the point of first purchase in the State irrespective of whether it was purchased within the State or outside the State.
However, by virtue of an amendment to the Act by Act 19 of 1986 tamarind which is purchased within the State was retained in Second Schedule, while tamarind purchased out side the State was transferred to First Schedule as item 170, making it taxable at the same rate at the point of first sale in the State.
The appellants had purchased tamarind from the State of Orissa paying tax there and incurred expenditure in bringing it to Andhra Pradesh for sale.
They challenged the said amendment modifying the point of taxability as discriminato ry between tamarind produced and purchased within the State and the tamarind produced and purchased outside the State and as such, violative of Articles 304(a) and 14 of the Constitution.
The submission was that imported tamarind which had suffered tax at the first sale point will again be taxed at the purchase point when purchased within the State, which would amount to double taxation, and that tax in case of imported tamarind would be more because its price will include freight charges and other State taxes.
The High Court found that there was no discrimination.
Dismissing the appeal by special leave, the Court, 423 HELD: When a taxing State is not imposing rates of tax on imported goods different from rates of tax on goods manufactured or produced, Article 304 of the Constitution has no application.
In the instant case, both tamarind purchased within, and outside, the State was taxed uniform ly.
There was.
therefore, no infraction of clause (a) of Article 304 of the Constitution.
[429D E; 426A; 425G H] Rattan Lal & Co. & Anr.
vs The Assessing Authority & Anr.
, ; , applied.
Firm A.T.B. Mehtao Majid & Co. vs The State of Madras, 14 STC 355 and Indian Cement Ltd. & Ors.
vs State of Andhra Pradesh & Ors., 69 STC 305, distinguished.
It may be that when the rate is applied the resulting tax in respect of imported tamarind may be somewhat higher because its price will include freight charges and other State taxes.
But that cannot be said to be the effect of what law has amended.
Tamarind will be imported only when it can be sold in the market at the same price as the tamarind produced within the State.
Only when after bearing the other State taxes and freight charges, if it is able to compete with the locally produced tamarind it will normally be imported from outside the State.
If there is any difference in prices because of market conditions and other factors, that cannot be said to be due to discrimination prohibited by clause (a) of Article 304.
[429E; 427D E] M/s Associated Tanners, Vizianagaram, A.P. vs C.T.O., Vizianagaram, A.P. & Ors., ; , referred to.
Weston Electroniks & Anr.
vs State of Gujarat & Ant.
, ; , distinguished.
Once the imported tamarind is taxed at the first sale point under the First Schedule there is no occasion for taxing it over again at the sale point under the Second Schedule.
The idea of both the Schedules is to tax only at one point, though the point of taxability is different in both the cases.
In case of tamarind purchased within the State, i.e., produced within the State, the tax is levied at the point of first purchase under the Second Schedule, and in case of imported tamarind i.e., purchased outside the State, the tax is levied at the point of first sale in the State under the First Schedule.
It could not therefore, be said that taxing the imported tamarind at the point of first sale in the State would amount to double taxation.
[427H; 428A; 427B C; 427G] 424 In the facts and circumstances of the case, there was, therefore, no ground to complain about the breach of Article 14 of the Constitution [429E F]