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Deputy Commissioner, Sales Tax (Law) Board Of Revenue(Taxes Vs. Pio Food Packers | indeed there may be several stages of processing and perhaps a different kind of processing at each stage. With each process suffered, the original commodity experiences a change. But it is only when the change, or a series of changes, take the commodity to the point where commercially it can no longer be regarded as the original commodity but instead is recognised as a new and distinct article that a manufacture can be said to take place. Where there is no essential difference in identity between the original commodity and the processed article it is not possible to say that one commodity has been consumed in the manufacture of another. Although it has undergone a degree of processing, it must be regarded as still retaining its original identity. 6. A large number of cases has been placed before us by the parties, and in each of them the same principle has been applied: Does the processing of the original commodity bring into existence a commercially different and distinct article ? Some of the cases where it was held by this Court that a different commercial article had come into existence include Anwarkhan Mehboob Co. v. The State of Bombay and Others (where raw tobacco was manufactured into bidi patti), A Hajee Abdul Shukoor and Co. v. The State of Madras (raw hides and skins constituted a different commodity from dressed hides and skins with different physical properties), The State of Madras v. Swasthik Tobacco Factory (raw tobacco manufactured into chewing tobacco) and Ganesh Trading Co. Karnal v. State of Haryana and Another, (paddy dehus ked into rice). On the other side, cases where this Court has held that although the original commodity has undergone a degree of processing it has not lost its original identity include Tungabhadra Industries Ltd., Kurnool v. Commercial Tax Officer, Kurnool (where hydrogenated groundnut oil was regarded as groundnut oil) and Commissioner of Sales Tax, U.P., Lucknow v. Harbilas Rai and sons (where bristles plucked from pigs, boiled, washed with soap and other chemicals and sorted out in bundles according to their size and colour were regarded as remaining the same commercial commodity, pigs bristles). 7. In the present case, there is no essential difference between pineapple fruit and the canned pineapple slices. The dealer and the consumer regard both as pineapple. The only difference is that the sliced pineapple is a presentation of fruit in a more convenient form and by reason of being canned it is capable of storage without spoiling. The additional sweetness in the canned pineapple arises from the sugar added as a preservative. On a total impression, it seems to us, the pineapple slices must be held to possess the same identity as the original pineapple fruit. 8. While on the point, we may refer to East Texas Motor Freight Lines v. Frozen Food Express, where the U.S. Supreme Court held that dressed and frozen chicken was not a commercially distinct article from the original chicken. It was pointed out: "Killing, dressed and freezing a chicken is certainly a change in the commodity. But it is no more drastic a change than the change which takes place in milk from pasturising, homogenizing, adding vitamin concentrates, standardising and bottling." It was also observed:".................. there is hardly less difference between cotton in the field and cotton at the gin or in the bale or between cottonseed in the field and cottonseed at the gin, than between a chicken in the pen and one that is dressed. The ginned and baled cotton and the cottonseed, as well as the dressed chicken, have gone through a processing stage But neither has been "manufactured" in the normal sense of the word." Referring to Antheuser-Busch Brewing Association v. United States the Court said: "Manufacture implies a change but every change is not manufacture and yet every change in an article is the result of treatment, labour and manipulation. But something more is necessary...................There must be transformation; a new and different article must emerge, having a distinctive name, character or use." And further: "At some point processing and manufacturing will merge. But where the commodity retains a continuing substantial identity through the processing stage we cannot say that it has been "manufactured". 9. The comment applies fully in the case before us. 10. Although a degree of processing is involved in preparing pineapple slices from the original fruit, the commodity continues to possess its original identity, notwithstanding the removal of inedible portions , the slicing and thereafter canning it on adding sugar to preserve it. It is contended for the Revenue that pineapple slices have a higher price in the market than the original fruit and that implies that the slices constitute a different commercial commodity. The higher price, it seems to us, is occasioned only because of the labour put into making the fruit more readily consumable and because of the can employed to contain it. It is not as if the higher price is claimed because it is a different commercial commodity. It is said that pineapple slices appeal to a different sector of the trade and that when a customer asks for a can of pineapple slices he has in mind something very different from fresh pineapple fruit. Here again, the distinction in the mind of the consumer arises not from any difference in the essential identity of the two, but is derived from the mere form in which the fruit is desired. 11. Learned counsel for the Revenue contends that even if no manufacturing process is involved, the case still falls within s. 5-A(1) (a) of the Kerala General Sales Tax Act, because the statutory provision speaks not only of goods consumed in the manufacture of other goods for sale but also goods consumed otherwise . There is a fallacy in the submission. The clause, truly read, speaks of goods consumed in the manufacture of other goods for sale or goods consumed in the manufacture of other goods for purposes other than sale. 12. | 0[ds]) of the Kerala General Sales Tax Act envisages the consumption of a commodity in the manufacture of another commodity. The goods purchased should be consumed, the consumption should be in the process of manufacture, and the result must be the manufacture of other goods. There are several criteria for determining whether a commodity is consumed in the manufacture of another. The generally prevalent test is whether the article produced is regarded in the trade, by those who deal in it, as distinct in identity from the commodity involved in its manufacture. Commonly, manufacture is the end result of one or more processes through which the original commodity is made to pass. The nature and extent of processing may vary from one case to another, and indeed there may be several stages of processing and perhaps a different kind of processing at each stage. With each process suffered, the original commodity experiences a change. But it is only when the change, or a series of changes, take the commodity to the point where commercially it can no longer be regarded as the original commodity but instead is recognised as a new and distinct article that a manufacture can be said to take place. Where there is no essential difference in identity between the original commodity and the processed article it is not possible to say that one commodity has been consumed in the manufacture of another. Although it has undergone a degree of processing, it must be regarded as still retaining its original identityA large number of cases has been placed before us by the parties, and in each of them the same principle has been applied: Does the processing of the original commodity bring into existence a commercially different and distinct article ? Some of the cases where it was held by this Court that a different commercial article had come into existence include Anwarkhan Mehboob Co. v. The State of Bombay and Others (where raw tobacco was manufactured into bidi patti), A Hajee Abdul Shukoor and Co. v. The State of Madras (raw hides and skins constituted a different commodity from dressed hides and skins with different physical properties), The State of Madras v. Swasthik Tobacco Factory (raw tobacco manufactured into chewing tobacco) and Ganesh Trading Co. Karnal v. State of Haryana and Another, (paddy dehus ked into rice). On the other side, cases where this Court has held that although the original commodity has undergone a degree of processing it has not lost its original identity include Tungabhadra Industries Ltd., Kurnool v. Commercial Tax Officer, Kurnool (where hydrogenated groundnut oil was regarded as groundnut oil) and Commissioner of Sales Tax, U.P., Lucknow v. Harbilas Rai and sons (where bristles plucked from pigs, boiled, washed with soap and other chemicals and sorted out in bundles according to their size and colour were regarded as remaining the same commercial commodity, pigs bristles)In the present case, there is no essential difference between pineapple fruit and the canned pineapple slices. The dealer and the consumer regard both as pineapple. The only difference is that the sliced pineapple is a presentation of fruit in a more convenient form and by reason of being canned it is capable of storage without spoiling. The additional sweetness in the canned pineapple arises from the sugar added as a preservative. On a total impression, it seems to us, the pineapple slices must be held to possess the same identity as the original pineapple fruitThe comment applies fully in the case before usAlthough a degree of processing is involved in preparing pineapple slices from the original fruit, the commodity continues to possess its original identity, notwithstanding the removal of inedible portions , the slicing and thereafter canning it on adding sugar to preserve itThe higher price, it seems to us, is occasioned only because of the labour put into making the fruit more readily consumable and because of the can employed to contain it. It is not as if the higher price is claimed because it is a different commercial commodity. It is said that pineapple slices appeal to a different sector of the trade and that when a customer asks for a can of pineapple slices he has in mind something very different from fresh pineapple fruit. Here again, the distinction in the mind of the consumer arises not from any difference in the essential identity of the two, but is derived from the mere form in which the fruit is desiredThere is a fallacy in the submission. The clause, truly read, speaks of goods consumed in the manufacture of other goods for sale or goods consumed in the manufacture of other goods for purposes other than sale. | 0 | 1,850 | 852 | ### Instruction:
Make a prediction on the court's ruling (acceptance (1) or rejection (0) of the petition), and then dissect the proceeding to provide a detailed explanation using key textual passages.
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indeed there may be several stages of processing and perhaps a different kind of processing at each stage. With each process suffered, the original commodity experiences a change. But it is only when the change, or a series of changes, take the commodity to the point where commercially it can no longer be regarded as the original commodity but instead is recognised as a new and distinct article that a manufacture can be said to take place. Where there is no essential difference in identity between the original commodity and the processed article it is not possible to say that one commodity has been consumed in the manufacture of another. Although it has undergone a degree of processing, it must be regarded as still retaining its original identity. 6. A large number of cases has been placed before us by the parties, and in each of them the same principle has been applied: Does the processing of the original commodity bring into existence a commercially different and distinct article ? Some of the cases where it was held by this Court that a different commercial article had come into existence include Anwarkhan Mehboob Co. v. The State of Bombay and Others (where raw tobacco was manufactured into bidi patti), A Hajee Abdul Shukoor and Co. v. The State of Madras (raw hides and skins constituted a different commodity from dressed hides and skins with different physical properties), The State of Madras v. Swasthik Tobacco Factory (raw tobacco manufactured into chewing tobacco) and Ganesh Trading Co. Karnal v. State of Haryana and Another, (paddy dehus ked into rice). On the other side, cases where this Court has held that although the original commodity has undergone a degree of processing it has not lost its original identity include Tungabhadra Industries Ltd., Kurnool v. Commercial Tax Officer, Kurnool (where hydrogenated groundnut oil was regarded as groundnut oil) and Commissioner of Sales Tax, U.P., Lucknow v. Harbilas Rai and sons (where bristles plucked from pigs, boiled, washed with soap and other chemicals and sorted out in bundles according to their size and colour were regarded as remaining the same commercial commodity, pigs bristles). 7. In the present case, there is no essential difference between pineapple fruit and the canned pineapple slices. The dealer and the consumer regard both as pineapple. The only difference is that the sliced pineapple is a presentation of fruit in a more convenient form and by reason of being canned it is capable of storage without spoiling. The additional sweetness in the canned pineapple arises from the sugar added as a preservative. On a total impression, it seems to us, the pineapple slices must be held to possess the same identity as the original pineapple fruit. 8. While on the point, we may refer to East Texas Motor Freight Lines v. Frozen Food Express, where the U.S. Supreme Court held that dressed and frozen chicken was not a commercially distinct article from the original chicken. It was pointed out: "Killing, dressed and freezing a chicken is certainly a change in the commodity. But it is no more drastic a change than the change which takes place in milk from pasturising, homogenizing, adding vitamin concentrates, standardising and bottling." It was also observed:".................. there is hardly less difference between cotton in the field and cotton at the gin or in the bale or between cottonseed in the field and cottonseed at the gin, than between a chicken in the pen and one that is dressed. The ginned and baled cotton and the cottonseed, as well as the dressed chicken, have gone through a processing stage But neither has been "manufactured" in the normal sense of the word." Referring to Antheuser-Busch Brewing Association v. United States the Court said: "Manufacture implies a change but every change is not manufacture and yet every change in an article is the result of treatment, labour and manipulation. But something more is necessary...................There must be transformation; a new and different article must emerge, having a distinctive name, character or use." And further: "At some point processing and manufacturing will merge. But where the commodity retains a continuing substantial identity through the processing stage we cannot say that it has been "manufactured". 9. The comment applies fully in the case before us. 10. Although a degree of processing is involved in preparing pineapple slices from the original fruit, the commodity continues to possess its original identity, notwithstanding the removal of inedible portions , the slicing and thereafter canning it on adding sugar to preserve it. It is contended for the Revenue that pineapple slices have a higher price in the market than the original fruit and that implies that the slices constitute a different commercial commodity. The higher price, it seems to us, is occasioned only because of the labour put into making the fruit more readily consumable and because of the can employed to contain it. It is not as if the higher price is claimed because it is a different commercial commodity. It is said that pineapple slices appeal to a different sector of the trade and that when a customer asks for a can of pineapple slices he has in mind something very different from fresh pineapple fruit. Here again, the distinction in the mind of the consumer arises not from any difference in the essential identity of the two, but is derived from the mere form in which the fruit is desired. 11. Learned counsel for the Revenue contends that even if no manufacturing process is involved, the case still falls within s. 5-A(1) (a) of the Kerala General Sales Tax Act, because the statutory provision speaks not only of goods consumed in the manufacture of other goods for sale but also goods consumed otherwise . There is a fallacy in the submission. The clause, truly read, speaks of goods consumed in the manufacture of other goods for sale or goods consumed in the manufacture of other goods for purposes other than sale. 12.
### Response:
0
### Explanation:
) of the Kerala General Sales Tax Act envisages the consumption of a commodity in the manufacture of another commodity. The goods purchased should be consumed, the consumption should be in the process of manufacture, and the result must be the manufacture of other goods. There are several criteria for determining whether a commodity is consumed in the manufacture of another. The generally prevalent test is whether the article produced is regarded in the trade, by those who deal in it, as distinct in identity from the commodity involved in its manufacture. Commonly, manufacture is the end result of one or more processes through which the original commodity is made to pass. The nature and extent of processing may vary from one case to another, and indeed there may be several stages of processing and perhaps a different kind of processing at each stage. With each process suffered, the original commodity experiences a change. But it is only when the change, or a series of changes, take the commodity to the point where commercially it can no longer be regarded as the original commodity but instead is recognised as a new and distinct article that a manufacture can be said to take place. Where there is no essential difference in identity between the original commodity and the processed article it is not possible to say that one commodity has been consumed in the manufacture of another. Although it has undergone a degree of processing, it must be regarded as still retaining its original identityA large number of cases has been placed before us by the parties, and in each of them the same principle has been applied: Does the processing of the original commodity bring into existence a commercially different and distinct article ? Some of the cases where it was held by this Court that a different commercial article had come into existence include Anwarkhan Mehboob Co. v. The State of Bombay and Others (where raw tobacco was manufactured into bidi patti), A Hajee Abdul Shukoor and Co. v. The State of Madras (raw hides and skins constituted a different commodity from dressed hides and skins with different physical properties), The State of Madras v. Swasthik Tobacco Factory (raw tobacco manufactured into chewing tobacco) and Ganesh Trading Co. Karnal v. State of Haryana and Another, (paddy dehus ked into rice). On the other side, cases where this Court has held that although the original commodity has undergone a degree of processing it has not lost its original identity include Tungabhadra Industries Ltd., Kurnool v. Commercial Tax Officer, Kurnool (where hydrogenated groundnut oil was regarded as groundnut oil) and Commissioner of Sales Tax, U.P., Lucknow v. Harbilas Rai and sons (where bristles plucked from pigs, boiled, washed with soap and other chemicals and sorted out in bundles according to their size and colour were regarded as remaining the same commercial commodity, pigs bristles)In the present case, there is no essential difference between pineapple fruit and the canned pineapple slices. The dealer and the consumer regard both as pineapple. The only difference is that the sliced pineapple is a presentation of fruit in a more convenient form and by reason of being canned it is capable of storage without spoiling. The additional sweetness in the canned pineapple arises from the sugar added as a preservative. On a total impression, it seems to us, the pineapple slices must be held to possess the same identity as the original pineapple fruitThe comment applies fully in the case before usAlthough a degree of processing is involved in preparing pineapple slices from the original fruit, the commodity continues to possess its original identity, notwithstanding the removal of inedible portions , the slicing and thereafter canning it on adding sugar to preserve itThe higher price, it seems to us, is occasioned only because of the labour put into making the fruit more readily consumable and because of the can employed to contain it. It is not as if the higher price is claimed because it is a different commercial commodity. It is said that pineapple slices appeal to a different sector of the trade and that when a customer asks for a can of pineapple slices he has in mind something very different from fresh pineapple fruit. Here again, the distinction in the mind of the consumer arises not from any difference in the essential identity of the two, but is derived from the mere form in which the fruit is desiredThere is a fallacy in the submission. The clause, truly read, speaks of goods consumed in the manufacture of other goods for sale or goods consumed in the manufacture of other goods for purposes other than sale.
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Dene l(Proprietary Limited) Vs. Bharat Electronics Ltd. and Another | arbitrator, only the `named person in the Clause-10 can be appointed and, therefore, the petitioner- company cannot request for appointment of independent arbitrator for resolving disputes, if any, between the parties. The learned counsel relies on the observations made by this Court in the case of You One Engineering & Construction Co. Ltd. & Anr. Vs. National Highways Authority of India (NHAI), [(2006) 4 SCC 372] . It is stated in the said decision: "Although the learned counsel for the petitioners contended that this is a situation falling within the contemplation of clause (c) of Section 11(6) of the Act, namely, that the institution i.e. IRC failing to perform the function entrusted to it under the appointment procedure, I am not satisfied. Under the appointment procedure agreed to under clause 67.3, each of the parties to the dispute is required to nominate its arbitrator and the third arbitrator is to be chosen by the two arbitrators appointed by the parties and he shall act as the presiding arbitrator. Clause 67.3(ii) provides that in case of the failure of the two arbitrators appointed by the parties to reach upon a consensus within a period of 30 days from the appointment of the arbitrator appointed subsequently, the presiding arbitrator shall be appointed by the President of the Indian Roads Congress." 18) The petitioner has prayed before this Court for the appointment of the sole arbitrator. The petitioner has submitted, that, it is clear from the invoices and the correspondence between the parties particularly dated 4th May 2005 and 8th June 2006, that the respondent has not disputed the liability of payment due to the petitioner. Therefore, as the respondent now seeks to avoid the payment of the amount due to the petitioner, there is dispute between the parties which requires to be referred for arbitration before the arbitrator. 19) Clause 10 of the `General Terms and Conditions to Purchase Order does constitute a valid arbitration clause as it shows the intention of the parties to appoint an arbitrator and refer the dispute between the parties for the arbitration proceedings under the Arbitration and Conciliation Act 1996. The wordings of Clause 10 are as follows: "ARBITRATION: All disputes regarding this order shall be referred to our Managing Director or his nominee for arbitration who shall have all powers conferred by Indian Arbitration and Conciliation Bill, 1996 for the time in force." 20) Section 11 of the Act provides for the appointment of arbitrators and sub-section (6) of Section 11 of the Act under which the present petition is before this Court reads as under: "6) Where, under an appointment procedure agreed upon by the parties, - (a) A party fails to act as required under that procedure; or (b) The parties, or the two appointed arbitrators, fail to reach an agreement expected of them under that procedure; or (c) A person, including an institution, fails to perform any function entrusted to him or it under that procedure, A party may request the Chief Justice or any person or institution designated by him to take the necessary measure, unless the agreement on the appointment procedure provides other means for securing the appointment" 21) Sub-section (6) of Section 11 of the Act provides, that, when the parties fail to reach to an agreement as regards the appointment of the arbitrator, can request the Chief Justice or any person or institution designated by him to come to the rescue of the parties. Therefore, petitioner in the present case has sought the appointment of the arbitrator by this Court so that the dispute between the parties can be resolved. 22) In the case of Datar Switchgears Ltd. v. Tata Finance Ltd. & Anr., [(2000) 8 SCC 151] , this Court while considering the powers of the Court to appoint arbitrator under Section 8 of the Arbitration Act, 1940, cited the decision of this Court in the case of Bhupinder Singh Bindra v. Union of India and Anr. [AIR1995 SC 2464]. It was held in that case that "It is settled law that court cannot interpose and interdict the appointment of an arbitrator, whom the parties have chosen under the terms of the contract unless legal misconduct of the arbitrator, fraud, disqualification etc. is pleaded and proved. It is not in the power of the party at his own will or pleasure to revoke the authority of the arbitrator appointed with his consent. There must be just and sufficient cause for revocation." The said principle has to abide by in the normal course. However, considering the peculiar conditions in the present case, whereby the arbitrator sought to be appointed under the arbitration clause, is the Managing Director of the company against whom the dispute is raised (the Respondents). In addition to that, the said Managing Director of Bharat Electronics Ltd which is a `Government Company, is also bound by the direction/instruction issued by his superior authorities. It is also the case of the respondent in the reply to the notice issued by the respondent, though it is liable to pay the amount due under the Purchase Orders, it is not in a position to settle the dues only because of the directions issued by Ministry of Defence, Government of India. It only shows that the Managing Director may not be in a position to independently decide the dispute between the parties. 23) The facts narrated by me would clearly demonstrate that there is a dispute between the parties in regard to payment of certain amounts towards Purchase Orders/Invoice. Since, there is a failure on the part of the respondent in making appointment of an arbitrator for resolving the dispute in accordance with the understanding of the parties which is reflected in the Purchase Order, the prayer of the petitioner requires to be granted. 24) Before parting with the case, in my considered opinion, the decision on which reliance is placed by Shri S.N. Bhat, learned counsel for the respondent, would not assist him to drive home his point. | 1[ds]n (6) of Section 11 of the Act provides, that, when the parties fail to reach to an agreement as regards the appointment of the arbitrator, can request the Chief Justice or any person or institution designated by him to come to the rescue of the parties. Therefore, petitioner in the present case has sought the appointment of the arbitrator by this Court so that the dispute between the parties can be resolved22) In the case of Datar Switchgears Ltd. v. Tata Finance Ltd. & Anr., [(2000) 8 SCC 151] , this Court while considering the powers of the Court to appoint arbitrator under Section 8 of the Arbitration Act, 1940, cited the decision of this Court in the case of Bhupinder Singh Bindra v. Union of India and Anr. [AIR1995 SC 2464]. It was held in that case that "It is settled law that court cannot interpose and interdict the appointment of an arbitrator, whom the parties have chosen under the terms of the contract unless legal misconduct of the arbitrator, fraud, disqualification etc. is pleaded and proved. It is not in the power of the party at his own will or pleasure to revoke the authority of the arbitrator appointed with his consent. There must be just and sufficient cause for revocation." The said principle has to abide by in the normal course. However, considering the peculiar conditions in the present case, whereby the arbitrator sought to be appointed under the arbitration clause, is the Managing Director of the company against whom the dispute is raised (the Respondents). In addition to that, the said Managing Director of Bharat Electronics Ltd which is a `Government Company, is also bound by the direction/instruction issued by his superior authorities. It is also the case of the respondent in the reply to the notice issued by the respondent, though it is liable to pay the amount due under the Purchase Orders, it is not in a position to settle the dues only because of the directions issued by Ministry of Defence, Government of India. It only shows that the Managing Director may not be in a position to independently decide the dispute between the parties23) The facts narrated by me would clearly demonstrate that there is a dispute between the parties in regard to payment of certain amounts towards Purchase Orders/Invoice. Since, there is a failure on the part of the respondent in making appointment of an arbitrator for resolving the dispute in accordance with the understanding of the parties which is reflected in the Purchase Order, the prayer of the petitioner requires to be granted24) Before parting with the case, in my considered opinion, the decision on which reliance is placed by Shri S.N. Bhat, learned counsel for the respondent, would not assist him to drive home his point. | 1 | 3,057 | 527 | ### Instruction:
Estimate the outcome of the case (positive (1) or negative (0) for the appellant) and then give a reasoned explanation by examining important sentences within the case documentation.
### Input:
arbitrator, only the `named person in the Clause-10 can be appointed and, therefore, the petitioner- company cannot request for appointment of independent arbitrator for resolving disputes, if any, between the parties. The learned counsel relies on the observations made by this Court in the case of You One Engineering & Construction Co. Ltd. & Anr. Vs. National Highways Authority of India (NHAI), [(2006) 4 SCC 372] . It is stated in the said decision: "Although the learned counsel for the petitioners contended that this is a situation falling within the contemplation of clause (c) of Section 11(6) of the Act, namely, that the institution i.e. IRC failing to perform the function entrusted to it under the appointment procedure, I am not satisfied. Under the appointment procedure agreed to under clause 67.3, each of the parties to the dispute is required to nominate its arbitrator and the third arbitrator is to be chosen by the two arbitrators appointed by the parties and he shall act as the presiding arbitrator. Clause 67.3(ii) provides that in case of the failure of the two arbitrators appointed by the parties to reach upon a consensus within a period of 30 days from the appointment of the arbitrator appointed subsequently, the presiding arbitrator shall be appointed by the President of the Indian Roads Congress." 18) The petitioner has prayed before this Court for the appointment of the sole arbitrator. The petitioner has submitted, that, it is clear from the invoices and the correspondence between the parties particularly dated 4th May 2005 and 8th June 2006, that the respondent has not disputed the liability of payment due to the petitioner. Therefore, as the respondent now seeks to avoid the payment of the amount due to the petitioner, there is dispute between the parties which requires to be referred for arbitration before the arbitrator. 19) Clause 10 of the `General Terms and Conditions to Purchase Order does constitute a valid arbitration clause as it shows the intention of the parties to appoint an arbitrator and refer the dispute between the parties for the arbitration proceedings under the Arbitration and Conciliation Act 1996. The wordings of Clause 10 are as follows: "ARBITRATION: All disputes regarding this order shall be referred to our Managing Director or his nominee for arbitration who shall have all powers conferred by Indian Arbitration and Conciliation Bill, 1996 for the time in force." 20) Section 11 of the Act provides for the appointment of arbitrators and sub-section (6) of Section 11 of the Act under which the present petition is before this Court reads as under: "6) Where, under an appointment procedure agreed upon by the parties, - (a) A party fails to act as required under that procedure; or (b) The parties, or the two appointed arbitrators, fail to reach an agreement expected of them under that procedure; or (c) A person, including an institution, fails to perform any function entrusted to him or it under that procedure, A party may request the Chief Justice or any person or institution designated by him to take the necessary measure, unless the agreement on the appointment procedure provides other means for securing the appointment" 21) Sub-section (6) of Section 11 of the Act provides, that, when the parties fail to reach to an agreement as regards the appointment of the arbitrator, can request the Chief Justice or any person or institution designated by him to come to the rescue of the parties. Therefore, petitioner in the present case has sought the appointment of the arbitrator by this Court so that the dispute between the parties can be resolved. 22) In the case of Datar Switchgears Ltd. v. Tata Finance Ltd. & Anr., [(2000) 8 SCC 151] , this Court while considering the powers of the Court to appoint arbitrator under Section 8 of the Arbitration Act, 1940, cited the decision of this Court in the case of Bhupinder Singh Bindra v. Union of India and Anr. [AIR1995 SC 2464]. It was held in that case that "It is settled law that court cannot interpose and interdict the appointment of an arbitrator, whom the parties have chosen under the terms of the contract unless legal misconduct of the arbitrator, fraud, disqualification etc. is pleaded and proved. It is not in the power of the party at his own will or pleasure to revoke the authority of the arbitrator appointed with his consent. There must be just and sufficient cause for revocation." The said principle has to abide by in the normal course. However, considering the peculiar conditions in the present case, whereby the arbitrator sought to be appointed under the arbitration clause, is the Managing Director of the company against whom the dispute is raised (the Respondents). In addition to that, the said Managing Director of Bharat Electronics Ltd which is a `Government Company, is also bound by the direction/instruction issued by his superior authorities. It is also the case of the respondent in the reply to the notice issued by the respondent, though it is liable to pay the amount due under the Purchase Orders, it is not in a position to settle the dues only because of the directions issued by Ministry of Defence, Government of India. It only shows that the Managing Director may not be in a position to independently decide the dispute between the parties. 23) The facts narrated by me would clearly demonstrate that there is a dispute between the parties in regard to payment of certain amounts towards Purchase Orders/Invoice. Since, there is a failure on the part of the respondent in making appointment of an arbitrator for resolving the dispute in accordance with the understanding of the parties which is reflected in the Purchase Order, the prayer of the petitioner requires to be granted. 24) Before parting with the case, in my considered opinion, the decision on which reliance is placed by Shri S.N. Bhat, learned counsel for the respondent, would not assist him to drive home his point.
### Response:
1
### Explanation:
n (6) of Section 11 of the Act provides, that, when the parties fail to reach to an agreement as regards the appointment of the arbitrator, can request the Chief Justice or any person or institution designated by him to come to the rescue of the parties. Therefore, petitioner in the present case has sought the appointment of the arbitrator by this Court so that the dispute between the parties can be resolved22) In the case of Datar Switchgears Ltd. v. Tata Finance Ltd. & Anr., [(2000) 8 SCC 151] , this Court while considering the powers of the Court to appoint arbitrator under Section 8 of the Arbitration Act, 1940, cited the decision of this Court in the case of Bhupinder Singh Bindra v. Union of India and Anr. [AIR1995 SC 2464]. It was held in that case that "It is settled law that court cannot interpose and interdict the appointment of an arbitrator, whom the parties have chosen under the terms of the contract unless legal misconduct of the arbitrator, fraud, disqualification etc. is pleaded and proved. It is not in the power of the party at his own will or pleasure to revoke the authority of the arbitrator appointed with his consent. There must be just and sufficient cause for revocation." The said principle has to abide by in the normal course. However, considering the peculiar conditions in the present case, whereby the arbitrator sought to be appointed under the arbitration clause, is the Managing Director of the company against whom the dispute is raised (the Respondents). In addition to that, the said Managing Director of Bharat Electronics Ltd which is a `Government Company, is also bound by the direction/instruction issued by his superior authorities. It is also the case of the respondent in the reply to the notice issued by the respondent, though it is liable to pay the amount due under the Purchase Orders, it is not in a position to settle the dues only because of the directions issued by Ministry of Defence, Government of India. It only shows that the Managing Director may not be in a position to independently decide the dispute between the parties23) The facts narrated by me would clearly demonstrate that there is a dispute between the parties in regard to payment of certain amounts towards Purchase Orders/Invoice. Since, there is a failure on the part of the respondent in making appointment of an arbitrator for resolving the dispute in accordance with the understanding of the parties which is reflected in the Purchase Order, the prayer of the petitioner requires to be granted24) Before parting with the case, in my considered opinion, the decision on which reliance is placed by Shri S.N. Bhat, learned counsel for the respondent, would not assist him to drive home his point.
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Mohamed Hussain Gulam Ali Shariffi Vs. Municipal Corporation of Greater Bombay & Others | the building in question known as Haroon Manzil, Ground Floor, 354 S.V.Patel Road, Mumbai (hereinafter referred to as Suit house). 6. Challenging the legality of the notice dated 17.05.2013, the appellant had initially filed a writ petition in the High Court. However, it was withdrawn with a liberty to file the Civil Suit. 7. Accordingly, the appellant filed a Suit in the Bombay City Civil Court, Greater Mumbai challenging the notice dated 17.05.2013 issued under Section 351 of the Act as also letter dated 20.06.2013. The appellant also prayed for injunction restraining respondent No.1 (defendant No.1) from acting upon the notice dated 17.05.2013 and letter dated 20.06.2013. During the pendency of the suit, respondent Nos. 2 and 3 filed an application (Chamber Summons No. 1353 of 2014) seeking permission to implead them as defendants in the suit. It was, inter alia, alleged that respondent Nos. 2 and 3 have an interest in the suit house inasmuch as they claimed to have an ownership rights in the suit house. It was also alleged that one Civil Suit No. 424/2008 seeking specific performance of agreement is filed by respondent Nos. 2 and 3 in relation to the suit house and the same is pending. It was thus prayed that they (respondent Nos. 2 and 3) being necessary parties for proper adjudication of the rights of the parties in relation to the suit house be allowed to become defendants in the suit in question. 8. The appellant as the plaintiff opposed the aforesaid application (Chamber Summons No. 1353/2014) made by respondent Nos. 2 and 3 contending, inter alia, that the application is wholly misconceived and hence liable to be dismissed. It was contended that respondent Nos. 2 and 3 are neither necessary nor proper parties to the suit filed by the appellant whereas the only necessary party to the suit is respondent No.1 for proper adjudication of the dispute for which the suit is filed against respondent No.1. 9. The Trial Court, by order dated 16.10.2014 allowed the application (Chamber Summons No. 1353/2014) filed by respondent Nos. 2 and 3 and permitted them to become party-defendants in the suit. The Trial Court held that respondent Nos. 2 and 3 are proper parties, if not necessary, in the suit. 10. The appellant, felt aggrieved by this order, filed writ petition before the High Court. By impugned order dated 16.11.2016, the High Court dismissed the appellants writ petition giving rise to filing of this appeal by way of special leave petition against the impugned order of the High Court. 11. Heard Mr. Shyam Divan, learned senior counsel for the appellant and Ms. Firdaus Moosa, learned counsel for respondent Nos. 2 & 3. 12. Having heard the learned counsel for the parties and on perusal of the record of the case, we are inclined to allow the appeal and set aside the impugned order. 13. In our considered opinion, having regard to the nature of the controversy, which is the subject matter of the suit, respondent Nos. 2 and 3 are neither necessary nor proper parties. As would be clear from mere perusal of the plaint, the basic question, which is required to be decided in the suit, is whether notice issued under Section 351 of the Act by respondent No. 1 (Corporation) to the appellant is legally valid or not (see prayer(a) in the plaint - page 251 of Volume II of S.L.P.Paper Book). 14. To decide this question, in our considered opinion, the only necessary and proper party to the suit is the Mumbai Municipal Corporation, Greater Mumbai, i.e., Respondent no 1, who has issued such notice, and for deciding this question either way, the presence of respondent Nos. 2 and 3 is not at all required. In other words, the suit can be decided even in the absence of respondent Nos. 2 and 3. 15. It is a settled principle of law, which does not need any authority to support the principle, that the plaintiff being a dominus litis cannot be forced to add any person as party to his suit unless it is held keeping in view the pleadings and the relief claimed therein that a person sought to be added as party is a necessary party and without his presence neither the suit can proceed and nor the relief can be granted. It is only then such person can be allowed to become party, else the suit will have to be dismissed for non-impleadment of such necessary party. Such does not appear to be a case here. 16. We do not find that the presence of respondent Nos. 2 and 3 in the facts of this case is required for deciding the legality of notice impugned in the suit on merits because the dispute centers around the question of legality and validity of the notice which, as mentioned above, arises between respondent No.1, who has issued the notice, and the person to whom it is given, i.e., appellant. 17. In the suit in question, the Court is not called upon to adjudicate the rights between the appellant and respondents Nos. 2 and 3 in relation to the suit house. Any such dispute, if arises, the same can be decided in the separate suit, which is pending between the parties or may be filed, if required, by the parties against each other but such dispute cannot be tried on the cause of action pleaded in the present suit by the appellant where the lis is essentially between the appellant (plaintiff) and respondent No. 1. Merely because the suit house is the subject matter between all the parties is no ground to get the dispute arising between the parties settled in one suit regardless of the nature of cause of action on which the suit is founded. 18. We cannot, therefore, agree with the reasoning of the two Courts that since respondent Nos. 2 and 3 are proper parties (though not necessary) to the suit and, therefore, they should be arrayed as party-defendants. | 1[ds]13. In our considered opinion, having regard to the nature of the controversy, which is the subject matter of the suit, respondent Nos. 2 and 3 are neither necessary nor proper parties. As would be clear from mere perusal of the plaint, the basic question, which is required to be decided in the suit, is whether notice issued under Section 351 of the Act by respondent No. 1 (Corporation) to the appellant is legally valid or not (see prayer(a) in the plaintpage 251 of Volume II of S.L.P.Paper Book)14. To decide this question, in our considered opinion, the only necessary and proper party to the suit is the Mumbai Municipal Corporation, Greater Mumbai, i.e., Respondent no 1, who has issued such notice, and for deciding this question either way, the presence of respondent Nos. 2 and 3 is not at all required. In other words, the suit can be decided even in the absence of respondent Nos. 2 and 315. It is a settled principle of law, which does not need any authority to support the principle, that the plaintiff being a dominus litis cannot be forced to add any person as party to his suit unless it is held keeping in view the pleadings and the relief claimed therein that a person sought to be added as party is a necessary party and without his presence neither the suit can proceed and nor the relief can be granted. It is only then such person can be allowed to become party, else the suit will have to be dismissed fort of such necessary party. Such does not appear to be a case here16. We do not find that the presence of respondent Nos. 2 and 3 in the facts of this case is required for deciding the legality of notice impugned in the suit on merits because the dispute centers around the question of legality and validity of the notice which, as mentioned above, arises between respondent No.1, who has issued the notice, and the person to whom it is given, i.e., appellant17. In the suit in question, the Court is not called upon to adjudicate the rights between the appellant and respondents Nos. 2 and 3 in relation to the suit house. Any such dispute, if arises, the same can be decided in the separate suit, which is pending between the parties or may be filed, if required, by the parties against each other but such dispute cannot be tried on the cause of action pleaded in the present suit by the appellant where the lis is essentially between the appellant (plaintiff) and respondent No. 1. Merely because the suit house is the subject matter between all the parties is no ground to get the dispute arising between the parties settled in one suit regardless of the nature of cause of action on which the suit is founded18. We cannot, therefore, agree with the reasoning of the two Courts that since respondent Nos. 2 and 3 are proper parties (though not necessary) to the suit and, therefore, they should be arrayed as | 1 | 1,365 | 586 | ### Instruction:
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the building in question known as Haroon Manzil, Ground Floor, 354 S.V.Patel Road, Mumbai (hereinafter referred to as Suit house). 6. Challenging the legality of the notice dated 17.05.2013, the appellant had initially filed a writ petition in the High Court. However, it was withdrawn with a liberty to file the Civil Suit. 7. Accordingly, the appellant filed a Suit in the Bombay City Civil Court, Greater Mumbai challenging the notice dated 17.05.2013 issued under Section 351 of the Act as also letter dated 20.06.2013. The appellant also prayed for injunction restraining respondent No.1 (defendant No.1) from acting upon the notice dated 17.05.2013 and letter dated 20.06.2013. During the pendency of the suit, respondent Nos. 2 and 3 filed an application (Chamber Summons No. 1353 of 2014) seeking permission to implead them as defendants in the suit. It was, inter alia, alleged that respondent Nos. 2 and 3 have an interest in the suit house inasmuch as they claimed to have an ownership rights in the suit house. It was also alleged that one Civil Suit No. 424/2008 seeking specific performance of agreement is filed by respondent Nos. 2 and 3 in relation to the suit house and the same is pending. It was thus prayed that they (respondent Nos. 2 and 3) being necessary parties for proper adjudication of the rights of the parties in relation to the suit house be allowed to become defendants in the suit in question. 8. The appellant as the plaintiff opposed the aforesaid application (Chamber Summons No. 1353/2014) made by respondent Nos. 2 and 3 contending, inter alia, that the application is wholly misconceived and hence liable to be dismissed. It was contended that respondent Nos. 2 and 3 are neither necessary nor proper parties to the suit filed by the appellant whereas the only necessary party to the suit is respondent No.1 for proper adjudication of the dispute for which the suit is filed against respondent No.1. 9. The Trial Court, by order dated 16.10.2014 allowed the application (Chamber Summons No. 1353/2014) filed by respondent Nos. 2 and 3 and permitted them to become party-defendants in the suit. The Trial Court held that respondent Nos. 2 and 3 are proper parties, if not necessary, in the suit. 10. The appellant, felt aggrieved by this order, filed writ petition before the High Court. By impugned order dated 16.11.2016, the High Court dismissed the appellants writ petition giving rise to filing of this appeal by way of special leave petition against the impugned order of the High Court. 11. Heard Mr. Shyam Divan, learned senior counsel for the appellant and Ms. Firdaus Moosa, learned counsel for respondent Nos. 2 & 3. 12. Having heard the learned counsel for the parties and on perusal of the record of the case, we are inclined to allow the appeal and set aside the impugned order. 13. In our considered opinion, having regard to the nature of the controversy, which is the subject matter of the suit, respondent Nos. 2 and 3 are neither necessary nor proper parties. As would be clear from mere perusal of the plaint, the basic question, which is required to be decided in the suit, is whether notice issued under Section 351 of the Act by respondent No. 1 (Corporation) to the appellant is legally valid or not (see prayer(a) in the plaint - page 251 of Volume II of S.L.P.Paper Book). 14. To decide this question, in our considered opinion, the only necessary and proper party to the suit is the Mumbai Municipal Corporation, Greater Mumbai, i.e., Respondent no 1, who has issued such notice, and for deciding this question either way, the presence of respondent Nos. 2 and 3 is not at all required. In other words, the suit can be decided even in the absence of respondent Nos. 2 and 3. 15. It is a settled principle of law, which does not need any authority to support the principle, that the plaintiff being a dominus litis cannot be forced to add any person as party to his suit unless it is held keeping in view the pleadings and the relief claimed therein that a person sought to be added as party is a necessary party and without his presence neither the suit can proceed and nor the relief can be granted. It is only then such person can be allowed to become party, else the suit will have to be dismissed for non-impleadment of such necessary party. Such does not appear to be a case here. 16. We do not find that the presence of respondent Nos. 2 and 3 in the facts of this case is required for deciding the legality of notice impugned in the suit on merits because the dispute centers around the question of legality and validity of the notice which, as mentioned above, arises between respondent No.1, who has issued the notice, and the person to whom it is given, i.e., appellant. 17. In the suit in question, the Court is not called upon to adjudicate the rights between the appellant and respondents Nos. 2 and 3 in relation to the suit house. Any such dispute, if arises, the same can be decided in the separate suit, which is pending between the parties or may be filed, if required, by the parties against each other but such dispute cannot be tried on the cause of action pleaded in the present suit by the appellant where the lis is essentially between the appellant (plaintiff) and respondent No. 1. Merely because the suit house is the subject matter between all the parties is no ground to get the dispute arising between the parties settled in one suit regardless of the nature of cause of action on which the suit is founded. 18. We cannot, therefore, agree with the reasoning of the two Courts that since respondent Nos. 2 and 3 are proper parties (though not necessary) to the suit and, therefore, they should be arrayed as party-defendants.
### Response:
1
### Explanation:
13. In our considered opinion, having regard to the nature of the controversy, which is the subject matter of the suit, respondent Nos. 2 and 3 are neither necessary nor proper parties. As would be clear from mere perusal of the plaint, the basic question, which is required to be decided in the suit, is whether notice issued under Section 351 of the Act by respondent No. 1 (Corporation) to the appellant is legally valid or not (see prayer(a) in the plaintpage 251 of Volume II of S.L.P.Paper Book)14. To decide this question, in our considered opinion, the only necessary and proper party to the suit is the Mumbai Municipal Corporation, Greater Mumbai, i.e., Respondent no 1, who has issued such notice, and for deciding this question either way, the presence of respondent Nos. 2 and 3 is not at all required. In other words, the suit can be decided even in the absence of respondent Nos. 2 and 315. It is a settled principle of law, which does not need any authority to support the principle, that the plaintiff being a dominus litis cannot be forced to add any person as party to his suit unless it is held keeping in view the pleadings and the relief claimed therein that a person sought to be added as party is a necessary party and without his presence neither the suit can proceed and nor the relief can be granted. It is only then such person can be allowed to become party, else the suit will have to be dismissed fort of such necessary party. Such does not appear to be a case here16. We do not find that the presence of respondent Nos. 2 and 3 in the facts of this case is required for deciding the legality of notice impugned in the suit on merits because the dispute centers around the question of legality and validity of the notice which, as mentioned above, arises between respondent No.1, who has issued the notice, and the person to whom it is given, i.e., appellant17. In the suit in question, the Court is not called upon to adjudicate the rights between the appellant and respondents Nos. 2 and 3 in relation to the suit house. Any such dispute, if arises, the same can be decided in the separate suit, which is pending between the parties or may be filed, if required, by the parties against each other but such dispute cannot be tried on the cause of action pleaded in the present suit by the appellant where the lis is essentially between the appellant (plaintiff) and respondent No. 1. Merely because the suit house is the subject matter between all the parties is no ground to get the dispute arising between the parties settled in one suit regardless of the nature of cause of action on which the suit is founded18. We cannot, therefore, agree with the reasoning of the two Courts that since respondent Nos. 2 and 3 are proper parties (though not necessary) to the suit and, therefore, they should be arrayed as
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State Of A.P Vs. K.Punardana Rao | and that he had gone to Chirala and attended the Panchayat at the instance of DW3 Major D. Samuel in Chirala. The respondent also contended that on chemical test his fingers were found to be positive only as he had shaken hands with PW-1 and his pyjama pockets were also contaminated with chemical substance as a mediator of the trap party had searched his pockets for the tainted money.3. The learned Single Judge held that there were certain discrepancies in the evidence of PW1. It was noted that the complainant received notice in respect of M/s. Sri Lakshmi Oil Mill & Company whereas the assessment was in respect of M/s. Sri Bharatha Lakshmi Traders. PW1 claimed that he was the proprietor of the M/s. Bharatha Lakshmi Traders as well as Shri Lakshmi Oil Mill & Company. Admittedly, the notices were issued by the respondent to the complainant. Whether the assessment related to M/s. Sri Lakshmi Oil Mill & Company or M/s. Bharatha Lakshmi Traders is inconsequential, as the assessment of both these concerns had to be finally settled by the respondent Officer. The High Court also was of the view that the turnover of M/s. Sri Bharatha Lakshmi Traders was only Rs. 1,55,750/-; therefore, the tax payable was only Rs. 6000/- or Rs. 7000/- and the complainant could not have agreed to pay Rs. 20,000/- as bribe. But it has come in evidence that the total annual turnover of M/s. Bharatha Lakshmi Traders, which was also a concern of the complainant was Rs. 30-40 lakhs. The whole question was whether the evidence of PW1 could be relied on. According to the respondent the complainant had visited his house in the early morning of 9.8.1992 for some work and sought time for submitting account books and the respondent asked him to come to his office. Thereafter his servant DW-4 found a bundle of notes lying on the sofa set. DW-4 immediately told the respondent about the same whereupon the respondent instructed DW-4 to go and find out whether the complainant had gone and to give him back the money he had left. DW-4 went out and found that the complainant had already left the place and, therefore, he gave the money to the respondent who kept the same underneath the pillow in his bedroom. The explanation offered by the respondent is highly improbable. DW-4 gave evidence in support of the defence set up by the respondent. But his evidence was not at all reliable and even the High Court found that the evidence of DW-4 did not inspire confidence. 4. In this case, it is proved by satisfactory evidence that PW1 went to the house of the respondent and the trap party was able to recover the money from the possession of the respondent. The phenolphthalein test conducted on the hands, pyjama and bed cover of the respondent proved to be positive. The explanation of the respondent that he shook hands with PW-1 and thus his hands got contaminated with chemical substance, is highly improbable.5. According to the respondent, he had no prior appointment with PW1 and how Rs. 20,000/- happened to be in his possession is not satisfactorily explained. The defence version supported by the evidence of DW-4 is highly improbable and no court of law can accept such improbable version. The alibi set up by the respondent that on 8.8.1992, he was not in Naidupet, also is not free from suspicion. The examination of railway officials proved that the respondent had travelled from Naidupet to Chirala in Hyderabad Express. The respondent had no reservation tickets and he stated that he had produced two tickets with certain specified number. How he could have remembered the number of tickets creates some doubt. Moreover, there is nothing on record to show that the respondent had availed leave on 7.8.1992, the day on which he is alleged to have left Naidupet. DW-4 gave the evidence to the effect that he had received a leave letter from the respondent to be handed over to an employee working in his office, but in fact, he did not hand over any such letter. It is important to note that there was no enmity alleged against PW-1. He is an independent witness having two business concerns and the matters relating to tax on the said two firms come within the jurisdiction of the respondent Officer. 6. The High Court committed a serious error by rejecting the evidence of PW1 and the evidence of the accompanying witnesses of the trap party. The recovery of the tainted money from the respondent coupled with the evidence of PW1 clearly establishes that the respondent did receive a bribe and thus committed the offence under section 13(1)(d) read with Section 13(2) of the Prevention of Corruption Act, 1988. The defence evidence adduced by the respondent was not able to cast any suspicion on the prosecution case.7. We are quite aware that this being an appeal against acquittal, this Court would be slow in reversing the acquittal, when the High Court has taken a reasonable view of the evidence as adduced by the prosecution; but if there is perverse appreciation of evidence and serious miscarriage of justice, the acquittal of the accused is to be reversed. This is one such case where the High Court failed to appreciate the evidence in the correct perspective. Minor flaws in the prosecution evidence were given undue importance and the impeccable evidence which unmistakably proved the guilt of the respondent was ignored. Therefore, we are of the view that the acquittal of the accused was clearly erroneous and the same is reversed. We find the respondent guilty of the offence punishable under Section 13(1)(d) read with Section 13(2) of the Prevention of Corruption Act, 1988. On each count, the appellant is sentenced to undergo imprisonment for a period of one year. The sentence on both counts shall run concurrently. The cash amount of Rs. 20,000/- recovered during the course of investigation shall be returned to PW1. 8. | 1[ds]The High Court committed a serious error by rejecting the evidence of PW1 and the evidence of the accompanying witnesses of the trap party. The recovery of the tainted money from the respondent coupled with the evidence of PW1 clearly establishes that the respondent did receive a bribe and thus committed the offence under section 13(1)(d) read with Section 13(2) of the Prevention of Corruption Act, 1988. The defence evidence adduced by the respondent was not able to cast any suspicion on the prosecution case.7. We are quite aware that this being an appeal against acquittal, this Court would be slow in reversing the acquittal, when the High Court has taken a reasonable view of the evidence as adduced by the prosecution; but if there is perverse appreciation of evidence and serious miscarriage of justice, the acquittal of the accused is to be reversed. This is one such case where the High Court failed to appreciate the evidence in the correct perspective. Minor flaws in the prosecution evidence were given undue importance and the impeccable evidence which unmistakably proved the guilt of the respondent was ignored. Therefore, we are of the view that the acquittal of the accused was clearly erroneous and the same is reversed. We find the respondent guilty of the offence punishable under Section 13(1)(d) read with Section 13(2) of the Prevention of Corruption Act, 1988. On each count, the appellant is sentenced to undergo imprisonment for a period of one year. The sentence on both counts shall run concurrently. The cash amount of Rs. 20,000/- recovered during the course of investigation shall be returned to PW1. | 1 | 1,612 | 312 | ### Instruction:
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and that he had gone to Chirala and attended the Panchayat at the instance of DW3 Major D. Samuel in Chirala. The respondent also contended that on chemical test his fingers were found to be positive only as he had shaken hands with PW-1 and his pyjama pockets were also contaminated with chemical substance as a mediator of the trap party had searched his pockets for the tainted money.3. The learned Single Judge held that there were certain discrepancies in the evidence of PW1. It was noted that the complainant received notice in respect of M/s. Sri Lakshmi Oil Mill & Company whereas the assessment was in respect of M/s. Sri Bharatha Lakshmi Traders. PW1 claimed that he was the proprietor of the M/s. Bharatha Lakshmi Traders as well as Shri Lakshmi Oil Mill & Company. Admittedly, the notices were issued by the respondent to the complainant. Whether the assessment related to M/s. Sri Lakshmi Oil Mill & Company or M/s. Bharatha Lakshmi Traders is inconsequential, as the assessment of both these concerns had to be finally settled by the respondent Officer. The High Court also was of the view that the turnover of M/s. Sri Bharatha Lakshmi Traders was only Rs. 1,55,750/-; therefore, the tax payable was only Rs. 6000/- or Rs. 7000/- and the complainant could not have agreed to pay Rs. 20,000/- as bribe. But it has come in evidence that the total annual turnover of M/s. Bharatha Lakshmi Traders, which was also a concern of the complainant was Rs. 30-40 lakhs. The whole question was whether the evidence of PW1 could be relied on. According to the respondent the complainant had visited his house in the early morning of 9.8.1992 for some work and sought time for submitting account books and the respondent asked him to come to his office. Thereafter his servant DW-4 found a bundle of notes lying on the sofa set. DW-4 immediately told the respondent about the same whereupon the respondent instructed DW-4 to go and find out whether the complainant had gone and to give him back the money he had left. DW-4 went out and found that the complainant had already left the place and, therefore, he gave the money to the respondent who kept the same underneath the pillow in his bedroom. The explanation offered by the respondent is highly improbable. DW-4 gave evidence in support of the defence set up by the respondent. But his evidence was not at all reliable and even the High Court found that the evidence of DW-4 did not inspire confidence. 4. In this case, it is proved by satisfactory evidence that PW1 went to the house of the respondent and the trap party was able to recover the money from the possession of the respondent. The phenolphthalein test conducted on the hands, pyjama and bed cover of the respondent proved to be positive. The explanation of the respondent that he shook hands with PW-1 and thus his hands got contaminated with chemical substance, is highly improbable.5. According to the respondent, he had no prior appointment with PW1 and how Rs. 20,000/- happened to be in his possession is not satisfactorily explained. The defence version supported by the evidence of DW-4 is highly improbable and no court of law can accept such improbable version. The alibi set up by the respondent that on 8.8.1992, he was not in Naidupet, also is not free from suspicion. The examination of railway officials proved that the respondent had travelled from Naidupet to Chirala in Hyderabad Express. The respondent had no reservation tickets and he stated that he had produced two tickets with certain specified number. How he could have remembered the number of tickets creates some doubt. Moreover, there is nothing on record to show that the respondent had availed leave on 7.8.1992, the day on which he is alleged to have left Naidupet. DW-4 gave the evidence to the effect that he had received a leave letter from the respondent to be handed over to an employee working in his office, but in fact, he did not hand over any such letter. It is important to note that there was no enmity alleged against PW-1. He is an independent witness having two business concerns and the matters relating to tax on the said two firms come within the jurisdiction of the respondent Officer. 6. The High Court committed a serious error by rejecting the evidence of PW1 and the evidence of the accompanying witnesses of the trap party. The recovery of the tainted money from the respondent coupled with the evidence of PW1 clearly establishes that the respondent did receive a bribe and thus committed the offence under section 13(1)(d) read with Section 13(2) of the Prevention of Corruption Act, 1988. The defence evidence adduced by the respondent was not able to cast any suspicion on the prosecution case.7. We are quite aware that this being an appeal against acquittal, this Court would be slow in reversing the acquittal, when the High Court has taken a reasonable view of the evidence as adduced by the prosecution; but if there is perverse appreciation of evidence and serious miscarriage of justice, the acquittal of the accused is to be reversed. This is one such case where the High Court failed to appreciate the evidence in the correct perspective. Minor flaws in the prosecution evidence were given undue importance and the impeccable evidence which unmistakably proved the guilt of the respondent was ignored. Therefore, we are of the view that the acquittal of the accused was clearly erroneous and the same is reversed. We find the respondent guilty of the offence punishable under Section 13(1)(d) read with Section 13(2) of the Prevention of Corruption Act, 1988. On each count, the appellant is sentenced to undergo imprisonment for a period of one year. The sentence on both counts shall run concurrently. The cash amount of Rs. 20,000/- recovered during the course of investigation shall be returned to PW1. 8.
### Response:
1
### Explanation:
The High Court committed a serious error by rejecting the evidence of PW1 and the evidence of the accompanying witnesses of the trap party. The recovery of the tainted money from the respondent coupled with the evidence of PW1 clearly establishes that the respondent did receive a bribe and thus committed the offence under section 13(1)(d) read with Section 13(2) of the Prevention of Corruption Act, 1988. The defence evidence adduced by the respondent was not able to cast any suspicion on the prosecution case.7. We are quite aware that this being an appeal against acquittal, this Court would be slow in reversing the acquittal, when the High Court has taken a reasonable view of the evidence as adduced by the prosecution; but if there is perverse appreciation of evidence and serious miscarriage of justice, the acquittal of the accused is to be reversed. This is one such case where the High Court failed to appreciate the evidence in the correct perspective. Minor flaws in the prosecution evidence were given undue importance and the impeccable evidence which unmistakably proved the guilt of the respondent was ignored. Therefore, we are of the view that the acquittal of the accused was clearly erroneous and the same is reversed. We find the respondent guilty of the offence punishable under Section 13(1)(d) read with Section 13(2) of the Prevention of Corruption Act, 1988. On each count, the appellant is sentenced to undergo imprisonment for a period of one year. The sentence on both counts shall run concurrently. The cash amount of Rs. 20,000/- recovered during the course of investigation shall be returned to PW1.
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Brij Bhushan And Another Vs. The State Of Delhi | Mahajan, J.(1) A decree for pre-emption of the property in suit was passed in favour of the plaintiff and he was ordered to deposit the sale price within two months from the date of the decree. An appeal was taken against this decision but it was withdrawn. The pre-emption money was not deposited within the time fixed in the decree. The pre-emptor made an application to the court for making the deposit without disclosing that the time fixed by the decree had elapsed. The application was allowed. The defendant, when apprised of the situation, made an application to the court to the effect that the plaintiffs suit stood dismissed owing to his failure in making the deposit in time and that he was not entitled to execute the decree. The trial Judge held that the pre-emption money not having been paid within the time fixed in the decree the suit stood dismissed. On appeal this decision was set aside but on second appeal it was restored and it was held that the suit stood dismissed under Order 20, Rule 14, Civil Procedure Code. Against this decision an appeal was preferred to the Judicial Committee of the State and it is now before us under Article 374(4) of the Constitution.(2) It was contended on behalf of the appellant that the decision of the High Court was wrong inasmuch as an appeal having been preferred from the trial courts decree in the pre-emption suit, the pre-emptor was justified in not depositing the amount within the time fixed by the decree. This argument cannot be sustained. Mere filing of an appeal does not suspend the decree of the trial Judge and unless that decree is altered in any manner by the court of appeal, the pre-emptor is bound to comply with its directions.(3) In our opinion, the High Court was right in holding that the pre-emptors suit stood dismissed by reason of his default in not depositing the pre-emption price within the time fixed in the trial Courts decree. It was next contended that the decree drawn up by the trial Judge was not in accordance with the provisions of Order 20 Rule 14 in that it contained no direction to the effect that if the deposit was not made within the time fixed the suit will stand dismissed.(4) In our view, this contention is not sound because the dismissal of the suit is as a result of the mandatory provisions of Order 20 Rule 14 and not by reason of any decision of the Court and the omission to incorporate this direction in the decree could not in any way affect the rights of the parties.(5) | 0[ds]In our opinion, the High Court was right in holding that thesuit stood dismissed by reason of his default in not depositing theprice within the time fixed in the trial Courts decree. It was next contended that the decree drawn up by the trial Judge was not in accordance with the provisions of Order 20 Rule 14 in that it contained no direction to the effect that if the deposit was not made within the time fixed the suit will standour view, this contention is not sound because the dismissal of the suit is as a result of the mandatory provisions of Order 20 Rule 14 and not by reason of any decision of the Court and the omission to incorporate this direction in the decree could not in any way affect the rights of the parties. | 0 | 488 | 145 | ### Instruction:
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Mahajan, J.(1) A decree for pre-emption of the property in suit was passed in favour of the plaintiff and he was ordered to deposit the sale price within two months from the date of the decree. An appeal was taken against this decision but it was withdrawn. The pre-emption money was not deposited within the time fixed in the decree. The pre-emptor made an application to the court for making the deposit without disclosing that the time fixed by the decree had elapsed. The application was allowed. The defendant, when apprised of the situation, made an application to the court to the effect that the plaintiffs suit stood dismissed owing to his failure in making the deposit in time and that he was not entitled to execute the decree. The trial Judge held that the pre-emption money not having been paid within the time fixed in the decree the suit stood dismissed. On appeal this decision was set aside but on second appeal it was restored and it was held that the suit stood dismissed under Order 20, Rule 14, Civil Procedure Code. Against this decision an appeal was preferred to the Judicial Committee of the State and it is now before us under Article 374(4) of the Constitution.(2) It was contended on behalf of the appellant that the decision of the High Court was wrong inasmuch as an appeal having been preferred from the trial courts decree in the pre-emption suit, the pre-emptor was justified in not depositing the amount within the time fixed by the decree. This argument cannot be sustained. Mere filing of an appeal does not suspend the decree of the trial Judge and unless that decree is altered in any manner by the court of appeal, the pre-emptor is bound to comply with its directions.(3) In our opinion, the High Court was right in holding that the pre-emptors suit stood dismissed by reason of his default in not depositing the pre-emption price within the time fixed in the trial Courts decree. It was next contended that the decree drawn up by the trial Judge was not in accordance with the provisions of Order 20 Rule 14 in that it contained no direction to the effect that if the deposit was not made within the time fixed the suit will stand dismissed.(4) In our view, this contention is not sound because the dismissal of the suit is as a result of the mandatory provisions of Order 20 Rule 14 and not by reason of any decision of the Court and the omission to incorporate this direction in the decree could not in any way affect the rights of the parties.(5)
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### Explanation:
In our opinion, the High Court was right in holding that thesuit stood dismissed by reason of his default in not depositing theprice within the time fixed in the trial Courts decree. It was next contended that the decree drawn up by the trial Judge was not in accordance with the provisions of Order 20 Rule 14 in that it contained no direction to the effect that if the deposit was not made within the time fixed the suit will standour view, this contention is not sound because the dismissal of the suit is as a result of the mandatory provisions of Order 20 Rule 14 and not by reason of any decision of the Court and the omission to incorporate this direction in the decree could not in any way affect the rights of the parties.
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Pramod Jha Vs. State Of Bihar | and that the State had not taken steps to deliver the amount in respect of each employee at his doorsteps by the relevant date. It was urged that the tender of compensation under Section 25F, in order to be valid, should be of the precise amount and should be made simultaneously with termination of the service. It was found that the bank drafts in respect of individual employees were dispatched in time so as to reach Divisional/ Sub-Divisional Offices of the employer well in advance of the date of expiry of the notice period and the date on which the retrenchment was to be effective. The amounts were not actually paid or tendered to the workers directly but a method for disbursement of compensation was evolved in the interest of workers” convenience. Instead of the workers, spread out all over the State, being asked to come to the Head Office to collect the amount of compensation and the difficulty of the employer in making available the compensation at the doorstep of each employee, an arrangement was made whereby the workers could go to the nearest Divisional /Sub-Divisional Office and collect the amount of compensation due to them. None of the workers ascertained whether the amounts sent by the Head Office to the Divisional/ Sub-Divisional Offices were the correct amounts. No instance was pointed out to show that the bank drafts were not for the correct amounts. The High Court felt satisfied that the individual compensation drafts were sent to the various subordinate offices ready for disbursement to the concerned workers on or before the relevant date. It was held that there was sufficient compliance with the provisions of clause (b) of Section 25F. This Court agreed with the view of the High Court. 14. In The Management of Delhi Transport Undertaking vs. The Industrial Tribunal, Delhi and Anr. (1965) 1 SCR 998 pari materia provision as to payment of compensation equivalent to one month”s wages to workmen contained in proviso to sub-section (2) of Section 33 of ID Act came up for the consideration of this Court. It was held that the proviso did not mean that the wages for one month have to be actually paid; the employer is expected to tender the amount before the dismissal but cannot force the employee to receive the payment before dismissal becomes effective. The making of the tender of the amount, before the order of dismissal becomes effective, would be sufficient compliance. 15. In Sain Steel Products (supra), which is a two-Judge Bench decision of this Court, the worker was informed "to collect what is due to him" without spelling out whether or not it included the amount as contemplated under Section 25F. It was in such peculiar facts and circumstances of the case that this Court refused to accept the offer in the terms in which it was made and quoted hereinabove as amounting to making an office in terms of Section 25F of the Act. Both the Labour Court and the High Court had recorded a finding of fact that Section 25f(b) was not complied with. Sain Steel Products case (supra) is clearly distinguishable and has no application to the facts of the present case. 16. In the case before us the workmen have been given one month”s notice in writing. The reasons for retrechment have been indicated. An opportunity of hearing against the proposed termination was also afforded though not required by Section 25F. Retrenchment was to take effect on expiry of one months from the date of the notice. Compensation as required by Section 25F was available in the form of banker”s cheques for payment to the workers simultaneously with the time of retrenchment and they were given an intimation in advance in that regard. The workers had already approached the High Court and secured an interim order protecting their employment and status quo being maintained. They were obviously not interested in receiving the retrenchment compensation which if done may have had the effect of frustrating the interim order. In these facts and circumstances, the retrenchment of any of the appellants cannot be found fault with on any of the grounds raised by the appellants by reference to clauses (a) and (b) of Section 25F.17. Faced with this situation, a last effort was made by the learned senior counsel for the appellants urging for relief being allowed on the ground of non-compliance with the provisions of Section 25N of the Act. Section 25N is placed in Chapter V-B of the Act which according to Section 25K has an application only to industrial establishment in which not less than 100 workmen were employed on an average per working day for the preceding 12 months. The plea was not raised before the High Court. It is not even taken in the special leave petitions. It was sought to be taken only at the time of hearing. The plea need not detain us any longer. The infirmity in retrenchment by reference to Section 25N cannot be ventured to be found out without laying factual foundation attracting applicability of the provision. It is basically a question of fact. In the absence of requisite pleadings having been raised and documents having been brought on record, we are not persuaded to entertain the plea. On the contrary, Shri B.B. Singh, the learned counsel for the State has pointed out that the controversy in this case is confined only to 55 workers and therefore the submission based on Section 25N of the Act is totally irrelevant and devoid of any merit. We find substance in the opposition so offered. In Hindustan Steel Works Construction Ltd. and others vs. Hindustan Steel Works Construction Ltd. Employee”s Union, Hyderabad and Anr. - (1995) 3 SCC 474 (vide para 18), this Court refused to entertain a plea raised on behalf of the workers by reference to Chapters V-A and V-B of the Act as the contention was not urged before the High Court. 18. For all the foregoing reasons | 0[ds]16. In the case before us the workmen have been given onenotice in writing. The reasons for retrechment have been indicated. An opportunity of hearing against the proposed termination was also afforded though not required by Section 25F. Retrenchment was to take effect on expiry of one months from the date of the notice. Compensation as required by Section 25F was available in the form ofcheques for payment to the workers simultaneously with the time of retrenchment and they were given an intimation in advance in that regard. The workers had already approached the High Court and secured an interim order protecting their employment and status quo being maintained. They were obviously not interested in receiving the retrenchment compensation which if done may have had the effect of frustrating the interim order. In these facts and circumstances, the retrenchment of any of the appellants cannot be found fault with on any of the grounds raised by the appellants by reference to clauses (a) and (b) of Section 25F. | 0 | 3,368 | 187 | ### Instruction:
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and that the State had not taken steps to deliver the amount in respect of each employee at his doorsteps by the relevant date. It was urged that the tender of compensation under Section 25F, in order to be valid, should be of the precise amount and should be made simultaneously with termination of the service. It was found that the bank drafts in respect of individual employees were dispatched in time so as to reach Divisional/ Sub-Divisional Offices of the employer well in advance of the date of expiry of the notice period and the date on which the retrenchment was to be effective. The amounts were not actually paid or tendered to the workers directly but a method for disbursement of compensation was evolved in the interest of workers” convenience. Instead of the workers, spread out all over the State, being asked to come to the Head Office to collect the amount of compensation and the difficulty of the employer in making available the compensation at the doorstep of each employee, an arrangement was made whereby the workers could go to the nearest Divisional /Sub-Divisional Office and collect the amount of compensation due to them. None of the workers ascertained whether the amounts sent by the Head Office to the Divisional/ Sub-Divisional Offices were the correct amounts. No instance was pointed out to show that the bank drafts were not for the correct amounts. The High Court felt satisfied that the individual compensation drafts were sent to the various subordinate offices ready for disbursement to the concerned workers on or before the relevant date. It was held that there was sufficient compliance with the provisions of clause (b) of Section 25F. This Court agreed with the view of the High Court. 14. In The Management of Delhi Transport Undertaking vs. The Industrial Tribunal, Delhi and Anr. (1965) 1 SCR 998 pari materia provision as to payment of compensation equivalent to one month”s wages to workmen contained in proviso to sub-section (2) of Section 33 of ID Act came up for the consideration of this Court. It was held that the proviso did not mean that the wages for one month have to be actually paid; the employer is expected to tender the amount before the dismissal but cannot force the employee to receive the payment before dismissal becomes effective. The making of the tender of the amount, before the order of dismissal becomes effective, would be sufficient compliance. 15. In Sain Steel Products (supra), which is a two-Judge Bench decision of this Court, the worker was informed "to collect what is due to him" without spelling out whether or not it included the amount as contemplated under Section 25F. It was in such peculiar facts and circumstances of the case that this Court refused to accept the offer in the terms in which it was made and quoted hereinabove as amounting to making an office in terms of Section 25F of the Act. Both the Labour Court and the High Court had recorded a finding of fact that Section 25f(b) was not complied with. Sain Steel Products case (supra) is clearly distinguishable and has no application to the facts of the present case. 16. In the case before us the workmen have been given one month”s notice in writing. The reasons for retrechment have been indicated. An opportunity of hearing against the proposed termination was also afforded though not required by Section 25F. Retrenchment was to take effect on expiry of one months from the date of the notice. Compensation as required by Section 25F was available in the form of banker”s cheques for payment to the workers simultaneously with the time of retrenchment and they were given an intimation in advance in that regard. The workers had already approached the High Court and secured an interim order protecting their employment and status quo being maintained. They were obviously not interested in receiving the retrenchment compensation which if done may have had the effect of frustrating the interim order. In these facts and circumstances, the retrenchment of any of the appellants cannot be found fault with on any of the grounds raised by the appellants by reference to clauses (a) and (b) of Section 25F.17. Faced with this situation, a last effort was made by the learned senior counsel for the appellants urging for relief being allowed on the ground of non-compliance with the provisions of Section 25N of the Act. Section 25N is placed in Chapter V-B of the Act which according to Section 25K has an application only to industrial establishment in which not less than 100 workmen were employed on an average per working day for the preceding 12 months. The plea was not raised before the High Court. It is not even taken in the special leave petitions. It was sought to be taken only at the time of hearing. The plea need not detain us any longer. The infirmity in retrenchment by reference to Section 25N cannot be ventured to be found out without laying factual foundation attracting applicability of the provision. It is basically a question of fact. In the absence of requisite pleadings having been raised and documents having been brought on record, we are not persuaded to entertain the plea. On the contrary, Shri B.B. Singh, the learned counsel for the State has pointed out that the controversy in this case is confined only to 55 workers and therefore the submission based on Section 25N of the Act is totally irrelevant and devoid of any merit. We find substance in the opposition so offered. In Hindustan Steel Works Construction Ltd. and others vs. Hindustan Steel Works Construction Ltd. Employee”s Union, Hyderabad and Anr. - (1995) 3 SCC 474 (vide para 18), this Court refused to entertain a plea raised on behalf of the workers by reference to Chapters V-A and V-B of the Act as the contention was not urged before the High Court. 18. For all the foregoing reasons
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0
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16. In the case before us the workmen have been given onenotice in writing. The reasons for retrechment have been indicated. An opportunity of hearing against the proposed termination was also afforded though not required by Section 25F. Retrenchment was to take effect on expiry of one months from the date of the notice. Compensation as required by Section 25F was available in the form ofcheques for payment to the workers simultaneously with the time of retrenchment and they were given an intimation in advance in that regard. The workers had already approached the High Court and secured an interim order protecting their employment and status quo being maintained. They were obviously not interested in receiving the retrenchment compensation which if done may have had the effect of frustrating the interim order. In these facts and circumstances, the retrenchment of any of the appellants cannot be found fault with on any of the grounds raised by the appellants by reference to clauses (a) and (b) of Section 25F.
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Deepal Girishbhai Soni Vs. United India Insurance Co. Ltd.,Borada | that the amount of compensation payable under any other law for the time being in force is to be reduced from the amount of the compensation payable under Sub-Section (2) thereof or under Section 163-A of the Act. Right to claim compensation under Section 140, having regard to the provisions contained in Section 141 is in addition to any other right to claim compensation on the principle of fault liability. Such a provision does not exist in Section 163-A. If no amount is payable under the fault liability of the compensation which may be received from any other law, no refund of the amount received by the claimant under Section 140 is postulated in the Scheme. Section 163-A, on the other hand, nowhere provides that the payment of compensation of no-fault liability in terms of the structured formula is in addition to the liability to pay compensation in accordance with the right to get compensation on the principle of fault liability. It is also not correct to contend that the expression "any other law for the time being in force" used in Section 140(5) would include any other provisions of the Motor Vehicles Act. Had the intention of the Parliament been to include the other provisions of Motor Vehicles Act within the meaning of the expression "any other law for the time being in force", it could have said so expressly. The very fact that the Parliament has chosen to use the expression "any other law", the same, in our considered opinion, would mean a law other than the provisions of the Motor Vehicles Act. The proviso appended to Sub-Section 95) of Section 140 of the Act is required to be given a purposive meeting. 63. It is not in dispute that the claim of compensation irrespective of the death or bodily injury may arise under other statutes as, for example, workmens Compensation Act, Factories Act, Fatal Accidents Act and other acts governing various industries including hazardous industries. 64. In the event, the motor vehicle in question is insured, ultimately the liability would also be fastened under the insurer having regard to the provision laid down in Chapter XII of the Act. We may also notice that Rule 211(1) of Gujarat Motor Vehicle Rules provides for the application for compensation in terms of Sub-Section (1) of Section 166 of the Act. A claim application is to be filed in Form Comp. A. Rule 231 thereof provides for an application for compensation in respect of liability without fault and for the said purpose the claim application prescribed therefore is to be filed in Form No. CWF. The very fact that different forms had been prescribed as regard determination of the final compensation is also suggestive of the fact that both proceedings are meant to be final in nature. Column No. 10 in Form Comp. A requires the claimant to give brief particulars of the accident which would include the nature and extent of fault on the part of the driver of the vehicle, but no such column is provided for in Form CWF, Subject to the said distinction, all other particulars required to be furnished are almost identical. 65. We may notice that Section 167 of the Act provides that where death of, or bodily injury to, any person gives rise to claim of compensation under the Act and also under the Workmens Compensation Act, 1923, he cannot claim compensation under both the Acts. The Motor Vehicles Act contains different expressions as, for example, "under the provision of the Act", "provisions of this Act", of "any other law or otherwise". In Section 163-A, the expression "notwithstanding anything contained in this Act or in any other law for the time being in force" has been used, which goes to show that the Parliament intended to insert a non-obstante clause of wide nature which would mean that the provisions of Section 163-A would apply despite the contrary provisions existing in the said Act or any other law for the time being in force. Section 163-A of the Act covers cases where even negligence is on the part of the victim. It is by way of an exception to Section 166 and the concept of social justice has been duly taken care of. Conclusion: 66. We, therefore, are of the opinion that Kodala (supra) has correctly been decided. However, we do not agree with the findings in Kodala (supra) that if a person invokes provisions of Section 163-A, the annual income of Rs. 40,000/- per annual shall be treated as a cap. In our opinion, the proceeding under Section 163-A being a social security provision, providing for a distinct scheme, only those who annual income is upto Rs. 40,000/- can take the benefit thereof. All other claims are required to be determined in terms of Chapter XII of the Act.67. However, in this case, we may notice that the parties have proceeded to file two applications - one, under Section 163-A and another under Section 166 of the Act. Both have been entertained. Both the Tribunal as also the High Court have proceeded on the basis that the amount of compensation under Section 163-A is by way of an interim award and the same would not preclude the claimants to proceed with this claim made in terms of Section 166 of the Act. It is submitted at the Bar that the appellants have withdrawn 50% of the amount and rest of the amount has been invested. The appellants have lost both of their parents in the accident. Only one of the appellants at the relevant time was a major. It appears that 70% of the amount permitted to be withdrawn has been deposited in the Fixed Deposit. We agree with the submission of Mr. Banerjee that the claim of the appellants made under Section 163-A be treated to be one under Section 140 of the Act and upon adjusting the amounts provided for thereunder, the appellants may refund the rest thereof to the insurer. | 0[ds]By reason of the Section 163-A, therefore, the compensation is required to be determined on the basis of a structured formula whereas in terms of Section 140 only a fixed amount is to be given. A provision of law providing for compensation is presumed to be final in nature unless a contra indication therefor is found to be in the statute either expressly or by necessary implication. While granting compensation, the Tribunal is required to adjudicate upon the disputed question as regard age and income of the deceased or the victim, as the case may be. Unlike Section 140 of the Act, adjudication on several issues arising between the parties is necessary in a proceeding under Section 163-A of the Act.48. Decisions rendered by this Court are galore where computation as regard the amount of compensation has been related to multiplier method involving ascertainment of loss of dependency and capitalizing the same by appropriate multiplier.The scheme envisaged under Section 163-A, in our opinion, leaves no manner of doubt that by reason thereof the rights and obligations of the parties are to be determined finally. the amount of compensation payable under the aforementioned provisions is not to be altered or varied in any other proceedings. It does not contain any provision providing for set off against a higher compensation unlike Section 140. In terms of the said provision, a distinct and specified class of citizens, namely, persons whose income per annum is Rs. 40,000/- or less is covered thereunder whereas Sections 140 and 166 cater to all sections ofscheme envisaged under Section 163-A, in our opinion, leaves no manner of doubt that by reason thereof the rights and obligations of the parties are to be determined finally. the amount of compensation payable under the aforementioned provisions is not to be altered or varied in any other proceedings. It does not contain any provision providing for set off against a higher compensation unlike Section 140. In terms of the said provision, a distinct and specified class of citizens, namely, persons whose income per annum is Rs. 40,000/- or less is covered thereunder whereas Sections 140 and 166 cater to all sections oftherefore, are of the opinion that remedy for payment of compensation both under Sections 163-A and 166 being final and independent of each other as statutorily provided, a claimant cannot pursue his remedies thereunder simultaneously. One, thus, must opt/elect to go either for a proceeding under Section 163-A or under Section 166 of the Act, but not under both.We, therefore, are of the opinion that Kodala (supra) has correctly been decided. However, we do not agree with the findings in Kodala (supra) that if a person invokes provisions of Section 163-A, the annual income of Rs. 40,000/- per annual shall be treated as a cap. In our opinion, the proceeding under Section 163-A being a social security provision, providing for a distinct scheme, only those who annual income is upto Rs. 40,000/- can take the benefit thereof. All other claims are required to be determined in terms of Chapter XII of the Act.67. However, in this case, we may notice that the parties have proceeded to file two applications - one, under Section 163-A and another under Section 166 of the Act. Both have been entertained. Both the Tribunal as also the High Court have proceeded on the basis that the amount of compensation under Section 163-A is by way of an interim award and the same would not preclude the claimants to proceed with this claim made in terms of Section 166 of the Act. It is submitted at the Bar that the appellants have withdrawn 50% of the amount and rest of the amount has been invested. The appellants have lost both of their parents in the accident. Only one of the appellants at the relevant time was a major. It appears that 70% of the amount permitted to be withdrawn has been deposited in the Fixed Deposit. We agree with the submission of Mr. Banerjee that the claim of the appellants made under Section 163-A be treated to be one under Section 140 of the Act and upon adjusting the amounts provided for thereunder, the appellants may refund the rest thereof to the insurer.So far as Civil Appeal Nos. 3126/2002 and 3127/2002 are concerned, we in exercise of our jurisdiction under Article 142 of the Constitution direct that the claim applications of the appellants under Section 163-A of the Act be treated to be applications under Section 140 thereof. The amount invested by the Tribunal may be allowed to be withdrawn by the respondent - Insurance Company. The appellants shall refund the excess amount withdrawn by them after adjusting the amount payable in terms of Section 140 of the Act and the interest which would have accrued thereon shall be adjusted towards the compensation received by the claimant within four weeks from the date of communication of this order where after, the Motor Vehicle Accident Claims Tribunal shall proceed to determine their claim petitions filed under Section 166 of the Act in accordance with law. This order shall not be treated as a precedent.71. Section 163-A was introduced in the year 1994. The executive authority of the Central Government has the requisite jurisdiction to amend the Section Schedule from time to time. Having regard to the inflation and fall in the rate of bank interest; it is desirable that the Central Government bestows serious consideration to this aspect of the matter. | 0 | 10,204 | 992 | ### Instruction:
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that the amount of compensation payable under any other law for the time being in force is to be reduced from the amount of the compensation payable under Sub-Section (2) thereof or under Section 163-A of the Act. Right to claim compensation under Section 140, having regard to the provisions contained in Section 141 is in addition to any other right to claim compensation on the principle of fault liability. Such a provision does not exist in Section 163-A. If no amount is payable under the fault liability of the compensation which may be received from any other law, no refund of the amount received by the claimant under Section 140 is postulated in the Scheme. Section 163-A, on the other hand, nowhere provides that the payment of compensation of no-fault liability in terms of the structured formula is in addition to the liability to pay compensation in accordance with the right to get compensation on the principle of fault liability. It is also not correct to contend that the expression "any other law for the time being in force" used in Section 140(5) would include any other provisions of the Motor Vehicles Act. Had the intention of the Parliament been to include the other provisions of Motor Vehicles Act within the meaning of the expression "any other law for the time being in force", it could have said so expressly. The very fact that the Parliament has chosen to use the expression "any other law", the same, in our considered opinion, would mean a law other than the provisions of the Motor Vehicles Act. The proviso appended to Sub-Section 95) of Section 140 of the Act is required to be given a purposive meeting. 63. It is not in dispute that the claim of compensation irrespective of the death or bodily injury may arise under other statutes as, for example, workmens Compensation Act, Factories Act, Fatal Accidents Act and other acts governing various industries including hazardous industries. 64. In the event, the motor vehicle in question is insured, ultimately the liability would also be fastened under the insurer having regard to the provision laid down in Chapter XII of the Act. We may also notice that Rule 211(1) of Gujarat Motor Vehicle Rules provides for the application for compensation in terms of Sub-Section (1) of Section 166 of the Act. A claim application is to be filed in Form Comp. A. Rule 231 thereof provides for an application for compensation in respect of liability without fault and for the said purpose the claim application prescribed therefore is to be filed in Form No. CWF. The very fact that different forms had been prescribed as regard determination of the final compensation is also suggestive of the fact that both proceedings are meant to be final in nature. Column No. 10 in Form Comp. A requires the claimant to give brief particulars of the accident which would include the nature and extent of fault on the part of the driver of the vehicle, but no such column is provided for in Form CWF, Subject to the said distinction, all other particulars required to be furnished are almost identical. 65. We may notice that Section 167 of the Act provides that where death of, or bodily injury to, any person gives rise to claim of compensation under the Act and also under the Workmens Compensation Act, 1923, he cannot claim compensation under both the Acts. The Motor Vehicles Act contains different expressions as, for example, "under the provision of the Act", "provisions of this Act", of "any other law or otherwise". In Section 163-A, the expression "notwithstanding anything contained in this Act or in any other law for the time being in force" has been used, which goes to show that the Parliament intended to insert a non-obstante clause of wide nature which would mean that the provisions of Section 163-A would apply despite the contrary provisions existing in the said Act or any other law for the time being in force. Section 163-A of the Act covers cases where even negligence is on the part of the victim. It is by way of an exception to Section 166 and the concept of social justice has been duly taken care of. Conclusion: 66. We, therefore, are of the opinion that Kodala (supra) has correctly been decided. However, we do not agree with the findings in Kodala (supra) that if a person invokes provisions of Section 163-A, the annual income of Rs. 40,000/- per annual shall be treated as a cap. In our opinion, the proceeding under Section 163-A being a social security provision, providing for a distinct scheme, only those who annual income is upto Rs. 40,000/- can take the benefit thereof. All other claims are required to be determined in terms of Chapter XII of the Act.67. However, in this case, we may notice that the parties have proceeded to file two applications - one, under Section 163-A and another under Section 166 of the Act. Both have been entertained. Both the Tribunal as also the High Court have proceeded on the basis that the amount of compensation under Section 163-A is by way of an interim award and the same would not preclude the claimants to proceed with this claim made in terms of Section 166 of the Act. It is submitted at the Bar that the appellants have withdrawn 50% of the amount and rest of the amount has been invested. The appellants have lost both of their parents in the accident. Only one of the appellants at the relevant time was a major. It appears that 70% of the amount permitted to be withdrawn has been deposited in the Fixed Deposit. We agree with the submission of Mr. Banerjee that the claim of the appellants made under Section 163-A be treated to be one under Section 140 of the Act and upon adjusting the amounts provided for thereunder, the appellants may refund the rest thereof to the insurer.
### Response:
0
### Explanation:
By reason of the Section 163-A, therefore, the compensation is required to be determined on the basis of a structured formula whereas in terms of Section 140 only a fixed amount is to be given. A provision of law providing for compensation is presumed to be final in nature unless a contra indication therefor is found to be in the statute either expressly or by necessary implication. While granting compensation, the Tribunal is required to adjudicate upon the disputed question as regard age and income of the deceased or the victim, as the case may be. Unlike Section 140 of the Act, adjudication on several issues arising between the parties is necessary in a proceeding under Section 163-A of the Act.48. Decisions rendered by this Court are galore where computation as regard the amount of compensation has been related to multiplier method involving ascertainment of loss of dependency and capitalizing the same by appropriate multiplier.The scheme envisaged under Section 163-A, in our opinion, leaves no manner of doubt that by reason thereof the rights and obligations of the parties are to be determined finally. the amount of compensation payable under the aforementioned provisions is not to be altered or varied in any other proceedings. It does not contain any provision providing for set off against a higher compensation unlike Section 140. In terms of the said provision, a distinct and specified class of citizens, namely, persons whose income per annum is Rs. 40,000/- or less is covered thereunder whereas Sections 140 and 166 cater to all sections ofscheme envisaged under Section 163-A, in our opinion, leaves no manner of doubt that by reason thereof the rights and obligations of the parties are to be determined finally. the amount of compensation payable under the aforementioned provisions is not to be altered or varied in any other proceedings. It does not contain any provision providing for set off against a higher compensation unlike Section 140. In terms of the said provision, a distinct and specified class of citizens, namely, persons whose income per annum is Rs. 40,000/- or less is covered thereunder whereas Sections 140 and 166 cater to all sections oftherefore, are of the opinion that remedy for payment of compensation both under Sections 163-A and 166 being final and independent of each other as statutorily provided, a claimant cannot pursue his remedies thereunder simultaneously. One, thus, must opt/elect to go either for a proceeding under Section 163-A or under Section 166 of the Act, but not under both.We, therefore, are of the opinion that Kodala (supra) has correctly been decided. However, we do not agree with the findings in Kodala (supra) that if a person invokes provisions of Section 163-A, the annual income of Rs. 40,000/- per annual shall be treated as a cap. In our opinion, the proceeding under Section 163-A being a social security provision, providing for a distinct scheme, only those who annual income is upto Rs. 40,000/- can take the benefit thereof. All other claims are required to be determined in terms of Chapter XII of the Act.67. However, in this case, we may notice that the parties have proceeded to file two applications - one, under Section 163-A and another under Section 166 of the Act. Both have been entertained. Both the Tribunal as also the High Court have proceeded on the basis that the amount of compensation under Section 163-A is by way of an interim award and the same would not preclude the claimants to proceed with this claim made in terms of Section 166 of the Act. It is submitted at the Bar that the appellants have withdrawn 50% of the amount and rest of the amount has been invested. The appellants have lost both of their parents in the accident. Only one of the appellants at the relevant time was a major. It appears that 70% of the amount permitted to be withdrawn has been deposited in the Fixed Deposit. We agree with the submission of Mr. Banerjee that the claim of the appellants made under Section 163-A be treated to be one under Section 140 of the Act and upon adjusting the amounts provided for thereunder, the appellants may refund the rest thereof to the insurer.So far as Civil Appeal Nos. 3126/2002 and 3127/2002 are concerned, we in exercise of our jurisdiction under Article 142 of the Constitution direct that the claim applications of the appellants under Section 163-A of the Act be treated to be applications under Section 140 thereof. The amount invested by the Tribunal may be allowed to be withdrawn by the respondent - Insurance Company. The appellants shall refund the excess amount withdrawn by them after adjusting the amount payable in terms of Section 140 of the Act and the interest which would have accrued thereon shall be adjusted towards the compensation received by the claimant within four weeks from the date of communication of this order where after, the Motor Vehicle Accident Claims Tribunal shall proceed to determine their claim petitions filed under Section 166 of the Act in accordance with law. This order shall not be treated as a precedent.71. Section 163-A was introduced in the year 1994. The executive authority of the Central Government has the requisite jurisdiction to amend the Section Schedule from time to time. Having regard to the inflation and fall in the rate of bank interest; it is desirable that the Central Government bestows serious consideration to this aspect of the matter.
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LMJ INTERNATIONAL LTD Vs. SLEEPWELL INDUSTRIES CO. LTD | If we disregard the alterations envisaged by the Amendment to the Contract dated 7 th December 2010, granting an even higher level for “Broken Grains” end “Dead, damaged and Discoloured Grains”, the results provided by ISC were well Within the parameters foreseen for the quality under the Contract.6.11 The Tribunal therefore FINDS THAT the quality of the cargo shipped on the three vessels was within the amended contractual specifications.6.12. In addition to the above, the provision DI the Quality Clause 5 of GAFTA Contract No.48, being Tale Quale contract as such, states, Inter alia: “Certificate of Inspection at time o/ loading –shall be final as to quality”.6.13 Consequently, and under consideration of the Payment Term of the- Contract providing for payment on receipt 01 the shipping documents’, inter alia the above Pre-Shipment Certificates as issued by ISC and provided by Sellers, Sellers were duty entitled to trigger payment under the Contract.6.14 WE THEREFORE FIND THAT Sellers’ claim for payment of IJSD 440.00 per metric ton all three partial shipments succeeds.6.15 In reference with the balance of USD 10.00 per metric ton for each partial shipment, as agreed under the Amendment dated 7 th December 2010, the Amendment Provided that the “Balance amount@ US$10.00 per MT will be payable after receipt of quality inspection report of destination port”.6.16 This indeed establishes an alteration to the original provision of the Contract that the quality would be final at the port of loading, at least as far as the balance of USD 10.00 per metric ton is concerned. On interpretation and construction of the Contract itself and its Amendment dated 7 th December 2010, the Tribunal notes that the Amendment itself defines in“1. Quantity” that the weight in accordance with the Contract would be still “final at loading” while the amended payment term now states that a balance amount of US$ 10.00 per MT would only“be payable after receipt of a quality inspection report of destination port.”6.17 WE THEREFORE FIND THAT the Contract had been validly altered to the provision that Sellers could only have triggered payment of the balance of USD 10.00 per metric ton after presentation of a quality inspection report from the port of destination, i.e. Bangladesh.6.18 As no such quality Inspection had been presented by Buyers, despite various reminders from Sellers, until the present day, the GAFTA Sampling Rules No.124, cl. 6:1 provide that a certificate of analysis should be sent to the other party “within 14 consecutive days” after dispatch of the samples to the analyst.6.19 Buyers in their message of 5 th February 2011 firstly explained that the quality of the cargo on the last vessel i.e. MV Tu man Gang, was inferior.6.20 The Tribunal Therefore finds that buyers, with respect Tribunal THEREFORE FINDS THAT with respect to cl. 6:1 of the GAFTA Sampling Rules No.124 were obliged to provide a certificate of analysis Latter that message dated 5 th February 201 1 therefore latest 20 th February 2011.6.21. The date of default shall therefore be one day later, the 21 st February 2011 and SO WE DO FIND.6.22 As Buyers failed to forward the certificate within this limit of 14 days, any claim for rejection or for an allowance in respect of any matters dealt with under the Contract, and its Amendments. shall be deemed to be waived and absolutely barred, AND SO WE DO FIND.6.23 THE TRIBUNAL THEREFORE FINDS THAT Sellers’ claim for payment of balance invoices of USD 10,00 per metric ton succeeds.6.24 There is no apparent disputes as far as the quantity of the shipment under the contract is concerned as the contract provided for the shipment of 15000 metric tons, +¬5% in buyers option and sellers only shipped 13,729.55 metric tons.6.25 Buyers nevertheless informed Sellers 5 th February 2011 that the original Letter of Credit as foreseen for payment under the Contract not be extended and Buyers therefore planned to “establish Fresh LC for the balance quantity of 2000 ton in the old contract”.6.26 The Tribunal has not seen any new letter of credit for this purpose and as Buyers have not filed such, the Contract came to its end,6.27 WE THEREFORE FIND THAT Sellers’ calculations for sums and interest due should be based on a quantity of 13,729.55 metric tons.6.28 WE FIND AND DECLARE THAT:1) Sellers’ claim for payment of balance of USD 10.00 per metric ton for each of the three shipments amounting to USD 137,148.20 succeeds. Interest to run from 29 th June 2011. The date of Buyers’ email stating that they would not be “obliged and/or liable to pay any sum” to Sellers.2) Sellers’ claim for the balance of as deducted from the invoice in reference to the shipment on board of MV Tuman Gang amounting to USD 382,348.90 succeeds. Interest to run from 20 th February 2011, the date by which Buyers should have provided a ‘quality inspection report at destination port’.Buyers shall pay compound interest on the above sum of USD 137,148.20 at the rate of 4% (four per cent) per annum calculated at quarterly rests, from 29 th June 2011 to the date of payment.7.2 Buyers shall forthwith pay to Sellers USD 382,348.90 (three hundred & eighty¬two thousand, three hundred and forty eight United States dollars and ninety cents). Buyers, shall forthwith pay to sellers USD 332,348.90 at the rate of 4% (four percent) per annum calculated at quarterly rests, from 20 th February 2011 to the date of payment.7.3 WE THEREFORE AWARD THAT Buyers shall pay the fees, costs and expenses of this arbitration as per the attached schedule.”17. Suffice it to observe that the Arbitral Tribunal has considered all aspects of the matter and even if it has committed any error, the same could, at best, be a matter for correction by way of appeal to be resorted to on grounds as may be permissible under the English Law, by which the subject arbitration proceedings are governed. We may not be understood to have expressed any opinion on the correctness of those issues.18. | 0[ds]The grounds, at best, could be urged by the petitioner in the appeal to be filed against the foreign award governed by English Laws (UK Arbitration Act, 1996). The petitioner has allowed the said awards to attain finality having failed to file such appeal. Even the argument of fraud on the basis of the allegation that the relevant documents were not brought to the notice of the Arbitral Tribunal by the respondent – award holder, is baseless and only a subterfuge for protracting the recovery of dues. In that, the respondent had produced a swift message dated 3 rd June, 2011 sent from the respondent bank to the petitioner bank and the subsequent correspondence between the parties to which reference has been made by the Arbitral Tribunal while deciding the matter. There is no allegation that the respondent concealed the stated correspondence between the parties with a view to obtain an arbitral award through fraud. The specific ground taken by the petitioner was that the award holder, with intent to deceive, perpetuated fraud on the petitioner. That is not enough to hold that the subject foreign awards were unenforceable within the meaning of Section 48 of the Act. The petitioner had sufficient notice of the arbitration proceedings but it chose not to participate in the said proceeding for reasons best known to it. Therefore, now it cannot turn around and make a grievance about non¬ consideration of any document. More so, the grievance is in the nature of inviting the Executing Court to have a second look at the award which is not the scope of Section 48 of the Act. The respondent has also refuted the ground urged on behalf of the petitioner regarding awarding of compound interest at the rate of 4% per annum calculated at quarterly rests, being in conformity with the governing laws. The respondent has also relied on the dictum in Shri Lal Mahal Ltd., (2014) 2 SCC 433 (supra) and Renusagar Power Company Ltd.,1994 Supp. (1) SCC 644 (supra). The respondent has also distinguished the judgments cited by the petitioner on the scope of interference in domestic awards on the ground of its enforceability as opposed to the foreign awards in the present cases. The respondent submits that these petitions be dismissed with exemplary costs and while doing so, appropriate directions be issued to the Registrar (OS), High Court at Calcutta to forthwith encash the FDs of approximately Rs.2 crores, in the credit of both the execution cases and forthwith remit the entire receipts, including the accrued interest in US Dollars, to the respondent, as was ordered earlier vide orders dated 5 th January, 2018, 5 th March, 2018 and 20 th April, 2018, respectively, after obtaining prior permission of the Reserve Bank of India in that regard. The respondent also seeks direction against the petitioner for securing the deficit amount, which would remain after appropriation of the amount under the FDs, lying with the Registrar (OS), Calcutta High Court. The respondent would contend that such direction is necessary in the peculiar facts of the present case and to obviate any complication due to moratorium, as the petitioner has invoked proceedings under the Insolvency and Bankruptcyr contends that on the earlier occasion, the objections were limited to the questions of maintainability of the execution case on grounds as were urged at the relevant time and not in reference to the enforceability of the subject foreign awards as such.This argument, to say the least, is an attempt to indulge in hair-splitting and nothing more. It is an argument in desperation only to protract the execution of the foreign award on untenable grounds. Indeed, the petitioner had not filed any formal application to raise the issue of maintainability of the execution case but the Court had permitted the petitioner to orally urgeThe learned Judge had then reproduced the five points, which alone were orally urged on behalf of the petitioner through its counsel, as extracted in paragraph 4 above. The High Court examined the said grounds which, obviously, were transcending in the realm of enforceability of the subject foreign awards. In the special leave petitions filed before this Court, the petitioner had articulated questions of law and the grounds also in reference to the scope of Section 48 of the Act which included the enforceability of the subject foreign awards. That can be discerned from the close reading of Questions and Grounds in the previous SLPs, reproduced in paragraph 5 above. Additionally, the learned Single Judge of the High Court vide order date 17 th March, 2015 had made it amply clear that the subject foreign awards were deemed to be decrees, which presupposes that the same were enforceable. That order came to be upheld by the Division Bench whilst disposing of the appeals preferred by the petitioner. These orders have become final and have not been challenged by the petitioner. The petitioner thereafter unsuccessfully resorted to the remedy of review before the High Court. Even the order passed in review petition has become final.14. Be that as it may, the grounds urged by the petitioner in the earlier round regarding the maintainability of the execution case could not have been considered in isolation and de hors the issue of enforceability of the subject foreign awards. For, the same was intrinsically linked to the question of enforceability of the subject foreign awards. In any case, all contentions available to the petitioner in that regard could and ought to have been raised specifically and, if raised, could have been examined by the Court at that stage itself. We are of the considered opinion that the scheme of Section 48 of the Act does not envisage piecemeal consideration of the issue of maintainability of the execution case concerning the foreign awards, in the first place; and then the issue of enforceability thereof. Whereas, keeping in mind the legislative intent of speedy disposal of arbitration proceedings and limited interference by the courts, the Court is expected to consider both these aspects simultaneously at the threshold. Taking any other view would result in encouraging successive and multiple round of proceedings for the execution of foreign awards. We cannot countenance such a situation keeping in mind the avowed object of the Arbitration and Conciliation Act, 1996, in particular, while dealing with the enforcement of foreign awards. For, the scope of interference has been consciously constricted by the legislature in relation to the execution of foreign awards. Therefore, the subject application filed by the petitioner deserves to be rejected, being barred by constructive res judicata, as has been justly observed by the High Court in the impugned judgment.15. There is an additional reason which dissuades us to show any indulgence to the petitioner. We find force in the grievance made by the respondent that the conduct of the petitioner is indicative of an attempt to overreach this Court. For, after an interim order was passed in favour of the respondent, permitting withdrawal of part of the deposited amount, the petitioner lost no time in changing the name of the company within three days thereafter on 23 rd April, 2018. The petitioner also changed its registered office address on 26 th April, 2018 and had no compunction in moving the NCLT, Kolkata on 27 th April, 2018 to prevent the respondent from enjoying the fruits of the subject awards, and saying so brazenly in the petition filed by it under Section 10 of the I & B Code. Strikingly, attention of this Court was invited to these facts by the respondent by moving a formal application. The petitioner has not offered any explanation, much less a plausible one. On this count also, the special leave petitions deserve to be rejected.16. Having said this, we do not wish to examine any other argument of the petitioner, including on merits of the enforceability of the subject foreign awards. Even if we were to do so, we would have agreed with the High Court that the grounds urged by the petitioner to question the enforceability of the subject foreign awards are untenable, not being within the purview of Section 48 of the Act. Be that as it may, we find that the High Court has considered every aspect of the grounds urged by the petitioner; and the view so expressed by the High Court in reference to each of the points considered by it is a possible view. The High Court has correctly noted the limited scope for interference in the matter of foreign awards under Section 48 of the Act, keeping in view the principles enunciated by this Court. The High Court has justly noted that the attempt of the petitioner was to call upon the executing court to have a re-look at the award. That cannot be countenanced. We would also agree with the High Court that all the relevant documents submitted to buttress the claim of the respondent before the Arbitral Tribunal, have been adverted to in the award and the findings reached in the award are based on the interpretation and meaning given to the said documents. That can be discerned from the discussion and findings recorded by the Arbitral Tribunal in the award under consideration.Suffice it to observe that the Arbitral Tribunal has considered all aspects of the matter and even if it has committed any error, the same could, at best, be a matter for correction by way of appeal to be resorted to on grounds as may be permissible under the English Law, by which the subject arbitration proceedings are governed. We may not be understood to have expressed any opinion on the correctness of those issues. | 0 | 9,690 | 1,762 | ### Instruction:
Speculate on the likely judgment (yes (1) or no (0) to the appeal) and then delve into the case proceeding to elucidate your prediction, focusing on critical sentences.
### Input:
If we disregard the alterations envisaged by the Amendment to the Contract dated 7 th December 2010, granting an even higher level for “Broken Grains” end “Dead, damaged and Discoloured Grains”, the results provided by ISC were well Within the parameters foreseen for the quality under the Contract.6.11 The Tribunal therefore FINDS THAT the quality of the cargo shipped on the three vessels was within the amended contractual specifications.6.12. In addition to the above, the provision DI the Quality Clause 5 of GAFTA Contract No.48, being Tale Quale contract as such, states, Inter alia: “Certificate of Inspection at time o/ loading –shall be final as to quality”.6.13 Consequently, and under consideration of the Payment Term of the- Contract providing for payment on receipt 01 the shipping documents’, inter alia the above Pre-Shipment Certificates as issued by ISC and provided by Sellers, Sellers were duty entitled to trigger payment under the Contract.6.14 WE THEREFORE FIND THAT Sellers’ claim for payment of IJSD 440.00 per metric ton all three partial shipments succeeds.6.15 In reference with the balance of USD 10.00 per metric ton for each partial shipment, as agreed under the Amendment dated 7 th December 2010, the Amendment Provided that the “Balance amount@ US$10.00 per MT will be payable after receipt of quality inspection report of destination port”.6.16 This indeed establishes an alteration to the original provision of the Contract that the quality would be final at the port of loading, at least as far as the balance of USD 10.00 per metric ton is concerned. On interpretation and construction of the Contract itself and its Amendment dated 7 th December 2010, the Tribunal notes that the Amendment itself defines in“1. Quantity” that the weight in accordance with the Contract would be still “final at loading” while the amended payment term now states that a balance amount of US$ 10.00 per MT would only“be payable after receipt of a quality inspection report of destination port.”6.17 WE THEREFORE FIND THAT the Contract had been validly altered to the provision that Sellers could only have triggered payment of the balance of USD 10.00 per metric ton after presentation of a quality inspection report from the port of destination, i.e. Bangladesh.6.18 As no such quality Inspection had been presented by Buyers, despite various reminders from Sellers, until the present day, the GAFTA Sampling Rules No.124, cl. 6:1 provide that a certificate of analysis should be sent to the other party “within 14 consecutive days” after dispatch of the samples to the analyst.6.19 Buyers in their message of 5 th February 2011 firstly explained that the quality of the cargo on the last vessel i.e. MV Tu man Gang, was inferior.6.20 The Tribunal Therefore finds that buyers, with respect Tribunal THEREFORE FINDS THAT with respect to cl. 6:1 of the GAFTA Sampling Rules No.124 were obliged to provide a certificate of analysis Latter that message dated 5 th February 201 1 therefore latest 20 th February 2011.6.21. The date of default shall therefore be one day later, the 21 st February 2011 and SO WE DO FIND.6.22 As Buyers failed to forward the certificate within this limit of 14 days, any claim for rejection or for an allowance in respect of any matters dealt with under the Contract, and its Amendments. shall be deemed to be waived and absolutely barred, AND SO WE DO FIND.6.23 THE TRIBUNAL THEREFORE FINDS THAT Sellers’ claim for payment of balance invoices of USD 10,00 per metric ton succeeds.6.24 There is no apparent disputes as far as the quantity of the shipment under the contract is concerned as the contract provided for the shipment of 15000 metric tons, +¬5% in buyers option and sellers only shipped 13,729.55 metric tons.6.25 Buyers nevertheless informed Sellers 5 th February 2011 that the original Letter of Credit as foreseen for payment under the Contract not be extended and Buyers therefore planned to “establish Fresh LC for the balance quantity of 2000 ton in the old contract”.6.26 The Tribunal has not seen any new letter of credit for this purpose and as Buyers have not filed such, the Contract came to its end,6.27 WE THEREFORE FIND THAT Sellers’ calculations for sums and interest due should be based on a quantity of 13,729.55 metric tons.6.28 WE FIND AND DECLARE THAT:1) Sellers’ claim for payment of balance of USD 10.00 per metric ton for each of the three shipments amounting to USD 137,148.20 succeeds. Interest to run from 29 th June 2011. The date of Buyers’ email stating that they would not be “obliged and/or liable to pay any sum” to Sellers.2) Sellers’ claim for the balance of as deducted from the invoice in reference to the shipment on board of MV Tuman Gang amounting to USD 382,348.90 succeeds. Interest to run from 20 th February 2011, the date by which Buyers should have provided a ‘quality inspection report at destination port’.Buyers shall pay compound interest on the above sum of USD 137,148.20 at the rate of 4% (four per cent) per annum calculated at quarterly rests, from 29 th June 2011 to the date of payment.7.2 Buyers shall forthwith pay to Sellers USD 382,348.90 (three hundred & eighty¬two thousand, three hundred and forty eight United States dollars and ninety cents). Buyers, shall forthwith pay to sellers USD 332,348.90 at the rate of 4% (four percent) per annum calculated at quarterly rests, from 20 th February 2011 to the date of payment.7.3 WE THEREFORE AWARD THAT Buyers shall pay the fees, costs and expenses of this arbitration as per the attached schedule.”17. Suffice it to observe that the Arbitral Tribunal has considered all aspects of the matter and even if it has committed any error, the same could, at best, be a matter for correction by way of appeal to be resorted to on grounds as may be permissible under the English Law, by which the subject arbitration proceedings are governed. We may not be understood to have expressed any opinion on the correctness of those issues.18.
### Response:
0
### Explanation:
the petitioner had not filed any formal application to raise the issue of maintainability of the execution case but the Court had permitted the petitioner to orally urgeThe learned Judge had then reproduced the five points, which alone were orally urged on behalf of the petitioner through its counsel, as extracted in paragraph 4 above. The High Court examined the said grounds which, obviously, were transcending in the realm of enforceability of the subject foreign awards. In the special leave petitions filed before this Court, the petitioner had articulated questions of law and the grounds also in reference to the scope of Section 48 of the Act which included the enforceability of the subject foreign awards. That can be discerned from the close reading of Questions and Grounds in the previous SLPs, reproduced in paragraph 5 above. Additionally, the learned Single Judge of the High Court vide order date 17 th March, 2015 had made it amply clear that the subject foreign awards were deemed to be decrees, which presupposes that the same were enforceable. That order came to be upheld by the Division Bench whilst disposing of the appeals preferred by the petitioner. These orders have become final and have not been challenged by the petitioner. The petitioner thereafter unsuccessfully resorted to the remedy of review before the High Court. Even the order passed in review petition has become final.14. Be that as it may, the grounds urged by the petitioner in the earlier round regarding the maintainability of the execution case could not have been considered in isolation and de hors the issue of enforceability of the subject foreign awards. For, the same was intrinsically linked to the question of enforceability of the subject foreign awards. In any case, all contentions available to the petitioner in that regard could and ought to have been raised specifically and, if raised, could have been examined by the Court at that stage itself. We are of the considered opinion that the scheme of Section 48 of the Act does not envisage piecemeal consideration of the issue of maintainability of the execution case concerning the foreign awards, in the first place; and then the issue of enforceability thereof. Whereas, keeping in mind the legislative intent of speedy disposal of arbitration proceedings and limited interference by the courts, the Court is expected to consider both these aspects simultaneously at the threshold. Taking any other view would result in encouraging successive and multiple round of proceedings for the execution of foreign awards. We cannot countenance such a situation keeping in mind the avowed object of the Arbitration and Conciliation Act, 1996, in particular, while dealing with the enforcement of foreign awards. For, the scope of interference has been consciously constricted by the legislature in relation to the execution of foreign awards. Therefore, the subject application filed by the petitioner deserves to be rejected, being barred by constructive res judicata, as has been justly observed by the High Court in the impugned judgment.15. There is an additional reason which dissuades us to show any indulgence to the petitioner. We find force in the grievance made by the respondent that the conduct of the petitioner is indicative of an attempt to overreach this Court. For, after an interim order was passed in favour of the respondent, permitting withdrawal of part of the deposited amount, the petitioner lost no time in changing the name of the company within three days thereafter on 23 rd April, 2018. The petitioner also changed its registered office address on 26 th April, 2018 and had no compunction in moving the NCLT, Kolkata on 27 th April, 2018 to prevent the respondent from enjoying the fruits of the subject awards, and saying so brazenly in the petition filed by it under Section 10 of the I & B Code. Strikingly, attention of this Court was invited to these facts by the respondent by moving a formal application. The petitioner has not offered any explanation, much less a plausible one. On this count also, the special leave petitions deserve to be rejected.16. Having said this, we do not wish to examine any other argument of the petitioner, including on merits of the enforceability of the subject foreign awards. Even if we were to do so, we would have agreed with the High Court that the grounds urged by the petitioner to question the enforceability of the subject foreign awards are untenable, not being within the purview of Section 48 of the Act. Be that as it may, we find that the High Court has considered every aspect of the grounds urged by the petitioner; and the view so expressed by the High Court in reference to each of the points considered by it is a possible view. The High Court has correctly noted the limited scope for interference in the matter of foreign awards under Section 48 of the Act, keeping in view the principles enunciated by this Court. The High Court has justly noted that the attempt of the petitioner was to call upon the executing court to have a re-look at the award. That cannot be countenanced. We would also agree with the High Court that all the relevant documents submitted to buttress the claim of the respondent before the Arbitral Tribunal, have been adverted to in the award and the findings reached in the award are based on the interpretation and meaning given to the said documents. That can be discerned from the discussion and findings recorded by the Arbitral Tribunal in the award under consideration.Suffice it to observe that the Arbitral Tribunal has considered all aspects of the matter and even if it has committed any error, the same could, at best, be a matter for correction by way of appeal to be resorted to on grounds as may be permissible under the English Law, by which the subject arbitration proceedings are governed. We may not be understood to have expressed any opinion on the correctness of those issues.
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Laurel Energetics Pvt. Ltd Vs. Securities Exchange Board Of India | are disclosed as such pursuant to filings under the listing agreement, the corporate veil is not lifted. The difference between sub regulations (ii), (iv) and (v) on the one hand, and sub regulation (iii) on the other, again shows us that it is impermissible for the court to lift the corporate veil, either partially or otherwise, in a manner that would distort the plain language of the regulation. Where the corporate veil is to be lifted, the regulation itself specifically so states. For this reason also, it is a little difficult to accept Mr. Vishwanathans argument that a reading of the other sub regulations contained within regulation 10 (1) (a) would further his argument in this case. 20. We now come to the two judgments of this Court which were cited before us in the context of Rent Acts. Chronologically, the first of these judgments is "Madras Bangalore Transport Co. (West) v. Inder Singh And Others" reported in 1986(2) R.C.R.(Rent) 377 : (1986) 3 SCC 62. In this case, the paragraph relied upon by Mr. Vishwanathan is paragraph 8, which is as under: "As mentioned by us earlier, the Madras-Bangalore Transport Company (West) continued to be in occupation of the premises even after the Caravan Goods Carrier Private Limited came in. They never effaced themselves. The firm allowed Caravan Goods Carrier Private Limited Company, to function from the same premises but Caravan Goods Carrier Private Limited though a separate legal entity, was in fact a creature of the partners of Madras-Banglore Transport Company (West) and was the very image of the firm. The limited company and the partnership firm were two only in name but one for practical purposes. There was substantial identity between the limited company and the partnership firm. We do not think that there was any sub-letting, assignment or parting with possession of the premises by Madras-Banglore Transport Company (West) to Caravan Goods Carrier Private Limited so as to attract Section 14(1) (b) of the Delhi Rent Control Act. In the result the appeal is allowed with costs." 21. It can be seen that a partnership firm became a limited company but, on facts it was found that since there was substantial identity between the limited company and the partnership firm, there was no subletting, assignment or parting with possession of the premises so as to contradict Section 14(1)(b) of the Delhi Rent Control Act.22. This case is wholly distinguishable from the present case as in the facts of the present case, the target company is clearly defined and "means" only Rattan Limited. To go behind Rattan Limited would not only be contrary to the clear language of Regulation 10(1)(a) but would also introduce a concept viz lifting the corporate veil by the Court contrary to the Regulation itself, which, as has been pointed out above, also contains sub regulation (iii) which, in the circumstances specified, lifts the corporate veil. 23. The second judgment cited before us "Sait Nagjee Purushotam & Co. Ltd. v. Vimalabai Prabhulal and Others" reported in 2005(2) R.C.R.(Rent) 436 : (2005) 8 SCC 252 also does not take us further for the same reasons. 24. In fact, even if we were to accept Mr. Vishwanathans argument that the object of the regulation being that promoters should not keep changing, and if on facts it is found that the same set of promoters continue, we should exempt such cases, this would not be possible for another good reason. 25. In the case of "M/s. Utkal Contractors and Joinery (P) Ltd. And others v. State of Orissa" reported in 1987 (Supp) SCC 751, a similar argument was turned down in the following terms : "11.Secondly, the validity of the statutory notification cannot be judged merely on the basis of Statement of Objects and Reasons accompanying the Bill. Nor it could be tested by the government policy taken from time to time. The executive policy of the government, or the Statement of Objects and Reasons of the Act or Ordinance cannot control the actual words used in the legislation. In Central Bank of India v. Workmen, S.K. Das, J. said :"...The Statement of Objects and Reasons is not admissible, however, for construing the section; far less can it control the actual words used."12. In State of West Bengal v. Union of India, Sinha, C.J. observed :"...It is however, well settled that the Statement of Objects and Reasons accompanying a Bill, when introduced in Parliament, cannot be used to determine the true meaning and effect of substantive provisions of the statute. They cannot be used except for the limited purpose of understanding the background and the antecedent state of affairs leading up to the legislation. But we cannot use this statement as an aid to the construction of the enactment or to show that the legislature did not intend to acquire the proprietary rights vested in the State or in any way to affect the State Governments rights as owner of minerals. A statute, as passed by Parliament, is the expression of the collective intention of the legislature as a whole, and any statement made by an individual, albeit a Minister, of the intention and objects of the Act cannot be used to cut down the generality of the words used in the statute." 26. In the factual scenario before us, having regard to the aforesaid judgment, it is not possible to construe the regulation in the light of its object, when the words used are clear. This statement of the law is of course with the well known caveat that the object of a provision can certainly be used as an extrinsic aid to the interpretation of statutes and subordinate legislation where there is ambiguity in the words used.27. As has already been stated by us, we find the literal language of the regulation clear and beyond any doubt. The language of sub regulation (ii) becomes even clearer when it is contrasted with the language of sub regulation (iii), as has been held by us above. | 0[ds]11. In so far as the facts of the present case are concerned, the definition that we are concerned with is that of a company, and not any other corporate entity. For the purpose of the present case, the Target Company, therefore, means a company whose shares are listed on a Stock Exchange. This would mean, on the facts of the present case, the Rattan Company, whose shares are listed on the two Stock Exchanges as mentioned above. Coming back to Regulation 10, it is thus clear that persons named as promoters in the shareholding pattern filed by the Rattan Company in terms of the listing agreement between the two Stock Exchanges is what is to be looked at. And for this purpose persons must be promoters of the Rattan Company for not less than three years prior to the proposed acquisition in order that the exemption under paragraph 10 would apply. On the facts of this case, therefore, the information memorandum having been filed on 19th July, 2012 pursuant to which listing took place one day later, is the relevant date from which this period is computed. This being the case, three years had not elapsed on 9/10th July, 2014, which was the date on which the earlier purchase of shares had taken place.Although, it is true that this Committees recommendations do disclose that the object of the regulation is to curb the abuse of introduction of new entities as qualifying parties, this again is tempered with a later sentence which states that if schemes do not really involve or deal with a target company per se, then only would the treatment of such open offer obligations be different.When we come to sub regulations (iv) and (v), it is clear that these two sub regulations follow the pattern contained in sub regulation (ii) in as much as when it comes to persons acting in concert, the period should be not less than three years prior to the proposed acquisition, and disclosed as such pursuant to filings under the listing agreement. Also, when it comes to shareholders of a target company who have been persons acting in concert for a period of not less than three years prior to the proposed acquisition and are disclosed as such pursuant to filings under the listing agreement, the corporate veil is not lifted. The difference between sub regulations (ii), (iv) and (v) on the one hand, and sub regulation (iii) on the other, again shows us that it is impermissible for the court to lift the corporate veil, either partially or otherwise, in a manner that would distort the plain language of the regulation. Where the corporate veil is to be lifted, the regulation itself specifically so states. For this reason also, it is a little difficult to accept Mr. Vishwanathans argument that a reading of the other sub regulations contained within regulation 10 (1) (a) would further his argument in this case.It can be seen that a partnership firm became a limited company but, on facts it was found that since there was substantial identity between the limited company and the partnership firm, there was no subletting, assignment or parting with possession of the premises so as to contradict Section 14(1)(b) of the Delhi Rent Control Act.22. This case is wholly distinguishable from the present case as in the facts of the present case, the target company is clearly defined and "means" only Rattan Limited. To go behind Rattan Limited would not only be contrary to the clear language of Regulation 10(1)(a) but would also introduce a concept viz lifting the corporate veil by the Court contrary to the Regulation itself, which, as has been pointed out above, also contains sub regulation (iii) which, in the circumstances specified, lifts the corporate veil.In fact, even if we were to accept Mr. Vishwanathans argument that the object of the regulation being that promoters should not keep changing, and if on facts it is found that the same set of promoters continue, we should exempt such cases, this would not be possible for another good reason.In the factual scenario before us, having regard to the aforesaid judgment, it is not possible to construe the regulation in the light of its object, when the words used are clear. This statement of the law is of course with the well known caveat that the object of a provision can certainly be used as an extrinsic aid to the interpretation of statutes and subordinate legislation where there is ambiguity in the words used.27. As has already been stated by us, we find the literal language of the regulation clear and beyond any doubt. The language of sub regulation (ii) becomes even clearer when it is contrasted with the language of sub regulation (iii), as has been held by us above. | 0 | 4,276 | 910 | ### Instruction:
Project the court's decision (favor (1) or against (0) the appeal) based on the case proceeding, and subsequently give an in-depth explanation by analyzing relevant sentences from the document.
### Input:
are disclosed as such pursuant to filings under the listing agreement, the corporate veil is not lifted. The difference between sub regulations (ii), (iv) and (v) on the one hand, and sub regulation (iii) on the other, again shows us that it is impermissible for the court to lift the corporate veil, either partially or otherwise, in a manner that would distort the plain language of the regulation. Where the corporate veil is to be lifted, the regulation itself specifically so states. For this reason also, it is a little difficult to accept Mr. Vishwanathans argument that a reading of the other sub regulations contained within regulation 10 (1) (a) would further his argument in this case. 20. We now come to the two judgments of this Court which were cited before us in the context of Rent Acts. Chronologically, the first of these judgments is "Madras Bangalore Transport Co. (West) v. Inder Singh And Others" reported in 1986(2) R.C.R.(Rent) 377 : (1986) 3 SCC 62. In this case, the paragraph relied upon by Mr. Vishwanathan is paragraph 8, which is as under: "As mentioned by us earlier, the Madras-Bangalore Transport Company (West) continued to be in occupation of the premises even after the Caravan Goods Carrier Private Limited came in. They never effaced themselves. The firm allowed Caravan Goods Carrier Private Limited Company, to function from the same premises but Caravan Goods Carrier Private Limited though a separate legal entity, was in fact a creature of the partners of Madras-Banglore Transport Company (West) and was the very image of the firm. The limited company and the partnership firm were two only in name but one for practical purposes. There was substantial identity between the limited company and the partnership firm. We do not think that there was any sub-letting, assignment or parting with possession of the premises by Madras-Banglore Transport Company (West) to Caravan Goods Carrier Private Limited so as to attract Section 14(1) (b) of the Delhi Rent Control Act. In the result the appeal is allowed with costs." 21. It can be seen that a partnership firm became a limited company but, on facts it was found that since there was substantial identity between the limited company and the partnership firm, there was no subletting, assignment or parting with possession of the premises so as to contradict Section 14(1)(b) of the Delhi Rent Control Act.22. This case is wholly distinguishable from the present case as in the facts of the present case, the target company is clearly defined and "means" only Rattan Limited. To go behind Rattan Limited would not only be contrary to the clear language of Regulation 10(1)(a) but would also introduce a concept viz lifting the corporate veil by the Court contrary to the Regulation itself, which, as has been pointed out above, also contains sub regulation (iii) which, in the circumstances specified, lifts the corporate veil. 23. The second judgment cited before us "Sait Nagjee Purushotam & Co. Ltd. v. Vimalabai Prabhulal and Others" reported in 2005(2) R.C.R.(Rent) 436 : (2005) 8 SCC 252 also does not take us further for the same reasons. 24. In fact, even if we were to accept Mr. Vishwanathans argument that the object of the regulation being that promoters should not keep changing, and if on facts it is found that the same set of promoters continue, we should exempt such cases, this would not be possible for another good reason. 25. In the case of "M/s. Utkal Contractors and Joinery (P) Ltd. And others v. State of Orissa" reported in 1987 (Supp) SCC 751, a similar argument was turned down in the following terms : "11.Secondly, the validity of the statutory notification cannot be judged merely on the basis of Statement of Objects and Reasons accompanying the Bill. Nor it could be tested by the government policy taken from time to time. The executive policy of the government, or the Statement of Objects and Reasons of the Act or Ordinance cannot control the actual words used in the legislation. In Central Bank of India v. Workmen, S.K. Das, J. said :"...The Statement of Objects and Reasons is not admissible, however, for construing the section; far less can it control the actual words used."12. In State of West Bengal v. Union of India, Sinha, C.J. observed :"...It is however, well settled that the Statement of Objects and Reasons accompanying a Bill, when introduced in Parliament, cannot be used to determine the true meaning and effect of substantive provisions of the statute. They cannot be used except for the limited purpose of understanding the background and the antecedent state of affairs leading up to the legislation. But we cannot use this statement as an aid to the construction of the enactment or to show that the legislature did not intend to acquire the proprietary rights vested in the State or in any way to affect the State Governments rights as owner of minerals. A statute, as passed by Parliament, is the expression of the collective intention of the legislature as a whole, and any statement made by an individual, albeit a Minister, of the intention and objects of the Act cannot be used to cut down the generality of the words used in the statute." 26. In the factual scenario before us, having regard to the aforesaid judgment, it is not possible to construe the regulation in the light of its object, when the words used are clear. This statement of the law is of course with the well known caveat that the object of a provision can certainly be used as an extrinsic aid to the interpretation of statutes and subordinate legislation where there is ambiguity in the words used.27. As has already been stated by us, we find the literal language of the regulation clear and beyond any doubt. The language of sub regulation (ii) becomes even clearer when it is contrasted with the language of sub regulation (iii), as has been held by us above.
### Response:
0
### Explanation:
11. In so far as the facts of the present case are concerned, the definition that we are concerned with is that of a company, and not any other corporate entity. For the purpose of the present case, the Target Company, therefore, means a company whose shares are listed on a Stock Exchange. This would mean, on the facts of the present case, the Rattan Company, whose shares are listed on the two Stock Exchanges as mentioned above. Coming back to Regulation 10, it is thus clear that persons named as promoters in the shareholding pattern filed by the Rattan Company in terms of the listing agreement between the two Stock Exchanges is what is to be looked at. And for this purpose persons must be promoters of the Rattan Company for not less than three years prior to the proposed acquisition in order that the exemption under paragraph 10 would apply. On the facts of this case, therefore, the information memorandum having been filed on 19th July, 2012 pursuant to which listing took place one day later, is the relevant date from which this period is computed. This being the case, three years had not elapsed on 9/10th July, 2014, which was the date on which the earlier purchase of shares had taken place.Although, it is true that this Committees recommendations do disclose that the object of the regulation is to curb the abuse of introduction of new entities as qualifying parties, this again is tempered with a later sentence which states that if schemes do not really involve or deal with a target company per se, then only would the treatment of such open offer obligations be different.When we come to sub regulations (iv) and (v), it is clear that these two sub regulations follow the pattern contained in sub regulation (ii) in as much as when it comes to persons acting in concert, the period should be not less than three years prior to the proposed acquisition, and disclosed as such pursuant to filings under the listing agreement. Also, when it comes to shareholders of a target company who have been persons acting in concert for a period of not less than three years prior to the proposed acquisition and are disclosed as such pursuant to filings under the listing agreement, the corporate veil is not lifted. The difference between sub regulations (ii), (iv) and (v) on the one hand, and sub regulation (iii) on the other, again shows us that it is impermissible for the court to lift the corporate veil, either partially or otherwise, in a manner that would distort the plain language of the regulation. Where the corporate veil is to be lifted, the regulation itself specifically so states. For this reason also, it is a little difficult to accept Mr. Vishwanathans argument that a reading of the other sub regulations contained within regulation 10 (1) (a) would further his argument in this case.It can be seen that a partnership firm became a limited company but, on facts it was found that since there was substantial identity between the limited company and the partnership firm, there was no subletting, assignment or parting with possession of the premises so as to contradict Section 14(1)(b) of the Delhi Rent Control Act.22. This case is wholly distinguishable from the present case as in the facts of the present case, the target company is clearly defined and "means" only Rattan Limited. To go behind Rattan Limited would not only be contrary to the clear language of Regulation 10(1)(a) but would also introduce a concept viz lifting the corporate veil by the Court contrary to the Regulation itself, which, as has been pointed out above, also contains sub regulation (iii) which, in the circumstances specified, lifts the corporate veil.In fact, even if we were to accept Mr. Vishwanathans argument that the object of the regulation being that promoters should not keep changing, and if on facts it is found that the same set of promoters continue, we should exempt such cases, this would not be possible for another good reason.In the factual scenario before us, having regard to the aforesaid judgment, it is not possible to construe the regulation in the light of its object, when the words used are clear. This statement of the law is of course with the well known caveat that the object of a provision can certainly be used as an extrinsic aid to the interpretation of statutes and subordinate legislation where there is ambiguity in the words used.27. As has already been stated by us, we find the literal language of the regulation clear and beyond any doubt. The language of sub regulation (ii) becomes even clearer when it is contrasted with the language of sub regulation (iii), as has been held by us above.
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Commissioner Of Income-Tax, Madras Vs. Prithvi Insurance Co. Ltd | being a previous year not earlier than the previous year for the assessment for the year ending on the 31st day of March 1940, (in any business profession or vocation) and the loss cannot be wholly set off under sub-s. (1), (so much of the loss as is not so set off or the whole loss where the assessee had no other head of income) shall be carried forward to the following year and set off against the profits and gains, if any, of the assessee from the same business profession or vocation for that year ; * * *"The words underlined (bracketed herein, Ed.) were substituted by the Income-tax Amendment Act (25 of 1953), for the words "under the head Profits and gains of business, profession or vocation" and "the portion not so set off" respectively. At the relevant time loss which could not be set off in the year of account may be carried forward to the following year, but it could be set off against the profits and gains of the assessee from "the same business, profession or vocation". If the loss carried forward from the previous year and sought to be set off was not from the same business, profession or vocation, it could not be set off under S. 24 (2). If there was no income or profits from the same business in the subsequent year, the loss could not be set off, but had to be carried forward in the next year following, subject to the restriction placed in that sub-section.5. The question whether the business of life insurance and the business of general insurance could be regarded as the same business assumes importance in this case, since the right to carry forward the loss suffered in the life insurance business and to set it off against the profit of the company in the general insurance business of the subsequent year is clearly in issue. If the life insurance business and the general insurance business were not "the same business" within the meaning of S. 24 (2), loss in the life insurance business which could not be set off against income from other business of the Company and sources of income, could not he carried forward and set off in the year following against the income from the general insurance business.6. Counsel for the Commissioner contended that life insurance business and general insurance business were separate businesses and he relied in support of that contention primarily upon the method of computation, of taxable income of the life insurance business and of the general insurance business. Both in respect of the life insurance business and general insurance business there are as already mentioned, special methods of computation of income. But because there are distinct methods of computation of taxable income of the insurance business, and the general provisions of the Income-tax Act relating to computation of profits and gains of a business in S. 10 and the related sections are inapplicable, it does not follow that the two businesses cannot be the same business" within the meaning of S. 24 (2).Whether two or more lines of business, may be regarded as the same business, or different business depends not upon the special methods prescribed by the Income-tax Act for computation of the taxable income, but upon the nature of the businesses, the nature of their organisation management, source of the capital fund utilised, method of book-keeping and a host of other related circumstances which stamp them as the same or distinct.7. In the present case, there is little doubt that the two businesses constituted one composite business : the Company was entitled to carry on the life insurance business and the general insurance business under its Memorandum of Association, and the businesses were attended to by the Branch Managers and the Agents without any distinction, there was one common administrative organization and the expenses incurred in connection with the business both for administration and for heads of expenditure such as salary of the staff, postage, staff welfare fund and general charges, were common.8. We are unable to agree with counsel for the Commissioner that the test whether one of the businesses can be closed without affecting tire conduct of the other business, is a decisive test in determining, whether the two constitute the same business within the meaning of S. 24 (2). If one business cannot conveniently be carried on after the closure of the other, there would be a strong indication that the two businesses constitute "the same business", but no decision inference may be drawn from the fact that after the closure of one business another may conveniently be carried on.9. In the present case the Tribunals judgment proceeds not upon any special circumstances governing the distinctive organization, management, at counts, methods of book-keeping or the peculiarities of the two businesses, but primarily upon the provisions of the Income-tax Act which provide different methods of computation of the taxable income of the life insurance business and of the general insurance business. We are notable to agree with the Tribunal, that because in respect of the life insurance business and general insurance business there are special methods of computation of income for the purpose of levying income-tax, they are not the "same business within the meaning of S. 24 (2). A fairly adequate test for determining whether the two constitute the same business is furnished by what Rowlatt, J. said in Scales v. George Thompson and Co. Ltd., (1929) 13 Tax Cas at p. 89"Was there any inter-connection, any interlacing, any inter-dependence, any unity at all embracing those two businesses?"That inter-connection, interlacing, inter-dependence and unity are furnished in this case by the existence of common management, common business organisation, common administration, common fund and a common place of business.10. In our view therefore the High Court was right in holding that the life insurance business and the general insurance business constitute the same business within the meaning of S. 24 (2) of the Act. | 0[ds]7. In the present case, there is little doubt that the two businesses constituted one composite business : the Company was entitled to carry on the life insurance business and the general insurance business under its Memorandum of Association, and the businesses were attended to by the Branch Managers and the Agents without any distinction, there was one common administrative organization and the expenses incurred in connection with the business both for administration and for heads of expenditure such as salary of the staff, postage, staff welfare fund and general charges, were common.8. We are unable to agree with counsel for the Commissioner that the test whether one of the businesses can be closed without affecting tire conduct of the other business, is a decisive test in determining, whether the two constitute the same business within the meaning of S. 24 (2). If one business cannot conveniently be carried on after the closure of the other, there would be a strong indication that the two businesses constitute "the same business", but no decision inference may be drawn from the fact that after the closure of one business another may conveniently be carried on.9. In the present case the Tribunals judgment proceeds not upon any special circumstances governing the distinctive organization, management, at counts, methods of book-keeping or the peculiarities of the two businesses, but primarily upon the provisions of the Income-tax Act which provide different methods of computation of the taxable income of the life insurance business and of the general insurance business. We are notable to agree with the Tribunal, that because in respect of the life insurance business and general insurance business there are special methods of computation of income for the purpose of levying income-tax, they are not the "same business within the meaning of S. 24 (2).In our view thereforewas right in holding that the life insurance business and the general insurance business constitute the same business within the meaning of S. 24 (2) of thethe life insurance business and the general insurance business were not "the same business" within the meaning of S. 24 (2), loss in the life insurance business which could not be set off against income from other business of the Company and sources of income, could not he carried forward and set off in the year following against the income from the general insurancein respect of the life insurance business and general insurance business there are as already mentioned, special methods of computation of income. But because there are distinct methods of computation of taxable income of the insurance business, and the general provisions of theAct relating to computation of profits and gains of a business in S. 10 and the related sections are inapplicable, it does not follow that the two businesses cannot be the same business" within the meaning of S. 24 (2).Whether two or more lines of business, may be regarded as the same business, or different business depends not upon the special methods prescribed by theAct for computation of the taxable income, but upon the nature of the businesses, the nature of their organisation management, source of the capital fund utilised, method ofand a host of other related circumstances which stamp them as the same or distinct. | 0 | 2,431 | 598 | ### Instruction:
Hypothesize the court's verdict (affirmation (1) or negation (0) of the appeal), and then clarify this hypothesis by interpreting significant sentences from the case proceeding.
### Input:
being a previous year not earlier than the previous year for the assessment for the year ending on the 31st day of March 1940, (in any business profession or vocation) and the loss cannot be wholly set off under sub-s. (1), (so much of the loss as is not so set off or the whole loss where the assessee had no other head of income) shall be carried forward to the following year and set off against the profits and gains, if any, of the assessee from the same business profession or vocation for that year ; * * *"The words underlined (bracketed herein, Ed.) were substituted by the Income-tax Amendment Act (25 of 1953), for the words "under the head Profits and gains of business, profession or vocation" and "the portion not so set off" respectively. At the relevant time loss which could not be set off in the year of account may be carried forward to the following year, but it could be set off against the profits and gains of the assessee from "the same business, profession or vocation". If the loss carried forward from the previous year and sought to be set off was not from the same business, profession or vocation, it could not be set off under S. 24 (2). If there was no income or profits from the same business in the subsequent year, the loss could not be set off, but had to be carried forward in the next year following, subject to the restriction placed in that sub-section.5. The question whether the business of life insurance and the business of general insurance could be regarded as the same business assumes importance in this case, since the right to carry forward the loss suffered in the life insurance business and to set it off against the profit of the company in the general insurance business of the subsequent year is clearly in issue. If the life insurance business and the general insurance business were not "the same business" within the meaning of S. 24 (2), loss in the life insurance business which could not be set off against income from other business of the Company and sources of income, could not he carried forward and set off in the year following against the income from the general insurance business.6. Counsel for the Commissioner contended that life insurance business and general insurance business were separate businesses and he relied in support of that contention primarily upon the method of computation, of taxable income of the life insurance business and of the general insurance business. Both in respect of the life insurance business and general insurance business there are as already mentioned, special methods of computation of income. But because there are distinct methods of computation of taxable income of the insurance business, and the general provisions of the Income-tax Act relating to computation of profits and gains of a business in S. 10 and the related sections are inapplicable, it does not follow that the two businesses cannot be the same business" within the meaning of S. 24 (2).Whether two or more lines of business, may be regarded as the same business, or different business depends not upon the special methods prescribed by the Income-tax Act for computation of the taxable income, but upon the nature of the businesses, the nature of their organisation management, source of the capital fund utilised, method of book-keeping and a host of other related circumstances which stamp them as the same or distinct.7. In the present case, there is little doubt that the two businesses constituted one composite business : the Company was entitled to carry on the life insurance business and the general insurance business under its Memorandum of Association, and the businesses were attended to by the Branch Managers and the Agents without any distinction, there was one common administrative organization and the expenses incurred in connection with the business both for administration and for heads of expenditure such as salary of the staff, postage, staff welfare fund and general charges, were common.8. We are unable to agree with counsel for the Commissioner that the test whether one of the businesses can be closed without affecting tire conduct of the other business, is a decisive test in determining, whether the two constitute the same business within the meaning of S. 24 (2). If one business cannot conveniently be carried on after the closure of the other, there would be a strong indication that the two businesses constitute "the same business", but no decision inference may be drawn from the fact that after the closure of one business another may conveniently be carried on.9. In the present case the Tribunals judgment proceeds not upon any special circumstances governing the distinctive organization, management, at counts, methods of book-keeping or the peculiarities of the two businesses, but primarily upon the provisions of the Income-tax Act which provide different methods of computation of the taxable income of the life insurance business and of the general insurance business. We are notable to agree with the Tribunal, that because in respect of the life insurance business and general insurance business there are special methods of computation of income for the purpose of levying income-tax, they are not the "same business within the meaning of S. 24 (2). A fairly adequate test for determining whether the two constitute the same business is furnished by what Rowlatt, J. said in Scales v. George Thompson and Co. Ltd., (1929) 13 Tax Cas at p. 89"Was there any inter-connection, any interlacing, any inter-dependence, any unity at all embracing those two businesses?"That inter-connection, interlacing, inter-dependence and unity are furnished in this case by the existence of common management, common business organisation, common administration, common fund and a common place of business.10. In our view therefore the High Court was right in holding that the life insurance business and the general insurance business constitute the same business within the meaning of S. 24 (2) of the Act.
### Response:
0
### Explanation:
7. In the present case, there is little doubt that the two businesses constituted one composite business : the Company was entitled to carry on the life insurance business and the general insurance business under its Memorandum of Association, and the businesses were attended to by the Branch Managers and the Agents without any distinction, there was one common administrative organization and the expenses incurred in connection with the business both for administration and for heads of expenditure such as salary of the staff, postage, staff welfare fund and general charges, were common.8. We are unable to agree with counsel for the Commissioner that the test whether one of the businesses can be closed without affecting tire conduct of the other business, is a decisive test in determining, whether the two constitute the same business within the meaning of S. 24 (2). If one business cannot conveniently be carried on after the closure of the other, there would be a strong indication that the two businesses constitute "the same business", but no decision inference may be drawn from the fact that after the closure of one business another may conveniently be carried on.9. In the present case the Tribunals judgment proceeds not upon any special circumstances governing the distinctive organization, management, at counts, methods of book-keeping or the peculiarities of the two businesses, but primarily upon the provisions of the Income-tax Act which provide different methods of computation of the taxable income of the life insurance business and of the general insurance business. We are notable to agree with the Tribunal, that because in respect of the life insurance business and general insurance business there are special methods of computation of income for the purpose of levying income-tax, they are not the "same business within the meaning of S. 24 (2).In our view thereforewas right in holding that the life insurance business and the general insurance business constitute the same business within the meaning of S. 24 (2) of thethe life insurance business and the general insurance business were not "the same business" within the meaning of S. 24 (2), loss in the life insurance business which could not be set off against income from other business of the Company and sources of income, could not he carried forward and set off in the year following against the income from the general insurancein respect of the life insurance business and general insurance business there are as already mentioned, special methods of computation of income. But because there are distinct methods of computation of taxable income of the insurance business, and the general provisions of theAct relating to computation of profits and gains of a business in S. 10 and the related sections are inapplicable, it does not follow that the two businesses cannot be the same business" within the meaning of S. 24 (2).Whether two or more lines of business, may be regarded as the same business, or different business depends not upon the special methods prescribed by theAct for computation of the taxable income, but upon the nature of the businesses, the nature of their organisation management, source of the capital fund utilised, method ofand a host of other related circumstances which stamp them as the same or distinct.
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Rameshwar & Another Vs. State of Uttar Pradesh | Alagiriswami, J.1. This is an appeal by special leave against the judgment of the High Court of Allahabad confirming the sentence of death passed on the 1st appellant and sentence of life imprisonment passed on the 2nd appellant by the Temporary Civil Sessions Judge, Banda.2. The first appellant is the father and the second appellant is the son. They and another son of the first appellant, Lasra, were prosecuted for causing the death of one Ramji on 22-8-1969 in the village of Pachokhar in the district of Banda. On that day at about 11 a.m. P. W. 5, Uma Prasad, the son of the deceased was taking his buffalo through the fallow land of the accused for grazing. The second appellant took objection to it and beat the buffalo and when this was objected to by Uma Prasad he caused two injuries on him with the end of his lathi. Uma Prasad narrated the incident to his father Ramji and his uncle Ram Murti, P. W. 1 Ramji thereupon seems to have given a few slaps to the second appellant. Thereafter P. W. 1 and the deceased went to the house of their cousin, P. W. 2 and one Lakshmi was also there. At about 2.30 p. m. the two appellants and Lasra arrived there. The first appellant had a rifle and the second appellant a barchhi and Lasra a lathi. The second appellant and Lasra were said to have exhorted the 1st appellant to kill P. W. 1 and the deceased. Thereupon the 1st appellant fired his rifle at the deceased and fired a second shot at P. W. 1. This did not hit P. W. 1 but Ramji died on the spot. The Sessions Judge convicted all the three accused. The High Court acquitted Lasra giving him the benefit of doubt.3. Both the Courts below accepted the evidence of P. W. 1, P. W. 2 and P. W. 3, Lakshmi, as regards the actual occurrence. They took the view that being a day light murder there was no question of the witnesses not being able to identify the miscreants and the witnesses here being close relatives of the deceased would be most unwilling to leave the real culprits and implicate wrong persons. We see no reason to differ from the concurrent findings of the Courts below as to the occurrence.4. So far as the sentence is concerned we agree with the High Court that no indulgence can be shown to the two appellants as the crime was committed in a most high handed and cruel manner on a mere small provocation, if at all provocation it were. It has been urged vehemently on behalf of the appellants by Mr. A. P. S. Chauhan, appearing for the appellants, that the first appellant is an old man and he should not, therefore, be sentenced to death. We are not able to accept this argument. We see no circumstances, which would warrant awarding of any sentence lesser than death on the first, appellant. | 0[ds]We see no reason to differ from the concurrent findings of the Courts below as to the occurrence.4. So far as the sentence is concerned we agree with the High Court that no indulgence can be shown to the two appellants as the crime was committed in a most high handed and cruel manner on a mere small provocation, if at all provocation it were. It has been urged vehemently on behalf of the appellants by Mr. A. P. S. Chauhan, appearing for the appellants, that the first appellant is an old man and he should not, therefore, be sentenced to death. We are not able to accept this argument. We see no circumstances, which would warrant awarding of any sentence lesser than death on the first, appellant. | 0 | 542 | 144 | ### Instruction:
Decide if the appeal in the case proceeding is more likely to be successful (1) or unsuccessful (0), and then justify your decision by focusing on essential sentences in the document.
### Input:
Alagiriswami, J.1. This is an appeal by special leave against the judgment of the High Court of Allahabad confirming the sentence of death passed on the 1st appellant and sentence of life imprisonment passed on the 2nd appellant by the Temporary Civil Sessions Judge, Banda.2. The first appellant is the father and the second appellant is the son. They and another son of the first appellant, Lasra, were prosecuted for causing the death of one Ramji on 22-8-1969 in the village of Pachokhar in the district of Banda. On that day at about 11 a.m. P. W. 5, Uma Prasad, the son of the deceased was taking his buffalo through the fallow land of the accused for grazing. The second appellant took objection to it and beat the buffalo and when this was objected to by Uma Prasad he caused two injuries on him with the end of his lathi. Uma Prasad narrated the incident to his father Ramji and his uncle Ram Murti, P. W. 1 Ramji thereupon seems to have given a few slaps to the second appellant. Thereafter P. W. 1 and the deceased went to the house of their cousin, P. W. 2 and one Lakshmi was also there. At about 2.30 p. m. the two appellants and Lasra arrived there. The first appellant had a rifle and the second appellant a barchhi and Lasra a lathi. The second appellant and Lasra were said to have exhorted the 1st appellant to kill P. W. 1 and the deceased. Thereupon the 1st appellant fired his rifle at the deceased and fired a second shot at P. W. 1. This did not hit P. W. 1 but Ramji died on the spot. The Sessions Judge convicted all the three accused. The High Court acquitted Lasra giving him the benefit of doubt.3. Both the Courts below accepted the evidence of P. W. 1, P. W. 2 and P. W. 3, Lakshmi, as regards the actual occurrence. They took the view that being a day light murder there was no question of the witnesses not being able to identify the miscreants and the witnesses here being close relatives of the deceased would be most unwilling to leave the real culprits and implicate wrong persons. We see no reason to differ from the concurrent findings of the Courts below as to the occurrence.4. So far as the sentence is concerned we agree with the High Court that no indulgence can be shown to the two appellants as the crime was committed in a most high handed and cruel manner on a mere small provocation, if at all provocation it were. It has been urged vehemently on behalf of the appellants by Mr. A. P. S. Chauhan, appearing for the appellants, that the first appellant is an old man and he should not, therefore, be sentenced to death. We are not able to accept this argument. We see no circumstances, which would warrant awarding of any sentence lesser than death on the first, appellant.
### Response:
0
### Explanation:
We see no reason to differ from the concurrent findings of the Courts below as to the occurrence.4. So far as the sentence is concerned we agree with the High Court that no indulgence can be shown to the two appellants as the crime was committed in a most high handed and cruel manner on a mere small provocation, if at all provocation it were. It has been urged vehemently on behalf of the appellants by Mr. A. P. S. Chauhan, appearing for the appellants, that the first appellant is an old man and he should not, therefore, be sentenced to death. We are not able to accept this argument. We see no circumstances, which would warrant awarding of any sentence lesser than death on the first, appellant.
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Textile Machinery Corporation Limited Vs. Their Workmen | holding that there was no relevant evidence on the point. The learned Solicitor-General has invited our attention to the affidavit made by Mr. Radhey Shyam Sharma, the Finance Officer of the appellant, in which it is averred that the details showing that the reserves were fully utilised in the business under the heads mentioned were as shown in the audited balance-sheet which had been tendered. Then follow the details about the reserves. A similar statement is found in the statement of the case filed on behalf of the appellant. We are unable to hold that the statement made in the affidavit can be treated as evidence of the fact that the reserves in question had in fact been used as working capital. What the statement purports to do is merely to collate the relevant figures and set them out as deduced from the balance-sheet and nothing more.It has been held by this Court that before an employer can claim any return on liquid reserves by way of interest, he must lead evidence to show that the reserves in question have been used as working capital during the relevant period. We are satisfied that the tribunal was right in holding that no evidence in fact had been adduced before it by the appellant in that behalf.Therefore, the appellant is not justified in making any further claim in respect of this item.5. Then in regard to the amount of Rs. 2.50 lakhs donated by the appellant to the West Bengal Engineering Foremens College, it may be conceded that the grant is charitable but the point which the tribunal had to consider was whether in determining the available surplus this amount should be debited. On this point the tribunal followed the decision of the Labour Appellate Tribunal in the case of Sree Meenakshi Mills Ltd. v. Their Workmen, 1954 Lab AC 132 at p. 138, and held that such a donation, however charitable or philanthropic it may be, has to be added back for the purpose of arriving at the gross profit. This decision has been confirmed by this Court in Sree Meenakshi Mills Ltd. v. Their Workmen, 1958 SCR 878: (AIR 1958 SC 153 ). Therefore, the tribunal was justified in adding back this amount for the purpose of determining the gross profit.6. Then as to the amount of Rs. 2.35 lakhs in respect of which a reserve has been created by the appellant to meet the possible losses in future, the tribunal was clearly right in adding this amount back for determining the gross profit. It is true that some of the debts due to the appellant may not be fully realised but it is difficult to understand how the appellant can create a reserve solely for the purpose of meeting any possible losses on account of bad or irrecoverable debts, and claim a deduction of this amount while determining the available surplus.The creation of such a reserve is wholly inconsistent with the Full Bench formula in question. There is, therefore, no substance in the argument that this amount would not have been added back.7. That takes us to the principal contention raised by the appellant and that is in respect of the rehabilitation and replacement charges. The appellants grievance is that though it had led evidence in support of this claim and filed the necessary statements bearing on the relevant points, the tribunal has not considered the said evidence but has proceeded on the assumption that "it has become a convention of all the tribunals to multiply cost of buildings constructed prior to 1949 by 2.25 and the cost of plants and machineries installed prior to 1948 by 2.7 for the purpose of equating the requirement to the present market value. It has also been a convention of the Industrial Tribunal to assess total life at 27 to 30 years in the case of buildings and 15 years in the case of plants and machineries". No doubt the tribunal has added that it thought that these conventions were not always favourable to the industries but there was no help. It is on this view that the tribunal reached the conclusion that Rs. 12 lakhs should be allowed to the appellant by way of rehabilitation charges.8. It is obvious that this conclusion is unsound and cannot be affirmed. The tribunal was in error in assuming that there was any convention legally established by which certain assumptions had to be made about the life of the machinery and about the price which would be needed to replace it. In fact decisions have consistently held that the amount of rehabilitation can be and should be determined only in the light of evidence adduced by the employer.This position has not been disputed by Mr. Viswanatha Sastri on behalf of the respondents. His argument, however, was that the evidence adduced by the appellant is unsatisfactory and had therefore been properly rejected. We propose to express no opinion on the merits of the evidence . We are satisfied that it was necessary for the tribunal to have considered the evidence before finally determining the amount which should be paid to the appellant by way of rehabilitation charges. The result is that the appeal must be partly allowed and the proceedings sent back to the Second Industrial Tribunal for dealing with the appellants claim for rehabilitation charges in accordance with law. The tribunal should consider the evidence led by the parties and then apply the principles which have been laid down by this Court in the case of the Associated Cement Companies Ltd. v. The Workmen Employed, 1959 SCR 925 : (AIR 1959 SC 967 ). It would not be open to the parties to lead any further evidence. After the tribunal reaches its conclusion in respect of the appellants claim for rehabilitation it may make its final award in regard to the bonus claimed by the respondents. No further point can be raised by the parties hereafter in the subsequent enquiry which we are now directing. | 1[ds]e question then which needs an answer is whether the tribunal was right in holding that there was no relevant evidence on the point.al has invited our attention to the affidavit made by Mr. Radhey Shyam Sharma, the Finance Officer of the appellant, in which it is averred that the details showing that the reserves were fully utilised in the business under the heads mentioned were as shown in the auditedwhich had been tendered. Then follow the details about the reserves. A similar statement is found in the statement of the case filed on behalf of the appellant.We are unable to hold that the statement made in the affidavit can be treated as evidence of the fact that the reserves in question had in fact been used as working capital. What the statement purports to do is merely to collate the relevant figures and set them out as deduced from theand nothing more.It has been held by this Court that before an employer can claim any return on liquid reserves by way of interest, he must lead evidence to show that the reserves in question have been used as working capital during the relevant period. We are satisfied that the tribunal was right in holding that no evidence in fact had been adduced before it by the appellant in that behalf.Therefore, the appellant is not justified in making any further claim in respect of this item.Then in regard to the amount of Rs. 2.50 lakhs donated by the appellant to the West Bengal Engineering Foremens College, it may be conceded that the grant is charitable but the point which the tribunal had to consider was whether in determining the available surplus this amount should be debited. On this point the tribunal followed the decision of the Labour Appellate Tribunal in the case of Sree Meenakshi Mills Ltd. v. Their Workmen, 1954 Lab AC 132 at p. 138, and held that such a donation, however charitable or philanthropic it may be, has to be added back for the purpose of arriving at the gross profit. This decision has been confirmed by this Court in Sree Meenakshi Mills Ltd. v. Their Workmen, 1958 SCR 878: (AIR 1958 SC 153 ). Therefore, the tribunal was justified in adding back this amount for the purpose of determining the gross profit.6. Then as to the amount of Rs. 2.35 lakhs in respect of which a reserve has been created by the appellant to meet the possible losses in future, the tribunal was clearly right in adding this amount back for determining the gross profit. It is true that some of the debts due to the appellant may not be fully realised but it is difficult to understand how the appellant can create a reserve solely for the purpose of meeting any possible losses on account of bad or irrecoverable debts, and claim a deduction of this amount while determining the available surplus.The creation of such a reserve is wholly inconsistent with the Full Bench formula in question. There is, therefore, no substance in the argument that this amount would not have been addedis on this view that the tribunal reached the conclusion that Rs. 12 lakhs should be allowed to the appellant by way of rehabilitation charges.8. It is obvious that this conclusion is unsound and cannot be affirmed. The tribunal was in error in assuming that there was any convention legally established by which certain assumptions had to be made about the life of the machinery and about the price which would be needed to replace it.In fact decisions have consistently held that the amount of rehabilitation can be and should be determined only in the light of evidence adduced by theare satisfied that it was necessary for the tribunal to have considered the evidence before finally determining the amount which should be paid to the appellant by way of rehabilitation charges. The result is that the appeal must be partly allowed and the proceedings sent back to the Second Industrial Tribunal for dealing with the appellants claim for rehabilitation charges in accordance with law. The tribunal should consider the evidence led by the parties and then apply the principles which have been laid down by this Court in the case of the Associated Cement Companies Ltd. v. The Workmen Employed, 1959 SCR 925 : (AIR 1959 SC 967 ). It would not be open to the parties to lead any further evidence. After the tribunal reaches its conclusion in respect of the appellants claim for rehabilitation it may make its final award in regard to the bonus claimed by the respondents. No further point can be raised by the parties hereafter in the subsequent enquiry which we are now directing. | 1 | 1,838 | 832 | ### Instruction:
Conjecture the end result of the case (acceptance (1) or non-acceptance (0) of the appeal), followed by a detailed explanation using crucial sentences from the case proceeding.
### Input:
holding that there was no relevant evidence on the point. The learned Solicitor-General has invited our attention to the affidavit made by Mr. Radhey Shyam Sharma, the Finance Officer of the appellant, in which it is averred that the details showing that the reserves were fully utilised in the business under the heads mentioned were as shown in the audited balance-sheet which had been tendered. Then follow the details about the reserves. A similar statement is found in the statement of the case filed on behalf of the appellant. We are unable to hold that the statement made in the affidavit can be treated as evidence of the fact that the reserves in question had in fact been used as working capital. What the statement purports to do is merely to collate the relevant figures and set them out as deduced from the balance-sheet and nothing more.It has been held by this Court that before an employer can claim any return on liquid reserves by way of interest, he must lead evidence to show that the reserves in question have been used as working capital during the relevant period. We are satisfied that the tribunal was right in holding that no evidence in fact had been adduced before it by the appellant in that behalf.Therefore, the appellant is not justified in making any further claim in respect of this item.5. Then in regard to the amount of Rs. 2.50 lakhs donated by the appellant to the West Bengal Engineering Foremens College, it may be conceded that the grant is charitable but the point which the tribunal had to consider was whether in determining the available surplus this amount should be debited. On this point the tribunal followed the decision of the Labour Appellate Tribunal in the case of Sree Meenakshi Mills Ltd. v. Their Workmen, 1954 Lab AC 132 at p. 138, and held that such a donation, however charitable or philanthropic it may be, has to be added back for the purpose of arriving at the gross profit. This decision has been confirmed by this Court in Sree Meenakshi Mills Ltd. v. Their Workmen, 1958 SCR 878: (AIR 1958 SC 153 ). Therefore, the tribunal was justified in adding back this amount for the purpose of determining the gross profit.6. Then as to the amount of Rs. 2.35 lakhs in respect of which a reserve has been created by the appellant to meet the possible losses in future, the tribunal was clearly right in adding this amount back for determining the gross profit. It is true that some of the debts due to the appellant may not be fully realised but it is difficult to understand how the appellant can create a reserve solely for the purpose of meeting any possible losses on account of bad or irrecoverable debts, and claim a deduction of this amount while determining the available surplus.The creation of such a reserve is wholly inconsistent with the Full Bench formula in question. There is, therefore, no substance in the argument that this amount would not have been added back.7. That takes us to the principal contention raised by the appellant and that is in respect of the rehabilitation and replacement charges. The appellants grievance is that though it had led evidence in support of this claim and filed the necessary statements bearing on the relevant points, the tribunal has not considered the said evidence but has proceeded on the assumption that "it has become a convention of all the tribunals to multiply cost of buildings constructed prior to 1949 by 2.25 and the cost of plants and machineries installed prior to 1948 by 2.7 for the purpose of equating the requirement to the present market value. It has also been a convention of the Industrial Tribunal to assess total life at 27 to 30 years in the case of buildings and 15 years in the case of plants and machineries". No doubt the tribunal has added that it thought that these conventions were not always favourable to the industries but there was no help. It is on this view that the tribunal reached the conclusion that Rs. 12 lakhs should be allowed to the appellant by way of rehabilitation charges.8. It is obvious that this conclusion is unsound and cannot be affirmed. The tribunal was in error in assuming that there was any convention legally established by which certain assumptions had to be made about the life of the machinery and about the price which would be needed to replace it. In fact decisions have consistently held that the amount of rehabilitation can be and should be determined only in the light of evidence adduced by the employer.This position has not been disputed by Mr. Viswanatha Sastri on behalf of the respondents. His argument, however, was that the evidence adduced by the appellant is unsatisfactory and had therefore been properly rejected. We propose to express no opinion on the merits of the evidence . We are satisfied that it was necessary for the tribunal to have considered the evidence before finally determining the amount which should be paid to the appellant by way of rehabilitation charges. The result is that the appeal must be partly allowed and the proceedings sent back to the Second Industrial Tribunal for dealing with the appellants claim for rehabilitation charges in accordance with law. The tribunal should consider the evidence led by the parties and then apply the principles which have been laid down by this Court in the case of the Associated Cement Companies Ltd. v. The Workmen Employed, 1959 SCR 925 : (AIR 1959 SC 967 ). It would not be open to the parties to lead any further evidence. After the tribunal reaches its conclusion in respect of the appellants claim for rehabilitation it may make its final award in regard to the bonus claimed by the respondents. No further point can be raised by the parties hereafter in the subsequent enquiry which we are now directing.
### Response:
1
### Explanation:
e question then which needs an answer is whether the tribunal was right in holding that there was no relevant evidence on the point.al has invited our attention to the affidavit made by Mr. Radhey Shyam Sharma, the Finance Officer of the appellant, in which it is averred that the details showing that the reserves were fully utilised in the business under the heads mentioned were as shown in the auditedwhich had been tendered. Then follow the details about the reserves. A similar statement is found in the statement of the case filed on behalf of the appellant.We are unable to hold that the statement made in the affidavit can be treated as evidence of the fact that the reserves in question had in fact been used as working capital. What the statement purports to do is merely to collate the relevant figures and set them out as deduced from theand nothing more.It has been held by this Court that before an employer can claim any return on liquid reserves by way of interest, he must lead evidence to show that the reserves in question have been used as working capital during the relevant period. We are satisfied that the tribunal was right in holding that no evidence in fact had been adduced before it by the appellant in that behalf.Therefore, the appellant is not justified in making any further claim in respect of this item.Then in regard to the amount of Rs. 2.50 lakhs donated by the appellant to the West Bengal Engineering Foremens College, it may be conceded that the grant is charitable but the point which the tribunal had to consider was whether in determining the available surplus this amount should be debited. On this point the tribunal followed the decision of the Labour Appellate Tribunal in the case of Sree Meenakshi Mills Ltd. v. Their Workmen, 1954 Lab AC 132 at p. 138, and held that such a donation, however charitable or philanthropic it may be, has to be added back for the purpose of arriving at the gross profit. This decision has been confirmed by this Court in Sree Meenakshi Mills Ltd. v. Their Workmen, 1958 SCR 878: (AIR 1958 SC 153 ). Therefore, the tribunal was justified in adding back this amount for the purpose of determining the gross profit.6. Then as to the amount of Rs. 2.35 lakhs in respect of which a reserve has been created by the appellant to meet the possible losses in future, the tribunal was clearly right in adding this amount back for determining the gross profit. It is true that some of the debts due to the appellant may not be fully realised but it is difficult to understand how the appellant can create a reserve solely for the purpose of meeting any possible losses on account of bad or irrecoverable debts, and claim a deduction of this amount while determining the available surplus.The creation of such a reserve is wholly inconsistent with the Full Bench formula in question. There is, therefore, no substance in the argument that this amount would not have been addedis on this view that the tribunal reached the conclusion that Rs. 12 lakhs should be allowed to the appellant by way of rehabilitation charges.8. It is obvious that this conclusion is unsound and cannot be affirmed. The tribunal was in error in assuming that there was any convention legally established by which certain assumptions had to be made about the life of the machinery and about the price which would be needed to replace it.In fact decisions have consistently held that the amount of rehabilitation can be and should be determined only in the light of evidence adduced by theare satisfied that it was necessary for the tribunal to have considered the evidence before finally determining the amount which should be paid to the appellant by way of rehabilitation charges. The result is that the appeal must be partly allowed and the proceedings sent back to the Second Industrial Tribunal for dealing with the appellants claim for rehabilitation charges in accordance with law. The tribunal should consider the evidence led by the parties and then apply the principles which have been laid down by this Court in the case of the Associated Cement Companies Ltd. v. The Workmen Employed, 1959 SCR 925 : (AIR 1959 SC 967 ). It would not be open to the parties to lead any further evidence. After the tribunal reaches its conclusion in respect of the appellants claim for rehabilitation it may make its final award in regard to the bonus claimed by the respondents. No further point can be raised by the parties hereafter in the subsequent enquiry which we are now directing.
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Guru Granth Saheb Sthan Meerghat Vanaras Vs. Ved Prakash & Others | The criminal court would deal with the offence punishable under the Act. On the other hand, the courts rarely stay the criminal cases and only when the compelling circumstances require the exercise of their power. We have never come across stay of any civil suits by the courts so far. The High Court of Rajasthan is only an exception to pass such orders. The High Court proceeded on a wrong premise that the accused would be expected to disclose their defence in the criminal case by asking them to proceed with the trial of the suit. It is not a correct principle of law. Even otherwise, it no longer subsists, since many of them have filed their defences in the civil suit. On principle of law, we hold that the approach adopted by the High Court is not correct. But since the defence has already been filed nothing survives in this matter.” 14. We may now refer to a three-Judge Bench decision of this Court in K.G. Premshanker3. The three-Judge Bench took into consideration Sections 40, 41, 42 and 43 of the Evidence Act, 1872 and also the decision of this Court in M.S. Sheriff1 and observed in paragraph 32 of the Report that the decision rendered by the Constitution Bench in M.S. Sheriff case1 would be binding wherein it has been specifically held that no hard and fast rule can be laid down and that possibility of conflicting decision in civil and criminal courts is not a relevant consideration. 15. Section 40 of the Evidence Act makes it plain that the existence of any judgment, order or decree which by law prevents any Courts from taking cognizance of a suit or holding a trial is a relevant fact when the question is whether such Court ought to take cognizance of such suit, or to hold such trial. 16. Section 41 provides for relevancy of judgments passed in the exercise of probate, matrimonial admiralty or insolvency jurisdiction by the Competent Court. It reads as follows : “S. 41. Relevancy of certain judgments in probate, etc., jurisdiction.—A final judgment, order or decree of a competent Court, in the exercise of probate, matrimonial admiralty or insolvency jurisdiction which confers upon or takes away from any person any legal character, or which declares any person to be entitled to any such character, or to be entitled to any specific thing, not as against any specified person but absolutely, is relevant when the existence of any such legal character, or the title of any such person to any such thing, is relevant.Such judgment, order or decree is conclusive proof—that any legal character, which it confers accrued at the time when such judgment, order or decree came into operation;that any legal character, to which it declares any such person to be entitled, accrued to that person at the time when such judgment, order or decree declares it to have accrued to that person;that any legal character which it takes away from any such person ceased at the time from which such judgment, order or decree declared that it had ceased or should cease;andthat anything to which it declares any person to be so entitled was the property of that person at the time from which such judgment, order or decree declares that it had been or should be his property.” 17. Section 42 deals with relevancy and effect of judgments, orders or decrees, other than those mentioned in Section 41. It reads as under: “S.42. Relevancy and effect of judgments, orders or decrees, other than those mentioned in section 41.—Judgments, orders or decrees other than those mentioned in section 41, are relevant if they relate to matters of a public nature relevant to the enquiry; but such judgments, orders or decrees are not conclusive proof of that which they state.” 18. Section 43 provides that the judgments, orders or decrees other than those mentioned in Sections 40, 41 and 42 are irrelevant unless the existence of such judgment, order or decree is a fact in issue or is relevant under some other provisions of the Evidence Act. 19. In K.G. Premshanker3, the effect of the above provisions (Sections 40 to 43 of the Evidence Act) has been broadly noted thus: if the criminal case and civil proceedings are for the same cause, judgment of the civil court would be relevant if conditions of any of Sections 40 to 43 are satisfied but it cannot be said that the same would be conclusive except as provided in Section 41. Section 41 provides which judgment would be conclusive proof of what is stated therein. Moreover, the judgment, order or decree passed in previous civil proceedings, if relevant, as provided under Sections 40 and 42 or other provisions of the Evidence Act then in each case the Court has to decide to what extent it is binding or conclusive with regard to the matters decided therein. In each and every case the first question which would require consideration is, whether judgment, order or decree is relevant; if relevant, its effect. This would depend upon the facts of each case. 20 In light of the above legal position, it may be immediately observed that the High Court was not at all justified in staying the proceedings in the civil suit till the decision of criminal case. Firstly, because even if there is possibility of conflicting decisions in the civil and criminal courts, such an eventuality cannot be taken as a relevant consideration. Secondly, in the facts of the present case there is no likelihood of any embarrassment to the defendants (respondent nos. 1 to 4 herein) as they had already filed the written statement in the civil suit and based on the pleadings of the parties the issues have been framed. In this view of the matter, the outcome and/or findings that may be arrived at by the civil court will not at all prejudice the defence(s) of the respondent nos. 1 to 4 in the criminal proceedings. 21. | 1[ds]In K.G. Premshanker3, the effect of the above provisions (Sections 40 to 43 of the Evidence Act) has been broadly noted thus: if the criminal case and civil proceedings are for the same cause, judgment of the civil court would be relevant if conditions of any of Sections 40 to 43 are satisfied but it cannot be said that the same would be conclusive except as provided in Section 41. Section 41 provides which judgment would be conclusive proof of what is stated therein. Moreover, the judgment, order or decree passed in previous civil proceedings, if relevant, as provided under Sections 40 and 42 or other provisions of the Evidence Act then in each case the Court has to decide to what extent it is binding or conclusive with regard to the matters decided therein. In each and every case the first question which would require consideration is, whether judgment, order or decree is relevant; if relevant, its effect. This would depend upon the facts of eachmay be immediately observed that the High Court was not at all justified in staying the proceedings in the civil suit till the decision of criminal case. Firstly, because even if there is possibility of conflicting decisions in the civil and criminal courts, such an eventuality cannot be taken as a relevant consideration. Secondly, in the facts of the present case there is no likelihood of any embarrassment to the defendants (respondent nos. 1 to 4 herein) as they had already filed the written statement in the civil suit and based on the pleadings of the parties the issues have been framed. In this view of the matter, the outcome and/or findings that may be arrived at by the civil court will not at all prejudice the defence(s) of the respondent nos. 1 to 4 in the criminal proceedings. | 1 | 2,728 | 344 | ### Instruction:
Decide if the appeal in the case proceeding is more likely to be successful (1) or unsuccessful (0), and then justify your decision by focusing on essential sentences in the document.
### Input:
The criminal court would deal with the offence punishable under the Act. On the other hand, the courts rarely stay the criminal cases and only when the compelling circumstances require the exercise of their power. We have never come across stay of any civil suits by the courts so far. The High Court of Rajasthan is only an exception to pass such orders. The High Court proceeded on a wrong premise that the accused would be expected to disclose their defence in the criminal case by asking them to proceed with the trial of the suit. It is not a correct principle of law. Even otherwise, it no longer subsists, since many of them have filed their defences in the civil suit. On principle of law, we hold that the approach adopted by the High Court is not correct. But since the defence has already been filed nothing survives in this matter.” 14. We may now refer to a three-Judge Bench decision of this Court in K.G. Premshanker3. The three-Judge Bench took into consideration Sections 40, 41, 42 and 43 of the Evidence Act, 1872 and also the decision of this Court in M.S. Sheriff1 and observed in paragraph 32 of the Report that the decision rendered by the Constitution Bench in M.S. Sheriff case1 would be binding wherein it has been specifically held that no hard and fast rule can be laid down and that possibility of conflicting decision in civil and criminal courts is not a relevant consideration. 15. Section 40 of the Evidence Act makes it plain that the existence of any judgment, order or decree which by law prevents any Courts from taking cognizance of a suit or holding a trial is a relevant fact when the question is whether such Court ought to take cognizance of such suit, or to hold such trial. 16. Section 41 provides for relevancy of judgments passed in the exercise of probate, matrimonial admiralty or insolvency jurisdiction by the Competent Court. It reads as follows : “S. 41. Relevancy of certain judgments in probate, etc., jurisdiction.—A final judgment, order or decree of a competent Court, in the exercise of probate, matrimonial admiralty or insolvency jurisdiction which confers upon or takes away from any person any legal character, or which declares any person to be entitled to any such character, or to be entitled to any specific thing, not as against any specified person but absolutely, is relevant when the existence of any such legal character, or the title of any such person to any such thing, is relevant.Such judgment, order or decree is conclusive proof—that any legal character, which it confers accrued at the time when such judgment, order or decree came into operation;that any legal character, to which it declares any such person to be entitled, accrued to that person at the time when such judgment, order or decree declares it to have accrued to that person;that any legal character which it takes away from any such person ceased at the time from which such judgment, order or decree declared that it had ceased or should cease;andthat anything to which it declares any person to be so entitled was the property of that person at the time from which such judgment, order or decree declares that it had been or should be his property.” 17. Section 42 deals with relevancy and effect of judgments, orders or decrees, other than those mentioned in Section 41. It reads as under: “S.42. Relevancy and effect of judgments, orders or decrees, other than those mentioned in section 41.—Judgments, orders or decrees other than those mentioned in section 41, are relevant if they relate to matters of a public nature relevant to the enquiry; but such judgments, orders or decrees are not conclusive proof of that which they state.” 18. Section 43 provides that the judgments, orders or decrees other than those mentioned in Sections 40, 41 and 42 are irrelevant unless the existence of such judgment, order or decree is a fact in issue or is relevant under some other provisions of the Evidence Act. 19. In K.G. Premshanker3, the effect of the above provisions (Sections 40 to 43 of the Evidence Act) has been broadly noted thus: if the criminal case and civil proceedings are for the same cause, judgment of the civil court would be relevant if conditions of any of Sections 40 to 43 are satisfied but it cannot be said that the same would be conclusive except as provided in Section 41. Section 41 provides which judgment would be conclusive proof of what is stated therein. Moreover, the judgment, order or decree passed in previous civil proceedings, if relevant, as provided under Sections 40 and 42 or other provisions of the Evidence Act then in each case the Court has to decide to what extent it is binding or conclusive with regard to the matters decided therein. In each and every case the first question which would require consideration is, whether judgment, order or decree is relevant; if relevant, its effect. This would depend upon the facts of each case. 20 In light of the above legal position, it may be immediately observed that the High Court was not at all justified in staying the proceedings in the civil suit till the decision of criminal case. Firstly, because even if there is possibility of conflicting decisions in the civil and criminal courts, such an eventuality cannot be taken as a relevant consideration. Secondly, in the facts of the present case there is no likelihood of any embarrassment to the defendants (respondent nos. 1 to 4 herein) as they had already filed the written statement in the civil suit and based on the pleadings of the parties the issues have been framed. In this view of the matter, the outcome and/or findings that may be arrived at by the civil court will not at all prejudice the defence(s) of the respondent nos. 1 to 4 in the criminal proceedings. 21.
### Response:
1
### Explanation:
In K.G. Premshanker3, the effect of the above provisions (Sections 40 to 43 of the Evidence Act) has been broadly noted thus: if the criminal case and civil proceedings are for the same cause, judgment of the civil court would be relevant if conditions of any of Sections 40 to 43 are satisfied but it cannot be said that the same would be conclusive except as provided in Section 41. Section 41 provides which judgment would be conclusive proof of what is stated therein. Moreover, the judgment, order or decree passed in previous civil proceedings, if relevant, as provided under Sections 40 and 42 or other provisions of the Evidence Act then in each case the Court has to decide to what extent it is binding or conclusive with regard to the matters decided therein. In each and every case the first question which would require consideration is, whether judgment, order or decree is relevant; if relevant, its effect. This would depend upon the facts of eachmay be immediately observed that the High Court was not at all justified in staying the proceedings in the civil suit till the decision of criminal case. Firstly, because even if there is possibility of conflicting decisions in the civil and criminal courts, such an eventuality cannot be taken as a relevant consideration. Secondly, in the facts of the present case there is no likelihood of any embarrassment to the defendants (respondent nos. 1 to 4 herein) as they had already filed the written statement in the civil suit and based on the pleadings of the parties the issues have been framed. In this view of the matter, the outcome and/or findings that may be arrived at by the civil court will not at all prejudice the defence(s) of the respondent nos. 1 to 4 in the criminal proceedings.
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Commissioner, Sales Tax, U.P Vs. M/s. Suraj Prasad Gauri Shanker | Hegde, J.1. These appeals by special leave arise from the decision of the Allahabad High Court in Sales Tax Reference No. 297 of 1967 on its file. In that case the High Court was considering a reference under Section 11 (1) of the U. P. Sales Tax Act 1948 (hereinafter to be referred to as the Act). The question referred for the opinion of the High Court was :"Wheter on the facts and in the circumstances of the case, the assessee acting as Commission Agent was liable to pay Sales Tax in the years 1960-61 and 1961-62 on the turnover of Khandsari sugar manufactured by his principles ?"The assessee was carrying on the business of commission agency in Varanasi. He is also a dealer in Oil-seeds and Kirana. In this case we are only concerned with his dealings in Khandsari sugar. In respect of the assessment years in question a dispute arose between him and the Sales Tax Officer as to his liability to pay tax on the turnover relating to Khandsari sugar sold by him as Commission Agent, on behalf of his principals who manufactured sugar in U. P. Act this stage it may also be noted that the Khandsari Sugar with which we are concerned in this case was not subjected to any additional excise duty under the Additional Duties of Excise (Goods of Special Importance) Act, 1957.2. The assessees contention was that in view of the Notification No. S. T. 1365/X-990-1956 dated April 1, 1960, the turnover relating to Khandsari sugar manufactured in the State was liable to tax as from April 1, 1960 only at the point of sale by the manufacturer and that he not being a manufacturer was not liable to pay any sales tax. On the other hand it was contended on behalf of the Department that in view of Section 3 of the Act the assessee was liable to pay Sales-tax in respect of his dealings in Khandsari sugar.3. It is not disputed that but for the Notification referred to earlier the assessee would have been liable to pay sales tax in respect of his turnover relating to sale of Khandsari sugar in view of Section 3 of the Act. The only question that calls for an answer is whether in view of the Notification referred to earlier he is not liable to pay the tax in question. The Notification so far as it is material for our purpose reads thus :"In excise of the powers conferred by Section 3-A of the U. P. Sales Tax Act, 1948 (U. P. Act No. XV of 1948), as amended from time to time the Governor of Uttar Pradesh is pleased to :(i) Supersede, with effect from April 1, 1960 all the previous notifications so far as they relate to the goods mentioned in column 2 of the Schedule hereto and the rates of sales tax given in such notifications, andDeclare that, with effect from April 1, 1960, the turnover in respect of the goods mentioned in column 2 of the Schedule thereto shall be liable to tax only at the point of sale specified in column 4 thereof and under the circumstances specified in column 3 thereof.(ii) The Governor is further pleased to declare that as from April 1, 1960, the rate of tax is respect of the turnover of individual goods mentioned in the aforesaid column 2 shall be as mentioned against each goods in column 5 of the Schedule hereto:Sl. No.Name of goods.Circumstances under which to be taxed.Point of saleRate of tax.1 2345***********40. Khandsari sugar on which additional excise duty is not leviable under the Additional Duties of Excise (Goods of Special Importance) Act, 1957(a) If imported from outside Uttar Pradesh.(a) Sale by importer. 2 paise per rupee.or if leviable it has specifically been exempted from such levy. (b) If manufactured in Uttar Pradesh(b) Sale by manufacturer. do. 4. Khandsari sugar with which we are concerned in this case was manufactured in U. P. That being so we are in agreement with the the High Court that only the sales by the manufacturers are liable to be brought to tax under the Notification. The Notification referred to earlier, in our opinion, takes the present case outside the scope of Section 3 of the Act. The sales effected by the Commission Agent in view of that Notification must be considered as sales by the manufacturer himself. Consequently it is only the manufacturer that could have been taxed in respect of the turnover relating to those sales and not the Commission Agent.5. Mr. Karkhanis, the learned counsel for the appellant, relied on certain decisions rendered by some of the High Courts, namely, Irri Veera Raju v. The Commercial Tax Officer, Tadapalligudem, (1967) 20 STC 501 (Andh Pra), Ramalakshmana and Co. v. State of Madras, (1968) 21 STC 35 (Mad) and Commissioner of Sales Tax v. Ganga Ram Ghuray Lal, (1971) 27 STC 109 (All) . None of those decisions have any bearing on the point in issue in this case. If at all, the ratio of the decision in Irri Veera Rajus case (supra) runs counter to the arguments advanced on behalf of the appellant. | 0[ds]4. Khandsari sugar with which we are concerned in this case was manufactured in U. P. That being so we are in agreement with the the High Court that only the sales by the manufacturers are liable to be brought to tax under the Notification. The Notification referred to earlier, in our opinion, takes the present case outside the scope of Section 3 of the Act. The sales effected by the Commission Agent in view of that Notification must be considered as sales by the manufacturer himself. Consequently it is only the manufacturer that could have been taxed in respect of the turnover relating to those sales and not the Commission Agent.5.Mr. Karkhanis, the learned counsel for the appellant, relied on certain decisions rendered by some of the High Courts, namely, Irri Veera Raju v. The Commercial Tax Officer, Tadapalligudem, (1967) 20 STC 501 (Andh Pra), Ramalakshmana and Co. v. State of Madras, (1968) 21 STC 35 (Mad) and Commissioner of Sales Tax v. Ganga Ram Ghuray Lal, (1971) 27 STC 109 (All) .None of those decisions have any bearing on the point in issue in this case. If at all, the ratio of the decision in Irri Veera Rajus case (supra) runs counter to the arguments advanced on behalf of the appellant. | 0 | 981 | 250 | ### Instruction:
Predict whether the case will result in an affirmative (1) or negative (0) decision for the appeal, and then provide a thorough explanation using key sentences to support your prediction.
### Input:
Hegde, J.1. These appeals by special leave arise from the decision of the Allahabad High Court in Sales Tax Reference No. 297 of 1967 on its file. In that case the High Court was considering a reference under Section 11 (1) of the U. P. Sales Tax Act 1948 (hereinafter to be referred to as the Act). The question referred for the opinion of the High Court was :"Wheter on the facts and in the circumstances of the case, the assessee acting as Commission Agent was liable to pay Sales Tax in the years 1960-61 and 1961-62 on the turnover of Khandsari sugar manufactured by his principles ?"The assessee was carrying on the business of commission agency in Varanasi. He is also a dealer in Oil-seeds and Kirana. In this case we are only concerned with his dealings in Khandsari sugar. In respect of the assessment years in question a dispute arose between him and the Sales Tax Officer as to his liability to pay tax on the turnover relating to Khandsari sugar sold by him as Commission Agent, on behalf of his principals who manufactured sugar in U. P. Act this stage it may also be noted that the Khandsari Sugar with which we are concerned in this case was not subjected to any additional excise duty under the Additional Duties of Excise (Goods of Special Importance) Act, 1957.2. The assessees contention was that in view of the Notification No. S. T. 1365/X-990-1956 dated April 1, 1960, the turnover relating to Khandsari sugar manufactured in the State was liable to tax as from April 1, 1960 only at the point of sale by the manufacturer and that he not being a manufacturer was not liable to pay any sales tax. On the other hand it was contended on behalf of the Department that in view of Section 3 of the Act the assessee was liable to pay Sales-tax in respect of his dealings in Khandsari sugar.3. It is not disputed that but for the Notification referred to earlier the assessee would have been liable to pay sales tax in respect of his turnover relating to sale of Khandsari sugar in view of Section 3 of the Act. The only question that calls for an answer is whether in view of the Notification referred to earlier he is not liable to pay the tax in question. The Notification so far as it is material for our purpose reads thus :"In excise of the powers conferred by Section 3-A of the U. P. Sales Tax Act, 1948 (U. P. Act No. XV of 1948), as amended from time to time the Governor of Uttar Pradesh is pleased to :(i) Supersede, with effect from April 1, 1960 all the previous notifications so far as they relate to the goods mentioned in column 2 of the Schedule hereto and the rates of sales tax given in such notifications, andDeclare that, with effect from April 1, 1960, the turnover in respect of the goods mentioned in column 2 of the Schedule thereto shall be liable to tax only at the point of sale specified in column 4 thereof and under the circumstances specified in column 3 thereof.(ii) The Governor is further pleased to declare that as from April 1, 1960, the rate of tax is respect of the turnover of individual goods mentioned in the aforesaid column 2 shall be as mentioned against each goods in column 5 of the Schedule hereto:Sl. No.Name of goods.Circumstances under which to be taxed.Point of saleRate of tax.1 2345***********40. Khandsari sugar on which additional excise duty is not leviable under the Additional Duties of Excise (Goods of Special Importance) Act, 1957(a) If imported from outside Uttar Pradesh.(a) Sale by importer. 2 paise per rupee.or if leviable it has specifically been exempted from such levy. (b) If manufactured in Uttar Pradesh(b) Sale by manufacturer. do. 4. Khandsari sugar with which we are concerned in this case was manufactured in U. P. That being so we are in agreement with the the High Court that only the sales by the manufacturers are liable to be brought to tax under the Notification. The Notification referred to earlier, in our opinion, takes the present case outside the scope of Section 3 of the Act. The sales effected by the Commission Agent in view of that Notification must be considered as sales by the manufacturer himself. Consequently it is only the manufacturer that could have been taxed in respect of the turnover relating to those sales and not the Commission Agent.5. Mr. Karkhanis, the learned counsel for the appellant, relied on certain decisions rendered by some of the High Courts, namely, Irri Veera Raju v. The Commercial Tax Officer, Tadapalligudem, (1967) 20 STC 501 (Andh Pra), Ramalakshmana and Co. v. State of Madras, (1968) 21 STC 35 (Mad) and Commissioner of Sales Tax v. Ganga Ram Ghuray Lal, (1971) 27 STC 109 (All) . None of those decisions have any bearing on the point in issue in this case. If at all, the ratio of the decision in Irri Veera Rajus case (supra) runs counter to the arguments advanced on behalf of the appellant.
### Response:
0
### Explanation:
4. Khandsari sugar with which we are concerned in this case was manufactured in U. P. That being so we are in agreement with the the High Court that only the sales by the manufacturers are liable to be brought to tax under the Notification. The Notification referred to earlier, in our opinion, takes the present case outside the scope of Section 3 of the Act. The sales effected by the Commission Agent in view of that Notification must be considered as sales by the manufacturer himself. Consequently it is only the manufacturer that could have been taxed in respect of the turnover relating to those sales and not the Commission Agent.5.Mr. Karkhanis, the learned counsel for the appellant, relied on certain decisions rendered by some of the High Courts, namely, Irri Veera Raju v. The Commercial Tax Officer, Tadapalligudem, (1967) 20 STC 501 (Andh Pra), Ramalakshmana and Co. v. State of Madras, (1968) 21 STC 35 (Mad) and Commissioner of Sales Tax v. Ganga Ram Ghuray Lal, (1971) 27 STC 109 (All) .None of those decisions have any bearing on the point in issue in this case. If at all, the ratio of the decision in Irri Veera Rajus case (supra) runs counter to the arguments advanced on behalf of the appellant.
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M/s. Veena Theatre, Patna Vs. State of Bihar | consistent with the Act for securing the payment of entertainment tax and generally for the purpose of carrying into effect the provisions of the Act.The power given under this provision is wide enough to make rules for the determination of the tax liability of an assessee. The mode and the manner in which that liability is to be determined can be provided under the rules. The main purpose of the Act is to levy and collect entertainment tax. Therefore it is idle to say that in exercise of the powers conferred on the State Government under S. 21(1) of the Act that Government cannot make rules for the determination of the tax liability of an assessee. Hence we reject the contention that Rule 28(4) which empowers the taxing authorities to determine the tax liability is ultra vires S. 21 of the Act.6. Rule 28 reads:"(1) If the Superintendent or Assistant Superintendent is satisfied without requiring the presence of the proprietor or production by him of any evidence that the return furnished in respect of any period is correct and complete, he shall assess the amount of tax due from the proprietor on the basis of such return.(2) If the Superintendent or Assistant Superintendent is not satisfied without requiring the presence of the proprietor or production of evidence that the return furnished in respect of any period is correct and complete, he shall serve a notice in from XI on such proprietor requiring him on a date and at a place to be specified therein either to attend in person or to produce or cause to be produced any evidence on which the proprietor relies to prove the correctness of such return or to submit such other accounts, registers or documents of the proprietor as may be considered necessary by the Superintendent or Asstt. Superintendent for the purpose of determining the amount of tax due against the proprietor.(3) On the date specified in the notice or as soon afterwards as may be, the Superintendent or Assistant Superintendent after hearing such evidence as the proprietor may produce and such other evidence as the Superintendent or Assistant Superintendent may require on specified points shall assess the amount of tax due from the proprietor.(4) If the proprietor fails to make a return or having made the return, fails to comply with all the terms of the notice issued under sub-rule (2) or to produce any evidence required under sub-rule (3), the Superintendent or Assistant Superintendent shall, after giving the proprietor a reasonable opportunity of being heard, assess to the best of his judgment, the amount of tax, if any, due from the proprietor."7. This rule is similar to S. 23 of the Indian Income-tax Act, 1922. Sub-rule (4) of rule 28 is analogous to sub-section (4) or S. 23.In view of Sub-rule (4) of Rule 28, the Superintendent or Assistant Superintendent, as the case may be, is competent to make an assessment on the basis of best judgment. The contention that the power conferred under sub-rule (4) of Rule 28 is available only if the assessee fails to make a return or having made it, fails to comply with the terms of the notice issued under sub-rule (2) or to produce any evidence under sub-rule (3), overlooks the fact that the assessee must satisfy that the return made by him is a correct one. If the return made by the assessee is rejected on a relevant ground, such a return cannot be considered as a good return under sub-rule (1) of Rule 28. In that event, the assessee is deemed to have made no return as required by Rule 28(1) and consequently he is liable to be assessed on the basis of best judgment.8. There is no substance in the contention that Rule 28 is repugnant to Section 9(2) of the Act.That rule covers a filed uncovered by Section 9(2). The provisions relating to the imposition of penalty found in S. 9(2) are not inconsistent with or repugnant to the provisions contained in Rule 28. Rule 28 deals with assessment whereas sub-section (2) of Section 9 deals with imposition of penalty. Hence the contention that Rule 28 is inconsistent with Section 9(2) has to be rejected.9. We are unable to accept the contention that the assessment in this case was arbitrarily made. The Assistant Superintendent of Commercial Taxes had computed the tax liability of the assessee on relevant grounds. He arrived at the conclusion that the tax liability of the assessee for the period in question is Rs. 67,500 after taking into consideration materials which were relevant in that regard. Dealing with that aspect of the case this is what that officer says in his order :"The Veena cinema has a capacity so as to yield a tax of nearly 500 per show, if the house goes full. If, therefore, the Cinema had run to the capacity of all days and in each show of the assessment period, the tax would have amounted to Rs. 2,70,000. But it is a known fact that the shows run full to the capacity only on the first days of the start of exhibition of a good and popular picture and that too only in the evening shows. The matinee and the night shows full (sic). As the picture gets older, the sale decreases. Towards the end, the number of persons to witness the picture thin down considerably and the amount of tax falls even below Rs. 50. Taking these points into consideration I feel that the business done by this Cinema in the assessment period was such as to give tax at the average rate of Rs. 125 per show. At this rate the total amount of tax payable in the assessment period comes to Rs. 67,500. This cinema is therefore, assessed to pay a tax of Rs. 67,500 for the period from 1-4-59 to 30-9-1959."10. The facts mentioned above are cogent and relevant in the matter of computing the probable receipts by sale of cinema tickets. | 0[ds]4. The return submitted by the appellant was rejected by the authorities on the grounds that the books of account produced by the appellant were entirely unreliable that the appellant had maintained duplicate sets of tickets and had suppressed the sale of the tickets. These findings were based on the result of a surprise inspection. All the authorities under the Act have concurrently come to the conclusion that theproduced by the appellant were entirely unreliable; that it had maintained duplicate sets of tickets and that it suppressed the sale oftickets. These findings werenot challenged before the High Court and therefore we did not allow the learned Counsel for the appellant to challenge those findings. In view of those findings, it cannot be denied that the taxing authorities were justified in rejecting the return submitted by theprovision in the Act deals with the mode of determination of tax payable by an assessee. That aspect of the matter is left to be governed by the rules to be made. Section 21 of the Act empowers the State Government to make rules.(1) of that section provides that the State Government may make rules, consistent with the Act for securing the payment of entertainment tax and generally for the purpose of carrying into effect the provisions of the Act.The power given under this provision is wide enough to make rules for the determination of the tax liability of an assessee. The mode and the manner in which that liability is to be determined can be provided under the rules. The main purpose of the Act is to levy and collect entertainment tax. Therefore it is idle to say that in exercise of the powers conferred on the State Government under S. 21(1) of the Act that Government cannot make rules for the determination of the tax liability of an assessee. Hence we reject the contention that Rule 28(4) which empowers the taxing authorities to determine the tax liability is ultra vires S. 21 of theule (4) of Rule 28, the Superintendent or Assistant Superintendent, as the case may be, is competent to make an assessment on the basis of best judgment. The contention that the power conferred under(4) of Rule 28 is available only if the assessee fails to make a return or having made it, fails to comply with the terms of the notice issued under(2) or to produce any evidence under(3), overlooks the fact that the assessee must satisfy that the return made by him is a correct one. If the return made by the assessee is rejected on a relevant ground, such a return cannot be considered as a good return under(1) of Rule 28. In that event, the assessee is deemed to have made no return as required by Rule 28(1) and consequently he is liable to be assessed on the basis of best judgment.8. There is no substance in the contention that Rule 28 is repugnant to Section 9(2) of the Act.That rule covers a filed uncovered by Section 9(2). The provisions relating to the imposition of penalty found in S. 9(2) are not inconsistent with or repugnant to the provisions contained in Rule 28. Rule 28 deals with assessment whereas(2) of Section 9 deals with imposition of penalty. Hence the contention that Rule 28 is inconsistent with Section 9(2) has to be rejected.9. We are unable to accept the contention that the assessment in this case was arbitrarily made. The Assistant Superintendent of Commercial Taxes had computed the tax liability of the assessee on relevant grounds. He arrived at the conclusion that the tax liability of the assessee for the period in question is Rs. 67,500 after taking into consideration materials which were relevant in thatwith that aspect of the case this is what that officer says in his orderVeena cinema has a capacity so as to yield a tax of nearly 500 per show, if the house goes full. If, therefore, the Cinema had run to the capacity of all days and in each show of the assessment period, the tax would have amounted to Rs. 2,70,000. But it is a known fact that the shows run full to the capacity only on the first days of the start of exhibition of a good and popular picture and that too only in the evening shows. The matinee and the night shows full (sic). As the picture gets older, the sale decreases. Towards the end, the number of persons to witness the picture thin down considerably and the amount of tax falls even below Rs. 50. Taking these points into consideration I feel that the business done by this Cinema in the assessment period was such as to give tax at the average rate of Rs. 125 per show. At this rate the total amount of tax payable in the assessment period comes to Rs. 67,500. This cinema is therefore, assessed to pay a tax of Rs. 67,500 for the period from0. The facts mentioned above are cogent and relevant in the matter of computing the probable receipts by sale of cinema tickets. | 0 | 1,782 | 950 | ### Instruction:
Speculate on the likely judgment (yes (1) or no (0) to the appeal) and then delve into the case proceeding to elucidate your prediction, focusing on critical sentences.
### Input:
consistent with the Act for securing the payment of entertainment tax and generally for the purpose of carrying into effect the provisions of the Act.The power given under this provision is wide enough to make rules for the determination of the tax liability of an assessee. The mode and the manner in which that liability is to be determined can be provided under the rules. The main purpose of the Act is to levy and collect entertainment tax. Therefore it is idle to say that in exercise of the powers conferred on the State Government under S. 21(1) of the Act that Government cannot make rules for the determination of the tax liability of an assessee. Hence we reject the contention that Rule 28(4) which empowers the taxing authorities to determine the tax liability is ultra vires S. 21 of the Act.6. Rule 28 reads:"(1) If the Superintendent or Assistant Superintendent is satisfied without requiring the presence of the proprietor or production by him of any evidence that the return furnished in respect of any period is correct and complete, he shall assess the amount of tax due from the proprietor on the basis of such return.(2) If the Superintendent or Assistant Superintendent is not satisfied without requiring the presence of the proprietor or production of evidence that the return furnished in respect of any period is correct and complete, he shall serve a notice in from XI on such proprietor requiring him on a date and at a place to be specified therein either to attend in person or to produce or cause to be produced any evidence on which the proprietor relies to prove the correctness of such return or to submit such other accounts, registers or documents of the proprietor as may be considered necessary by the Superintendent or Asstt. Superintendent for the purpose of determining the amount of tax due against the proprietor.(3) On the date specified in the notice or as soon afterwards as may be, the Superintendent or Assistant Superintendent after hearing such evidence as the proprietor may produce and such other evidence as the Superintendent or Assistant Superintendent may require on specified points shall assess the amount of tax due from the proprietor.(4) If the proprietor fails to make a return or having made the return, fails to comply with all the terms of the notice issued under sub-rule (2) or to produce any evidence required under sub-rule (3), the Superintendent or Assistant Superintendent shall, after giving the proprietor a reasonable opportunity of being heard, assess to the best of his judgment, the amount of tax, if any, due from the proprietor."7. This rule is similar to S. 23 of the Indian Income-tax Act, 1922. Sub-rule (4) of rule 28 is analogous to sub-section (4) or S. 23.In view of Sub-rule (4) of Rule 28, the Superintendent or Assistant Superintendent, as the case may be, is competent to make an assessment on the basis of best judgment. The contention that the power conferred under sub-rule (4) of Rule 28 is available only if the assessee fails to make a return or having made it, fails to comply with the terms of the notice issued under sub-rule (2) or to produce any evidence under sub-rule (3), overlooks the fact that the assessee must satisfy that the return made by him is a correct one. If the return made by the assessee is rejected on a relevant ground, such a return cannot be considered as a good return under sub-rule (1) of Rule 28. In that event, the assessee is deemed to have made no return as required by Rule 28(1) and consequently he is liable to be assessed on the basis of best judgment.8. There is no substance in the contention that Rule 28 is repugnant to Section 9(2) of the Act.That rule covers a filed uncovered by Section 9(2). The provisions relating to the imposition of penalty found in S. 9(2) are not inconsistent with or repugnant to the provisions contained in Rule 28. Rule 28 deals with assessment whereas sub-section (2) of Section 9 deals with imposition of penalty. Hence the contention that Rule 28 is inconsistent with Section 9(2) has to be rejected.9. We are unable to accept the contention that the assessment in this case was arbitrarily made. The Assistant Superintendent of Commercial Taxes had computed the tax liability of the assessee on relevant grounds. He arrived at the conclusion that the tax liability of the assessee for the period in question is Rs. 67,500 after taking into consideration materials which were relevant in that regard. Dealing with that aspect of the case this is what that officer says in his order :"The Veena cinema has a capacity so as to yield a tax of nearly 500 per show, if the house goes full. If, therefore, the Cinema had run to the capacity of all days and in each show of the assessment period, the tax would have amounted to Rs. 2,70,000. But it is a known fact that the shows run full to the capacity only on the first days of the start of exhibition of a good and popular picture and that too only in the evening shows. The matinee and the night shows full (sic). As the picture gets older, the sale decreases. Towards the end, the number of persons to witness the picture thin down considerably and the amount of tax falls even below Rs. 50. Taking these points into consideration I feel that the business done by this Cinema in the assessment period was such as to give tax at the average rate of Rs. 125 per show. At this rate the total amount of tax payable in the assessment period comes to Rs. 67,500. This cinema is therefore, assessed to pay a tax of Rs. 67,500 for the period from 1-4-59 to 30-9-1959."10. The facts mentioned above are cogent and relevant in the matter of computing the probable receipts by sale of cinema tickets.
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4. The return submitted by the appellant was rejected by the authorities on the grounds that the books of account produced by the appellant were entirely unreliable that the appellant had maintained duplicate sets of tickets and had suppressed the sale of the tickets. These findings were based on the result of a surprise inspection. All the authorities under the Act have concurrently come to the conclusion that theproduced by the appellant were entirely unreliable; that it had maintained duplicate sets of tickets and that it suppressed the sale oftickets. These findings werenot challenged before the High Court and therefore we did not allow the learned Counsel for the appellant to challenge those findings. In view of those findings, it cannot be denied that the taxing authorities were justified in rejecting the return submitted by theprovision in the Act deals with the mode of determination of tax payable by an assessee. That aspect of the matter is left to be governed by the rules to be made. Section 21 of the Act empowers the State Government to make rules.(1) of that section provides that the State Government may make rules, consistent with the Act for securing the payment of entertainment tax and generally for the purpose of carrying into effect the provisions of the Act.The power given under this provision is wide enough to make rules for the determination of the tax liability of an assessee. The mode and the manner in which that liability is to be determined can be provided under the rules. The main purpose of the Act is to levy and collect entertainment tax. Therefore it is idle to say that in exercise of the powers conferred on the State Government under S. 21(1) of the Act that Government cannot make rules for the determination of the tax liability of an assessee. Hence we reject the contention that Rule 28(4) which empowers the taxing authorities to determine the tax liability is ultra vires S. 21 of theule (4) of Rule 28, the Superintendent or Assistant Superintendent, as the case may be, is competent to make an assessment on the basis of best judgment. The contention that the power conferred under(4) of Rule 28 is available only if the assessee fails to make a return or having made it, fails to comply with the terms of the notice issued under(2) or to produce any evidence under(3), overlooks the fact that the assessee must satisfy that the return made by him is a correct one. If the return made by the assessee is rejected on a relevant ground, such a return cannot be considered as a good return under(1) of Rule 28. In that event, the assessee is deemed to have made no return as required by Rule 28(1) and consequently he is liable to be assessed on the basis of best judgment.8. There is no substance in the contention that Rule 28 is repugnant to Section 9(2) of the Act.That rule covers a filed uncovered by Section 9(2). The provisions relating to the imposition of penalty found in S. 9(2) are not inconsistent with or repugnant to the provisions contained in Rule 28. Rule 28 deals with assessment whereas(2) of Section 9 deals with imposition of penalty. Hence the contention that Rule 28 is inconsistent with Section 9(2) has to be rejected.9. We are unable to accept the contention that the assessment in this case was arbitrarily made. The Assistant Superintendent of Commercial Taxes had computed the tax liability of the assessee on relevant grounds. He arrived at the conclusion that the tax liability of the assessee for the period in question is Rs. 67,500 after taking into consideration materials which were relevant in thatwith that aspect of the case this is what that officer says in his orderVeena cinema has a capacity so as to yield a tax of nearly 500 per show, if the house goes full. If, therefore, the Cinema had run to the capacity of all days and in each show of the assessment period, the tax would have amounted to Rs. 2,70,000. But it is a known fact that the shows run full to the capacity only on the first days of the start of exhibition of a good and popular picture and that too only in the evening shows. The matinee and the night shows full (sic). As the picture gets older, the sale decreases. Towards the end, the number of persons to witness the picture thin down considerably and the amount of tax falls even below Rs. 50. Taking these points into consideration I feel that the business done by this Cinema in the assessment period was such as to give tax at the average rate of Rs. 125 per show. At this rate the total amount of tax payable in the assessment period comes to Rs. 67,500. This cinema is therefore, assessed to pay a tax of Rs. 67,500 for the period from0. The facts mentioned above are cogent and relevant in the matter of computing the probable receipts by sale of cinema tickets.
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Commissioner of Sales Tax, Bombay Vs. Amandi Private Limited | S. P. BHARUCHA, J. The High Court at Bombay rejected the sales tax application made on behalf of the Commissioner of Sales Tax, Maharashtra, to direct the Sales Tax Tribunal to refer to the High Court the following question : "Whether the Tribunal was correct in holding that in purchasing materials for the construction of the barges intended for use in the business of sea transport the opponent-company was not carrying on the business of buying goods and hence was not a dealer as defined by clause (11) of section2 of the Bombay Sales Tax Act, 1959 ?" * The High Court rejected the application in limine stating that the Sales Tax Tribunal had been right in holding that the case was covered by the High Courts decision in Famous Cine Laboratory and Studio Ltd. v. State of Maharashtra. The Commissioner of Sales Tax has been given special leave to appeal. The assessee (respondent) carries on the business of hiring out barges. It owns two barges, both of which were built by the assessee itself after purchase of the requisite raw materials. The Deputy Commissioner of Sales Tax held, upon an application made to him by the assessee under section52 of the Bombay Sales Tax Act, 1959, that the assessee was a dealer within the meaning of section2(11) of the Act. The decision of the Deputy Commissioner was set aside by the Sales Tax Tribunal, reliance being placed upon the aforementioned judgment in the case of Famous Cine Laboratory and Studio Ltd. Basing itself upon the same judgment, the High Court, as aforesaid, declined to call for a reference. The Famous Cine Laboratory and Studio Ltd. owned a film studio and a film laboratory and hired out the studio and equipment to film producers for shooting films. It purchased materials such as bricks, wood, plaster, paint, etc., and utilised them in the maintenance of the studio and in the making of film sets. It was held that in processing the said goods for the said purposes what the assessee was doing was either making additions to its capital assets or providing itself with further capital assets and it was, accordingly, not carrying on the business of buying goods and was not a dealer within the meaning of section 2(11).Learned counsel for the Commissioner of Sales Tax has drawn our attention to the judgment of the same High Court, delivered just a day earlier, in the case of Commissioner of Sales Tax v. D. V. Save. This was a case where the assessee purchased building materials in the course of its business as building contractor and consumed them in the construction of buildings or in carrying out repairs to buildings. It was held that the assessee was a dealer within the meaning of section 2(11). Learned counsel submitted that to the facts of the case before us it was the judgment in D. V. Saves case which was applicable. Having heard counsel we are of the view that the question aforementioned is a question of law and that it requires consideration in the light of the judgment in D. V. Saves case, which, prima facie, appears to us to be more on point than the judgment in the case of Famous Cine Laboratory and Studio Ltd. | 1[ds]Having heard counsel we are of the view that the question aforementioned is a question of law and that it requires consideration in the light of the judgment in D. V. Saves case, which, prima facie, appears to us to be more on point than the judgment in the case of Famous Cine Laboratory and Studio Ltd. | 1 | 599 | 65 | ### Instruction:
Decide if the appeal in the case proceeding is more likely to be successful (1) or unsuccessful (0), and then justify your decision by focusing on essential sentences in the document.
### Input:
S. P. BHARUCHA, J. The High Court at Bombay rejected the sales tax application made on behalf of the Commissioner of Sales Tax, Maharashtra, to direct the Sales Tax Tribunal to refer to the High Court the following question : "Whether the Tribunal was correct in holding that in purchasing materials for the construction of the barges intended for use in the business of sea transport the opponent-company was not carrying on the business of buying goods and hence was not a dealer as defined by clause (11) of section2 of the Bombay Sales Tax Act, 1959 ?" * The High Court rejected the application in limine stating that the Sales Tax Tribunal had been right in holding that the case was covered by the High Courts decision in Famous Cine Laboratory and Studio Ltd. v. State of Maharashtra. The Commissioner of Sales Tax has been given special leave to appeal. The assessee (respondent) carries on the business of hiring out barges. It owns two barges, both of which were built by the assessee itself after purchase of the requisite raw materials. The Deputy Commissioner of Sales Tax held, upon an application made to him by the assessee under section52 of the Bombay Sales Tax Act, 1959, that the assessee was a dealer within the meaning of section2(11) of the Act. The decision of the Deputy Commissioner was set aside by the Sales Tax Tribunal, reliance being placed upon the aforementioned judgment in the case of Famous Cine Laboratory and Studio Ltd. Basing itself upon the same judgment, the High Court, as aforesaid, declined to call for a reference. The Famous Cine Laboratory and Studio Ltd. owned a film studio and a film laboratory and hired out the studio and equipment to film producers for shooting films. It purchased materials such as bricks, wood, plaster, paint, etc., and utilised them in the maintenance of the studio and in the making of film sets. It was held that in processing the said goods for the said purposes what the assessee was doing was either making additions to its capital assets or providing itself with further capital assets and it was, accordingly, not carrying on the business of buying goods and was not a dealer within the meaning of section 2(11).Learned counsel for the Commissioner of Sales Tax has drawn our attention to the judgment of the same High Court, delivered just a day earlier, in the case of Commissioner of Sales Tax v. D. V. Save. This was a case where the assessee purchased building materials in the course of its business as building contractor and consumed them in the construction of buildings or in carrying out repairs to buildings. It was held that the assessee was a dealer within the meaning of section 2(11). Learned counsel submitted that to the facts of the case before us it was the judgment in D. V. Saves case which was applicable. Having heard counsel we are of the view that the question aforementioned is a question of law and that it requires consideration in the light of the judgment in D. V. Saves case, which, prima facie, appears to us to be more on point than the judgment in the case of Famous Cine Laboratory and Studio Ltd.
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Having heard counsel we are of the view that the question aforementioned is a question of law and that it requires consideration in the light of the judgment in D. V. Saves case, which, prima facie, appears to us to be more on point than the judgment in the case of Famous Cine Laboratory and Studio Ltd.
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CTP Environment S.A.S Vs. Sentro Technologies Limited and Ors | G.S. Patel, J. 1. This order will dispose of these two Notices of Motion, both filed by the Defendants. The suit is an action in patent infringement. 2. Notice of Motion No. 912 of 2015 purports to be under Order VII Rule 10 and Order VII Rule 11, read with Section 51 of the Code of Civil Procedure, 1908 (CPC). Notice of Motion No. 913 of 2015 is more substantial. It seeks recall of two orders dated 10th October 2014 and 8th January 2015, because, according to the Defendants, these orders were ex parte orders obtained without proper notice to the Defendants. 3. I have heard Mr. Khata for the Defendants and Mr. Tulzapurkar for the Plaintiff at quite considerable length. With their assistance, I have considered the material on record. RE: NOTICE OF MOTION NO. 912 OF 2015 4. In my view, this Notice of Motion is completely misconceived and not maintainable. The reasons are many. To begin with, the cast of the prayer is wrong. This being a Chartered High Court, in view of the provisions of Order 49 Rule 3, there is no question of rejection of a plaint under Order 7 Rule 10. That Rule does not apply to the Chartered High Courts. In any case, that Rule is for return of the plaint and not for rejection of the plaint, which is a completely different aspect. 5. As regards the relief under Order 7, Rule 11, this too cannot be maintained. Order 49 also provides that clauses (b) and (c) of Order 7 Rule 11 have no application to a Chartered High Court. Mr. Khata places his case emphatically under Order VII Rule 11(d), saying that it is barred by any law. By this, he means that this Court does not have the jurisdiction to entertain the Suit. Incidentally, this is another reason why the application under Order 7 Rule 10 can never lie, even assuming that that Rule applied to this Court. If the Defendants case is that this Court has no jurisdiction because the Defendants are not in India, then no Court in India has jurisdiction and there is no question of returning the plaint for presentation to the proper Court; according to the Defendants themselves, there is simply no other Court in India to which the Plaintiff could go. 6. In any case, the application under Order 7 Rule 11 must proceed on a demurrer, i.e., on taking the plaint as it stands. This is settled law. It cannot be assessed on any convoluted, complicated or complex process of reasoning. On the plaint, as it stands, there is a clear case made out showing that the Court has jurisdiction. The necessary averments are to be found in paragraph 45 of the plaint. Here, the Plaintiff avers that the 1st Defendant has a place of business or an office in Mumbai, and the 2nd Defendants place of business is also in Mumbai. It is also alleged that the patent infringement in question took place in Mumbai and, therefore, the entire cause of action arose within the jurisdiction of this Court. 7. The entirety of the Defendants case is based on one entirely incorrect and flawed premise, viz., that it is only the situs of the Defendants that gives a Court jurisdiction. Even a plain reading of Section 20 of the CPC indicates otherwise. Here, the case of the Plaintiff is, in addition to the Defendants situs, that the cause of action, i.e., the patent infringement, took place in Mumbai. If this be so, then this is an additional reason to reject the Defendants Notice of Motion. This is a matter not to be gauged on the basis of Replies and Rejoinders but on the demurrer and on a reading of the plaint as it stands. In short, what Order 7, Rule 11 of the CPC requires is this: that the defendant must be able to say, take the plaint as it stands, and when you do, you will find that there is no cause of action against the defendant and that this Court in no case has jurisdiction. It is not possible to hold that the Defendants have made out any such case. | 0[ds]4. In my view, this Notice of Motion is completely misconceived and not maintainable. The reasons are many. To begin with, the cast of the prayer is wrong. This being a Chartered High Court, in view of the provisions of Order 49 Rule 3, there is no question of rejection of a plaint under Order 7 Rule 10. That Rule does not apply to the Chartered High Courts. In any case, that Rule is for return of the plaint and not for rejection of the plaint, which is a completely different aspect.5. As regards the relief under Order 7, Rule 11, this too cannot be maintained. Order 49 also provides that clauses (b) and (c) of Order 7 Rule 11 have no application to a Chartered High Court.Incidentally, this is another reason why the application under Order 7 Rule 10 can never lie, even assuming that that Rule applied to this Court. If the Defendants case is that this Court has no jurisdiction because the Defendants are not in India, then no Court in India has jurisdiction and there is no question of returning the plaint for presentation to the proper Court; according to the Defendants themselves, there is simply no other Court in India to which the Plaintiff could go.6. In any case, the application under Order 7 Rule 11 must proceed on a demurrer, i.e., on taking the plaint as it stands. This is settled law. It cannot be assessed on any convoluted, complicated or complex process of reasoning. On the plaint, as it stands, there is a clear case made out showing that the Court has jurisdiction. The necessary averments are to be found in paragraph 45 of the plaint. Here, the Plaintiff avers that the 1st Defendant has a place of business or an office in Mumbai, and the 2nd Defendants place of business is also in Mumbai. It is also alleged that the patent infringement in question took place in Mumbai and, therefore, the entire cause of action arose within the jurisdiction of this Court.7. The entirety of the Defendants case is based on one entirely incorrect and flawed premise, viz., that it is only the situs of the Defendants that gives a Court jurisdiction. Even a plain reading of Section 20 of the CPC indicates otherwise. Here, the case of the Plaintiff is, in addition to the Defendants situs, that the cause of action, i.e., the patent infringement, took place in Mumbai. If this be so, then this is an additional reason to reject the Defendants Notice of Motion. This is a matter not to be gauged on the basis of Replies and Rejoinders but on the demurrer and on a reading of the plaint as it stands. In short, what Order 7, Rule 11 of the CPC requires is this: that the defendant must be able to say, take the plaint as it stands, and when you do, you will find that there is no cause of action against the defendant and that this Court in no case has jurisdiction. It is not possible to hold that the Defendants have made out any such case.I am given to understand that this means he is some sort of magician or performer given to demonstrating feats of mind-reading and other such displays of apparently extraordinary mental prowess. That does not seem to have helped the Defendants in the least; for the record shows that there were at least two minds that went totally unread.16. So: what we have, therefore, is that the Arcadia address was shown at the Sentro Tech website; at that physical address, only MIPL was to be found; and Suchards mentalist sibling has an association with MIPL.17. A question, therefore, directly arose in these very proceedings about the identity of the registrant of the domain name sentro-tech.com. There is material before me to indicate that the Defendants attempted to conceal or hide the details of the true registrant of this domain name; that matters little, since it is a very difficult business to obscure digital footprints, even with a mentalist in the family. The Plaintiff filed a subsequent Notice of Motion No. 1440 of 2016. I passed an order on that Motion on 17th June 2016. Prayer (c) of that Notice of Motion demanded a disclosure by the domain name registrar, domainsbyproxy.com, of the registrant of this domain name. That domain name registrar filed an affidavit. It is part of the record. It shows in no uncertain terms that the registrant of that domain is none other than Suchard himself.18. Therefore, to return to the summation in its next iteration: the Sentro Tech website showed the Arcadia address; the Sentro Tech website is now known to be registered to Suchard; at that physical address, only MIPL was found; and Suchards sibling is associated with MIPL.19. From the documents annexed to the Affidavit in Reply and the Affidavit in Rejoinder, it is not possible to tell whether the website at www.sentro-tech.com is limited to the 2nd Defendant or to the US firm (Sentro Technologies LLC) or both, or whether it includes the 1st Defendant Company. It certainly mentions an office in India. It also mentions an email address at which Sentro Technologies may be contacted. The Plaintiff served the Defendants at that email address as well.20. Mr. Tulzapurkar also points to another page from a business profile.2 It refers to Sentro Technologies Limited, obviously the 1st Defendant. It carries the same logo that appears on the webpages to which I referred earlier, and it refers generically to Sentro Technologies. What is interesting is that it lists the 1st Defendants website as being at www.sentro-tech.com, the very URL of which Suchard is personally the registrant and which Suchard claims is the URL of the US firm. What we now have, therefore, in addition to the previous factual array is that both the 1st Defendant Company and the US firm, at a minimum, share the same URL and website, under a domain name registered to Suchard, the 2nd Defendant.21. It is impossible to accept Mr. Khatas argument that since Suchard is a Director of the 1st Defendant, and the 1st Defendant has no office in India, therefore, the 2nd Defendant must also be deemed never to have been in India. This is more or less the substance of what is stated in paragraph F(ii) of the Affidavit in Support of the present Notice of Motion.22. Paragraph 6 is deliberately misleading; and to say that the 1st Defendant does not have a website is, as we have seen, entirely false. There is, too, the wilful suppression of the domain name registration information. Paragraph 13 is the purest chicanery, with Suchard claiming that he must be served in his capacity as a director of the 1st Defendant; and that if the 1st Defendant has no office here then he, as its director, does not either - notwithstanding that he might himself actually be doing business in India. These statements are of the stripe that are sufficient to dismiss the Motion with nothing further.323. Further, the extracted paragraphs are directly contrary to paragraph 12 of the Rejoinder,4 where the 1st Defendant admits that one Mr. Shay, a Project Manager, received a notice from the Plaintiff in June 2014. The 2nd Defendant alleges that Shay resigned on 1st October 2014. But this must necessarily mean that the 1st Defendant company did have an office in Mumbai in June 2014; and the statement in paragraph 6(i) of the Rejoinder is, therefore, clearly false.24. There is also the question of whether the Defendants have any credibility at all. I will leave aside all questions about the patent itself. There is, however, one statement in the Affidavit in Rejoinder that is a telling, if inadvertent, admission, and this is in paragraph 4, where the 2nd Defendant admits that apart from him there are two other companies that provide online cleaning services in India. This means that the 2nd Defendant also does business in India. That is enough for the purposes of jurisdiction.25. In paragraph G(iii) of the Affidavit in support, page 20, the 2nd Defendant claims that he has nothing whatever to do with MIPL in Mumbai. This statement is demonstrably incorrect. The Plaintiff applied for the appointment of a Court Receiver to make a site inspection of the refinery of Essar Oil at Jamnagar. I allowed that application by an order dated 1st October 2015. The Court Receiver was also directed to visit, importantly, a guest house near that refinery. When he did so, the Court Receivers representative found that not only the 2nd Defendant but others who are associated with Sentro Technologies LLC in California had visited that very guest house. A copy of the address of the visitors log was annexed to that report. This showed the name of the 2nd Defendant, one Samuel Marshall, and two others. All of them were shown as having an Indian address as Sentro/MIPL Mumbai. All were said to have arrived at Jamnagar from Mumbai on official work.26. Mr. Khatas argument also overlooks the provisions of Order 29 Rule 2 of the CPC. Service on a corporation, and the 1st Defendant is one, may be effected by service on the secretary/director or other principal officer or by leaving it or sending it by post addressed to the corporation at its registered office, or if there is no registered office, then at the place where the corporation carries on business. This is unambiguous. On its own showing, the 1st Defendant had an address in Mumbai. The 2nd Defendant certainly did. He was served in Mumbai.28. Thus, viewed from any perspective, the 2nd Defendant, who certainly has business in India and a place of business in Mumbai, is deemed to have been served. On account of the substituted service, the 1st Defendant is duly served as well.29. It is impossible to hold that the orders of 10th October 2014 or 8th January 2015 were ex parte orders obtained without notice. I believe Mr. Tulzapurkar is also correct in pointing out that the Defendants waited for six months between January and June 2015 to move this Notice of Motion because they were, during that time, trying to take whatever steps they could to obscure the registration information of the Sentro Technologies website. | 0 | 805 | 1,929 | ### Instruction:
First, predict whether the appeal in case proceeding will be accepted (1) or not (0), and then explain the decision by identifying crucial sentences from the document.
### Input:
G.S. Patel, J. 1. This order will dispose of these two Notices of Motion, both filed by the Defendants. The suit is an action in patent infringement. 2. Notice of Motion No. 912 of 2015 purports to be under Order VII Rule 10 and Order VII Rule 11, read with Section 51 of the Code of Civil Procedure, 1908 (CPC). Notice of Motion No. 913 of 2015 is more substantial. It seeks recall of two orders dated 10th October 2014 and 8th January 2015, because, according to the Defendants, these orders were ex parte orders obtained without proper notice to the Defendants. 3. I have heard Mr. Khata for the Defendants and Mr. Tulzapurkar for the Plaintiff at quite considerable length. With their assistance, I have considered the material on record. RE: NOTICE OF MOTION NO. 912 OF 2015 4. In my view, this Notice of Motion is completely misconceived and not maintainable. The reasons are many. To begin with, the cast of the prayer is wrong. This being a Chartered High Court, in view of the provisions of Order 49 Rule 3, there is no question of rejection of a plaint under Order 7 Rule 10. That Rule does not apply to the Chartered High Courts. In any case, that Rule is for return of the plaint and not for rejection of the plaint, which is a completely different aspect. 5. As regards the relief under Order 7, Rule 11, this too cannot be maintained. Order 49 also provides that clauses (b) and (c) of Order 7 Rule 11 have no application to a Chartered High Court. Mr. Khata places his case emphatically under Order VII Rule 11(d), saying that it is barred by any law. By this, he means that this Court does not have the jurisdiction to entertain the Suit. Incidentally, this is another reason why the application under Order 7 Rule 10 can never lie, even assuming that that Rule applied to this Court. If the Defendants case is that this Court has no jurisdiction because the Defendants are not in India, then no Court in India has jurisdiction and there is no question of returning the plaint for presentation to the proper Court; according to the Defendants themselves, there is simply no other Court in India to which the Plaintiff could go. 6. In any case, the application under Order 7 Rule 11 must proceed on a demurrer, i.e., on taking the plaint as it stands. This is settled law. It cannot be assessed on any convoluted, complicated or complex process of reasoning. On the plaint, as it stands, there is a clear case made out showing that the Court has jurisdiction. The necessary averments are to be found in paragraph 45 of the plaint. Here, the Plaintiff avers that the 1st Defendant has a place of business or an office in Mumbai, and the 2nd Defendants place of business is also in Mumbai. It is also alleged that the patent infringement in question took place in Mumbai and, therefore, the entire cause of action arose within the jurisdiction of this Court. 7. The entirety of the Defendants case is based on one entirely incorrect and flawed premise, viz., that it is only the situs of the Defendants that gives a Court jurisdiction. Even a plain reading of Section 20 of the CPC indicates otherwise. Here, the case of the Plaintiff is, in addition to the Defendants situs, that the cause of action, i.e., the patent infringement, took place in Mumbai. If this be so, then this is an additional reason to reject the Defendants Notice of Motion. This is a matter not to be gauged on the basis of Replies and Rejoinders but on the demurrer and on a reading of the plaint as it stands. In short, what Order 7, Rule 11 of the CPC requires is this: that the defendant must be able to say, take the plaint as it stands, and when you do, you will find that there is no cause of action against the defendant and that this Court in no case has jurisdiction. It is not possible to hold that the Defendants have made out any such case.
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domain name registrar, domainsbyproxy.com, of the registrant of this domain name. That domain name registrar filed an affidavit. It is part of the record. It shows in no uncertain terms that the registrant of that domain is none other than Suchard himself.18. Therefore, to return to the summation in its next iteration: the Sentro Tech website showed the Arcadia address; the Sentro Tech website is now known to be registered to Suchard; at that physical address, only MIPL was found; and Suchards sibling is associated with MIPL.19. From the documents annexed to the Affidavit in Reply and the Affidavit in Rejoinder, it is not possible to tell whether the website at www.sentro-tech.com is limited to the 2nd Defendant or to the US firm (Sentro Technologies LLC) or both, or whether it includes the 1st Defendant Company. It certainly mentions an office in India. It also mentions an email address at which Sentro Technologies may be contacted. The Plaintiff served the Defendants at that email address as well.20. Mr. Tulzapurkar also points to another page from a business profile.2 It refers to Sentro Technologies Limited, obviously the 1st Defendant. It carries the same logo that appears on the webpages to which I referred earlier, and it refers generically to Sentro Technologies. What is interesting is that it lists the 1st Defendants website as being at www.sentro-tech.com, the very URL of which Suchard is personally the registrant and which Suchard claims is the URL of the US firm. What we now have, therefore, in addition to the previous factual array is that both the 1st Defendant Company and the US firm, at a minimum, share the same URL and website, under a domain name registered to Suchard, the 2nd Defendant.21. It is impossible to accept Mr. Khatas argument that since Suchard is a Director of the 1st Defendant, and the 1st Defendant has no office in India, therefore, the 2nd Defendant must also be deemed never to have been in India. This is more or less the substance of what is stated in paragraph F(ii) of the Affidavit in Support of the present Notice of Motion.22. Paragraph 6 is deliberately misleading; and to say that the 1st Defendant does not have a website is, as we have seen, entirely false. There is, too, the wilful suppression of the domain name registration information. Paragraph 13 is the purest chicanery, with Suchard claiming that he must be served in his capacity as a director of the 1st Defendant; and that if the 1st Defendant has no office here then he, as its director, does not either - notwithstanding that he might himself actually be doing business in India. These statements are of the stripe that are sufficient to dismiss the Motion with nothing further.323. Further, the extracted paragraphs are directly contrary to paragraph 12 of the Rejoinder,4 where the 1st Defendant admits that one Mr. Shay, a Project Manager, received a notice from the Plaintiff in June 2014. The 2nd Defendant alleges that Shay resigned on 1st October 2014. But this must necessarily mean that the 1st Defendant company did have an office in Mumbai in June 2014; and the statement in paragraph 6(i) of the Rejoinder is, therefore, clearly false.24. There is also the question of whether the Defendants have any credibility at all. I will leave aside all questions about the patent itself. There is, however, one statement in the Affidavit in Rejoinder that is a telling, if inadvertent, admission, and this is in paragraph 4, where the 2nd Defendant admits that apart from him there are two other companies that provide online cleaning services in India. This means that the 2nd Defendant also does business in India. That is enough for the purposes of jurisdiction.25. In paragraph G(iii) of the Affidavit in support, page 20, the 2nd Defendant claims that he has nothing whatever to do with MIPL in Mumbai. This statement is demonstrably incorrect. The Plaintiff applied for the appointment of a Court Receiver to make a site inspection of the refinery of Essar Oil at Jamnagar. I allowed that application by an order dated 1st October 2015. The Court Receiver was also directed to visit, importantly, a guest house near that refinery. When he did so, the Court Receivers representative found that not only the 2nd Defendant but others who are associated with Sentro Technologies LLC in California had visited that very guest house. A copy of the address of the visitors log was annexed to that report. This showed the name of the 2nd Defendant, one Samuel Marshall, and two others. All of them were shown as having an Indian address as Sentro/MIPL Mumbai. All were said to have arrived at Jamnagar from Mumbai on official work.26. Mr. Khatas argument also overlooks the provisions of Order 29 Rule 2 of the CPC. Service on a corporation, and the 1st Defendant is one, may be effected by service on the secretary/director or other principal officer or by leaving it or sending it by post addressed to the corporation at its registered office, or if there is no registered office, then at the place where the corporation carries on business. This is unambiguous. On its own showing, the 1st Defendant had an address in Mumbai. The 2nd Defendant certainly did. He was served in Mumbai.28. Thus, viewed from any perspective, the 2nd Defendant, who certainly has business in India and a place of business in Mumbai, is deemed to have been served. On account of the substituted service, the 1st Defendant is duly served as well.29. It is impossible to hold that the orders of 10th October 2014 or 8th January 2015 were ex parte orders obtained without notice. I believe Mr. Tulzapurkar is also correct in pointing out that the Defendants waited for six months between January and June 2015 to move this Notice of Motion because they were, during that time, trying to take whatever steps they could to obscure the registration information of the Sentro Technologies website.
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Debi Prasad (Dead) By L.Rs Vs. Tribeni Devi And Ors | the said firm." 17. If Debi Prasad was the rightful heir to the estate of Gopal Das, he could not have admitted in the year 1935 that Shyam Behari Lal was the proprietor of the firm Gopal Das Chhangamal. Debi Prasads explanation that on the date he gave that deposition, he was unaware of the fact that he was the heir of Gopal Das, cannot be believed. In Ex. A-226, the decree in the aforesaid suit, Shyam Behari Lal was described as the son of Gopal Das. Exh. A-274 is another certified copy of the deposition given by Debi Prasad. This was given on July 19, 1923 in a suit where Gopal Das was the plaintiff. Therein he stated in cross-examination:"The plaintiff No. I has got a son named B. Shyam Behari Lal Vakil ...... Our business is also ancestral business. His son Shyam Behari and his grandson Mukut Behari are members of a joint Hindu Family." He further stated therein:-"Lala Gopal Das, his son (referring to Shyam Behari Lal) and grandson are the sole owners of the firm styled Kuramal Kedar Nath." 18. Exh. A-236 is the certified copy of the plaint filed by Shyam Behari Lal and Debi Prasad jointly in Suit No. 353 of 1935 in the Court of Civil Judge, Faizabad. In paragraph 1 of the plaint, it is stated:"The proprietor of the said shop was Gopal Das, father of the plaintiff No. 1 till his life time and after his death to which about a year nine months and half have passed, the plaintiff No. 1 as survivor became and is the proprietor of the said property." This is an extremely important admission. This admission was made after the death of Gopal Das. Therein Debi Prasad not only admitted that Shyam Behari Lal was the son of Gopal Das, he further admitted that he became the proprietor of the concern by survivorship. This could have only happened if Shyam Behari Lal had been adopted by Gopal Das. Exhs. A-352 and 356 are two applications made for registration of a firm under the Indian Partnership Act, 1932. The first application was made on March 26, 1936. It was returned with some objection and the second application was made on May 4, 1936. Both these applications bear the signature of Debi Prasad as well as Shyam Behari Lal. In those applications, it was stated that Shyam Behari Lal had succeeded as a partner of the firm whose registration was sought in the place of his father Gopal Das who had died. Exh. A-358 is an application for transfer of shares made to the Banaras Cotton and Silk Mills Ltd., by Debi Prasad. Thereunder he sought to transfer his 100 shares to Shyam Behari Lal whom he described in his application as the son of Gopal Das. Similar averments were made in Exh. A-359. 19. Exhs. A-262, 656, 657 and A-276 are the statements made by the relations of Shyam Behari Lal and Debi Prasad wherein Shyam Behari Lal was described as the son of Gopal Das. 20. A large number of documents have been produced to show that friends, relations and even strangers were treating Shyam Behari Lal as the son of Gopal Das. The documents produced before the Court conclusively prove that right from 1907till 1946, Shyam Behari Lal was treated as the son of Gopal Das. This continuous and consistent course of conduct on the part of Debi Prasad, Gopal Das and others affords a satisfactory proof of the fact that Shyam Behari Lal must have been the adopted son of Gopal Das. No other reasonable inference can be drawn from the material on record. 21. Mr. Desai appearing on behalf of the appellants contended that we should not accept the adoption pleaded firstly because, it was unlikely that Gopal Das would have taken a child in adoption as far back as 1892 when he was only 32 years of age; secondly the story that a one-day old child was taken in adoption when the family must have been in pollution must be rejected as being repugnant to Hindu notions and lastly in a decree of 1910, Shyam Behari Lal was described as the son of Ram Das, his natural father. We are unable to accept these contentions. It is in evidence that Gopal Das had lost three children even before 1890. Evidently he had lost all hopes of getting a natural son. Further it is not necessary to speculate in the face of the documentary evidence referred to earlier why Gopal Das should have taken a son in adoption when there was every [possibility for him to get a natural son. Coming to the question of adoption on the very day Shyam Behari Lal was born, that plea rests on hearsay information. There is no positive evidence before us as to when exactly Shyam Behari Lal was adopted. From the evidence of D. Ws. 10 and 15, it is clear that he must have been adopted very soon after his birth. That is the best that can be said on the basis of the evidence. That apart custom differs from place to place and from community to community. It is true that in a decree made in 1910, Shyam Behari Lal was described as the son of Ram Das. But in the very next year in another decree, he was described as the son of Gopal Das. We do not think that the evidence afforded by that solitary document showing Shyam Behari Lal as the son of Ram Das can outweigh the other evidence which is both satisfactory as well as voluminous. 22. On an appreciation of the entire evidence on record, we are in agreement with the High Courts conclusion that Shyam Behari Lal was the adopted son of Gopal Das and there is nothing to show that the said adoption was invalid for any reason. In view of this conclusion, it is unnecessary to consider the other contentions raised in the appeal. | 0[ds]We are unable to accept these contentions. It is in evidence that Gopal Das had lost three children even before 1890. Evidently he had lost all hopes of getting a natural son. Further it is not necessary to speculate in the face of the documentary evidence referred to earlier why Gopal Das should have taken a son in adoption when there was every [possibility for him to get a natural son. Coming to the question of adoption on the very day Shyam Behari Lal was born, that plea rests on hearsay information. There is no positive evidence before us as to when exactly Shyam Behari Lal was adopted. From the evidence of D. Ws. 10 and 15, it is clear that he must have been adopted very soon after his birth. That is the best that can be said on the basis of the evidence. That apart custom differs from place to place and from community to community. It is true that in a decree made in 1910, Shyam Behari Lal was described as the son of Ram Das. But in the very next year in another decree, he was described as the son of Gopal Das. We do not think that the evidence afforded by that solitary document showing Shyam Behari Lal as the son of Ram Das can outweigh the other evidence which is both satisfactory as well as voluminous22. On an appreciation of the entire evidence on record, we are in agreement with the High Courts conclusion that Shyam Behari Lal was the adopted son of Gopal Das and there is nothing to show that the said adoption was invalid for any reason. In view of this conclusion, it is unnecessary to consider the other contentions raised in the appeal9. There is no doubt that the burden of proving satisfactorily that he was given by his natural father and received by Gopal Das as his adoptive son is on Shyam Behari Lal. But as observed by the Judicial Committee of the Privy Council in Rajendro Nath Holder v. Jogendro Nath Banerjee,) 14 Moo Ind App. 67 (PC) that although the person who pleads that he had been adopted is bound to prove his title as adopted son,as a fact yet from the long period during which he had been received as an adopted son, every allowance for the absence of evidence to prove such fact was to be favourably entertained, and that the case was analogous to that in which the legitimacy of a person in possession had been acquiesced in for a considerable time, and afterwards impeached by a party, who had a right to question the legitimacy, where the Defendant, in order to defend his status, is allowed to invoke against the claimant every presumption which arises from long recognition of his legitimacy by members of his family;that in the case of Hindoo, long recognition as an adopted son, raised even a stronger presumption in favour of the validity of his adoption, arising from the possibility of the loss of his rights in his own family by being adopted in another family.In Rup Narain v. Mst. Gopal Devi, (1909) 36 Ind App. 103 (PC), the Judicial Committee observed that in the absence of direct evidence much value had to be attached to the fact that the alleged adopted son had without controversy succeeded to his adoptive fathers estate and enjoyed till his death and that documents during his life and after his death were framed upon the basis of the adoption. A Division Bench of the Orissa High Court in Balinki Padhano v. Gopalkrishna Padhano, AIR 1964 Orissa 117; held thatin the case of an ancient adoption evidence showing that the boy was treated for a long time as the adopted son at a time when there was no controversy is sufficient to prove the adoption although evidence of actual giving and taking is not forthcoming. We are in agreement with the views expressed in the decisions referred to above12. Before dealing with the evidence mentioned earlier, it is necessary to mention that the High Court has relied in proof of the adoption pleaded, on the evidence of D. W. 10 Rikhab Das and D. W. 15 Chhotey Lal. Both of them were the close relations of the wife of Gopal Das. They are disinterested witnesses. Their evidence is to the effect that sometime after the birth of Shyam Behari Lal, the wife of Gopal Das took him to her paternal home where Paon Pheri ceremony was performed. There is satisfactory evidence to show that this ceremony is customarily performed in the parental home of a lady who has given birth to her first child. We see no reason to disbelieve the testimony of these witnesses. Their evidence clearly indicates the fact that Shyam Behari Lal must have been taken in adoption by Gopal Das. We may also at this stage refer to another important circumstance appearing in the case. As mentioned earlier, both Gopal Das and his wife died in the year 1934. the suit from which this appeal arises was instituted only in 1946, just a few months before the period of limitation for instituting the same expired. Debi Prasad has not given any satisfactory explanation for this inordinate delay in instituting the suit. This circumstance tends to show that the suit is likely to be speculative one. | 0 | 3,987 | 970 | ### Instruction:
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the said firm." 17. If Debi Prasad was the rightful heir to the estate of Gopal Das, he could not have admitted in the year 1935 that Shyam Behari Lal was the proprietor of the firm Gopal Das Chhangamal. Debi Prasads explanation that on the date he gave that deposition, he was unaware of the fact that he was the heir of Gopal Das, cannot be believed. In Ex. A-226, the decree in the aforesaid suit, Shyam Behari Lal was described as the son of Gopal Das. Exh. A-274 is another certified copy of the deposition given by Debi Prasad. This was given on July 19, 1923 in a suit where Gopal Das was the plaintiff. Therein he stated in cross-examination:"The plaintiff No. I has got a son named B. Shyam Behari Lal Vakil ...... Our business is also ancestral business. His son Shyam Behari and his grandson Mukut Behari are members of a joint Hindu Family." He further stated therein:-"Lala Gopal Das, his son (referring to Shyam Behari Lal) and grandson are the sole owners of the firm styled Kuramal Kedar Nath." 18. Exh. A-236 is the certified copy of the plaint filed by Shyam Behari Lal and Debi Prasad jointly in Suit No. 353 of 1935 in the Court of Civil Judge, Faizabad. In paragraph 1 of the plaint, it is stated:"The proprietor of the said shop was Gopal Das, father of the plaintiff No. 1 till his life time and after his death to which about a year nine months and half have passed, the plaintiff No. 1 as survivor became and is the proprietor of the said property." This is an extremely important admission. This admission was made after the death of Gopal Das. Therein Debi Prasad not only admitted that Shyam Behari Lal was the son of Gopal Das, he further admitted that he became the proprietor of the concern by survivorship. This could have only happened if Shyam Behari Lal had been adopted by Gopal Das. Exhs. A-352 and 356 are two applications made for registration of a firm under the Indian Partnership Act, 1932. The first application was made on March 26, 1936. It was returned with some objection and the second application was made on May 4, 1936. Both these applications bear the signature of Debi Prasad as well as Shyam Behari Lal. In those applications, it was stated that Shyam Behari Lal had succeeded as a partner of the firm whose registration was sought in the place of his father Gopal Das who had died. Exh. A-358 is an application for transfer of shares made to the Banaras Cotton and Silk Mills Ltd., by Debi Prasad. Thereunder he sought to transfer his 100 shares to Shyam Behari Lal whom he described in his application as the son of Gopal Das. Similar averments were made in Exh. A-359. 19. Exhs. A-262, 656, 657 and A-276 are the statements made by the relations of Shyam Behari Lal and Debi Prasad wherein Shyam Behari Lal was described as the son of Gopal Das. 20. A large number of documents have been produced to show that friends, relations and even strangers were treating Shyam Behari Lal as the son of Gopal Das. The documents produced before the Court conclusively prove that right from 1907till 1946, Shyam Behari Lal was treated as the son of Gopal Das. This continuous and consistent course of conduct on the part of Debi Prasad, Gopal Das and others affords a satisfactory proof of the fact that Shyam Behari Lal must have been the adopted son of Gopal Das. No other reasonable inference can be drawn from the material on record. 21. Mr. Desai appearing on behalf of the appellants contended that we should not accept the adoption pleaded firstly because, it was unlikely that Gopal Das would have taken a child in adoption as far back as 1892 when he was only 32 years of age; secondly the story that a one-day old child was taken in adoption when the family must have been in pollution must be rejected as being repugnant to Hindu notions and lastly in a decree of 1910, Shyam Behari Lal was described as the son of Ram Das, his natural father. We are unable to accept these contentions. It is in evidence that Gopal Das had lost three children even before 1890. Evidently he had lost all hopes of getting a natural son. Further it is not necessary to speculate in the face of the documentary evidence referred to earlier why Gopal Das should have taken a son in adoption when there was every [possibility for him to get a natural son. Coming to the question of adoption on the very day Shyam Behari Lal was born, that plea rests on hearsay information. There is no positive evidence before us as to when exactly Shyam Behari Lal was adopted. From the evidence of D. Ws. 10 and 15, it is clear that he must have been adopted very soon after his birth. That is the best that can be said on the basis of the evidence. That apart custom differs from place to place and from community to community. It is true that in a decree made in 1910, Shyam Behari Lal was described as the son of Ram Das. But in the very next year in another decree, he was described as the son of Gopal Das. We do not think that the evidence afforded by that solitary document showing Shyam Behari Lal as the son of Ram Das can outweigh the other evidence which is both satisfactory as well as voluminous. 22. On an appreciation of the entire evidence on record, we are in agreement with the High Courts conclusion that Shyam Behari Lal was the adopted son of Gopal Das and there is nothing to show that the said adoption was invalid for any reason. In view of this conclusion, it is unnecessary to consider the other contentions raised in the appeal.
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We are unable to accept these contentions. It is in evidence that Gopal Das had lost three children even before 1890. Evidently he had lost all hopes of getting a natural son. Further it is not necessary to speculate in the face of the documentary evidence referred to earlier why Gopal Das should have taken a son in adoption when there was every [possibility for him to get a natural son. Coming to the question of adoption on the very day Shyam Behari Lal was born, that plea rests on hearsay information. There is no positive evidence before us as to when exactly Shyam Behari Lal was adopted. From the evidence of D. Ws. 10 and 15, it is clear that he must have been adopted very soon after his birth. That is the best that can be said on the basis of the evidence. That apart custom differs from place to place and from community to community. It is true that in a decree made in 1910, Shyam Behari Lal was described as the son of Ram Das. But in the very next year in another decree, he was described as the son of Gopal Das. We do not think that the evidence afforded by that solitary document showing Shyam Behari Lal as the son of Ram Das can outweigh the other evidence which is both satisfactory as well as voluminous22. On an appreciation of the entire evidence on record, we are in agreement with the High Courts conclusion that Shyam Behari Lal was the adopted son of Gopal Das and there is nothing to show that the said adoption was invalid for any reason. In view of this conclusion, it is unnecessary to consider the other contentions raised in the appeal9. There is no doubt that the burden of proving satisfactorily that he was given by his natural father and received by Gopal Das as his adoptive son is on Shyam Behari Lal. But as observed by the Judicial Committee of the Privy Council in Rajendro Nath Holder v. Jogendro Nath Banerjee,) 14 Moo Ind App. 67 (PC) that although the person who pleads that he had been adopted is bound to prove his title as adopted son,as a fact yet from the long period during which he had been received as an adopted son, every allowance for the absence of evidence to prove such fact was to be favourably entertained, and that the case was analogous to that in which the legitimacy of a person in possession had been acquiesced in for a considerable time, and afterwards impeached by a party, who had a right to question the legitimacy, where the Defendant, in order to defend his status, is allowed to invoke against the claimant every presumption which arises from long recognition of his legitimacy by members of his family;that in the case of Hindoo, long recognition as an adopted son, raised even a stronger presumption in favour of the validity of his adoption, arising from the possibility of the loss of his rights in his own family by being adopted in another family.In Rup Narain v. Mst. Gopal Devi, (1909) 36 Ind App. 103 (PC), the Judicial Committee observed that in the absence of direct evidence much value had to be attached to the fact that the alleged adopted son had without controversy succeeded to his adoptive fathers estate and enjoyed till his death and that documents during his life and after his death were framed upon the basis of the adoption. A Division Bench of the Orissa High Court in Balinki Padhano v. Gopalkrishna Padhano, AIR 1964 Orissa 117; held thatin the case of an ancient adoption evidence showing that the boy was treated for a long time as the adopted son at a time when there was no controversy is sufficient to prove the adoption although evidence of actual giving and taking is not forthcoming. We are in agreement with the views expressed in the decisions referred to above12. Before dealing with the evidence mentioned earlier, it is necessary to mention that the High Court has relied in proof of the adoption pleaded, on the evidence of D. W. 10 Rikhab Das and D. W. 15 Chhotey Lal. Both of them were the close relations of the wife of Gopal Das. They are disinterested witnesses. Their evidence is to the effect that sometime after the birth of Shyam Behari Lal, the wife of Gopal Das took him to her paternal home where Paon Pheri ceremony was performed. There is satisfactory evidence to show that this ceremony is customarily performed in the parental home of a lady who has given birth to her first child. We see no reason to disbelieve the testimony of these witnesses. Their evidence clearly indicates the fact that Shyam Behari Lal must have been taken in adoption by Gopal Das. We may also at this stage refer to another important circumstance appearing in the case. As mentioned earlier, both Gopal Das and his wife died in the year 1934. the suit from which this appeal arises was instituted only in 1946, just a few months before the period of limitation for instituting the same expired. Debi Prasad has not given any satisfactory explanation for this inordinate delay in instituting the suit. This circumstance tends to show that the suit is likely to be speculative one.
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Ct. A. Ct. Nachiappa Chettiar And Others Vs. Ct. A. Ct. Subramaniam Chettiar | Chunder Banerjee v. Ambica Churn Mookerjee, ILR 18 Cal 507 . As we have already observed, prior to the enactment of the Act there has been a longstanding judicial practice under has been a longstanding judicial practice under which orders of reference have been passed by appellate courts in respect of matters is dispute between the parties in appeals pending before them.42. The construction of S. 21 has led to a divergence of judicial opinion. In Abani Bhusan Chakravarty v. Hem Chandra Chakravarty. AIR 1947 Cal 93, the Calcutta High Court has taken the view that the court as defined in the Arbitration Act does not include an appellate court and consequently there is nothing in the Act which enables an appellate court to refer to arbitration matters in dispute between the parties. This decision proceeds on the erroneous view that the "court" in S., 21 means only the court as defined in S. 2 (c) and that the considerations based on the powers of the appellate court prescribed by S. 107 are foreign to the Act. It also appears that the learned judges were disposed to think that if the matter in dispute between the parties at the appellate stage was referred to arbitration it might tend to bring the lower courts into contempt. There is no doubt that a court cannot claim an inherent right to refer a matter in dispute between the parties to arbitration. Before a matter can be thus referred to arbitration it must be shown that the court in question has been statutorily clothed with the power to make such an order; and that would depend on the construction of S. 21 of the Act. The Calcutta High Court has construed the said section in substance consistently with the view taken by it in the case of Jugeshur Dey, 12 Beng LR 266.43. On the other hand the Patna High Court has taken a contrary view in Thakur Prasad v. Baleshwar Ahir, AIR 1954 Pat 106 . Jamuar J., who delivered the judgment of the court, has considered the decision of the Calcutta High Court in the case of Jugeshur Dey, 12 Beng LR 266, and has dissented from it. In the Allahabad High Court somewhat conflicting views had been expressed on different occasions; but, on the question as to whether the appellate court can refer a matter in dispute between the parties to arbitration or not, and whether the suit includes an appeal, the decision of the Full Bench of the Allahabad High Court in Moradhwaj v. Bhudar Das, (S) AIR 1955 All 353 , seems to be on the same lines as that of the Patna High Court. This Full Bench also considered the question about the applicability of S. 21 to execution proceedings but with that aspect of the matter we are not concerned in the preset appeal. The Madras High Court has taken the same view in Subramannaya Bhatta v. Devadas Nayak, (S) AIR 1955 Mad 693 . However, none of these decisions had occasion to consider the question about the competence of both the trial court and the appellate court in cases where a preliminary decree has been passed and an appeal has been filed against the said decree. It would thus appear that the majority of the Indian High Courts have construed the words "suit" and "court" used in S. 21 liberally as including appellate proceedings and the appellate court respectively. In the result we hold that the trial court was competent to make the reference and its validity is not open to any objection.44. That leaves only one point to be considered. It is urged by the appellants that the arbitrators acted illegally and without jurisdiction in directing the appellants to pay to the respondent Rs. 2,682-60 by way of interest on the amounts specified in the award up to December 5, 1944, and from that date at the rate of 5 as. per cent, per mensem, thus, imposing on the appellants a total liability of Rs. 2,36,782-11-9. The appellants have also been directed to pay future interest on the same amount at 8 as percent per mensem from the said date until the date of payment. This argument is based solely on the observations made by Bose J., who delivered the judgment of this Court, in Thawardas Pherumal v. Union India, (S) AIR 1955 SC 468 . It appears that in that case the claim awarded by the arbitrators was a claim for an unliquidated sum to which Interest Act of 1839 applied as interest was otherwise not payable by law in that kind of case. Dealing with the contention that the arbitrators could not have awarded interest in such a case Bose J., set out four conditions which must be satisfied before interest can be awarded under the Interest Act, and observed that none of them was present in the case; and so he concluded that the arbitrator had no power to allow interest simply because he thought that the payment was reasonable. The alternative argument urged before this Court that interest could be awarded under S. 34 of the Code of Civil Procedure, 1908, was also repelled on the ground that the arbitrator is not a court within the meaning of the Code nor does not Code apply to arbitrators. Mr. Viswanatha Sastri relies upon these observations and contends that in no case can be arbitrators award interest. It is open to doubt whether the observations on which Mr. Viswanatha Sastri relies support or were intended to lay down such a broad and unqualified proposition. However we do not propose to pursue this matter any further because the present contention was not urged before the High Court. It was no doubt taken as a ground of appeal but from the judgment it is clear that it was not urged at the time of hearing. Under these circumstances we do not think we would be justified in allowing this point to be raised before us. | 0[ds]30. It is these portions of the award on which the appellants based their contention that immoveable properties in Pudukottai and Burma have been dealt with by the arbitrators. In our opinion this contention is not well-founded. What the arbitrators have done is to divide the properties which were then the subject-matter of the dispute between the parties and having done so they have indicated what the legal position of the parties would be in respect of the properties outside the dispute. In appreciating the effect of the words used in the award we must bear in mind that the arbitrators were laymen not familiar with the technical significance of legal expression, and so we must read the relevant clauses as a whole with a view to determine what in effect and substance they intended to decide. Now take the recitals in the award to the Pudukottai properties. The award expressly states that the properties had not been divided by them and that the plaintiff and the defendants shall have them divided when so required. All that the award says is that since the parties had separated and the properties in suit before the arbitrators had been actually divided by metes and bounds, the two branches shall enjoy the Pudukottai properties in equal halves. This clause in the award cannot be said to divide the said properties or even to determine their shares in them. The shares of the parties in the said properties were admitted and so the award merely says that as divided members they will hold and enjoy the properties half and half.31. Similarly in regard to the properties in Burma the award expressly states that the said properties had not been divided and it merely refers to the true legal position that they would be enjoyed by the two branches half and half. The arrangement proposed by the arbitrators in respect of the immoveable properties in Burma is very significant. They merely asked the parties to hold the documents of title half and half for safe custody and they have added that when the parties decide to divide the properties all the documents would have to be brought together and a partition made according to law. That again is an arrangement dictated by commonsense and cannot be said to amount to a decision in any way. It is not as if the award declares the shares of the parties in respect of the properties. What is does is no more than to state the true and admitted legal position of the parties rights in respect of the said properties.32. In this connection it would be useful to refer to the observations made by Viscount Dunedin in Bageshwari Charan Singh v. Jagarnath Kuari, ILR 11 Pat 272 : (AIR 298 PC 55). In that case the Privy Council was called upon to consider the question about the admissibility of a petition which relied upon as an acknowledgment of liability under S. 19 sub-s. (1) of the Limitation Act, and it was urged that the said petition was inadmissible because it purported operated to create or declare a right to immoveable property and as such was compulsorily registrable under S. 17(1)(b) of the Registration Act, 1908. In urging the objection to the admissibility of the petition a large number of Indian decisions were cited before the Privy Council dealing with the word "declare" used in S. 17 (1) (b) of the Registration Act, 1908; and it was apparent that there was a sharp conflict of views. In Sakharam Krishnaji v. Madan Krishnaji, ILR 5 Bom 232. West J, had observed that the word "declare" in S. 17(1)(b) is placed along with create, assign, limit or extinguish a right title or interest, and these words imply definite change of legal relation to the property by an expression of will embodied in the document referred to, and had added that he thought that is equally the case with the word "declare". On the other hand certain other decisions had construed the word declare liberally in a very wide sense and it was on those decisions that the objection against admissibility of the petition was founded. In repealling the objection Lord Dunedin observed that "though the word declare" might be given a wider meaning they are satisfied that the view originally taken by West J., is right. The distinction is between a mere recital of fact and something which in itself creates a title." These observations assist us in deciding the question as to whether the impugned portions of the award declare the parties rights in immoveable properties in the sense of deciding them as points or matters referred to arbitration in our opinion, the High Court was right in answering this question against the appellants. Therefore the award is not open to the attack that it deals with immoveable properties out of the jurisdiction of the court.33. That takes us to the next ground to attack against the validity of the award. It is urged that the award contravenes the order passed by the High Court on the stay petition filed before it by appellant 2. There is, however, no substance in this contention. All that the High Court directed was that pending the final decision of the appeals before it a final decree should not be drawn. In fact the High Court clearly observed that there was no reason for staying all the proceedings pending before the Commissioner. That is the usual order made in such cases, and it is difficult to appreciate how this order has been contravened by reference to arbitration or by the award that followed it. The award is not and does not purport to be a final decree in the proceedings and the proceedings before the arbitrators substantially correspond to the proceedings of the enquiry which the Commissioner would have held even under the order of the High Court. Therefore this contention must also fail.We may now briefly refer to some of the decisions to which our attention was invited. Before the Act was passed in 1940 the procedure for referring matters in dispute between the parties in pending suits was governed by the provisions of Sch. II to the Code of Civil Procedure. There appears to have been a consensus of judicial opinion in favour of the view that under Sch., II paragraph 1, the appellate court could make an order of reference in respect of matters in dispute between the parties in an appeal pending before it. A note of dissent had, however, been struck by a Full Bench of the Calcutta High Court in Juge shur Dey v. Kritartha Moyee Dossee, 12 Beng LR 266. In that case the question for decision arose under the provisions of the Code of 1859 and the Full Bench held that an appellate court had no power even by consent of parties to refer a case for arbitration under the arbitration sections of Act VIII of 1859 which applied only to courts of original jurisdiction nor was such power conferred on an appellate court by S. 37 of Act XXIII ofOne of the reasons which weighed with Couch C. J. who delivered the principal judgment of the Full Bench was that according to him neither reasons nor convenience required that the appellate court should refer a suit to arbitration after the matter had been decided by the trial court. Kemp J., who concurred with the decision, apprehended that "if the parties are allowed to refer matters to arbitration after a case has been finally disposed of by a court of justice such a proceeding might tend to bring lower courts into contempt". In our opinion this apprehension is not well-founded. Besides it is well-known that when parties agree to refer the matters in dispute between them in suit to arbitration they desire that their disputes should be disposed of untrammelled by the rigid technicalities of the court procedure. A search for a short-cut by means of such arbitration sometimes takes the parties on a very long route of litigation but that is another matter.The Calcutta view was dissented from by the Madras High Court in Sankaralingam Pillai In re, ILR 3 Mad 78 , in somewhat emphaticall respect for the opinions of the learned judges of the High Court of Calcutta by whom the case of Jugeshur Dey, 12 Beng LR 266, was decided", observed the judgment, "we are not convinced by the reason given in the judgment for holding that an appellate court might not, with consent of the parties, refer the matters in dispute in the appeal tothus expressed their disapproval of the Calcutta view, the learned judges proceeded to add that in the case before them an order of reference was sought for under S. 582 of the Code of 1877 and they held that under the said provision the appellate court is given the same powers and is required to perform the same functions as nearly as may be as the trial court. The view thus expressed by the Madras High Court was subsequently accepted and approved by the Calcutta High Court in Bhugwan Das Marwari v. Nund Lall Sein, ILR 12 Cal 173 , and Suresh Chunder Banerjee v. Ambica Churn Mookerjee, ILR 18 Cal 507 . As we have already observed, prior to the enactment of the Act there has been a longstanding judicial practice under has been a longstanding judicial practice under which orders of reference have been passed by appellate courts in respect of matters is dispute between the parties in appeals pending before them.42. The construction of S. 21 has led to a divergence of judicial opinion. In Abani Bhusan Chakravarty v. Hem Chandra Chakravarty. AIR 1947 Cal 93, the Calcutta High Court has taken the view that the court as defined in the Arbitration Act does not include an appellate court and consequently there is nothing in the Act which enables an appellate court to refer to arbitration matters in dispute between the parties. This decision proceeds on the erroneous view that the "court" in S., 21 means only the court as defined in S. 2 (c) and that the considerations based on the powers of the appellate court prescribed by S. 107 are foreign to the Act. It also appears that the learned judges were disposed to think that if the matter in dispute between the parties at the appellate stage was referred to arbitration it might tend to bring the lower courts into contempt. There is no doubt that a court cannot claim an inherent right to refer a matter in dispute between the parties to arbitration. Before a matter can be thus referred to arbitration it must be shown that the court in question has been statutorily clothed with the power to make such an order; and that would depend on the construction of S. 21 of the Act. The Calcutta High Court has construed the said section in substance consistently with the view taken by it in the case of Jugeshur Dey, 12 Beng LR 266.43. On the other hand the Patna High Court has taken a contrary view in Thakur Prasad v. Baleshwar Ahir, AIR 1954 Pat 106 . Jamuar J., who delivered the judgment of the court, has considered the decision of the Calcutta High Court in the case of Jugeshur Dey, 12 Beng LR 266, and has dissented from it. In the Allahabad High Court somewhat conflicting views had been expressed on different occasions; but, on the question as to whether the appellate court can refer a matter in dispute between the parties to arbitration or not, and whether the suit includes an appeal, the decision of the Full Bench of the Allahabad High Court in Moradhwaj v. Bhudar Das, (S) AIR 1955 All 353 , seems to be on the same lines as that of the Patna High Court. This Full Bench also considered the question about the applicability of S. 21 to execution proceedings but with that aspect of the matter we are not concerned in the preset appeal. The Madras High Court has taken the same view in Subramannaya Bhatta v. Devadas Nayak, (S) AIR 1955 Mad 693 . However, none of these decisions had occasion to consider the question about the competence of both the trial court and the appellate court in cases where a preliminary decree has been passed and an appeal has been filed against the said decree. It would thus appear that the majority of the Indian High Courts have construed the words "suit" and "court" used in S. 21 liberally as including appellate proceedings and the appellate court respectively. In the result we hold that the trial court was competent to make the reference and its validity is not open to any objection.That leaves only one point to be considered. It is urged by the appellants that the arbitrators acted illegally and without jurisdiction in directing the appellants to pay to the respondent Rs. 2,682-60 by way of interest on the amounts specified in the award up to December 5, 1944, and from that date at the rate of 5 as. per cent, per mensem, thus, imposing on the appellants a total liability of Rs. 2,36,782-11-9. The appellants have also been directed to pay future interest on the same amount at 8 as percent per mensem from the said date until the date of payment. This argument is based solely on the observations made by Bose J., who delivered the judgment of this Court, in Thawardas Pherumal v. Union India, (S) AIR 1955 SC 468 . It appears that in that case the claim awarded by the arbitrators was a claim for an unliquidated sum to which Interest Act of 1839 applied as interest was otherwise not payable by law in that kind of case. Dealing with the contention that the arbitrators could not have awarded interest in such a case Bose J., set out four conditions which must be satisfied before interest can be awarded under the Interest Act, and observed that none of them was present in the case; and so he concluded that the arbitrator had no power to allow interest simply because he thought that the payment was reasonable. The alternative argument urged before this Court that interest could be awarded under S. 34 of the Code of Civil Procedure, 1908, was also repelled on the ground that the arbitrator is not a court within the meaning of the Code nor does not Code apply to arbitrators. Mr. Viswanatha Sastri relies upon these observations and contends that in no case can be arbitrators award interest. It is open to doubt whether the observations on which Mr. Viswanatha Sastri relies support or were intended to lay down such a broad and unqualified proposition. However we do not propose to pursue this matter any further because the present contention was not urged before the High Court. It was no doubt taken as a ground of appeal but from the judgment it is clear that it was not urged at the time of hearing. Under these circumstances we do not think we would be justified in allowing this point to be raised before us. | 0 | 11,111 | 2,725 | ### Instruction:
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Chunder Banerjee v. Ambica Churn Mookerjee, ILR 18 Cal 507 . As we have already observed, prior to the enactment of the Act there has been a longstanding judicial practice under has been a longstanding judicial practice under which orders of reference have been passed by appellate courts in respect of matters is dispute between the parties in appeals pending before them.42. The construction of S. 21 has led to a divergence of judicial opinion. In Abani Bhusan Chakravarty v. Hem Chandra Chakravarty. AIR 1947 Cal 93, the Calcutta High Court has taken the view that the court as defined in the Arbitration Act does not include an appellate court and consequently there is nothing in the Act which enables an appellate court to refer to arbitration matters in dispute between the parties. This decision proceeds on the erroneous view that the "court" in S., 21 means only the court as defined in S. 2 (c) and that the considerations based on the powers of the appellate court prescribed by S. 107 are foreign to the Act. It also appears that the learned judges were disposed to think that if the matter in dispute between the parties at the appellate stage was referred to arbitration it might tend to bring the lower courts into contempt. There is no doubt that a court cannot claim an inherent right to refer a matter in dispute between the parties to arbitration. Before a matter can be thus referred to arbitration it must be shown that the court in question has been statutorily clothed with the power to make such an order; and that would depend on the construction of S. 21 of the Act. The Calcutta High Court has construed the said section in substance consistently with the view taken by it in the case of Jugeshur Dey, 12 Beng LR 266.43. On the other hand the Patna High Court has taken a contrary view in Thakur Prasad v. Baleshwar Ahir, AIR 1954 Pat 106 . Jamuar J., who delivered the judgment of the court, has considered the decision of the Calcutta High Court in the case of Jugeshur Dey, 12 Beng LR 266, and has dissented from it. In the Allahabad High Court somewhat conflicting views had been expressed on different occasions; but, on the question as to whether the appellate court can refer a matter in dispute between the parties to arbitration or not, and whether the suit includes an appeal, the decision of the Full Bench of the Allahabad High Court in Moradhwaj v. Bhudar Das, (S) AIR 1955 All 353 , seems to be on the same lines as that of the Patna High Court. This Full Bench also considered the question about the applicability of S. 21 to execution proceedings but with that aspect of the matter we are not concerned in the preset appeal. The Madras High Court has taken the same view in Subramannaya Bhatta v. Devadas Nayak, (S) AIR 1955 Mad 693 . However, none of these decisions had occasion to consider the question about the competence of both the trial court and the appellate court in cases where a preliminary decree has been passed and an appeal has been filed against the said decree. It would thus appear that the majority of the Indian High Courts have construed the words "suit" and "court" used in S. 21 liberally as including appellate proceedings and the appellate court respectively. In the result we hold that the trial court was competent to make the reference and its validity is not open to any objection.44. That leaves only one point to be considered. It is urged by the appellants that the arbitrators acted illegally and without jurisdiction in directing the appellants to pay to the respondent Rs. 2,682-60 by way of interest on the amounts specified in the award up to December 5, 1944, and from that date at the rate of 5 as. per cent, per mensem, thus, imposing on the appellants a total liability of Rs. 2,36,782-11-9. The appellants have also been directed to pay future interest on the same amount at 8 as percent per mensem from the said date until the date of payment. This argument is based solely on the observations made by Bose J., who delivered the judgment of this Court, in Thawardas Pherumal v. Union India, (S) AIR 1955 SC 468 . It appears that in that case the claim awarded by the arbitrators was a claim for an unliquidated sum to which Interest Act of 1839 applied as interest was otherwise not payable by law in that kind of case. Dealing with the contention that the arbitrators could not have awarded interest in such a case Bose J., set out four conditions which must be satisfied before interest can be awarded under the Interest Act, and observed that none of them was present in the case; and so he concluded that the arbitrator had no power to allow interest simply because he thought that the payment was reasonable. The alternative argument urged before this Court that interest could be awarded under S. 34 of the Code of Civil Procedure, 1908, was also repelled on the ground that the arbitrator is not a court within the meaning of the Code nor does not Code apply to arbitrators. Mr. Viswanatha Sastri relies upon these observations and contends that in no case can be arbitrators award interest. It is open to doubt whether the observations on which Mr. Viswanatha Sastri relies support or were intended to lay down such a broad and unqualified proposition. However we do not propose to pursue this matter any further because the present contention was not urged before the High Court. It was no doubt taken as a ground of appeal but from the judgment it is clear that it was not urged at the time of hearing. Under these circumstances we do not think we would be justified in allowing this point to be raised before us.
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Churn Mookerjee, ILR 18 Cal 507 . As we have already observed, prior to the enactment of the Act there has been a longstanding judicial practice under has been a longstanding judicial practice under which orders of reference have been passed by appellate courts in respect of matters is dispute between the parties in appeals pending before them.42. The construction of S. 21 has led to a divergence of judicial opinion. In Abani Bhusan Chakravarty v. Hem Chandra Chakravarty. AIR 1947 Cal 93, the Calcutta High Court has taken the view that the court as defined in the Arbitration Act does not include an appellate court and consequently there is nothing in the Act which enables an appellate court to refer to arbitration matters in dispute between the parties. This decision proceeds on the erroneous view that the "court" in S., 21 means only the court as defined in S. 2 (c) and that the considerations based on the powers of the appellate court prescribed by S. 107 are foreign to the Act. It also appears that the learned judges were disposed to think that if the matter in dispute between the parties at the appellate stage was referred to arbitration it might tend to bring the lower courts into contempt. There is no doubt that a court cannot claim an inherent right to refer a matter in dispute between the parties to arbitration. Before a matter can be thus referred to arbitration it must be shown that the court in question has been statutorily clothed with the power to make such an order; and that would depend on the construction of S. 21 of the Act. The Calcutta High Court has construed the said section in substance consistently with the view taken by it in the case of Jugeshur Dey, 12 Beng LR 266.43. On the other hand the Patna High Court has taken a contrary view in Thakur Prasad v. Baleshwar Ahir, AIR 1954 Pat 106 . Jamuar J., who delivered the judgment of the court, has considered the decision of the Calcutta High Court in the case of Jugeshur Dey, 12 Beng LR 266, and has dissented from it. In the Allahabad High Court somewhat conflicting views had been expressed on different occasions; but, on the question as to whether the appellate court can refer a matter in dispute between the parties to arbitration or not, and whether the suit includes an appeal, the decision of the Full Bench of the Allahabad High Court in Moradhwaj v. Bhudar Das, (S) AIR 1955 All 353 , seems to be on the same lines as that of the Patna High Court. This Full Bench also considered the question about the applicability of S. 21 to execution proceedings but with that aspect of the matter we are not concerned in the preset appeal. The Madras High Court has taken the same view in Subramannaya Bhatta v. Devadas Nayak, (S) AIR 1955 Mad 693 . However, none of these decisions had occasion to consider the question about the competence of both the trial court and the appellate court in cases where a preliminary decree has been passed and an appeal has been filed against the said decree. It would thus appear that the majority of the Indian High Courts have construed the words "suit" and "court" used in S. 21 liberally as including appellate proceedings and the appellate court respectively. In the result we hold that the trial court was competent to make the reference and its validity is not open to any objection.That leaves only one point to be considered. It is urged by the appellants that the arbitrators acted illegally and without jurisdiction in directing the appellants to pay to the respondent Rs. 2,682-60 by way of interest on the amounts specified in the award up to December 5, 1944, and from that date at the rate of 5 as. per cent, per mensem, thus, imposing on the appellants a total liability of Rs. 2,36,782-11-9. The appellants have also been directed to pay future interest on the same amount at 8 as percent per mensem from the said date until the date of payment. This argument is based solely on the observations made by Bose J., who delivered the judgment of this Court, in Thawardas Pherumal v. Union India, (S) AIR 1955 SC 468 . It appears that in that case the claim awarded by the arbitrators was a claim for an unliquidated sum to which Interest Act of 1839 applied as interest was otherwise not payable by law in that kind of case. Dealing with the contention that the arbitrators could not have awarded interest in such a case Bose J., set out four conditions which must be satisfied before interest can be awarded under the Interest Act, and observed that none of them was present in the case; and so he concluded that the arbitrator had no power to allow interest simply because he thought that the payment was reasonable. The alternative argument urged before this Court that interest could be awarded under S. 34 of the Code of Civil Procedure, 1908, was also repelled on the ground that the arbitrator is not a court within the meaning of the Code nor does not Code apply to arbitrators. Mr. Viswanatha Sastri relies upon these observations and contends that in no case can be arbitrators award interest. It is open to doubt whether the observations on which Mr. Viswanatha Sastri relies support or were intended to lay down such a broad and unqualified proposition. However we do not propose to pursue this matter any further because the present contention was not urged before the High Court. It was no doubt taken as a ground of appeal but from the judgment it is clear that it was not urged at the time of hearing. Under these circumstances we do not think we would be justified in allowing this point to be raised before us.
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MANGILAL KAJODIA Vs. UNION OF INDIA | was not on vacation when the transfer orders were issued and after availing joining time, he should have joined the new place of posting on expiry of the joining time. It is, therefore, clear that the petitioner, Shri Kajodia had wilfully violated the orders of transfer; Notwithstanding the above, in the light of the observations of the Hon?ble Supreme Court in its orders dated 9.8.2019 mentioned above, I am inclined to take a lenient view in the matter and the representation dated 29.9.2008 submitted by Shri Kajodia has been considered sympathetically and consequently order that he may be reinstated in the service of KVS from the date of his removal from service vide orders dated 21.7.2008 (i.e. w.e.f. 7.5.2008). However, the period of absence from the duty w.e.f. 7.5.2008 till the date of his joining his duties on reinstatement will be treated as ‘dies non? for all purposes.? 9. The Central Government?s order, under cover of the letter was taken on record and copy of it was made available to the petitioner. Subsequently, on 17.09.2019, when the matter was listed, the petitioner expressed his reservation with respect to the proposal to reinstate him but treat the entire period of absence as dies non. The petitioner submitted that the action of the authorities, particularly, the order of removal was actuated by mala fides and utterly unfair. It is submitted that the removal order is void on the ground that it is unreasoned and contrary to the rules. Just because the petitioner did not join KVS Kargil within the time prescribed, the same could not have been a justification for his removal or for that matter, to treat his absence as one leading to abandonment of services. The petitioner relied on Rule 12(2) of the Joining Time Rules to say that Kargil had no summer vacations but rather had winter vacations from 07.12.2008 to 15.02.2009 and on the other hand, in Devas, summer vacation had continued from 04.05.2008 to 22.06.2008. In these circumstances, the transfer order was made during the summer vacation and that the petitioner?s joining time would have commenced only after 22.06.2008. 10. The petitioner further submitted that even if reinstatement were to be accepted, the condition of dies non is extremely harsh inasmuch as 12 years of service would stand forfeited and he would be deprived of all benefits of pay, increased DA, accrual of PF and pension benefits. 11. The facts discussed reveal petitioner has approached this Court and sought substantive reliefs under Article 32 of the Constitution after almost 9 years of the accrual of cause of action. He approached the CAT which disposed of an application on 10.08.2011 with a direction that he could approach it afresh after the application/fresh petition preferred by him to the President was dealt with and disposed of. As a matter of fact, the petition - in the nature of a mercy plea, was not disposed of; the petitioner initiated contempt proceedings which led to the KVS approaching the Madhya Pradesh High Court. The High Court rebuked the KVS and granted time to it to comply with the directions. Eventually, the Minister, on 23.09.2015 rejected the mercy petition. 12. Having regard to the fact that the petitioner himself did not seek redressal substantively of his grievance, given that the petitioner did not approach the Court in a timely manner – (the application made to CAT itself was after three years of the removal order), and furthermore, has approached this court directly, it would not be appropriate to examine the correctness of the decision of the order of removal by the KVS. At the same time, the court had felt that the order of removal constituted a harsh disciplinary measure and that the petitioner could be meted a lighter penalty. It was with this in mind the Attorney General was asked to intervene and obtain instructions from the Central Government. The order made by the Union Minister now is clear that the petitioner would be taken back into the services in the post that he held at the time of removal. At the same time, the Central Government has clarified that the entire period of absence, i.e. from the date of removal till the date he rejoins would be treated as dies non for which no benefit would accrue to him. 13. This court is of the opinion that the position taken by the Central Government not to grant substantive benefit for the duration of absence cannot be per se termed harsh and arbitrary. The petitioner did not join the place KV Kargil, nor did he approach the court at the relevant time or even after his removal contemporaneously. In these circumstances, conceding the benefit of arrears of salary, seniority and continuity, arrears of salary and related benefits would not be fair. However, placing the petitioner in the same position he was as on 07.05.2008 (the date of his removal) would be what could be extremely harsh, in the opinion of the court, inasmuch as he would draw salary at the stage at which he was almost 12 years ago. 14. In the peculiar circumstances, in the opinion of this Court, the interest of justice lies in suitably modifying the order proposed by the Central Government. Although the petitioner would not be entitled to the payment of arrears of salary for the period he was out of service, the KVS should issue a separate order fixing his salary having regard to notional increments effective from the date he would have been entitled to the increment in the year 2009 after taking into consideration the relevant increments which accrue thereafter. In other words, the petitioner should be reinstated, and at the same time, the pay fixation order should ensure that the period of absence which would otherwise be treated as dies non is ignored for the purpose of fixation and fitment of salary alone. The order can also expressly state that the benefit of arrears of salary would not accrue to the petitioner. | 1[ds]11. The facts discussed reveal petitioner has approached this Court and sought substantive reliefs under Article 32 of the Constitution after almost 9 years of the accrual of cause of action. He approached the CAT which disposed of an application on 10.08.2011 with a direction that he could approach it afresh after the application/fresh petition preferred by him to the President was dealt with and disposed of. As a matter of fact, the petition - in the nature of a mercy plea, was not disposed of; the petitioner initiated contempt proceedings which led to the KVS approaching the Madhya Pradesh High Court. The High Court rebuked the KVS and granted time to it to comply with the directions. Eventually, the Minister, on 23.09.2015 rejected the mercy petition12. Having regard to the fact that the petitioner himself did not seek redressal substantively of his grievance, given that the petitioner did not approach the Court in a timely manner – (the application made to CAT itself was after three years of the removal order), and furthermore, has approached this court directly, it would not be appropriate to examine the correctness of the decision of the order of removal by the KVS. At the same time, the court had felt that the order of removal constituted a harsh disciplinary measure and that the petitioner could be meted a lighter penalty. It was with this in mind the Attorney General was asked to intervene and obtain instructions from the Central Government. The order made by the Union Minister now is clear that the petitioner would be taken back into the services in the post that he held at the time of removal. At the same time, the Central Government has clarified that the entire period of absence, i.e. from the date of removal till the date he rejoins would be treated as dies non for which no benefit would accrue to him13. This court is of the opinion that the position taken by the Central Government not to grant substantive benefit for the duration of absence cannot be per se termed harsh and arbitrary. The petitioner did not join the place KV Kargil, nor did he approach the court at the relevant time or even after his removal contemporaneously. In these circumstances, conceding the benefit of arrears of salary, seniority and continuity, arrears of salary and related benefits would not be fair. However, placing the petitioner in the same position he was as on 07.05.2008 (the date of his removal) would be what could be extremely harsh, in the opinion of the court, inasmuch as he would draw salary at the stage at which he was almost 12 years ago14. In the peculiar circumstances, in the opinion of this Court, the interest of justice lies in suitably modifying the order proposed by the Central Government. Although the petitioner would not be entitled to the payment of arrears of salary for the period he was out of service, the KVS should issue a separate order fixing his salary having regard to notional increments effective from the date he would have been entitled to the increment in the year 2009 after taking into consideration the relevant increments which accrue thereafter. In other words, the petitioner should be reinstated, and at the same time, the pay fixation order should ensure that the period of absence which would otherwise be treated as dies non is ignored for the purpose of fixation and fitment of salary alone. The order can also expressly state that the benefit of arrears of salary would not accrue to the petitioner. | 1 | 2,545 | 651 | ### Instruction:
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was not on vacation when the transfer orders were issued and after availing joining time, he should have joined the new place of posting on expiry of the joining time. It is, therefore, clear that the petitioner, Shri Kajodia had wilfully violated the orders of transfer; Notwithstanding the above, in the light of the observations of the Hon?ble Supreme Court in its orders dated 9.8.2019 mentioned above, I am inclined to take a lenient view in the matter and the representation dated 29.9.2008 submitted by Shri Kajodia has been considered sympathetically and consequently order that he may be reinstated in the service of KVS from the date of his removal from service vide orders dated 21.7.2008 (i.e. w.e.f. 7.5.2008). However, the period of absence from the duty w.e.f. 7.5.2008 till the date of his joining his duties on reinstatement will be treated as ‘dies non? for all purposes.? 9. The Central Government?s order, under cover of the letter was taken on record and copy of it was made available to the petitioner. Subsequently, on 17.09.2019, when the matter was listed, the petitioner expressed his reservation with respect to the proposal to reinstate him but treat the entire period of absence as dies non. The petitioner submitted that the action of the authorities, particularly, the order of removal was actuated by mala fides and utterly unfair. It is submitted that the removal order is void on the ground that it is unreasoned and contrary to the rules. Just because the petitioner did not join KVS Kargil within the time prescribed, the same could not have been a justification for his removal or for that matter, to treat his absence as one leading to abandonment of services. The petitioner relied on Rule 12(2) of the Joining Time Rules to say that Kargil had no summer vacations but rather had winter vacations from 07.12.2008 to 15.02.2009 and on the other hand, in Devas, summer vacation had continued from 04.05.2008 to 22.06.2008. In these circumstances, the transfer order was made during the summer vacation and that the petitioner?s joining time would have commenced only after 22.06.2008. 10. The petitioner further submitted that even if reinstatement were to be accepted, the condition of dies non is extremely harsh inasmuch as 12 years of service would stand forfeited and he would be deprived of all benefits of pay, increased DA, accrual of PF and pension benefits. 11. The facts discussed reveal petitioner has approached this Court and sought substantive reliefs under Article 32 of the Constitution after almost 9 years of the accrual of cause of action. He approached the CAT which disposed of an application on 10.08.2011 with a direction that he could approach it afresh after the application/fresh petition preferred by him to the President was dealt with and disposed of. As a matter of fact, the petition - in the nature of a mercy plea, was not disposed of; the petitioner initiated contempt proceedings which led to the KVS approaching the Madhya Pradesh High Court. The High Court rebuked the KVS and granted time to it to comply with the directions. Eventually, the Minister, on 23.09.2015 rejected the mercy petition. 12. Having regard to the fact that the petitioner himself did not seek redressal substantively of his grievance, given that the petitioner did not approach the Court in a timely manner – (the application made to CAT itself was after three years of the removal order), and furthermore, has approached this court directly, it would not be appropriate to examine the correctness of the decision of the order of removal by the KVS. At the same time, the court had felt that the order of removal constituted a harsh disciplinary measure and that the petitioner could be meted a lighter penalty. It was with this in mind the Attorney General was asked to intervene and obtain instructions from the Central Government. The order made by the Union Minister now is clear that the petitioner would be taken back into the services in the post that he held at the time of removal. At the same time, the Central Government has clarified that the entire period of absence, i.e. from the date of removal till the date he rejoins would be treated as dies non for which no benefit would accrue to him. 13. This court is of the opinion that the position taken by the Central Government not to grant substantive benefit for the duration of absence cannot be per se termed harsh and arbitrary. The petitioner did not join the place KV Kargil, nor did he approach the court at the relevant time or even after his removal contemporaneously. In these circumstances, conceding the benefit of arrears of salary, seniority and continuity, arrears of salary and related benefits would not be fair. However, placing the petitioner in the same position he was as on 07.05.2008 (the date of his removal) would be what could be extremely harsh, in the opinion of the court, inasmuch as he would draw salary at the stage at which he was almost 12 years ago. 14. In the peculiar circumstances, in the opinion of this Court, the interest of justice lies in suitably modifying the order proposed by the Central Government. Although the petitioner would not be entitled to the payment of arrears of salary for the period he was out of service, the KVS should issue a separate order fixing his salary having regard to notional increments effective from the date he would have been entitled to the increment in the year 2009 after taking into consideration the relevant increments which accrue thereafter. In other words, the petitioner should be reinstated, and at the same time, the pay fixation order should ensure that the period of absence which would otherwise be treated as dies non is ignored for the purpose of fixation and fitment of salary alone. The order can also expressly state that the benefit of arrears of salary would not accrue to the petitioner.
### Response:
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### Explanation:
11. The facts discussed reveal petitioner has approached this Court and sought substantive reliefs under Article 32 of the Constitution after almost 9 years of the accrual of cause of action. He approached the CAT which disposed of an application on 10.08.2011 with a direction that he could approach it afresh after the application/fresh petition preferred by him to the President was dealt with and disposed of. As a matter of fact, the petition - in the nature of a mercy plea, was not disposed of; the petitioner initiated contempt proceedings which led to the KVS approaching the Madhya Pradesh High Court. The High Court rebuked the KVS and granted time to it to comply with the directions. Eventually, the Minister, on 23.09.2015 rejected the mercy petition12. Having regard to the fact that the petitioner himself did not seek redressal substantively of his grievance, given that the petitioner did not approach the Court in a timely manner – (the application made to CAT itself was after three years of the removal order), and furthermore, has approached this court directly, it would not be appropriate to examine the correctness of the decision of the order of removal by the KVS. At the same time, the court had felt that the order of removal constituted a harsh disciplinary measure and that the petitioner could be meted a lighter penalty. It was with this in mind the Attorney General was asked to intervene and obtain instructions from the Central Government. The order made by the Union Minister now is clear that the petitioner would be taken back into the services in the post that he held at the time of removal. At the same time, the Central Government has clarified that the entire period of absence, i.e. from the date of removal till the date he rejoins would be treated as dies non for which no benefit would accrue to him13. This court is of the opinion that the position taken by the Central Government not to grant substantive benefit for the duration of absence cannot be per se termed harsh and arbitrary. The petitioner did not join the place KV Kargil, nor did he approach the court at the relevant time or even after his removal contemporaneously. In these circumstances, conceding the benefit of arrears of salary, seniority and continuity, arrears of salary and related benefits would not be fair. However, placing the petitioner in the same position he was as on 07.05.2008 (the date of his removal) would be what could be extremely harsh, in the opinion of the court, inasmuch as he would draw salary at the stage at which he was almost 12 years ago14. In the peculiar circumstances, in the opinion of this Court, the interest of justice lies in suitably modifying the order proposed by the Central Government. Although the petitioner would not be entitled to the payment of arrears of salary for the period he was out of service, the KVS should issue a separate order fixing his salary having regard to notional increments effective from the date he would have been entitled to the increment in the year 2009 after taking into consideration the relevant increments which accrue thereafter. In other words, the petitioner should be reinstated, and at the same time, the pay fixation order should ensure that the period of absence which would otherwise be treated as dies non is ignored for the purpose of fixation and fitment of salary alone. The order can also expressly state that the benefit of arrears of salary would not accrue to the petitioner.
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M/S Muneer Enterprises Mine Owners By Partner Vs. M/S Ramgad Min.& Mining P.Ltd.& Ors | of the reasons which weighed in the report of the Hon’ble Minister reflected the true facts. The conclusion of the Hon’ble Minister that the possession continued to remain with the owner was contrary to what was found on records. The Mahazar dated 09.12.1983 as noted by learned Single Judge from the original file reveal that the conclusion of the Hon’ble Minister was ex facie illegal and untrue. The said conclusion obviously appeared to have been made with some ulterior motive and purpose and with a view to show some undue favour to the first respondent herein. The acquisition became final and conclusive as far back as on 15.7.1971 when Section 6 declaration came to be issued. At no point of time was there any challenge to either preliminary notification dated 21.9.1967 or the final declaration notified on 15.7.1971. Even the award dated 21.11.1983 approved on 29.11.1983 was not the subject matter of challenge in any proceedings.16. xxx xxx xxx17. xxx xxx xxx18. In our considered opinion, the Division Bench failed to take note of the above gross illegality committed by the Hon’ble Minister while directing the issuance of the de-notification dated 05.10.1999 in spite of the fact that possession had already been handed over to the State as early as on 09.12.1983 and that the decree of the Civil Court did not in any way create any fetters on the authorities concerned to take steps for possession by resorting to appropriate legal means. At the risk of repetition, it will have to be stated that the Civil Court decree to that effect was dated 15.12.1981 and that the possession was taken by taking necessary steps under the provisions of the Land Acquisition Act under the Mahazar dated 09.12.1983 which was never challenged by any party much less the first respondent herein. The Division Bench unfortunately completely omitted to take note of the relevant facts while interfering with the order of the learned Single Judge. The appeals, therefore, stand allowed. The order of the Division Bench is set aside and the order of the learned Single Judge dated 26.8.2002 passed in Vijaya Leasing Ltd. v. State of Karnataka stands restored by this common judgment.” (underlining is ours) 116. The above judgment throws some light as to how certain excess role played on behalf of the State without any justifiable reasons were brought to the notice of the Court, the Court should not hesitate to set aside such orders in the interest of Rule of Law. When we compare the facts set out in paragraph 15 of the said judgment, when we refer to the facts dealt with by us in this case, we have noted as to how after surrender made by M/s.Dalmia had become conclusive as on 31.01.2002, on behalf of the State Government the very same officer who held the post of Director of Mines and Geology as on 25.08.2001 came forward to recommend for the transfer applied for by M/s.Dalmia on 04.02.2002, in the recommendation order dated 06.02.2002 and by simply glossing over the gross violations of the Forest Act, 1980, the order came to be passed on 16.03.2002 approving of the transfer applied for by M/s.Dalmia in favour of the first respondent. In the said circumstances, the order of the learned Single Judge in setting aside the said order dated 16.03.2002, was perfectly justified and the interference with the same by the Division Bench by the order impugned is required to be set aside, in view of the various incongruities which were prevalent in the case on hand. 117. We are, therefore, convinced that when once M.L. No.2010 had come to an end by virtue of the surrender effected by M/s. Dalmia and accepted by the State Government, there was no legal right or power with the State Government or any authority acting on behalf of the State Government to consider the very application for transfer made at the instance of M/s. Dalmia on 4.2.2002 and for passing the order of transfer dated 16.3.2002. It can only be stated that such a decision taken and passed in the order dated 16.3.2002 was in total violation of the provisions of the MMDR Act and the Mineral Concession Rules. It will have to be stated that once surrender of M.L. No.2010 had come into effect the only other course open to the State Government was to invoke Rule 59 by throwing open those lands by way of public auction in order to get the maximum revenue by granting any lease hold rights. Here again, it must be stated that apart from the act of surrender made by M/s.Dalmia which became final and conclusive due to non-compliance of the conditions imposed in the in-principle Stage I clearance dated 24.12.1997, M/s.Dalmia lost its right to retain the lease and the consequence of it rendered the lease itself void as per Rule 37(1A) and on this ground as well, there was no scope for the State Government or any other Authority acting on its behalf to have considered the transfer application of M/s.Dalmia with reference to a lease which ceased to exist as from 31.01.2002 due to the act of surrender and in any case from 24.12.2002 when the 5 year period to comply with the conditions imposed in the order dated 24.12.1997 expired. 118. In this context, it will be more relevant to state that mines and mineral being national wealth, dealing with the same as the largesse of the State by way of grant of lease or in the form of any other right in favour of any party can only be resorted to strictly in accordance with the provisions governing disposal of such largesse and could not have been resorted to as has been done by the State Government and the Director of Mines and Geology of the State of Karnataka by passing the order of transfer dated 16.3.2002. Such a conduct of the State and its authorities are highly condemnable and, therefore, calls for stringent action against them. | 1[ds]49. In order to consider the first question as to whether M/s. Dalmia surrendered the mining lease M.L. No.2010 and whether such surrender has become final and conclusive, we have to recapitulate certain basic facts relating to the said lease. The said lease M.L. No.2010 was granted on 25.11.1953 for 30 years and the extent of land was 331.50 hectares covering 819.20 acres of forest land in Jaisinghpur village R.N. Block, Sandur Taluk, Bellary District. The said initial lease period expired on 24.11.1983 and by order dated 07.03.1986 the lease was renewed for another 20 years retrospectively from 25.11.1983, which was to expire by 24.11.2003. The relevant fact to be noted is that by the time the lease expired on 24.11.1983, the Forest Act 1980 had come into force and under Section 2 of the Forest Act in order to carry on any further mining activity in the entirety of the 331.50 hectares of land covered by M.L.No. 2010, the prior approval of the Central Government was necessary and required. It is not in dispute that when the mining lease was renewed by order dated 07.03.1986 by the Department of Mines of the State Government, Section 2 of the Forest Act of 1980 was not complied with. It remained unnoticed till the issue came to be considered by this Court in the judgment concerned in Godavarman-I. By virtue of the direction issued by this Court all the mines, which did not comply with the requirement of Section 2 of the Forest Act were directed to stop all their mining activities. Consequently by order dated 25.01.1997 the second respondent herein namely Director of Mines and Geology called upon M/s. Dalmia to stop all mining activities pertaining to M.L. No.2010 and the mining activities were stopped by M/s. Dalmia. Thereafter, by the Godavarman-II judgment, which is reported in (1997) 3 SCC 312 , the MOEF was directed to consider those applications for ex post facto approval. Pursuant to the said direction of this Court, by order dated 24.12.1997, MOEF granted conditional in-principle stage-I approval for the renewal of M/s.mining lease for an extent of 201.50 hectares of forest land. The said stage-I approval was subject to fulfillment of specific conditions within six months from the date of the order. It was also specifically mentioned that only after receipt of compliance report of the conditions stipulated in the stage-I approval, consideration for grant of final approval under Section 2 of the Forest Conservation Act would be made and issued. After the receipt of the order dated 24.12.1997 M/s. Dalmia surrendered 196.58 hectares of land out of 331.50 hectares to the forest department of the State Government through their letter dated 16.04.1999. By virtue of the said surrender made by M/s. Dalmia out of 331.50 hectares the M/s. Dalmia can be said to have retained only 134.92 hectares for its mining operations. Be that as it may, on 27.03.2001 M/s. Dalmia wrote to the Directors of Mines and Geology expressing its decision to determine the lease and surrender the remaining area and gave notice as required under the terms of the mining lease deed for determination of the lease. In the said letter M/s. Dalmia mentioned that such determination of lease would take effect upon expiry of 12 months notice period from 01.04.2001 or earlier if permitted by the State Government.The said stand of M/s. Dalmia which was the third respondent in that writ petition also disclosed that M/s. Dalmia categorically made it clear that it was not operating the mines covered by M.L.No. 2010. After the letter of M/s. Dalmia dated 27.03.2001 expressing its decision to surrender the lease and determine the same, the Director of Mines sent its communication dated 25.05.2001 pursuant to which M/s. Dalmia surrendered the lease deed book of M.L.No. 2010 along with its letter dated 16.06.2001. Thereafter, an application came to be filed at the instance of a company called ‘M.S.P.L.through its Executive Directed Mr. Rahul Baldota on 21.07.2001 for the grant of mining lease which was held by M/s. Dalmia and shown as government land in itsout of the remaining 201.50 hectares, according to M/s. Dalmia, 110 hectare was broken up for mining, 5.75 hectare was used for roads, dams, stores, office etc., 19.17 hectares was broken up but unusable virgin area used for roads and that it was non ore-bearing area and the remaining virgin area which was not yet broken and which was being surrendered was 66.58 hectares. It is also further stated therein that the management decided to surrender even the virgin area of 66.58 hectares and ultimately wanted to retain only 134.92 hectares.56. In fact this letter, dated 16.04.1999 apparently appeared to have been sent in response to the in-principle stage-I approval granted by the Government of India in its letter dated 24.12.1997 wherein certain conditions were imposed. While responding to the said order, M/s. Dalmia in its letter dated 16.04.1999 mentioned that as far as conditions (i) and (ii) of the Government of India dated 24.12.1997, no action need be taken since it decided to surrender nearly 196.58 hectares and what was to be retained was only 134.92 hectares. As regards condition No.(iii), namely, the cost of penal compensatory aforestation charges was concerned, while referring to the demand, twice the area of 201.50 hectares i.e. 403 hectares @ Rs.40,700/- per hectare, M/s. Dalmia pointed out that there cannot be a demand by Government of India to that extent and at best the demand can only be raised in respect of the broken up area of 134.92 hectares. It was further contended that since M/s. Dalmia was carrying mining operations even in that 134.92 hectares with the permission of the State Government Authorities from time to time, no penal compensatory aforestation charges can be claimed over that area.A cumulative consideration of the letter dated 16.4.1999 along with the ex post facto approval order dated 24.12.1997 and the letter dated 27.3.2001 of M/s. Dalmia, it transpires that as on 27.3.2001 M/s. Dalmia was in possession of only 134.92 hectares of the total area of 331.50 hectares covered by mining lease No.2010. As noted by us in the letter dated 27.3.2001, M/s. Dalmia wanted the Director of Mines and Geology to determine the lease even in respect of 134.92 hectares which was in its physical possession, either on expiry of the twelveperiod or any earlier date which the concerned authority may permit. To be more precise, M/s.Dalmia surrendered 130 hectares of land prior to 16.04.1999. Along with its letter dated 16.04.1999 surrender of 196.58 hectares was effected. The remaining 134.92 hectares was surrendered through its letter dated 27.03.2001.That apart, in the Writ Petition which was pending before the High Court of Karnataka in WP 6304 of 1998 as between the first respondent and the Director of Mines, as well as, Chief Conservator of Forest where M/s. Dalmia was also a party respondent, namely, third respondent, on its behalf its counsel represented before the High Court that M/s. Dalmia was no longer interested in the working of the mines situated in the land adjoining the writ appellant, namely, the first respondent therein and, therefore, as on that date, no boundary dispute was existing as between them. The said stand of M/s. Dalmia was the main ground which weighed with the learned Single Judge for setting aside the order dated 16.11.1997 which was impugned before it in the said Writ Petition at the instance of the first respondent. The said stand of M/s. Dalmia was clearly reflected in the order of the Learned Single Judge dated 26.6.2001.66. Apart from the above facts, after the forwarding of the letters dated 16.4.1999, 27.3.2001 and 16.6.2001 by M/s. Dalmia whereby the surrender of the lands in its entirety, as well as, the mining lease itself, third parties were aspiring to get the mining lease in respect of the surrendered lands held by M/s. Dalmia. One such application was taken out by one M/s. M.S.P.L. Ltd. through its Executive Director, Mr. Rahul Baldota. The said application was made on 21.7.2001 for grant of mining lease in its favour.A cumulative consideration of all the above sequence of events disclose that right from 1999 in fact even prior to that date, M/s. Dalmia surrendered major part of the land covered by M.L. No.2010 and that by its letter dated 27.3.2001, it expressed its decision to determine the lease of the remaining area of 134.92 hectares and wanted the Director of Mines to accept such surrender either after the expiry of twelveperiod or even earlier. By 25.5.2001, the Director of Mines in response to M/s.desire to determine the lease, directed it to surrender the lease book of M.L. No.2010 as well as the mining plan, and that M/s. Dalmia surrendered the lease book while stating that mining plan was not available with it at that point of time. Closely followed by that, when third parties applied for grant of lease, the Director of Mines stated in no uncertain terms that those lands were surrendered by M/s. Dalmia but lease cannot be granted based on applications and that Rule 59 (1) of MCR Rules will have to be followed for grant of such lease. In fact, subsequent to the above development on 26.9.2001, the suit filed by M/s. Dalmia against first respondent relating to the boundary dispute was also dismissed for non-prosecution. Yet another factor to be borne in mind is that on 30.1.2002, M/s. Dalmia paid a sum of Rs.22,332/- towards the arrears in respect of its mining lease and claimed that no further amount was due and payable in respect of M.L. No.2010. By a letter dated 31.1.2002, the office of the Deputy Director, Department of Mines and Geology issued a no dues certificate to M/s. Dalmia by acknowledging the receipt of Rs.22,332/- based on the revised audit report and that no other amount was due in respect of the said mining lease.69. If we consider the above material evidence placed before us, it can be stated that as on 27.3.2001 M/s. Dalmia tacitly decided to surrender its mining lease M.L. No.2010 and that in pursuance of the said decision, it informed the Director of Mines and Geology to determine the lease either on expiry of twelve months or on any day earlier to that and in response to the said desire expressed by M/s. Dalmia, the Director of Mines and Geology also responded by directing M/s. Dalmia to surrender the lease book as well as the mining plan and then subsequently also collected whatever arrears which were due and payable by M/s. Dalmia as on 31.01.2002. It must, therefore, be held that in effect the leasehold rights of M/s. Dalmia had come to an end by 31.1.2002.70. Keeping the said factual scenario in mind, when we consider the contentions made on behalf of the respective parties according to the appellants, M/s. Dalmia had surrendered the entirety of the lands held by it under M.L.No. 2010 which surrender had come into effect pursuant to its letter dated 27.03.2001 accepted and acknowledged by the Department of Mines and Geology in their letter dated 31.01.2002. We have also noted the various factual aspects of the development that had taken place in regard to the said surrender of M/s. Dalmia and noted that a conscious decision was taken by M/s. Dalmia to surrender its mining lease in M.L.No. 2010 and factual surrender was also effected in writing to the Director of Mines and Geology and that the Office of Director of Mines and Geology also acknowledged such surrender. However, not to accept the plea of surrender as projected, on behalf of the appellants Mr. K.K.Venugopal and Mr.Krishnan Venugopal relied upon various statutory prescriptions and contended that in reality if the case of surrender pleaded by the appellants is to be accepted, the compliance of such statutory requirements have to be fulfilled.As against the above submissions, on behalf of the appellant Mr. Kapil Sibal, learned senior counsel contended that there was no lacunae in accepting the surrender offered by M/s. Dalmia, that such surrender had really taken place by virtue of the conduct of the parties, namely, M/s. Dalmia as well as the Department of Mines and Geology of the State Government and, therefore, it was too late in the day for the first respondent to contend that the surrender made by M/s. Dalmia had not taken place.75. Having considered the respective submissions on this question, there can be no two opinions that when the grant, operation and termination of mining lease is governed by the MMDR Act and the Mineral Concession Rules, anyone of those factors viz., either grant of lease, operation of the mines based on such grant and the termination of it either by way of surrender at the instance of the lessee or by way of termination at the instance of the State should be carried out strictly in accordance with the prescribed stipulations of the provisions of the above Act and the Rules.When we examine the contention made on behalf of the first respondent about the statutory requirement to be satisfied under Rule 29 read along with para 4 and 5 of Part VIII of the lease deed, it is clear that on behalf of the lessor, namely, the State Government, the signatory to the lease deed was the Director of Mines and Geology. Therefore, there can be no controversy as to who can validly represent the State Government with reference to the grant of lease, operation of it as well as its determination who is none other than the Director of Mines and Geology. When the Director of Mines and Geology was authorized to sign the lease deed on behalf of the Governor of the State of Karnataka, it must be taken to mean that he was the authority who was validly authorized by the State Government as stipulated in Rule 29(1) of the Rules for the purpose of the lessee to inform about its decision to determine the lease while giving 12notice. It must be stated that the very fact that the Director of Mines and Geology was authorized to sign the lease deed on behalf of the Governor of State of Karnataka, it was quite explicit that he was the only authority who was competent to authenticate the grant of the lease as well as for its determination. Unless there was any other Authority prescribed to carryout the said task as a statutory requirement.79. Once we steer clear of the said position as to who is the competent authority for the purpose of operating Rule 29(1), any amount of reliance placed upon the Notification No.CI3MMM95, Bangalore dated 27.05.1995 issued by the Commerce and Industries Department of the State of Karnataka will be of no avail. The said notification was relied upon to contend that while specific direction was issued to the effect that the powers exercisable by the State Government in relation to matters with reference to various provisions as conferred by sub-section (2) of Section 26 of the MMDR Act vested with the Director of Mines and Geology, Government of Karnataka, there was no reference to the powers exercisable by the State under Rule 29. When the State of Karnataka had authorized the Director of Mines and Geology to sign the very mining lease deed itself on behalf of the Governor of State as disclosed in the Xerox copy of the mining lease M.L.No. 2010, it is futile on the part of the first respondent to contend that for the purpose of determination of that very lease, a different Authority should be preferred. In fact, M/s. Dalmia itself having understood the prescribed Authority, sent its letter of determination of the lease dated 27.03.2001 only to the Director of Mines and Geology. The said Authority also responded to the letter of determination in its letter dated 25.05.2001 addressed to its subordinate officer marking a copy to M/s.Dalmia. Therefore, the said contention raised on behalf of the first respondent that the surrender of the lease not having been forwarded to the authorized officer of the State Government by M/s. Dalmia, the so-called letter of surrender dated 16.04.1999 and 27.03.2001 cannot be validly construed as the act of M/s. Dalmia to determine the lease is to be stated only to be rejected. We are afraid that it is too late in the day for the first respondent to come forward with such a contention when M/s. Dalmia having entered into lease deed with the State of Karnataka duly represented by the Director of Mines and Geology exercised its right to determine the lease by addressing its communication on 27.03.2001 to the very same Authority. It must be stated that such a decision taken and communicated by M/s. Dalmia to the Director of Mines and Geology was valid in law and was in consonance with the prescription contained in sub-Rule (1) of Rulethe first place, even according to M/s. Dalmia in their letter dated 27.3.2001 M/s. Dalmia themselves while giving 12 months notice as required under para 4 of Part VIII of the mining lease deed also stated that it may be determined on any earlier date i.e. prior to 1.4.2001 if the Director of Mines and Geology so permit. When such a categorical stand was made on behalf of M/s. Dalmia, acting upon it, the office of Director of Mines and Geology in their letter dated 25.5.2001 addressed to the Senior Geologist while marking its copy to M/s. Dalmia directed it to surrender the lease deed book along with the mining plan immediately to enable its office to take further action. In fact, in the body of the letter addressed to Senior Geologist, the Director of Mines and Geology specifically mentioned that M/s. Dalmia wanted to surrender the lease M.L. No.2010 earlier than 12 months period. Apart from such specific instructions issued, M/s. Dalmia themselves in their reply dated 16.6.2001 to the Director of Mines and Geology surrendered the lease deed book of M.L. No.2010 and as regards the mining plan it stated that the same was not available with it. Thereafter, as was noticed earlier, on 30.1.2002, M/s. Dalmia paid a sum of Rs.22,332/- towards arrears in respect of the mining lease which was also acknowledged by the Director of Mines and Geology which was duly communicated to M/s. Dalmia by stating that by issuing such no due certificate, no further amount was due and payable in respect of said mining lease.The contention that only on expiry of the twelve months period, the surrender will come into effect does not stand to reason also. In fact, we do not see any sound basis in making such a contention on behalf of the first respondent. On the other hand, para 5 of the lease deed itself gives ample right to the lessor, namely the Director of Mines and Geology to refund the security deposit, if any, to make the determination of lease within the 12 months period of notice. The said clause provides clear indication for such earlier acceptance of the determination of the lease. We have noted extensively that long prior to 16.04.1999 as well as from 16.4.1999 onwards till M/s. Dalmia by its communication dated 27.3.2001 positively expressed its decision to determine the lease, M/s. Dalmia themselves were only referring to the mining operations to the extent of 130.4 hectares which remained with them as on 27.03.2001. Even in respect of the said extent of lands by virtue of the general directions issued by this Court in Godavarman I no mining operation was being carried on from January 1997. Subsequently, based on Godavarman II order of this Court, when the Ministry of Environment and Forest was directed to consider issuance of ex post facto approval, one such order was issued in favour of M/s. Dalmia on 24.12.1997 by way of in principle stage-I approval by imposing three conditions. Even as on 16.4.1999, M/s. Dalmia in writing categorically stated and took the stand that it need not comply with the conditions imposed in the order dated 24.12.1997. In effect M/s. Dalmia was not operating its right of carrying out any mining activity in respect of the entirety of 334.40 hectares after the first renewal effected in the year 1983. Ultimately, in its letter dated 27.03.2001, it made explicitly clear that it was not operating the mines and, therefore, it wanted to surrender either after expiry of twelve months period from the date of issuance of such notice or any day earlier that may be acceptable to the State Government.83. In the light of such a clear stand disclosed by M/s. Dalmia, we fail to understand as to for what reason the State Government should wait for the expiry of the twelve months period for the surrender to come into effect. On the other hand, the decision made by the Director of Mines and Geology in its communication dated 25.5.2001 addressed to the Senior Geologist with a copy marked to M/s. Dalmia to determine the lease earlier and for that purpose directed M/s. Dalmia to surrender mining lease book, namely, M.L. No.2010 along with the mining plan was a pointer to the effect that the surrender was decided to be accepted on behalf of the State Government instantaneously which was also not prohibited either under the Rules or under the terms of the lease deed or under any other statutory provision.The said well settled principle of law set down by this Court will have universal application. When such principle is applied to the case on hand, as rightly pointed out by Mr.Sibal, learned senior counsel when the State of Karnataka chose to accept the surrender made by M/s. Dalmia in its letter dated 27.03.2001, immediately thereafter by directing M/s. Dalmia to surrender the lease book of M.L.2010 along with mining plan such action of the State Government for the purpose of ensuring the effective surrender offered by M/s.Dalmia having been made in the general public interest, as the leasehold rights of the mining activities would be in the lands belonging to the State and that too Forest Lands, such action taken in accepting the surrender by waiving the 12 months period should be taken as having come into effect. We find force in the said submission of the learned senior counsel for the appellant.Therefore, if such a different connotation is followed for the expressionand when we apply the said principle to the case on hand with particular reference to Rule 37(1A) we have explained in detail as to how the voidness of the leasehold right would result in by virtue of the serious violations committed by M/s. Dalmia while dealing with the mining lease in M.L.No.2010 while carrying out the first renewal in the year 1983 when the violation of Section 2 of the Forest Act, 1980 occurred and subsequently when Stage I ex post facto approval was granted on 24.12.1997 by imposing conditions which were flagrantly violated by M/s. Dalmia and thereby made the lease void ab initio.Our above conclusion as regards the surrender effected by M/s. Dalmia answers question Nos.(i) to (iii) framed in paragraph 48. With that we come to the next question as to whether the act of surrender in order to become complete should have been accepted by the State. It must be stated that acceptance by the State though not a statutory requirement, the provisions contained in the mining lease, in particular, Part VIII paragraphs 4 and 5 impliedly require such acceptance. While answering question Nos.(i) to (iii), we have elaborately noted as to the manner in which M/s.proposal to determine the lease as initiated in its communication dated 27.3.2001 ultimately resulted in the surrender of the lease by acknowledging the sum of Rs.22,332/- towards final dues payable by it under the said lease. We have also held that the Director of Mines and Geology was the competent authority to receive a proposal for determination of lease by M/s. Dalmia. The subsequent correspondence exchanged between M/s. Dalmia and the Director of Mines and Geology also confirm that the proposal of M/s. Dalmia was considered and subsequent directions were issued for the purpose of accepting the surrender proposed and ultimately by acknowledging the payment of arrears and issuance of no due certificate the surrender was finally accepted on behalf of the State Government by the Director of Mines and Geology. Therefore, while holding that acceptance of surrender is impliedly mandated under Rule 29 read along with paragraphs 4 and 5 of Part VIII of the mining lease, there was a factual acceptance on behalf of the State of Karnataka of the mining lease M.L. No.2010.Under Rule 27, it is stated that every mining lease shall be subject to certain conditions. Sub-Rule (2) states that a mining lease may contain such other conditions as the State Government may deem necessary in regard to conditions (a) to (o). Under the said sub-Rule (2) in clause (l), it is provided that delivery of possession of lands and mines on the surrender, expiration or determination of lease. What is required under Rule (2) of Rule 27 was that a mining lease may contain many conditions including what is specified in Clause (l). The reference to Rule 27 (2)(l) was relied upon by learned counsel for the State. Except merely drawing our attention to the said sub-clause (l) of Rule 27 (2), we were not drawn to any of the clause contained in the mining lease in M.L. No.2010 to state that such a condition was specifically incorporated in the mining lease. It is not even the case of the first respondent or the respondent State that such a condition for physical possession of the lands on surrender was specified in the mining lease.100. In such circumstances, we do not find any need or necessity to delve deep into the said contention in order to find out whether or not such a condition should have been fulfilled by M/s. Dalmia or by the State Government for the purpose of surrender to come into effect. We, therefore, hold that insofar M.L. No.2010 was concerned, there being no specific provision as specified in Clause (l) of Rule 27 (2) there was no mandatory requirement of delivery of possession as stipulated therein.101. When we come to question Nos.(vi), (vii), (viii), (ix) and (x) the said questions would arise if at all the surrender had not taken place and thereby assuming the lease continued for non-compliance of the conditions imposed in the in principle stage-I approval in the order dated 24.12.1997, did the mining lease stood automatically expired on 24.11.2003. Question No.(vii) again pertains to the lease becoming void ab initio by virtue of contravention of Rules 29 and 37 of Mining Concession Rules read with Section 19 of the MMDR Act. The next question pertains to the prior approval for any mining lease to come into operation as stipulated in Section 2 of the Forest Act of 1980. In fact, the said question was required to be considered in the light of the contention raised on behalf of the appellants that ex post facto approval is not provided for under the Forest Act of 1980 and that such a course was adopted only by this Court in Godavarman I and II as a one time measure. Whereas on behalf of the first respondent, it was contended that there was a clear distinction as regards the grant of mining lease on the one hand under the provisions of MMDR Act and the Mining Concession Rules and the requirement of approval under Section 2 of the Forest Act 1980 and the one does not overlap the other. In the first instance, in support of the said stand made on behalf of the first respondent, reliance was placed upon amended Forest Conservation Rules, in particular Rules 6, 7 and 8 and state that non-compliance of Section 2 of the Forest Act will not ipso facto make the lease void ab initio. The consideration of the said questions would become relevant for the purpose of considering the subsequent claim of M/s. Dalmia as well as the first respondent that mining lease M.L. No.2010 stood transferred by M/s. Dalmia in favour of the first respondent pursuant to the application of transfer dated 4.2.2002 made by M/s. Dalmia and the order dated 16.3.2002 of the State Government by which such a transfer of lease of M.L. No. 2010 was granted in favour of the first respondent.102. When we consider question Nos.(vi), (vii), (viii), (ix) and (x) as far as question No.(vi) is concerned, we have found that when during the operation of the first renewal viz., between 25.11.1983 and 24.11.2003, there was a statutory violation in as much as the mandatory requirement of approval under Section 2 of the Forest Act, 1980 was not secured on the date when the first renewal was granted viz., 07.06.1986. However, fortunately for M/s.Dalmia, Godavarman I and Godavarman II judgments of this Court came for its rescue by way of a general direction while all mining operations were directed to be stopped in Godavarman I, subsequently in Godavarman II direction was issued to the Central Government to consider ex post facto approval under Section 2 of the Act as a one time measure. Pursuant to the said direction, in the case of M/s.Dalmia, an order came to be passed on 24.12.1997, granting in-principle first stage approval by imposing three conditions. The said order further directed that while granting in principle first stage approval, to enable M/s.Dalmia to carry on its mining operations, the requirement of fulfillment of three conditions were mandated to be complied within a period of five years from the date of the said order i.e. on or before 24.12.2002. Admittedly, M/s.Dalmia did not comply with those conditions. The stand of M/s.Dalmia was that as on that date it was in possession of only 134.92 hectares and that even in respect of those areas since it was carrying on mining operations with the permission of the Forest Department of the State Government, no further compliance was required.103. As far as the surrender of land and afforestation compensation was concerned, M/s. Dalmia took a categorical stand that it was not liable to comply with those directions. Therefore, the outcome of such a stand taken on by M/s.Dalmia was to the effect that in-principle stage I approval granted by MOEF was not carried out. Of course, Mr.Krishnan Venugopal, learned senior counsel in his submissions contended that having regard to the subsequent amendment of the Forest (Conservation) Rules in particular Rules 6, 7 and 8 and also a communication of the MOEF dated 14.9.2001, the non-compliance of the conditions will not have any impact on the validity of the lease as the amended Rules and the communication of the MOEF made it clear that the compliance of such conditions imposed can always be carried out even after the expiry of the initial period of five years and the MOEF came forward to give extension of time for compliance of whatever conditions which were imposed at the time of grant of the first renewal to enable the lessee to continue to retain its mining lease and thereby seek for further renewal.104. It is true that a reference to the amended Rules 6, 7 and 8 as well as the earlier communication of MOEF did to some extent support the stand of the learned senior counsel for the first respondent. However, persuasive such a contention may be as raised on behalf of the first respondent, we find it extremely difficult to accept such a contention. As rightly pointed out by Mr.Kapil Sibal, learned senior counsel when we construe Rules 29 and 37(1A) read along with Section 19 of the MMDR Act, de hors any liberal approach offered by the authorities of MOEF under the provisions of the Forest Act, such relaxation in the matter of compliance of conditions of prior approval would always be subject to the mining lease granted under the provisions of MMDR Act and the Mineral Concession Rules is in a live stage. In other words, unless the mining lease granted under the provisions of the MMDR Act read along with the provisions contained in the Mineral Concession Rules continue to remain valid and operative, the question of compliance of the conditions for prior approval under Section 2 of the Forest Act even with whatever relaxation granted by the authorities under the said Act will be of no use.Keeping the above said mandatory prescription in Section 19 in mind, when we analysis the case on hand, in the first place, admittedly after the first renewal, there was a serious violation of failure to get the prior approval under Section 2 of the Forest Act, 1980 i.e. when the renewal order was passed on 07.03.1986. Therefore, if we strictly apply Section 19, it must be stated that even as on 07.03.1986, for violation of Section 2 of the Forest Act, 1980 it must be stated that, in law, there was no mining lease at all in existence as it became void on the expiry of the initial period of the original lease granted in 1953. It may be contended that such violation get cured by virtue of the judgments in Godavarman I and Godavarman II, though for argument sake, such a contention put forth on behalf of M/s.Dalmia and the first respondent can be taken to be available, as pointed out by us earlier, based on the said judgments of this Court when the in-principle first stage approval was granted by imposing conditions in the order dated 24.12.1997, such conditions were blatantly violated by M/s.Dalmia by taking a stand that it was not bound to comply with those conditions. The reply of M/s.Dalmia dated 16.04.1999, was sufficient to confirm the said stand of M/s.Dalmia. Therefore, as on 16.04.1999, since the lessee viz., M/s.Dalmia refused to comply with the conditions imposed in the in-principle first stage approval, it cannot lie in the mouth of either M/s.Dalmia or anyone who seek to claim any right through M/s.Dalmia by contending that any violation of Section 19 of MMDR Act or any of the Rules of Mineral (Concession) Rules or orders made therein or Section 2 of the Forest Act of 1980 should be ignored and the plea made on behalf of M/s.Dalmia as well as the first respondent should be accepted.107. We are unable to accept such an extreme proposition canvassed on behalf of M/s.Dalmia and the first respondent, as in our considered opinion, the violation had occurred at the time of the order of first renewal viz., 07.03.1986 itself, striking at the very root of the validity of the lease, as it must be held that it was void at that very stage itself for non-compliance of the prior approval under Section 2 of the Forest Act, 1980 and in any case, on the blatant refusal to comply with the conditions imposed in the in-principle first stage approval granted in the year 24.12.1997. Once we are able to come to the said conclusion, we hold that the mining lease which was held by M/s.Dalmia in M.L.No.2010 became void and inoperative for violation of the mandatory requirements of the conditions.In the first blush it may appear that what all required is the acceptance by the transferee to comply with all the conditions and liabilities which the transferor was obliged to fulfill in respect of the mining lease. But on a deeper scrutiny of the said Rule, it will have to be stated that if there was a total violation of mandatory statutory conditions under the MMDR Act and by virtue of the requirements in this case of the fulfillment of Section 2 of the Forest Act, 1980 as well as the proviso to Section 5 of the MMDR Act, the question of considering the very application for consent to transfer should be held to be not available at all. As we have held in the earlier part of this order that M/s.Dalmia committed serious violation in regard to the compliance of Section 2 of the Forest Act, 1980 at the time of first renewal in the year 1983/86 itself and in any event, by refusing to comply with the conditions imposed in the order dated 24.12.1997, the said violation would strike at the very root of the claim for transfer of the dead lease as stipulated in Section 19 of the MMDR Act. Therefore, on this ground as well, it must be held that there was no scope at all for the State Government to consider the application made by M/s.Dalmia for transferring of its mining lease in favour of the first respondent. When we go little further and examine Rule 29, as we have held that M/s.Dalmia had surrendered its mining lease M.L.No.2010 once and for all, based on its proposal made on 27.03.2001 and accepted by the Director of Mines and Geology on behalf of the State Government which became conclusive as on 31.01.2002, there was no live lease for the purpose of considering any application for transfer under Rule 37 of the Mineral (Concession) Rules. When that be the legal consequence in respect of the lease, which was void and inoperative, it must be held that there was no scope for holding that there was a valid transfer made by M/s.Dalmia in favour of the first respondent on 16.03.2002.As far as the question Nos.(xiii) and (xiv) are concerned, as to whether the order of transfer dated 16.3.2002 was bona fide taking into account the sequence of events and whether the transfer of lease dated 16.3.2002 can be held to be valid, we wish to recapitulate the various sequence of events as from 16.4.1999 till 30.1.2002 pertaining to the surrender of lease made by M/s. Dalmia. Since we have extensively dealt with the said issue in the earlier part of our order, we merely state that our conclusion as regards the coming into force of the surrender made on behalf of the M/s. Dalmia and its acceptance by the State Government from 31.01.2002 would be sufficient to hold that there was total lack of bona fides on the part of the State government in taking a sudden U-turn for passing the order of transfer dated 16.3.2002 in favour of the first respondent. In this context, as rightly contended on behalf of the appellant, the conduct of the Director of Mines and Geology, one Dr. Reddy who dealt with the applications made by one M.S.P.L. Ltd. through its Executive Director Mr. Rahul Baldota on 21.7.2001 and another applicant with reference to which Dr. Reddy made an endorsement in the office note dated 25.8.2001 which stated that the land covered by M.L. No.2010 was surrendered by M/s. Dalmia, that certain other applications were also received for grant of lease in respect of those lands apart from M.S.P.L. Ltd. and that there was no scope to consider any of those applications since in respect of surrendered land Rule 59(1) of Mineral Concession Rules would automatically come into play and any future grant of lease can only be done as specified under the said Rule. When such a clear stand was spelt out by the said officer, namely, Dr. Reddy while making the endorsement on 25.8.2001, we fail to see any justifiable reason as to how the very same officer in his capacity as Director of Mines and Geology could be a signatory to its recommendation dated 6.2.2002 for effecting the transfer and based on his recommendation the State Government allowed the application for transfer of M.L. No. 2010.We are, therefore, convinced that when once M.L. No.2010 had come to an end by virtue of the surrender effected by M/s. Dalmia and accepted by the State Government, there was no legal right or power with the State Government or any authority acting on behalf of the State Government to consider the very application for transfer made at the instance of M/s. Dalmia on 4.2.2002 and for passing the order of transfer dated 16.3.2002. It can only be stated that such a decision taken and passed in the order dated 16.3.2002 was in total violation of the provisions of the MMDR Act and the Mineral Concession Rules. It will have to be stated that once surrender of M.L. No.2010 had come into effect the only other course open to the State Government was to invoke Rule 59 by throwing open those lands by way of public auction in order to get the maximum revenue by granting any lease hold rights. Here again, it must be stated that apart from the act of surrender made by M/s.Dalmia which became final and conclusive due to non-compliance of the conditions imposed in the in-principle Stage I clearance dated 24.12.1997, M/s.Dalmia lost its right to retain the lease and the consequence of it rendered the lease itself void as per Rule 37(1A) and on this ground as well, there was no scope for the State Government or any other Authority acting on its behalf to have considered the transfer application of M/s.Dalmia with reference to a lease which ceased to exist as from 31.01.2002 due to the act of surrender and in any case from 24.12.2002 when the 5 year period to comply with the conditions imposed in the order dated 24.12.1997 expired. | 1 | 25,020 | 7,501 | ### Instruction:
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of the reasons which weighed in the report of the Hon’ble Minister reflected the true facts. The conclusion of the Hon’ble Minister that the possession continued to remain with the owner was contrary to what was found on records. The Mahazar dated 09.12.1983 as noted by learned Single Judge from the original file reveal that the conclusion of the Hon’ble Minister was ex facie illegal and untrue. The said conclusion obviously appeared to have been made with some ulterior motive and purpose and with a view to show some undue favour to the first respondent herein. The acquisition became final and conclusive as far back as on 15.7.1971 when Section 6 declaration came to be issued. At no point of time was there any challenge to either preliminary notification dated 21.9.1967 or the final declaration notified on 15.7.1971. Even the award dated 21.11.1983 approved on 29.11.1983 was not the subject matter of challenge in any proceedings.16. xxx xxx xxx17. xxx xxx xxx18. In our considered opinion, the Division Bench failed to take note of the above gross illegality committed by the Hon’ble Minister while directing the issuance of the de-notification dated 05.10.1999 in spite of the fact that possession had already been handed over to the State as early as on 09.12.1983 and that the decree of the Civil Court did not in any way create any fetters on the authorities concerned to take steps for possession by resorting to appropriate legal means. At the risk of repetition, it will have to be stated that the Civil Court decree to that effect was dated 15.12.1981 and that the possession was taken by taking necessary steps under the provisions of the Land Acquisition Act under the Mahazar dated 09.12.1983 which was never challenged by any party much less the first respondent herein. The Division Bench unfortunately completely omitted to take note of the relevant facts while interfering with the order of the learned Single Judge. The appeals, therefore, stand allowed. The order of the Division Bench is set aside and the order of the learned Single Judge dated 26.8.2002 passed in Vijaya Leasing Ltd. v. State of Karnataka stands restored by this common judgment.” (underlining is ours) 116. The above judgment throws some light as to how certain excess role played on behalf of the State without any justifiable reasons were brought to the notice of the Court, the Court should not hesitate to set aside such orders in the interest of Rule of Law. When we compare the facts set out in paragraph 15 of the said judgment, when we refer to the facts dealt with by us in this case, we have noted as to how after surrender made by M/s.Dalmia had become conclusive as on 31.01.2002, on behalf of the State Government the very same officer who held the post of Director of Mines and Geology as on 25.08.2001 came forward to recommend for the transfer applied for by M/s.Dalmia on 04.02.2002, in the recommendation order dated 06.02.2002 and by simply glossing over the gross violations of the Forest Act, 1980, the order came to be passed on 16.03.2002 approving of the transfer applied for by M/s.Dalmia in favour of the first respondent. In the said circumstances, the order of the learned Single Judge in setting aside the said order dated 16.03.2002, was perfectly justified and the interference with the same by the Division Bench by the order impugned is required to be set aside, in view of the various incongruities which were prevalent in the case on hand. 117. We are, therefore, convinced that when once M.L. No.2010 had come to an end by virtue of the surrender effected by M/s. Dalmia and accepted by the State Government, there was no legal right or power with the State Government or any authority acting on behalf of the State Government to consider the very application for transfer made at the instance of M/s. Dalmia on 4.2.2002 and for passing the order of transfer dated 16.3.2002. It can only be stated that such a decision taken and passed in the order dated 16.3.2002 was in total violation of the provisions of the MMDR Act and the Mineral Concession Rules. It will have to be stated that once surrender of M.L. No.2010 had come into effect the only other course open to the State Government was to invoke Rule 59 by throwing open those lands by way of public auction in order to get the maximum revenue by granting any lease hold rights. Here again, it must be stated that apart from the act of surrender made by M/s.Dalmia which became final and conclusive due to non-compliance of the conditions imposed in the in-principle Stage I clearance dated 24.12.1997, M/s.Dalmia lost its right to retain the lease and the consequence of it rendered the lease itself void as per Rule 37(1A) and on this ground as well, there was no scope for the State Government or any other Authority acting on its behalf to have considered the transfer application of M/s.Dalmia with reference to a lease which ceased to exist as from 31.01.2002 due to the act of surrender and in any case from 24.12.2002 when the 5 year period to comply with the conditions imposed in the order dated 24.12.1997 expired. 118. In this context, it will be more relevant to state that mines and mineral being national wealth, dealing with the same as the largesse of the State by way of grant of lease or in the form of any other right in favour of any party can only be resorted to strictly in accordance with the provisions governing disposal of such largesse and could not have been resorted to as has been done by the State Government and the Director of Mines and Geology of the State of Karnataka by passing the order of transfer dated 16.3.2002. Such a conduct of the State and its authorities are highly condemnable and, therefore, calls for stringent action against them.
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to comply with all the conditions and liabilities which the transferor was obliged to fulfill in respect of the mining lease. But on a deeper scrutiny of the said Rule, it will have to be stated that if there was a total violation of mandatory statutory conditions under the MMDR Act and by virtue of the requirements in this case of the fulfillment of Section 2 of the Forest Act, 1980 as well as the proviso to Section 5 of the MMDR Act, the question of considering the very application for consent to transfer should be held to be not available at all. As we have held in the earlier part of this order that M/s.Dalmia committed serious violation in regard to the compliance of Section 2 of the Forest Act, 1980 at the time of first renewal in the year 1983/86 itself and in any event, by refusing to comply with the conditions imposed in the order dated 24.12.1997, the said violation would strike at the very root of the claim for transfer of the dead lease as stipulated in Section 19 of the MMDR Act. Therefore, on this ground as well, it must be held that there was no scope at all for the State Government to consider the application made by M/s.Dalmia for transferring of its mining lease in favour of the first respondent. When we go little further and examine Rule 29, as we have held that M/s.Dalmia had surrendered its mining lease M.L.No.2010 once and for all, based on its proposal made on 27.03.2001 and accepted by the Director of Mines and Geology on behalf of the State Government which became conclusive as on 31.01.2002, there was no live lease for the purpose of considering any application for transfer under Rule 37 of the Mineral (Concession) Rules. When that be the legal consequence in respect of the lease, which was void and inoperative, it must be held that there was no scope for holding that there was a valid transfer made by M/s.Dalmia in favour of the first respondent on 16.03.2002.As far as the question Nos.(xiii) and (xiv) are concerned, as to whether the order of transfer dated 16.3.2002 was bona fide taking into account the sequence of events and whether the transfer of lease dated 16.3.2002 can be held to be valid, we wish to recapitulate the various sequence of events as from 16.4.1999 till 30.1.2002 pertaining to the surrender of lease made by M/s. Dalmia. Since we have extensively dealt with the said issue in the earlier part of our order, we merely state that our conclusion as regards the coming into force of the surrender made on behalf of the M/s. Dalmia and its acceptance by the State Government from 31.01.2002 would be sufficient to hold that there was total lack of bona fides on the part of the State government in taking a sudden U-turn for passing the order of transfer dated 16.3.2002 in favour of the first respondent. In this context, as rightly contended on behalf of the appellant, the conduct of the Director of Mines and Geology, one Dr. Reddy who dealt with the applications made by one M.S.P.L. Ltd. through its Executive Director Mr. Rahul Baldota on 21.7.2001 and another applicant with reference to which Dr. Reddy made an endorsement in the office note dated 25.8.2001 which stated that the land covered by M.L. No.2010 was surrendered by M/s. Dalmia, that certain other applications were also received for grant of lease in respect of those lands apart from M.S.P.L. Ltd. and that there was no scope to consider any of those applications since in respect of surrendered land Rule 59(1) of Mineral Concession Rules would automatically come into play and any future grant of lease can only be done as specified under the said Rule. When such a clear stand was spelt out by the said officer, namely, Dr. Reddy while making the endorsement on 25.8.2001, we fail to see any justifiable reason as to how the very same officer in his capacity as Director of Mines and Geology could be a signatory to its recommendation dated 6.2.2002 for effecting the transfer and based on his recommendation the State Government allowed the application for transfer of M.L. No. 2010.We are, therefore, convinced that when once M.L. No.2010 had come to an end by virtue of the surrender effected by M/s. Dalmia and accepted by the State Government, there was no legal right or power with the State Government or any authority acting on behalf of the State Government to consider the very application for transfer made at the instance of M/s. Dalmia on 4.2.2002 and for passing the order of transfer dated 16.3.2002. It can only be stated that such a decision taken and passed in the order dated 16.3.2002 was in total violation of the provisions of the MMDR Act and the Mineral Concession Rules. It will have to be stated that once surrender of M.L. No.2010 had come into effect the only other course open to the State Government was to invoke Rule 59 by throwing open those lands by way of public auction in order to get the maximum revenue by granting any lease hold rights. Here again, it must be stated that apart from the act of surrender made by M/s.Dalmia which became final and conclusive due to non-compliance of the conditions imposed in the in-principle Stage I clearance dated 24.12.1997, M/s.Dalmia lost its right to retain the lease and the consequence of it rendered the lease itself void as per Rule 37(1A) and on this ground as well, there was no scope for the State Government or any other Authority acting on its behalf to have considered the transfer application of M/s.Dalmia with reference to a lease which ceased to exist as from 31.01.2002 due to the act of surrender and in any case from 24.12.2002 when the 5 year period to comply with the conditions imposed in the order dated 24.12.1997 expired.
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K. Karuppuraj Vs. M. Ganesan | matter to the High Court and we decide the appeal on merits. 8. It is required to be noted that as per the case of the original plaintiff, the defendant was required to evict the tenants and hand over the physical and vacant possession at the time of execution of the sale deed on payment of full sale consideration. Even in the suit notice issued by the plaintiff, the plaintiff called upon the defendant to evict the tenants and thereafter execute the sale deed on payment of full consideration from the plaintiff. Even when we consider the pleadings and the averments in the plaint, it appears that the plaintiff was never willing to get the sale deed executed with tenants and/or as it is. It was the insistence on the part of the plaintiff to deliver the vacant possession after evicting the tenants. Therefore, on the basis of the pleadings in the plaint and on appreciation of evidence, the learned Trial Court held the issue of willingness against the plaintiff. However, before the High Court, the plaintiff filed an affidavit stating that he is now ready and willing to get the sale deed executed with respect to the property with tenants and unfortunately, the High Court relying upon the affidavit in the first appeal considered that as now the plaintiff is ready and willing to purchase the property with tenants and get the sale deed executed with respect to the property in question with tenants, the High Court has allowed the appeal and decreed the suit for specific performance. The aforesaid procedure adopted by the High Court relying upon the affidavit in a First Appeal by which virtually without submitting any application for amendment of the plaint under Order VI Rule 17 CPC, the High Court as a First Appellate Court has taken on record the affidavit and as such relied upon the same. Such a procedure is untenable and unknown to law. First appeals are to be decided after following the procedure to be followed under the CPC. The affidavit, which was filed by the plaintiff and which has been relied upon by the High Court is just contrary to the pleadings in the plaint. As observed hereinabove, there were no pleadings in the plaint that he is ready and willing to purchase the property and get the sale deed executed of the property with tenants and the specific pleadings were to hand over the peaceful and vacant possession after getting the tenants evicted and to execute the sale deed. The proper procedure would have been for the plaintiff to move a proper application for amendment of the plaint in exercise of the power under Order VI Rule 17 CPC, if at all it would have been permissible in a first appeal under Section 96 read with Order XLI CPC. However, straightaway to rely upon the affidavit without amending the plaint and the pleadings is wholly impermissible under the law. Therefore, such a procedure adopted by the High Court is disapproved. The learned Trial Court held the issue of willingness against the plaintiff by giving cogent reasons and appreciation of evidence and considering the pleadings and averments in the plaint. We have also gone through the averments and the pleadings in the plaint and on considering the same, we are of the opinion that the learned Trial Court was justified in holding the issue of willingness against the plaintiff. The plaintiff was never ready and willing to purchase the property and/or get the sale deed executed of the property with tenants. It was for the first time before the High Court in the affidavit filed before the High Court and subsequently when the learned Trial Court held the issue of willingness against the plaintiff, the plaintiff came out with a case that he is ready and willing to purchase the property with tenants. For the purpose of passing the decree for specific performance, the plaintiff has to prove both the readiness and willingness. Therefore, once it is found on appreciation of evidence that there was no willingness on the part of the plaintiff, the plaintiff is not entitled to the decree for specific performance. Therefore, in the present case, the learned Trial Court was justified in refusing to pass the decree for specific performance. 9. The submission on behalf of the plaintiff that in the agreement a duty was cast upon the defendant to evict the tenants and to handover the vacant and peaceful possession, which the defendant failed and, therefore, in such a situation, not to pass a decree for specific performance in favour of the plaintiff would be giving a premium to the defendant despite he having failed to perform his part of the contract. The aforesaid seems to be attractive but for the purpose of passing a decree for specific performance, readiness and willingness has to be established and proved and that is the relevant consideration for the purpose of passing a decree for specific performance. 10. Now, so far as the submission on behalf of the plaintiff that even the defendant has not refunded the amount of Rs.3,60,001/- with interest @ 18% as ordered by the learned Trial Court concerned, the order passed by the learned Trial Court is very clear and the defendant is saddled with the law to pay the interest @ 18% till its realization. Therefore, the plaintiff is compensated by awarding 18% interest. His not refunding the amount of part sale consideration with 18% interest as ordered by the learned Trial Court cannot be a ground to confirm the impugned judgment and order passed by the High Court. The plaintiff as such could have filed an execution petition to execute the judgment/decree passed by the learned Trial Court. Further, we propose to issue a direction to the appellant – original defendant directing him to refund the amount of Rs.3,60,001/- with 18% interest from the date of the agreement till the date of realization within a period of eight weeks from today. | 1[ds]6. In the present case, the original plaintiff instituted a suit for specific performance of the contract. On appreciation of evidence, the learned Trial Court held the issue of readiness in favour of the plaintiff. However, refused to pass the decree for specific performance of the contract on the ground that the plaintiff was not willing to purchase the property with tenants. Therefore, the issue with respect to willingness was held against the plaintiff. In an appeal filed before the High Court under Section 96 read with Order XLI by the impugned judgment and order, the High Court has allowed the said appeal and has quashed and set aside the decree passed by the learned Trial Court dismissing the suit and consequently has decreed the suit for specific performance. Having gone through the impugned judgment and order passed by the High Court, it can be seen that there is a total non-compliance of the Order XLI Rule 31 of CPC. While disposing of the appeal, the High Court has not raised the points for determination as required under Order XLI Rule 31 CPC. It also appears that the High Court being the First Appellate court has not discussed the entire matter and the issues in detail and as such it does not reveal that the High Court has re-appreciated the evidence while disposing of the first appeal. It also appears that the High Court has disposed of the appeal preferred under Order XLI CPC read with Section 96 in a most casual and perfunctory manner. Apart from the fact that the High Court has not framed the points for determination as required under Order XLI Rule 31 CPC, it appears that even the High Court has not exercised the powers vested in it as a First Appellate Court. As observed above, the High Court has neither re- appreciated the entire evidence on record nor has given any specific findings on the issues which were even raised before the learned Trial Court.6.1 In the case of B.V. Nagesh and Anr. (supra), this Court has observed and held that without framing points for determination and considering both facts and law; without proper discussion and assigning the reasons, the First Appellate Court cannot dispose of the first appeal under Section 96 CPC and that too without raising the points for determination as provided under Order XLI Rule 31 CPC. In paragraphs 3 and 4, it is observed and held as under:-3. How the regular first appeal is to be disposed of by the appellate court/High Court has been considered by this Court in various decisions. Order 41 CPC deals with appeals from original decrees. Among the various rules, Rule 31 mandates that the judgment of the appellate court shall state:(a) the points for determination;(b) the decision thereon;(c) the reasons for the decision; and(d) where the decree appealed from is reversed or varied, the relief to which the appellant is entitled.4. The appellate court has jurisdiction to reverse or affirm the findings of the trial court. The first appeal is a valuable right of the parties and unless restricted by law, the whole case is therein open for rehearing both on questions of fact and law. The judgment of the appellate court must, therefore, reflect its conscious application of mind and record findings supported by reasons, on all the issues arising along with the contentions put forth, and pressed by the parties for decision of the appellate court. Sitting as a court of first appeal, it was the duty of the High Court to deal with all the issues and the evidence led by the parties before recording its findings. The first appeal is a valuable right and the parties have a right to be heard both on questions of law and on facts and the judgment in the first appeal must address itself to all the issues of law and fact and decide it by giving reasons in support of the findings. (Vide Santosh Hazari v. Purushottam Tiwari [(2001) 3 SCC 179] , SCC p. 188, para 15 and Madhukar v. Sangram [(2001) 4 SCC 756] , SCC p. 758, para 5.)7. Applying the law laid down by this Court in the aforesaid decisions, if the impugned judgment and order passed by the High Court is considered, in that case, there is a total non-compliance of the provisions of the Order XLI Rule 31 CPC. The High Court has failed to exercise the jurisdiction vested in it as a First Appellate Court; the High Court has not at all re-appreciated the entire evidence on record; and not even considered the reasoning given by the learned Trial Court, in particular, on findings recorded by the learned Trial Court on the issue of willingness. Therefore, as such, the impugned judgment and order passed by the High Court is unsustainable and in normal circumstances we would have accepted the request of the learned senior counsel appearing on behalf of the respondent to remand the matter to the High Court for fresh consideration of appeal. However, even on other points also, the impugned judgment and order passed by the High Court is not sustainable. We refrain from remanding the matter to the High Court and we decide the appeal on merits.8. It is required to be noted that as per the case of the original plaintiff, the defendant was required to evict the tenants and hand over the physical and vacant possession at the time of execution of the sale deed on payment of full sale consideration. Even in the suit notice issued by the plaintiff, the plaintiff called upon the defendant to evict the tenants and thereafter execute the sale deed on payment of full consideration from the plaintiff. Even when we consider the pleadings and the averments in the plaint, it appears that the plaintiff was never willing to get the sale deed executed with tenants and/or as it is. It was the insistence on the part of the plaintiff to deliver the vacant possession after evicting the tenants. Therefore, on the basis of the pleadings in the plaint and on appreciation of evidence, the learned Trial Court held the issue of willingness against the plaintiff. However, before the High Court, the plaintiff filed an affidavit stating that he is now ready and willing to get the sale deed executed with respect to the property with tenants and unfortunately, the High Court relying upon the affidavit in the first appeal considered that as now the plaintiff is ready and willing to purchase the property with tenants and get the sale deed executed with respect to the property in question with tenants, the High Court has allowed the appeal and decreed the suit for specific performance. The aforesaid procedure adopted by the High Court relying upon the affidavit in a First Appeal by which virtually without submitting any application for amendment of the plaint under Order VI Rule 17 CPC, the High Court as a First Appellate Court has taken on record the affidavit and as such relied upon the same. Such a procedure is untenable and unknown to law. First appeals are to be decided after following the procedure to be followed under the CPC. The affidavit, which was filed by the plaintiff and which has been relied upon by the High Court is just contrary to the pleadings in the plaint. As observed hereinabove, there were no pleadings in the plaint that he is ready and willing to purchase the property and get the sale deed executed of the property with tenants and the specific pleadings were to hand over the peaceful and vacant possession after getting the tenants evicted and to execute the sale deed. The proper procedure would have been for the plaintiff to move a proper application for amendment of the plaint in exercise of the power under Order VI Rule 17 CPC, if at all it would have been permissible in a first appeal under Section 96 read with Order XLI CPC. However, straightaway to rely upon the affidavit without amending the plaint and the pleadings is wholly impermissible under the law. Therefore, such a procedure adopted by the High Court is disapproved.The learned Trial Court held the issue of willingness against the plaintiff by giving cogent reasons and appreciation of evidence and considering the pleadings and averments in the plaint. We have also gone through the averments and the pleadings in the plaint and on considering the same, we are of the opinion that the learned Trial Court was justified in holding the issue of willingness against the plaintiff. The plaintiff was never ready and willing to purchase the property and/or get the sale deed executed of the property with tenants. It was for the first time before the High Court in the affidavit filed before the High Court and subsequently when the learned Trial Court held the issue of willingness against the plaintiff, the plaintiff came out with a case that he is ready and willing to purchase the property with tenants. For the purpose of passing the decree for specific performance, the plaintiff has to prove both the readiness and willingness. Therefore, once it is found on appreciation of evidence that there was no willingness on the part of the plaintiff, the plaintiff is not entitled to the decree for specific performance. Therefore, in the present case, the learned Trial Court was justified in refusing to pass the decree for specific performance.The aforesaid seems to be attractive but for the purpose of passing a decree for specific performance, readiness and willingness has to be established and proved and that is the relevant consideration for the purpose of passing a decree for specific performance.10. Now, so far as the submission on behalf of the plaintiff that even the defendant has not refunded the amount of Rs.3,60,001/- with interest @ 18% as ordered by the learned Trial Court concerned, the order passed by the learned Trial Court is very clear and the defendant is saddled with the law to pay the interest @ 18% till its realization. Therefore, the plaintiff is compensated by awarding 18% interest. His not refunding the amount of part sale consideration with 18% interest as ordered by the learned Trial Court cannot be a ground to confirm the impugned judgment and order passed by the High Court. The plaintiff as such could have filed an execution petition to execute the judgment/decree passed by the learned Trial Court. Further, we propose to issue a direction to the appellant – original defendant directing him to refund the amount of Rs.3,60,001/- with 18% interest from the date of the agreement till the date of realization within a period of eight weeks from today. | 1 | 4,742 | 1,941 | ### Instruction:
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matter to the High Court and we decide the appeal on merits. 8. It is required to be noted that as per the case of the original plaintiff, the defendant was required to evict the tenants and hand over the physical and vacant possession at the time of execution of the sale deed on payment of full sale consideration. Even in the suit notice issued by the plaintiff, the plaintiff called upon the defendant to evict the tenants and thereafter execute the sale deed on payment of full consideration from the plaintiff. Even when we consider the pleadings and the averments in the plaint, it appears that the plaintiff was never willing to get the sale deed executed with tenants and/or as it is. It was the insistence on the part of the plaintiff to deliver the vacant possession after evicting the tenants. Therefore, on the basis of the pleadings in the plaint and on appreciation of evidence, the learned Trial Court held the issue of willingness against the plaintiff. However, before the High Court, the plaintiff filed an affidavit stating that he is now ready and willing to get the sale deed executed with respect to the property with tenants and unfortunately, the High Court relying upon the affidavit in the first appeal considered that as now the plaintiff is ready and willing to purchase the property with tenants and get the sale deed executed with respect to the property in question with tenants, the High Court has allowed the appeal and decreed the suit for specific performance. The aforesaid procedure adopted by the High Court relying upon the affidavit in a First Appeal by which virtually without submitting any application for amendment of the plaint under Order VI Rule 17 CPC, the High Court as a First Appellate Court has taken on record the affidavit and as such relied upon the same. Such a procedure is untenable and unknown to law. First appeals are to be decided after following the procedure to be followed under the CPC. The affidavit, which was filed by the plaintiff and which has been relied upon by the High Court is just contrary to the pleadings in the plaint. As observed hereinabove, there were no pleadings in the plaint that he is ready and willing to purchase the property and get the sale deed executed of the property with tenants and the specific pleadings were to hand over the peaceful and vacant possession after getting the tenants evicted and to execute the sale deed. The proper procedure would have been for the plaintiff to move a proper application for amendment of the plaint in exercise of the power under Order VI Rule 17 CPC, if at all it would have been permissible in a first appeal under Section 96 read with Order XLI CPC. However, straightaway to rely upon the affidavit without amending the plaint and the pleadings is wholly impermissible under the law. Therefore, such a procedure adopted by the High Court is disapproved. The learned Trial Court held the issue of willingness against the plaintiff by giving cogent reasons and appreciation of evidence and considering the pleadings and averments in the plaint. We have also gone through the averments and the pleadings in the plaint and on considering the same, we are of the opinion that the learned Trial Court was justified in holding the issue of willingness against the plaintiff. The plaintiff was never ready and willing to purchase the property and/or get the sale deed executed of the property with tenants. It was for the first time before the High Court in the affidavit filed before the High Court and subsequently when the learned Trial Court held the issue of willingness against the plaintiff, the plaintiff came out with a case that he is ready and willing to purchase the property with tenants. For the purpose of passing the decree for specific performance, the plaintiff has to prove both the readiness and willingness. Therefore, once it is found on appreciation of evidence that there was no willingness on the part of the plaintiff, the plaintiff is not entitled to the decree for specific performance. Therefore, in the present case, the learned Trial Court was justified in refusing to pass the decree for specific performance. 9. The submission on behalf of the plaintiff that in the agreement a duty was cast upon the defendant to evict the tenants and to handover the vacant and peaceful possession, which the defendant failed and, therefore, in such a situation, not to pass a decree for specific performance in favour of the plaintiff would be giving a premium to the defendant despite he having failed to perform his part of the contract. The aforesaid seems to be attractive but for the purpose of passing a decree for specific performance, readiness and willingness has to be established and proved and that is the relevant consideration for the purpose of passing a decree for specific performance. 10. Now, so far as the submission on behalf of the plaintiff that even the defendant has not refunded the amount of Rs.3,60,001/- with interest @ 18% as ordered by the learned Trial Court concerned, the order passed by the learned Trial Court is very clear and the defendant is saddled with the law to pay the interest @ 18% till its realization. Therefore, the plaintiff is compensated by awarding 18% interest. His not refunding the amount of part sale consideration with 18% interest as ordered by the learned Trial Court cannot be a ground to confirm the impugned judgment and order passed by the High Court. The plaintiff as such could have filed an execution petition to execute the judgment/decree passed by the learned Trial Court. Further, we propose to issue a direction to the appellant – original defendant directing him to refund the amount of Rs.3,60,001/- with 18% interest from the date of the agreement till the date of realization within a period of eight weeks from today.
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the issue of willingness. Therefore, as such, the impugned judgment and order passed by the High Court is unsustainable and in normal circumstances we would have accepted the request of the learned senior counsel appearing on behalf of the respondent to remand the matter to the High Court for fresh consideration of appeal. However, even on other points also, the impugned judgment and order passed by the High Court is not sustainable. We refrain from remanding the matter to the High Court and we decide the appeal on merits.8. It is required to be noted that as per the case of the original plaintiff, the defendant was required to evict the tenants and hand over the physical and vacant possession at the time of execution of the sale deed on payment of full sale consideration. Even in the suit notice issued by the plaintiff, the plaintiff called upon the defendant to evict the tenants and thereafter execute the sale deed on payment of full consideration from the plaintiff. Even when we consider the pleadings and the averments in the plaint, it appears that the plaintiff was never willing to get the sale deed executed with tenants and/or as it is. It was the insistence on the part of the plaintiff to deliver the vacant possession after evicting the tenants. Therefore, on the basis of the pleadings in the plaint and on appreciation of evidence, the learned Trial Court held the issue of willingness against the plaintiff. However, before the High Court, the plaintiff filed an affidavit stating that he is now ready and willing to get the sale deed executed with respect to the property with tenants and unfortunately, the High Court relying upon the affidavit in the first appeal considered that as now the plaintiff is ready and willing to purchase the property with tenants and get the sale deed executed with respect to the property in question with tenants, the High Court has allowed the appeal and decreed the suit for specific performance. The aforesaid procedure adopted by the High Court relying upon the affidavit in a First Appeal by which virtually without submitting any application for amendment of the plaint under Order VI Rule 17 CPC, the High Court as a First Appellate Court has taken on record the affidavit and as such relied upon the same. Such a procedure is untenable and unknown to law. First appeals are to be decided after following the procedure to be followed under the CPC. The affidavit, which was filed by the plaintiff and which has been relied upon by the High Court is just contrary to the pleadings in the plaint. As observed hereinabove, there were no pleadings in the plaint that he is ready and willing to purchase the property and get the sale deed executed of the property with tenants and the specific pleadings were to hand over the peaceful and vacant possession after getting the tenants evicted and to execute the sale deed. The proper procedure would have been for the plaintiff to move a proper application for amendment of the plaint in exercise of the power under Order VI Rule 17 CPC, if at all it would have been permissible in a first appeal under Section 96 read with Order XLI CPC. However, straightaway to rely upon the affidavit without amending the plaint and the pleadings is wholly impermissible under the law. Therefore, such a procedure adopted by the High Court is disapproved.The learned Trial Court held the issue of willingness against the plaintiff by giving cogent reasons and appreciation of evidence and considering the pleadings and averments in the plaint. We have also gone through the averments and the pleadings in the plaint and on considering the same, we are of the opinion that the learned Trial Court was justified in holding the issue of willingness against the plaintiff. The plaintiff was never ready and willing to purchase the property and/or get the sale deed executed of the property with tenants. It was for the first time before the High Court in the affidavit filed before the High Court and subsequently when the learned Trial Court held the issue of willingness against the plaintiff, the plaintiff came out with a case that he is ready and willing to purchase the property with tenants. For the purpose of passing the decree for specific performance, the plaintiff has to prove both the readiness and willingness. Therefore, once it is found on appreciation of evidence that there was no willingness on the part of the plaintiff, the plaintiff is not entitled to the decree for specific performance. Therefore, in the present case, the learned Trial Court was justified in refusing to pass the decree for specific performance.The aforesaid seems to be attractive but for the purpose of passing a decree for specific performance, readiness and willingness has to be established and proved and that is the relevant consideration for the purpose of passing a decree for specific performance.10. Now, so far as the submission on behalf of the plaintiff that even the defendant has not refunded the amount of Rs.3,60,001/- with interest @ 18% as ordered by the learned Trial Court concerned, the order passed by the learned Trial Court is very clear and the defendant is saddled with the law to pay the interest @ 18% till its realization. Therefore, the plaintiff is compensated by awarding 18% interest. His not refunding the amount of part sale consideration with 18% interest as ordered by the learned Trial Court cannot be a ground to confirm the impugned judgment and order passed by the High Court. The plaintiff as such could have filed an execution petition to execute the judgment/decree passed by the learned Trial Court. Further, we propose to issue a direction to the appellant – original defendant directing him to refund the amount of Rs.3,60,001/- with 18% interest from the date of the agreement till the date of realization within a period of eight weeks from today.
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Brahm Parkash Vs. Manbir Singh And Others | the High Court that in order to entitle a creditor to claim a right of subrogation it was not necessary that he should have entered into a written agreement stipulating for such a right. His submission, however, was on the following lines: Accepting the law as expounded by Sir Richard Couch in Gokuldas v. Ram Bux, 11 Ind App 126 (PC) at pp. 133-134 in the following terms:"In India the art of conveyancing has been and is of a very simple character, Their Lordships cannot find that a formal transfer of a mortgage is ever made, or an intention to keep it alive ever formally expressed ...... The obvious question to ask in the interests of justice, equity, and good conscience is, what was the intention of the party paying off the charge? He had a sight to extinguish it and a right to keep it alive. What was his intention? If there is no express evidence of it, what intention should be ascribed to him? The ordinary rule is that a man having a right to act in either of two ways, shall be assumed to have acted according to his interest. In the familiar instance of a tenant for life paying off a charge upon the inheritance, he is assumed, in the absence of evidence to the contrary, to have intended to keep the charge alive. It cannot signify whether the division of interests in the property is by way of life estate reminder, or by way of successive charges. In each case it may be for the advantage of the owner of a partial interest to keep on foot a charge upon the corpus which he has paid"as laying down the correct test for determining whether the right of subrogation could be claimed or not, Mr. Achhru Ram submitted that the law was that even where there was no express agreement stipulating for subrogation, the law would presume such a right on the ground that the payer intended to act in a manner most advantageous to him, but that this was only a rebuttable presumption which would be negatived on positive proof from the conduct or statements of such a creditor pointing to a contrary intention. In other words, that there was nothing to prevent its being shown that the creditor paying off the charge did not intend to preserve the mortgage which he discharged so as to obtain the priority which the discharged encumbrance enjoyed. He urged that in the present case, on the terms of the documents to which Sham Sunder was a party, such an intention not to keep alive the discharged encumbrance of Daulatram was clearly made out. In this connection he drew to our attention first the terms of the mortgage executed in favour of Sham Sunder on July 13, 1944 in which this Rs.84,000/- left with the mortgagee is referred to as being held by the latter in trust for the payment of the previous encumbrancer-Daulatram. Next, he referred us to the endorsements of discharge on the mortgages of Daulatram which read as if the amount due had been paid by Sham Sunder on behalf of the mortgagor-Mohinder. On this basis the contention was urged that any intention to obtain the benefit of subrogation was clearly negatived.6. We do not propose to discuss the merits of this contention, and it is not as if it is not capable of cogent refutation, because we are satisfied that the appellant should not be permitted to raise such an argument at this stage. In both the suits the legal representatives of Sham Sunder filed written statements in which they specifically stated that the discharge of the encumbrances of Daulatram was under circumstances in which they were entitled to claim the relief of subrogation. The question regarding the intention with which a prior encumbrance is discharged, whether it is with a view to obtain the priority of the mortgage paid off or not, in circumstances like the present would be a question of fact and would have to be answered on a conspectus of the entire circumstances of the case. If the appellant was disputing the plea of Sham Sunders representatives that the intention of Sham Sunder in discharging Daulatrams -mortgages was to retain the benefit of subrogation, it was for him to have raised it by proper pleading when an issue would have been struck and evidence led for or against such a contention. At the stage of the trial the only objection raised to the claim for subrogation was based on the absence of a written agreement which the appellant contended was a requirement of the law which had not been complied with. In one sense such a plea would appear to assume that the intention of the party Paying off the mortgage was to obtain the benefit of subrogation but that he had failed to comply with a requirement of the law in having that intention embodied in a document. This plea was accepted by the learned trial Judge and the claim for subrogation was disallowed but Sham Sunders representatives filed an appeal to the High Court. Again, at the stage of the appeal the only contention urged before the learned Judges was as regards this supposed requirement of the law that there should be a written agreement. When this plea was rejected it is obvious that on the pleadings the right to subrogation should be held to be established. The matter, however, does not stop here, because even at the stage of appeal to this Court no point was made that in the instant case the presumption in favour of a person having acted to his interest and so entitled to claim subrogation was displaced by clear evidence of the partys statements or conduct. Nor can even a trace of such plea be found in the statement of case filed in these appeals. We do not therefore consider it proper to permit learned Counsel to urge any such ground before us. | 0[ds]In both the suits the legal representatives of Sham Sunder filed written statements in which they specifically stated that the discharge of the encumbrances of Daulatram was under circumstances in which they were entitled to claim the relief of subrogation. The question regarding the intention with which a prior encumbrance is discharged, whether it is with a view to obtain the priority of the mortgage paid off or not, in circumstances like the present would be a question of fact and would have to be answered on a conspectus of the entire circumstances of the case. If the appellant was disputing the plea of Sham Sunders representatives that the intention of Sham Sunder in discharging Daulatrams -mortgages was to retain the benefit of subrogation, it was for him to have raised it by proper pleading when an issue would have been struck and evidence led for or against such a contention. At the stage of the trial the only objection raised to the claim for subrogation was based on the absence of a written agreement which the appellant contended was a requirement of the law which had not been complied with. In one sense such a plea would appear to assume that the intention of the party Paying off the mortgage was to obtain the benefit of subrogation but that he had failed to comply with a requirement of the law in having that intention embodied in a document. This plea was accepted by the learned trial Judge and the claim for subrogation was disallowed but Sham Sunders representatives filed an appeal to the High Court. Again, at the stage of the appeal the only contention urged before the learned Judges was as regards this supposed requirement of the law that there should be a written agreement. When this plea was rejected it is obvious that on the pleadings the right to subrogation should be held to be established. The matter, however, does not stop here, because even at the stage of appeal to this Court no point was made that in the instant case the presumption in favour of a person having acted to his interest and so entitled to claim subrogation was displaced by clear evidence of the partys statements or conduct. Nor can even a trace of such plea be found in the statement of case filed in these appeals. We do not therefore consider it proper to permit learned Counsel to urge any such ground beforeconsider this submission wholly without substance. When S. 56 refers to a subsequent purchaser it does not obviously exclude a purchaser who has some mortgage over property with which these proceedings are not concerned. His mortgage rights over some other property of the mortgagor is wholly irrelevant or considering his rights qua purchaser of one of the properties to which opening words of S.56 apply. The construction contended for, in our opinion, has only to be stated to be rejected.(2)the other submission of learned Counsel was that the learned Judges failed to give effect to the last portion of S. 56 under which marshalling is not to be permitted so as to prejudice the rights inter alia of the mortgagees or other persons claiming under him, i.e., under the original mortagagor. Learned Counsel pointed out that the appellant having proved his mortgage and the fact that it was subsisting, the learned Judges of the High Court ought to have held that any direction as to marshalling must necessarily prejudice him. We are unable to agree that this follows as any matter of law. The question of prejudice is purely one of fact which has to be pleaded and the necessary facts and circumstances established. It is obvious that the question of prejudice would be intimately connected with the value of the property against which the mortgagee is directed to proceed in the first instance. If even after paying off such a mortgage there is enough left for payment over to the subsequent encumbrances referred to in the last portion of S. 56 it would be manifest that there would be no question of prejudice. If therefore the appellant desired to invoke the benefit of the last portion of S. 56 he should have made some plea as to the value of the property and shown how it would prejudice his rights as a subsequent encumbrancer. He however made no such plea and no evidence was led as to the value of the property. Even at the stage of the appeal in the High Court the contention that to allow marshalling in favour of the subsequent purchaser Mukhamal would result in prejudice to him was admittedly never put forward before the learned Judges. As the point is one not of pure law but springs from the factual inadequacy of the property mortgaged to him to discharge his debt it is too late for the appellant to raise such a plea in this Court. | 0 | 2,175 | 865 | ### Instruction:
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the High Court that in order to entitle a creditor to claim a right of subrogation it was not necessary that he should have entered into a written agreement stipulating for such a right. His submission, however, was on the following lines: Accepting the law as expounded by Sir Richard Couch in Gokuldas v. Ram Bux, 11 Ind App 126 (PC) at pp. 133-134 in the following terms:"In India the art of conveyancing has been and is of a very simple character, Their Lordships cannot find that a formal transfer of a mortgage is ever made, or an intention to keep it alive ever formally expressed ...... The obvious question to ask in the interests of justice, equity, and good conscience is, what was the intention of the party paying off the charge? He had a sight to extinguish it and a right to keep it alive. What was his intention? If there is no express evidence of it, what intention should be ascribed to him? The ordinary rule is that a man having a right to act in either of two ways, shall be assumed to have acted according to his interest. In the familiar instance of a tenant for life paying off a charge upon the inheritance, he is assumed, in the absence of evidence to the contrary, to have intended to keep the charge alive. It cannot signify whether the division of interests in the property is by way of life estate reminder, or by way of successive charges. In each case it may be for the advantage of the owner of a partial interest to keep on foot a charge upon the corpus which he has paid"as laying down the correct test for determining whether the right of subrogation could be claimed or not, Mr. Achhru Ram submitted that the law was that even where there was no express agreement stipulating for subrogation, the law would presume such a right on the ground that the payer intended to act in a manner most advantageous to him, but that this was only a rebuttable presumption which would be negatived on positive proof from the conduct or statements of such a creditor pointing to a contrary intention. In other words, that there was nothing to prevent its being shown that the creditor paying off the charge did not intend to preserve the mortgage which he discharged so as to obtain the priority which the discharged encumbrance enjoyed. He urged that in the present case, on the terms of the documents to which Sham Sunder was a party, such an intention not to keep alive the discharged encumbrance of Daulatram was clearly made out. In this connection he drew to our attention first the terms of the mortgage executed in favour of Sham Sunder on July 13, 1944 in which this Rs.84,000/- left with the mortgagee is referred to as being held by the latter in trust for the payment of the previous encumbrancer-Daulatram. Next, he referred us to the endorsements of discharge on the mortgages of Daulatram which read as if the amount due had been paid by Sham Sunder on behalf of the mortgagor-Mohinder. On this basis the contention was urged that any intention to obtain the benefit of subrogation was clearly negatived.6. We do not propose to discuss the merits of this contention, and it is not as if it is not capable of cogent refutation, because we are satisfied that the appellant should not be permitted to raise such an argument at this stage. In both the suits the legal representatives of Sham Sunder filed written statements in which they specifically stated that the discharge of the encumbrances of Daulatram was under circumstances in which they were entitled to claim the relief of subrogation. The question regarding the intention with which a prior encumbrance is discharged, whether it is with a view to obtain the priority of the mortgage paid off or not, in circumstances like the present would be a question of fact and would have to be answered on a conspectus of the entire circumstances of the case. If the appellant was disputing the plea of Sham Sunders representatives that the intention of Sham Sunder in discharging Daulatrams -mortgages was to retain the benefit of subrogation, it was for him to have raised it by proper pleading when an issue would have been struck and evidence led for or against such a contention. At the stage of the trial the only objection raised to the claim for subrogation was based on the absence of a written agreement which the appellant contended was a requirement of the law which had not been complied with. In one sense such a plea would appear to assume that the intention of the party Paying off the mortgage was to obtain the benefit of subrogation but that he had failed to comply with a requirement of the law in having that intention embodied in a document. This plea was accepted by the learned trial Judge and the claim for subrogation was disallowed but Sham Sunders representatives filed an appeal to the High Court. Again, at the stage of the appeal the only contention urged before the learned Judges was as regards this supposed requirement of the law that there should be a written agreement. When this plea was rejected it is obvious that on the pleadings the right to subrogation should be held to be established. The matter, however, does not stop here, because even at the stage of appeal to this Court no point was made that in the instant case the presumption in favour of a person having acted to his interest and so entitled to claim subrogation was displaced by clear evidence of the partys statements or conduct. Nor can even a trace of such plea be found in the statement of case filed in these appeals. We do not therefore consider it proper to permit learned Counsel to urge any such ground before us.
### Response:
0
### Explanation:
In both the suits the legal representatives of Sham Sunder filed written statements in which they specifically stated that the discharge of the encumbrances of Daulatram was under circumstances in which they were entitled to claim the relief of subrogation. The question regarding the intention with which a prior encumbrance is discharged, whether it is with a view to obtain the priority of the mortgage paid off or not, in circumstances like the present would be a question of fact and would have to be answered on a conspectus of the entire circumstances of the case. If the appellant was disputing the plea of Sham Sunders representatives that the intention of Sham Sunder in discharging Daulatrams -mortgages was to retain the benefit of subrogation, it was for him to have raised it by proper pleading when an issue would have been struck and evidence led for or against such a contention. At the stage of the trial the only objection raised to the claim for subrogation was based on the absence of a written agreement which the appellant contended was a requirement of the law which had not been complied with. In one sense such a plea would appear to assume that the intention of the party Paying off the mortgage was to obtain the benefit of subrogation but that he had failed to comply with a requirement of the law in having that intention embodied in a document. This plea was accepted by the learned trial Judge and the claim for subrogation was disallowed but Sham Sunders representatives filed an appeal to the High Court. Again, at the stage of the appeal the only contention urged before the learned Judges was as regards this supposed requirement of the law that there should be a written agreement. When this plea was rejected it is obvious that on the pleadings the right to subrogation should be held to be established. The matter, however, does not stop here, because even at the stage of appeal to this Court no point was made that in the instant case the presumption in favour of a person having acted to his interest and so entitled to claim subrogation was displaced by clear evidence of the partys statements or conduct. Nor can even a trace of such plea be found in the statement of case filed in these appeals. We do not therefore consider it proper to permit learned Counsel to urge any such ground beforeconsider this submission wholly without substance. When S. 56 refers to a subsequent purchaser it does not obviously exclude a purchaser who has some mortgage over property with which these proceedings are not concerned. His mortgage rights over some other property of the mortgagor is wholly irrelevant or considering his rights qua purchaser of one of the properties to which opening words of S.56 apply. The construction contended for, in our opinion, has only to be stated to be rejected.(2)the other submission of learned Counsel was that the learned Judges failed to give effect to the last portion of S. 56 under which marshalling is not to be permitted so as to prejudice the rights inter alia of the mortgagees or other persons claiming under him, i.e., under the original mortagagor. Learned Counsel pointed out that the appellant having proved his mortgage and the fact that it was subsisting, the learned Judges of the High Court ought to have held that any direction as to marshalling must necessarily prejudice him. We are unable to agree that this follows as any matter of law. The question of prejudice is purely one of fact which has to be pleaded and the necessary facts and circumstances established. It is obvious that the question of prejudice would be intimately connected with the value of the property against which the mortgagee is directed to proceed in the first instance. If even after paying off such a mortgage there is enough left for payment over to the subsequent encumbrances referred to in the last portion of S. 56 it would be manifest that there would be no question of prejudice. If therefore the appellant desired to invoke the benefit of the last portion of S. 56 he should have made some plea as to the value of the property and shown how it would prejudice his rights as a subsequent encumbrancer. He however made no such plea and no evidence was led as to the value of the property. Even at the stage of the appeal in the High Court the contention that to allow marshalling in favour of the subsequent purchaser Mukhamal would result in prejudice to him was admittedly never put forward before the learned Judges. As the point is one not of pure law but springs from the factual inadequacy of the property mortgaged to him to discharge his debt it is too late for the appellant to raise such a plea in this Court.
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S. N. Dutt Vs. Union Of India | it is not. No amount of common sense will put the name of the plaintiff there, if it is not there. 10. Let us therefore examine the notices and the plaint in this case to see whether the suit is by the same person who gave the notices, for it cannot be gainsaid that the identity of the person who issues the notice with the person who brings the suit must be there, before it can be said that S. 80 has been complied with. Now the relevant part of the two notices was in these terms:- Under instructions from my client Messrs. S. N. Dutt and Co. of Krishnagar, I beg to give you notice that my said client will bring a suit for damages in the court of the Subordinate Judge of Nadia at Krishnagar against the B and A Railway Administration. In the plaint, the description of the plaintiff was in these terms:- Surendra Nath Dutta sole proprietor of a business carried on under the name and style of S. N. Dutt and Co. of Krishnagar. P. S. Krishnagar, District Nadia. 11. It will be immediately obvious that the notices were in the name of Messrs. S. N. Dutt and Co., while the suit was filed by S. N. Dutt claiming to be the sole proprietor of Messrs. S. N. Dutt and Co. It is urged on behalf of the appellant that the reason why the suit was filed in the name of S. N. Dutt as sole proprietor of Messrs. S. N. Dutt and Co. was that no suit could have been filed in the name of Messrs. S. N. Dutt and Co., as that was not a firm; that was merely the name and style in which an individual, namely S. N. Dutt, was carrying on the business. The question therefore that immediately arises is whether S. N. Dutt who filed the suit was the person who gave the notices and the answer is obvious that it is not so. It may be that S. N. Dutt is the sole proprietor of Messrs. S. N. Dutt and Co. and is carrying on business in that name and style;but that does not mean that these notices were by S. N. Dutt. Any one reading these notices would not necessarily come to the conclusion that Messrs. S. N. Dutt and Co. was merely the name and style in which an individual was carrying on business. The prima facie impression from reading the notices would be that Messrs. S. N. Dutt and Co. was some kind of partnership firm and notices were being given in the name of that partnership firm. It cannot therefore be said on a comparison of the notices in this case with the plaint that there is identity of the person who issued the notices with the person who brought the suit. Besides if Messrs. S. N. Dutt and Co., not being a partnership firm, could not file a suit in that name and style on behalf of its members, we cannot see how Messrs. S. N. Dutt and Co. could give a valid and legal notice in that name and style on behalf of an individual, S. N. Dutt. As was pointed out by the Privy Council in Pestonji Aredshir Wadias case, 76 Ind App 85: AIR 1949 PC 143 the case of members of a firm stood on a different footing, for the members of a firm might sue in the name of the firm; but in the present case Messrs. S. N. Dutt and Co, is not a firm; it is merely the name and style in which an individual (namely, S. N. Dutt) is carrying on business and though the individual may in certain circumstances be sued in that name and style, he would have no right to sue in that name. Therefore, where an individual carries on business in some name and style the notice has to be given by the individual in his own name for the suit can only be filed in the name of the individual. The present suit is analogous to the case of trustees where the suit cannot be filed in the name of the trust; it can only be filed in the name of the trustees and the notice therefore has also to be given in the name of all the trustees who have to file a suit. Therefore comparing the notices given in this suit with the plaint, and remembering that Messrs. S. N. Dutt and Co. is not a partnership firm but merely a name and style in which an individual trades, the conclusion is inescapable that the person giving the notices is not the same as the person suing. 12. It was urged on behalf of the appellant that the Railway Administration knew the position that Messrs. S. N. Dutt and Co. was merely the name and style in which an individual (namely, S. N. Dutt) was trading. But even this in our opinion is not correct as a fact, for, as pointed out by the High Court, there are documents on the record which show that S. N. Dutt gave himself out as a partner of Messrs. S. N. Dutt and Co., thus suggesting that S. N. Dutt and Co. was a firm. That was the reason why a plea was raised on behalf of the Union of India that the suit was barred under S. 69 of the Partnership Act as the firm was not a registered firm. 13. In this connection learned counsel for the appellant referred us to certain cases in which in similar circumstances the notice was considered to be valid under S. 80. These cases are Kamta Prasad v. Union of India, 1957 All LJ 299 and Secretary to State v. Sagarmal Marwari, AIR 1941 Pat 517 . In view of what we have said above, we cannot agree with the view taken in these cases and must hold that they were wrongly decided. | 0[ds]The defect in the present case is in regard to the name, it being not disputed that there is no other defect in the noticeIt must however be remembered that the defect with which this Court was dealing in these cases was in the matter of cause of action and relief, and this Court pointed out that it was necessary to use a little common sense in such circumstances. Where the matter (for example) concerns the relief or the cause of action, it may be necessary to use common sense to find out whether S. 80 has been complied with. But where it is a question of the name of the plaintiff, there is in our opinion little scope for the use of common sense, for either the name of the person suing is there in the notice or it is not. No amount of common sense will put the name of the plaintiff there, if it is not thereIt may be that S. N. Dutt is the sole proprietor of Messrs. S. N. Dutt and Co. and is carrying on business in that name and style;but that does not mean that these notices were by S. N. Dutt. Any one reading these notices would not necessarily come to the conclusion that Messrs. S. N. Dutt and Co. was merely the name and style in which an individual was carrying on business. The prima facie impression from reading the notices would be that Messrs. S. N. Dutt and Co. was some kind of partnership firm and notices were being given in the name of that partnership firm. It cannot therefore be said on a comparison of the notices in this case with the plaint that there is identity of the person who issued the notices with the person who brought the suit. Besides if Messrs. S. N. Dutt and Co., not being a partnership firm, could not file a suit in that name and style on behalf of its members, we cannot see how Messrs. S. N. Dutt and Co. could give a valid and legal notice in that name and style on behalf of an individual, S. N. Duttbut in the present case Messrs. S. N. Dutt and Co, is not a firm; it is merely the name and style in which an individual (namely, S. N. Dutt) is carrying on business and though the individual may in certain circumstances be sued in that name and style, he would have no right to sue in that name. Therefore, where an individual carries on business in some name and style the notice has to be given by the individual in his own name for the suit can only be filed in the name of the individual. The present suit is analogous to the case of trustees where the suit cannot be filed in the name of the trust; it can only be filed in the name of the trustees and the notice therefore has also to be given in the name of all the trustees who have to file a suit. Therefore comparing the notices given in this suit with the plaint, and remembering that Messrs. S. N. Dutt and Co. is not a partnership firm but merely a name and style in which an individual trades, the conclusion is inescapable that the person giving the notices is not the same as the person suingBut even this in our opinion is not correct as a fact, for, as pointed out by the High Court, there are documents on the record which show that S. N. Dutt gave himself out as a partner of Messrs. S. N. Dutt and Co., thus suggesting that S. N. Dutt and Co. was a firm. That was the reason why a plea was raised on behalf of the Union of India that the suit was barred under S. 69 of the Partnership Act as the firm was not a registered firmIn view of what we have said above, we cannot agree with the view taken in these cases and must hold that they were wrongly decided | 0 | 2,875 | 729 | ### Instruction:
Speculate on the likely judgment (yes (1) or no (0) to the appeal) and then delve into the case proceeding to elucidate your prediction, focusing on critical sentences.
### Input:
it is not. No amount of common sense will put the name of the plaintiff there, if it is not there. 10. Let us therefore examine the notices and the plaint in this case to see whether the suit is by the same person who gave the notices, for it cannot be gainsaid that the identity of the person who issues the notice with the person who brings the suit must be there, before it can be said that S. 80 has been complied with. Now the relevant part of the two notices was in these terms:- Under instructions from my client Messrs. S. N. Dutt and Co. of Krishnagar, I beg to give you notice that my said client will bring a suit for damages in the court of the Subordinate Judge of Nadia at Krishnagar against the B and A Railway Administration. In the plaint, the description of the plaintiff was in these terms:- Surendra Nath Dutta sole proprietor of a business carried on under the name and style of S. N. Dutt and Co. of Krishnagar. P. S. Krishnagar, District Nadia. 11. It will be immediately obvious that the notices were in the name of Messrs. S. N. Dutt and Co., while the suit was filed by S. N. Dutt claiming to be the sole proprietor of Messrs. S. N. Dutt and Co. It is urged on behalf of the appellant that the reason why the suit was filed in the name of S. N. Dutt as sole proprietor of Messrs. S. N. Dutt and Co. was that no suit could have been filed in the name of Messrs. S. N. Dutt and Co., as that was not a firm; that was merely the name and style in which an individual, namely S. N. Dutt, was carrying on the business. The question therefore that immediately arises is whether S. N. Dutt who filed the suit was the person who gave the notices and the answer is obvious that it is not so. It may be that S. N. Dutt is the sole proprietor of Messrs. S. N. Dutt and Co. and is carrying on business in that name and style;but that does not mean that these notices were by S. N. Dutt. Any one reading these notices would not necessarily come to the conclusion that Messrs. S. N. Dutt and Co. was merely the name and style in which an individual was carrying on business. The prima facie impression from reading the notices would be that Messrs. S. N. Dutt and Co. was some kind of partnership firm and notices were being given in the name of that partnership firm. It cannot therefore be said on a comparison of the notices in this case with the plaint that there is identity of the person who issued the notices with the person who brought the suit. Besides if Messrs. S. N. Dutt and Co., not being a partnership firm, could not file a suit in that name and style on behalf of its members, we cannot see how Messrs. S. N. Dutt and Co. could give a valid and legal notice in that name and style on behalf of an individual, S. N. Dutt. As was pointed out by the Privy Council in Pestonji Aredshir Wadias case, 76 Ind App 85: AIR 1949 PC 143 the case of members of a firm stood on a different footing, for the members of a firm might sue in the name of the firm; but in the present case Messrs. S. N. Dutt and Co, is not a firm; it is merely the name and style in which an individual (namely, S. N. Dutt) is carrying on business and though the individual may in certain circumstances be sued in that name and style, he would have no right to sue in that name. Therefore, where an individual carries on business in some name and style the notice has to be given by the individual in his own name for the suit can only be filed in the name of the individual. The present suit is analogous to the case of trustees where the suit cannot be filed in the name of the trust; it can only be filed in the name of the trustees and the notice therefore has also to be given in the name of all the trustees who have to file a suit. Therefore comparing the notices given in this suit with the plaint, and remembering that Messrs. S. N. Dutt and Co. is not a partnership firm but merely a name and style in which an individual trades, the conclusion is inescapable that the person giving the notices is not the same as the person suing. 12. It was urged on behalf of the appellant that the Railway Administration knew the position that Messrs. S. N. Dutt and Co. was merely the name and style in which an individual (namely, S. N. Dutt) was trading. But even this in our opinion is not correct as a fact, for, as pointed out by the High Court, there are documents on the record which show that S. N. Dutt gave himself out as a partner of Messrs. S. N. Dutt and Co., thus suggesting that S. N. Dutt and Co. was a firm. That was the reason why a plea was raised on behalf of the Union of India that the suit was barred under S. 69 of the Partnership Act as the firm was not a registered firm. 13. In this connection learned counsel for the appellant referred us to certain cases in which in similar circumstances the notice was considered to be valid under S. 80. These cases are Kamta Prasad v. Union of India, 1957 All LJ 299 and Secretary to State v. Sagarmal Marwari, AIR 1941 Pat 517 . In view of what we have said above, we cannot agree with the view taken in these cases and must hold that they were wrongly decided.
### Response:
0
### Explanation:
The defect in the present case is in regard to the name, it being not disputed that there is no other defect in the noticeIt must however be remembered that the defect with which this Court was dealing in these cases was in the matter of cause of action and relief, and this Court pointed out that it was necessary to use a little common sense in such circumstances. Where the matter (for example) concerns the relief or the cause of action, it may be necessary to use common sense to find out whether S. 80 has been complied with. But where it is a question of the name of the plaintiff, there is in our opinion little scope for the use of common sense, for either the name of the person suing is there in the notice or it is not. No amount of common sense will put the name of the plaintiff there, if it is not thereIt may be that S. N. Dutt is the sole proprietor of Messrs. S. N. Dutt and Co. and is carrying on business in that name and style;but that does not mean that these notices were by S. N. Dutt. Any one reading these notices would not necessarily come to the conclusion that Messrs. S. N. Dutt and Co. was merely the name and style in which an individual was carrying on business. The prima facie impression from reading the notices would be that Messrs. S. N. Dutt and Co. was some kind of partnership firm and notices were being given in the name of that partnership firm. It cannot therefore be said on a comparison of the notices in this case with the plaint that there is identity of the person who issued the notices with the person who brought the suit. Besides if Messrs. S. N. Dutt and Co., not being a partnership firm, could not file a suit in that name and style on behalf of its members, we cannot see how Messrs. S. N. Dutt and Co. could give a valid and legal notice in that name and style on behalf of an individual, S. N. Duttbut in the present case Messrs. S. N. Dutt and Co, is not a firm; it is merely the name and style in which an individual (namely, S. N. Dutt) is carrying on business and though the individual may in certain circumstances be sued in that name and style, he would have no right to sue in that name. Therefore, where an individual carries on business in some name and style the notice has to be given by the individual in his own name for the suit can only be filed in the name of the individual. The present suit is analogous to the case of trustees where the suit cannot be filed in the name of the trust; it can only be filed in the name of the trustees and the notice therefore has also to be given in the name of all the trustees who have to file a suit. Therefore comparing the notices given in this suit with the plaint, and remembering that Messrs. S. N. Dutt and Co. is not a partnership firm but merely a name and style in which an individual trades, the conclusion is inescapable that the person giving the notices is not the same as the person suingBut even this in our opinion is not correct as a fact, for, as pointed out by the High Court, there are documents on the record which show that S. N. Dutt gave himself out as a partner of Messrs. S. N. Dutt and Co., thus suggesting that S. N. Dutt and Co. was a firm. That was the reason why a plea was raised on behalf of the Union of India that the suit was barred under S. 69 of the Partnership Act as the firm was not a registered firmIn view of what we have said above, we cannot agree with the view taken in these cases and must hold that they were wrongly decided
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Municipal Corporation For The City Of Poona Etc Vs. Bijlee Products (India) Ltd. Etc. Etc | duty as contained in rule 62B. It was on this representation that the respondents applied for allotment of the plots and spent huge amounts of money for the import of machinery and the materials and set up industries.10. The resolution of the Government deleting rule 5(B) read as a whole also clearly indicates that it did not intend to depart from the recommendation made by the Corporation or to modify the same in any manner. On the other hand, the resolution clearly indicates that it was being passed on the basis of the letter of the Municipal Commissioner dated 2nd June, 19 68 as would be manifestly clear from the citations in the resolution which may be extracted thus:"Read: Government Resolution, Urban Development, Public Health and House Department No. PMC/2862/15/C dated 28th January, 1963 .Government Circular, Urban Development Public Health and Housing Department No. MUN/1164/58163/A dated 25th February, 1966.Letter No. MC/101 dated 2nd June, 1968 from the Municipal Commissioner, Poona Municipal Corporation".11. It is, therefore, evident that while exercising its power to delete rule 5(8) the Government had the following materials before it, (1) It knew that Rule 5(8) had granted exemption for a period of 10 years to some industrialists, who on the basis of the representation made by the Corporation had set up their industries; (2) the Municipal Corporation had made an express recommendation that while deleting rule 5(8) the previous concessions regarding exemption from octroi duty must continue, (3) the Government could delete rule 5(8) in the exercise of the powers conferred on it by sub-sections (2) and (5) of section 149 and sub-section (1) of section 455 of the Act.12. Section 149(2) runs thus:"The rules shall b e submitted by the Corporation to the Provincial Government and the Provincial Government may either refuse them or refer them back to the Corporation for further consideration or sanction them either as they stand or with such modifications as it thinks fit, not, however, involving an increase in the rate or rates of the levy or the extent thereof".13. This sub-section gives three alternative courses to the Government. After the matter is submitted by the Corporation to the Government (1) it may refuse to sanction the rules recommended, or (2) it may refer back to the Corporation any rule for further consideration or (3) it may sanction the rule as recommended, or with certain modifications as it thinks fit. There can be no doubt that the Government had the power to make modifications in the recommendation submitted by the Corporation, but the express provision by which the Government could refer the matter back to the Corporation is clearly suggestive of the fact that the Government would refer the matter to the Corporation if it wants to modify the proposal. In the instant case, the Government has done nothing of the sort but has clearly passed the order purely in terms of the recommendation. In these circumstances, therefore, the inference is irresistible that the Government never intended to make any changes in the rule recommended by the Corporation particularly because the question o f not accepting the condition recommended by the Corporation, namely, that the existing concessions must continue would entail taking away of vested rights and put the Corporation in a wrong box inasmuch as it would then have to go back from its own assurance. The Government must certainly have been aware of these complications and if it thought that in spite of all this rule 5(8) should be deleted unconditionally, it would have referred the matter back to the Corporation in order to g et its revised views in the matter. But that was not done. In these circumstances, therefore, we are of the opinion that the Government order dated 30th July, 1968 must be so read as to include the proviso recommended by the Corporation while deleting rule 5(8), namely, that the concessions already granted to the industrialists would continue. It is true that the Government resolution does not say so in so many words, but having regard to the language in which it was couched and to the express reference to the letter dated 2nd July, 1968 of the Municipal Commissioner contained in the order itself which clearly mentions that rule 5(8) should be repealed provided the exemption already granted shall continue until the expiry of the respective periods of their grants, the aforesaid condition would be deemed to be included in the order dated 30-7-1968 by necessary intendment. Such an interpretation will be fully in consonance with the well settled rule of int erpretation of statutes that any amendment to a statute affecting the legal rights of an individual must be presumed to be prospective unless it is made expressly or is impliedly retrospective. This principle is contained in section 7 of the Bombay General Clauses Act. In the instant case, if we were to take a different view the result would be that a valuable right vested in the respondents and others would be taken away and we are unable to find any evidence in the language of the Government order to indicate any such intention.Even assuming that the order of the Government deleted rule 5(8) without any condition and without retaining the exemption granted to the respondents, the order would suffer from a v ery serious legal infirmity. Section 149(2) of the Act empowers the Government to modify the recommendation of the Corporation provided it does not involve any increase in the rate or rates of the levy or the extent thereof. There can be no doubt tha t if the concession of exemption from octroi duty given to the respondents is unconditionally withdrawn with effect from 1-9-1968 then this would have the effect of extending the application of the rules to an area where they did not apply. This is yet another reason why the Government impugned order should be read down so as to provide for deletion of rule 5(8) with the exception that the concession already granted will continue.14. | 1[ds]We have given our anxious consideration to the arguments advanced before us by counsel for the parties. We feel that in the circumstances of this case and in the view that we take, it is not at all necessary for us to travel into the domain of promissory estoppel. We are clearly of the opinion that reading the order dated 30-7-1968 against the history and background of the recommendation of the Corporation, the first contention of the respondents mustis not disputed that the Corporation in its resolution dated 30-5-1968 while recommending to the Government to delete rule 5(8) expressly recommended that the exemption already granted would continue. The last paragraph of the resolution runsRule No. 5(8) is hereby repealed. Provided that notwithstanding such repeal the exemption already granted shall continue until the expiry of the respective periods of theirthis, the Corporation itself had take n a policy decision that the industrialists choosing to set up industries in the demarcated area would be given exemption from octroi duty as contained in rule 62B. It was on this representation that the respondents applied for allotment of the plots and spent huge amounts of money for the import of machinery and the materials and set upresolution of the Government deleting rule 5(B) read as a whole also clearly indicates that it did not intend to depart from the recommendation made by the Corporation or to modify the same in any manner. On the other hand, the resolution clearly indicates that it was being passed on the basis of the letter of the Municipal Commissioner dated 2nd June, 19 68 as would be manifestly clear from the citations in the resolution which may be extractedGovernment Resolution, Urban Development, Public Health and House Department No. PMC/2862/15/C dated 28th January, 1963 .Government Circular, Urban Development Public Health and Housing Department No. MUN/1164/58163/A dated 25th February, 1966.Letter No. MC/101 dated 2nd June, 1968 from the Municipal Commissioner, Poona Municipalis, therefore, evident that while exercising its power to delete rule 5(8) the Government had the following materials before it, (1) It knew that Rule 5(8) had granted exemption for a period of 10 years to some industrialists, who on the basis of the representation made by the Corporation had set up their industries; (2) the Municipal Corporation had made an express recommendation that while deleting rule 5(8) the previous concessions regarding exemption from octroi duty must continue, (3) the Government could delete rule 5(8) in the exercise of the powers conferred on it by sub-sections (2) and (5) of section 149 and sub-section (1) of section 455 of theThe rules shall b e submitted by the Corporation to the Provincial Government and the Provincial Government may either refuse them or refer them back to the Corporation for further consideration or sanction them either as they stand or with such modifications as it thinks fit, not, however, involving an increase in the rate or rates of the levy or the extent94 of 1971FAZAL ALI,appeal by special leave is directed against the order of the High Court dated 21st December, 1970 dismissing the petition in limine. In view of the findings given and the decision rendered by us in Civil Appeals No. 2009 and 2081 of 1969 and 355 & 356 of 1970 it is not necessary for us to go into the details of the facts of this case as we have already held that the Government order dated 30-7-1968 must be read to this effect that rule 5(8) is deleted but the previous concessions given to the industrialists concerned will continue. It appears, however, that so far as the appellant is concerned, it has not executed any sale-deed though it was allotted a plot which was also demarcated. Apart from the point which we decided in the other appeals there being additional points of law involved in this case, we do not think that this was a fit case which should have been dismissed in limine by the Bombay High Court. We, therefore, allow this appeal and remit the case to the High Court for re-admitting and disposal of t he writ petition according to law. The point regarding the interpretation of Government order dated 30-7-1968 has already been decided by us in Civil Appeals No. 2009 and 2081 of 1969 and 355 & 356 of 1970 referred to above and will apply to the present case also, if the appellant is able to prove that it falls within the four corners of the Government order. | 1 | 3,521 | 837 | ### Instruction:
Forecast the likely verdict of the case (granting (1) or denying (0) the appeal) and then rationalize your prediction by pinpointing and explaining pivotal sentences in the case document.
### Input:
duty as contained in rule 62B. It was on this representation that the respondents applied for allotment of the plots and spent huge amounts of money for the import of machinery and the materials and set up industries.10. The resolution of the Government deleting rule 5(B) read as a whole also clearly indicates that it did not intend to depart from the recommendation made by the Corporation or to modify the same in any manner. On the other hand, the resolution clearly indicates that it was being passed on the basis of the letter of the Municipal Commissioner dated 2nd June, 19 68 as would be manifestly clear from the citations in the resolution which may be extracted thus:"Read: Government Resolution, Urban Development, Public Health and House Department No. PMC/2862/15/C dated 28th January, 1963 .Government Circular, Urban Development Public Health and Housing Department No. MUN/1164/58163/A dated 25th February, 1966.Letter No. MC/101 dated 2nd June, 1968 from the Municipal Commissioner, Poona Municipal Corporation".11. It is, therefore, evident that while exercising its power to delete rule 5(8) the Government had the following materials before it, (1) It knew that Rule 5(8) had granted exemption for a period of 10 years to some industrialists, who on the basis of the representation made by the Corporation had set up their industries; (2) the Municipal Corporation had made an express recommendation that while deleting rule 5(8) the previous concessions regarding exemption from octroi duty must continue, (3) the Government could delete rule 5(8) in the exercise of the powers conferred on it by sub-sections (2) and (5) of section 149 and sub-section (1) of section 455 of the Act.12. Section 149(2) runs thus:"The rules shall b e submitted by the Corporation to the Provincial Government and the Provincial Government may either refuse them or refer them back to the Corporation for further consideration or sanction them either as they stand or with such modifications as it thinks fit, not, however, involving an increase in the rate or rates of the levy or the extent thereof".13. This sub-section gives three alternative courses to the Government. After the matter is submitted by the Corporation to the Government (1) it may refuse to sanction the rules recommended, or (2) it may refer back to the Corporation any rule for further consideration or (3) it may sanction the rule as recommended, or with certain modifications as it thinks fit. There can be no doubt that the Government had the power to make modifications in the recommendation submitted by the Corporation, but the express provision by which the Government could refer the matter back to the Corporation is clearly suggestive of the fact that the Government would refer the matter to the Corporation if it wants to modify the proposal. In the instant case, the Government has done nothing of the sort but has clearly passed the order purely in terms of the recommendation. In these circumstances, therefore, the inference is irresistible that the Government never intended to make any changes in the rule recommended by the Corporation particularly because the question o f not accepting the condition recommended by the Corporation, namely, that the existing concessions must continue would entail taking away of vested rights and put the Corporation in a wrong box inasmuch as it would then have to go back from its own assurance. The Government must certainly have been aware of these complications and if it thought that in spite of all this rule 5(8) should be deleted unconditionally, it would have referred the matter back to the Corporation in order to g et its revised views in the matter. But that was not done. In these circumstances, therefore, we are of the opinion that the Government order dated 30th July, 1968 must be so read as to include the proviso recommended by the Corporation while deleting rule 5(8), namely, that the concessions already granted to the industrialists would continue. It is true that the Government resolution does not say so in so many words, but having regard to the language in which it was couched and to the express reference to the letter dated 2nd July, 1968 of the Municipal Commissioner contained in the order itself which clearly mentions that rule 5(8) should be repealed provided the exemption already granted shall continue until the expiry of the respective periods of their grants, the aforesaid condition would be deemed to be included in the order dated 30-7-1968 by necessary intendment. Such an interpretation will be fully in consonance with the well settled rule of int erpretation of statutes that any amendment to a statute affecting the legal rights of an individual must be presumed to be prospective unless it is made expressly or is impliedly retrospective. This principle is contained in section 7 of the Bombay General Clauses Act. In the instant case, if we were to take a different view the result would be that a valuable right vested in the respondents and others would be taken away and we are unable to find any evidence in the language of the Government order to indicate any such intention.Even assuming that the order of the Government deleted rule 5(8) without any condition and without retaining the exemption granted to the respondents, the order would suffer from a v ery serious legal infirmity. Section 149(2) of the Act empowers the Government to modify the recommendation of the Corporation provided it does not involve any increase in the rate or rates of the levy or the extent thereof. There can be no doubt tha t if the concession of exemption from octroi duty given to the respondents is unconditionally withdrawn with effect from 1-9-1968 then this would have the effect of extending the application of the rules to an area where they did not apply. This is yet another reason why the Government impugned order should be read down so as to provide for deletion of rule 5(8) with the exception that the concession already granted will continue.14.
### Response:
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### Explanation:
We have given our anxious consideration to the arguments advanced before us by counsel for the parties. We feel that in the circumstances of this case and in the view that we take, it is not at all necessary for us to travel into the domain of promissory estoppel. We are clearly of the opinion that reading the order dated 30-7-1968 against the history and background of the recommendation of the Corporation, the first contention of the respondents mustis not disputed that the Corporation in its resolution dated 30-5-1968 while recommending to the Government to delete rule 5(8) expressly recommended that the exemption already granted would continue. The last paragraph of the resolution runsRule No. 5(8) is hereby repealed. Provided that notwithstanding such repeal the exemption already granted shall continue until the expiry of the respective periods of theirthis, the Corporation itself had take n a policy decision that the industrialists choosing to set up industries in the demarcated area would be given exemption from octroi duty as contained in rule 62B. It was on this representation that the respondents applied for allotment of the plots and spent huge amounts of money for the import of machinery and the materials and set upresolution of the Government deleting rule 5(B) read as a whole also clearly indicates that it did not intend to depart from the recommendation made by the Corporation or to modify the same in any manner. On the other hand, the resolution clearly indicates that it was being passed on the basis of the letter of the Municipal Commissioner dated 2nd June, 19 68 as would be manifestly clear from the citations in the resolution which may be extractedGovernment Resolution, Urban Development, Public Health and House Department No. PMC/2862/15/C dated 28th January, 1963 .Government Circular, Urban Development Public Health and Housing Department No. MUN/1164/58163/A dated 25th February, 1966.Letter No. MC/101 dated 2nd June, 1968 from the Municipal Commissioner, Poona Municipalis, therefore, evident that while exercising its power to delete rule 5(8) the Government had the following materials before it, (1) It knew that Rule 5(8) had granted exemption for a period of 10 years to some industrialists, who on the basis of the representation made by the Corporation had set up their industries; (2) the Municipal Corporation had made an express recommendation that while deleting rule 5(8) the previous concessions regarding exemption from octroi duty must continue, (3) the Government could delete rule 5(8) in the exercise of the powers conferred on it by sub-sections (2) and (5) of section 149 and sub-section (1) of section 455 of theThe rules shall b e submitted by the Corporation to the Provincial Government and the Provincial Government may either refuse them or refer them back to the Corporation for further consideration or sanction them either as they stand or with such modifications as it thinks fit, not, however, involving an increase in the rate or rates of the levy or the extent94 of 1971FAZAL ALI,appeal by special leave is directed against the order of the High Court dated 21st December, 1970 dismissing the petition in limine. In view of the findings given and the decision rendered by us in Civil Appeals No. 2009 and 2081 of 1969 and 355 & 356 of 1970 it is not necessary for us to go into the details of the facts of this case as we have already held that the Government order dated 30-7-1968 must be read to this effect that rule 5(8) is deleted but the previous concessions given to the industrialists concerned will continue. It appears, however, that so far as the appellant is concerned, it has not executed any sale-deed though it was allotted a plot which was also demarcated. Apart from the point which we decided in the other appeals there being additional points of law involved in this case, we do not think that this was a fit case which should have been dismissed in limine by the Bombay High Court. We, therefore, allow this appeal and remit the case to the High Court for re-admitting and disposal of t he writ petition according to law. The point regarding the interpretation of Government order dated 30-7-1968 has already been decided by us in Civil Appeals No. 2009 and 2081 of 1969 and 355 & 356 of 1970 referred to above and will apply to the present case also, if the appellant is able to prove that it falls within the four corners of the Government order.
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Palure Bhaskar Rao Etc.Etc Vs. P.Ramaseshaiah & Ors. Etc | an induction to a new cadre and sometimes with a different type of duty. Such induction has distinct consequence on the career of the employee different from what would have been the normal course had he continued in the parent service. Thus the recruitment by transfer terminates the lien of an employee in the parent cadre/service whereas transfer simplicitor to a similar post in the same cadre results only in change of place of employment and therefore there is no termination of lien, (See :- V. Jagannadha Rao & Ors. v. State of A.P. & Ors., (2001) 10 SCC 401 , B. Thirumal v. Ananda Sivakumar & Ors., 2014(1) S.C.T. 639 : (2014) 16 SCC 593). 16. Seniority and eligibility are also distinct concepts. As far as promotion or recruitment by transfer to a higher category or different service is concerned if the method of promotion is seniority-cum-merit or seniority per se, there is no question of eligible senior being superseded. Other things being equal, senior automatically gets promoted. But in the case of selection based on merit-cum-seniority, it is a settled principle that seniority has to give way to merit. Only if merit being equal senior will get the promotion. 17. Merely because a person is senior, if the senior is not otherwise eligible for consideration as per the rules for promotion, the senior will have to give way to the eligible juniors. The instant case is a classic example for the said principle. The Reserve Sub-Inspectors selected and appointed on transfer as Sub-Inspectors (Civil) carries seniority from the date of appointment as Reserve Sub-Inspectors. But the eligibility for appointment by way of a transfer to the post of Inspector under the A.P. Police Service requires 6 completed years of service after being recruited to the category of Sub-Inspector of Police (Civil). In other words, though the Reserve Sub-Inspector selected and appointed on transfer as Sub-Inspector (Civil) may be seniormost in the category of Sub-Inspector of Police, but still he will be ineligible for consideration of appointment as Inspector in case he does not have 6 years of service as Sub-Inspector of Police (Civil). All his juniors who have 6 years of service as Sub-Inspector of Police and having been recruited to that post from different categories are entitled to steal a march over him as the rule now stands. The rule making authority in its wisdom has provided such a classification and we do not find any material on record to upset the said wisdom. 18. The view taken by us as above is fortified by the decision of this Court in the case of R. Prabha Devi and others v. Government of India, Through Secretary, Ministry of Personnel and Training, Administrative Reforms and others, (1988) 2 SCC 233 wherein it has been held that :- 15.The rule-making authority is competent to frame rules laying down eligibility condition for promotion to a higher post. When such an eligibility condition has been laid down by service rules, it cannot be said that a direct recruit who is senior to the promotees is not required to comply with the eligibility condition and he is entitled to be considered for promotion to the higher post merely on the basis of his seniority. The amended rule in question has specified a period of eight years approved service in the grade of Section Officer as a condition of eligibility for being considered for promotion to Grade I post of CSS. This rule is equally applicable to both the direct recruit Section Officers as well as the promotee Section Officers. The submission that a senior Section Officer has a right to be considered for promotion to Grade I post when his juniors who have fulfilled the eligibility condition are being considered for promotion to the higher post, Grade I, is wholly unsustainable. The prescribing of an eligibility condition for entitlement for consideration for promotion is within the competence of the rule-making authority. This eligibility condition has to be fulfilled by the Section Officers including senior direct recruits in order to be eligible for being considered for promotion. When qualifications for appointment to a post in a particular cadre are prescribed, the same have to be satisfied before a person can be considered for appointment. Seniority in a particular cadre does not entitle a public servant for promotion to a higher post unless he fulfils the eligibility condition prescribed by the relevant rules. A person must be eligible for promotion having regard to the qualifications prescribed for the post before he can be considered for promotion. Seniority will be relevant only amongst persons eligible. Seniority cannot be substituted for eligibility nor it can override it in the matter of promotion to the next higher post. The rule in question which prescribes an uniform period of qualified service cannot be said to be arbitrary or unjust violative of Article 14 or 16 of the Constitution. It has been rightly held by the Tribunal: When certain length of service in a particular cadre can validly be prescribed and is so prescribed, unless a person possesses that qualification, he cannot be considered eligible for appointment. There is no law which lays down that a senior in service would automatically be eligible for promotion. Seniority by itself does not outweigh experience. The aforesaid view of this Court in the case of R. Prabha Devi (supra) has been reiterated and followed in State of Punjab and others v. Inder Singh and others, 1998(2) S.C.T. 765 : (1997) 8 SCC 372 and Shiba Shankar Mohapatra & Ors. v. State of Orissa and others, 2011(1) S.C.T. 359 : (2010) 12 SCC 471. 19. No doubt on the date of occurrence of a vacancy in the post of Inspector of Police, in case a Reserve Sub-Inspector selected and appointed on transfer as Sub-Inspector of Police has completed 6 years as Sub-Inspector of Police (Civil), he is entitled to be considered in preference to his juniors in the seniority list of Sub-Inspectors of Police. | 0[ds]10. Heard learned senior counsel and other counsel appearing on behalf of both sides. Though several contentions have been raised, the crux of the arguments is that once seniority is considered from the date of appointment as Reserve Sub-Inspector, since the scales of pay of Reserve Sub-Inspector and Sub-Inspector (Civil) is the same and since both belong to the same class under the A.P. Police Subordinate Service, the Sub-Inspectors selected by transfer and appointed as Sub-Inspectors (Civil) against 5% vacancy and subsequently recruitment by transfer should be allowed to carry the benefit of total service, lest it should also violate Article 14 of the Constitution of India11. We find it difficult to appreciate the above submission. A.P. Police Subordinate Service and A.P. Police Service are two distinct and separate services. And though the pay scales of both categories in Class I post of A.P. Police Subordinate Service is one and the same, the posts are not interchangeable. It has been the submission of the State that there is functional difference in the service as well. Be that as it may, the selection to the post of Sub-Inspector (Civil) from Reserve Sub-Inspector is by way of transfer by selection based on merit. Only 5% quota is allocated to the Reserve Sub-Inspectors. Once the Reserve Sub-Inspector comes into the category of Sub-Inspector of Police (Civil), he is entitled to carry his seniority from the date of appointment as Reserve Sub-Inspector and placed accordingly in the seniority list of Sub-Inspectors (Civil). In other words as and when a Reserve Sub-Inspector is selected and appointed by transfer to the post of Sub-Inspector (Civil), though there may be Sub-Inspectors of Police (Civil) already available in that category working for more than 4 years but less than 5 years yet the Reserve Sub-Inspector transferred as Sub-Inspector of Police (Civil) will be placed above those existing Sub-Inspectors of Police recruited from other channels without the benefit of `carry on seniority. But that does not mean that on such placement in seniority he will be entitled to claim appointment as Inspector of Police in the A.P. Police Service since under the A.P. Police Service Rules, a Sub-Inspector of Police recruited by transfer should have a minimum service of 6 completed years for appointment by transfer as Inspector of Police. This rule is not under challenge13. The rule as stands now and having regard to the functional duties of Reserve Sub-Inspector and Sub-Inspector, and in the absence of a challenge set up on discrimination we find it difficult to test the arguments on the tenets of Article 14 of the Constitution of India14. Transfer and recruitment by transfer are entirely two different concepts. No doubt transfer can be from one category to another category or within the class if the rule permits interchangeability of the categories within a class. Any other transfer both intra category and inter category are in fact, under law is a selection and appointment by way of a transfer from one category to another or from one class to another class or from one service to another. If it is a transfer simplicitor it conveys a different meaning and if it is a recruitment by transfer, as we have clarified above conveys a different concept altogether. The latter is a mode of selection/recruitment to a service16. Seniority and eligibility are also distinct concepts. As far as promotion or recruitment by transfer to a higher category or different service is concerned if the method of promotion is seniority-cum-merit or seniority per se, there is no question of eligible senior being superseded. Other things being equal, senior automatically gets promoted. But in the case of selection based on merit-cum-seniority, it is a settled principle that seniority has to give way to merit. Only if merit being equal senior will get the promotion17. Merely because a person is senior, if the senior is not otherwise eligible for consideration as per the rules for promotion, the senior will have to give way to the eligible juniors. The instant case is a classic example for the said principle. The Reserve Sub-Inspectors selected and appointed on transfer as Sub-Inspectors (Civil) carries seniority from the date of appointment as Reserve Sub-Inspectors. But the eligibility for appointment by way of a transfer to the post of Inspector under the A.P. Police Service requires 6 completed years of service after being recruited to the category of Sub-Inspector of Police (Civil). In other words, though the Reserve Sub-Inspector selected and appointed on transfer as Sub-Inspector (Civil) may be seniormost in the category of Sub-Inspector of Police, but still he will be ineligible for consideration of appointment as Inspector in case he does not have 6 years of service as Sub-Inspector of Police (Civil). All his juniors who have 6 years of service as Sub-Inspector of Police and having been recruited to that post from different categories are entitled to steal a march over him as the rule now stands. The rule making authority in its wisdom has provided such a classification and we do not find any material on record to upset the said wisdom19. No doubt on the date of occurrence of a vacancy in the post of Inspector of Police, in case a Reserve Sub-Inspector selected and appointed on transfer as Sub-Inspector of Police has completed 6 years as Sub-Inspector of Police (Civil), he is entitled to be considered in preference to his juniors in the seniority list of Sub-Inspectors of Police | 0 | 3,223 | 1,001 | ### Instruction:
Make a prediction on the court's ruling (acceptance (1) or rejection (0) of the petition), and then dissect the proceeding to provide a detailed explanation using key textual passages.
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an induction to a new cadre and sometimes with a different type of duty. Such induction has distinct consequence on the career of the employee different from what would have been the normal course had he continued in the parent service. Thus the recruitment by transfer terminates the lien of an employee in the parent cadre/service whereas transfer simplicitor to a similar post in the same cadre results only in change of place of employment and therefore there is no termination of lien, (See :- V. Jagannadha Rao & Ors. v. State of A.P. & Ors., (2001) 10 SCC 401 , B. Thirumal v. Ananda Sivakumar & Ors., 2014(1) S.C.T. 639 : (2014) 16 SCC 593). 16. Seniority and eligibility are also distinct concepts. As far as promotion or recruitment by transfer to a higher category or different service is concerned if the method of promotion is seniority-cum-merit or seniority per se, there is no question of eligible senior being superseded. Other things being equal, senior automatically gets promoted. But in the case of selection based on merit-cum-seniority, it is a settled principle that seniority has to give way to merit. Only if merit being equal senior will get the promotion. 17. Merely because a person is senior, if the senior is not otherwise eligible for consideration as per the rules for promotion, the senior will have to give way to the eligible juniors. The instant case is a classic example for the said principle. The Reserve Sub-Inspectors selected and appointed on transfer as Sub-Inspectors (Civil) carries seniority from the date of appointment as Reserve Sub-Inspectors. But the eligibility for appointment by way of a transfer to the post of Inspector under the A.P. Police Service requires 6 completed years of service after being recruited to the category of Sub-Inspector of Police (Civil). In other words, though the Reserve Sub-Inspector selected and appointed on transfer as Sub-Inspector (Civil) may be seniormost in the category of Sub-Inspector of Police, but still he will be ineligible for consideration of appointment as Inspector in case he does not have 6 years of service as Sub-Inspector of Police (Civil). All his juniors who have 6 years of service as Sub-Inspector of Police and having been recruited to that post from different categories are entitled to steal a march over him as the rule now stands. The rule making authority in its wisdom has provided such a classification and we do not find any material on record to upset the said wisdom. 18. The view taken by us as above is fortified by the decision of this Court in the case of R. Prabha Devi and others v. Government of India, Through Secretary, Ministry of Personnel and Training, Administrative Reforms and others, (1988) 2 SCC 233 wherein it has been held that :- 15.The rule-making authority is competent to frame rules laying down eligibility condition for promotion to a higher post. When such an eligibility condition has been laid down by service rules, it cannot be said that a direct recruit who is senior to the promotees is not required to comply with the eligibility condition and he is entitled to be considered for promotion to the higher post merely on the basis of his seniority. The amended rule in question has specified a period of eight years approved service in the grade of Section Officer as a condition of eligibility for being considered for promotion to Grade I post of CSS. This rule is equally applicable to both the direct recruit Section Officers as well as the promotee Section Officers. The submission that a senior Section Officer has a right to be considered for promotion to Grade I post when his juniors who have fulfilled the eligibility condition are being considered for promotion to the higher post, Grade I, is wholly unsustainable. The prescribing of an eligibility condition for entitlement for consideration for promotion is within the competence of the rule-making authority. This eligibility condition has to be fulfilled by the Section Officers including senior direct recruits in order to be eligible for being considered for promotion. When qualifications for appointment to a post in a particular cadre are prescribed, the same have to be satisfied before a person can be considered for appointment. Seniority in a particular cadre does not entitle a public servant for promotion to a higher post unless he fulfils the eligibility condition prescribed by the relevant rules. A person must be eligible for promotion having regard to the qualifications prescribed for the post before he can be considered for promotion. Seniority will be relevant only amongst persons eligible. Seniority cannot be substituted for eligibility nor it can override it in the matter of promotion to the next higher post. The rule in question which prescribes an uniform period of qualified service cannot be said to be arbitrary or unjust violative of Article 14 or 16 of the Constitution. It has been rightly held by the Tribunal: When certain length of service in a particular cadre can validly be prescribed and is so prescribed, unless a person possesses that qualification, he cannot be considered eligible for appointment. There is no law which lays down that a senior in service would automatically be eligible for promotion. Seniority by itself does not outweigh experience. The aforesaid view of this Court in the case of R. Prabha Devi (supra) has been reiterated and followed in State of Punjab and others v. Inder Singh and others, 1998(2) S.C.T. 765 : (1997) 8 SCC 372 and Shiba Shankar Mohapatra & Ors. v. State of Orissa and others, 2011(1) S.C.T. 359 : (2010) 12 SCC 471. 19. No doubt on the date of occurrence of a vacancy in the post of Inspector of Police, in case a Reserve Sub-Inspector selected and appointed on transfer as Sub-Inspector of Police has completed 6 years as Sub-Inspector of Police (Civil), he is entitled to be considered in preference to his juniors in the seniority list of Sub-Inspectors of Police.
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### Explanation:
10. Heard learned senior counsel and other counsel appearing on behalf of both sides. Though several contentions have been raised, the crux of the arguments is that once seniority is considered from the date of appointment as Reserve Sub-Inspector, since the scales of pay of Reserve Sub-Inspector and Sub-Inspector (Civil) is the same and since both belong to the same class under the A.P. Police Subordinate Service, the Sub-Inspectors selected by transfer and appointed as Sub-Inspectors (Civil) against 5% vacancy and subsequently recruitment by transfer should be allowed to carry the benefit of total service, lest it should also violate Article 14 of the Constitution of India11. We find it difficult to appreciate the above submission. A.P. Police Subordinate Service and A.P. Police Service are two distinct and separate services. And though the pay scales of both categories in Class I post of A.P. Police Subordinate Service is one and the same, the posts are not interchangeable. It has been the submission of the State that there is functional difference in the service as well. Be that as it may, the selection to the post of Sub-Inspector (Civil) from Reserve Sub-Inspector is by way of transfer by selection based on merit. Only 5% quota is allocated to the Reserve Sub-Inspectors. Once the Reserve Sub-Inspector comes into the category of Sub-Inspector of Police (Civil), he is entitled to carry his seniority from the date of appointment as Reserve Sub-Inspector and placed accordingly in the seniority list of Sub-Inspectors (Civil). In other words as and when a Reserve Sub-Inspector is selected and appointed by transfer to the post of Sub-Inspector (Civil), though there may be Sub-Inspectors of Police (Civil) already available in that category working for more than 4 years but less than 5 years yet the Reserve Sub-Inspector transferred as Sub-Inspector of Police (Civil) will be placed above those existing Sub-Inspectors of Police recruited from other channels without the benefit of `carry on seniority. But that does not mean that on such placement in seniority he will be entitled to claim appointment as Inspector of Police in the A.P. Police Service since under the A.P. Police Service Rules, a Sub-Inspector of Police recruited by transfer should have a minimum service of 6 completed years for appointment by transfer as Inspector of Police. This rule is not under challenge13. The rule as stands now and having regard to the functional duties of Reserve Sub-Inspector and Sub-Inspector, and in the absence of a challenge set up on discrimination we find it difficult to test the arguments on the tenets of Article 14 of the Constitution of India14. Transfer and recruitment by transfer are entirely two different concepts. No doubt transfer can be from one category to another category or within the class if the rule permits interchangeability of the categories within a class. Any other transfer both intra category and inter category are in fact, under law is a selection and appointment by way of a transfer from one category to another or from one class to another class or from one service to another. If it is a transfer simplicitor it conveys a different meaning and if it is a recruitment by transfer, as we have clarified above conveys a different concept altogether. The latter is a mode of selection/recruitment to a service16. Seniority and eligibility are also distinct concepts. As far as promotion or recruitment by transfer to a higher category or different service is concerned if the method of promotion is seniority-cum-merit or seniority per se, there is no question of eligible senior being superseded. Other things being equal, senior automatically gets promoted. But in the case of selection based on merit-cum-seniority, it is a settled principle that seniority has to give way to merit. Only if merit being equal senior will get the promotion17. Merely because a person is senior, if the senior is not otherwise eligible for consideration as per the rules for promotion, the senior will have to give way to the eligible juniors. The instant case is a classic example for the said principle. The Reserve Sub-Inspectors selected and appointed on transfer as Sub-Inspectors (Civil) carries seniority from the date of appointment as Reserve Sub-Inspectors. But the eligibility for appointment by way of a transfer to the post of Inspector under the A.P. Police Service requires 6 completed years of service after being recruited to the category of Sub-Inspector of Police (Civil). In other words, though the Reserve Sub-Inspector selected and appointed on transfer as Sub-Inspector (Civil) may be seniormost in the category of Sub-Inspector of Police, but still he will be ineligible for consideration of appointment as Inspector in case he does not have 6 years of service as Sub-Inspector of Police (Civil). All his juniors who have 6 years of service as Sub-Inspector of Police and having been recruited to that post from different categories are entitled to steal a march over him as the rule now stands. The rule making authority in its wisdom has provided such a classification and we do not find any material on record to upset the said wisdom19. No doubt on the date of occurrence of a vacancy in the post of Inspector of Police, in case a Reserve Sub-Inspector selected and appointed on transfer as Sub-Inspector of Police has completed 6 years as Sub-Inspector of Police (Civil), he is entitled to be considered in preference to his juniors in the seniority list of Sub-Inspectors of Police
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THE COMMERCIAL TAX OFFICER AND ANR Vs. MOHAN BREWARIES AND DISTRILLERIES LIMITED | Cements Limited, the circular in question was not found to be in conflict with any statutory provision or the applicable schemes and, therefore, the same was held binding on the adjudicating authority in the following words: – 30. In the present case, it is not the case of the Revenue that the Circular dated 1-5-2000 is in conflict with either any statutory provision or the deferral schemes announced under the aforementioned government orders. We, therefore, hold that the said circular is binding in law on the adjudicating authority under the TNGST Act. 60. The aforesaid and other decisions, essentially dealing with exemption notifications, have no application to the present case; and in any event, none of the decisions, as referred on behalf of the assessee or as referred by the High Court, could be read for any principle contrary to that laid down by the Constitution Bench in Ratan Melting & Wire Industries (supra). 61. For what has been discussed hereinabove, we need not examine as to whether the Clarifications/Circulars in question could be said to be such clarification as envisaged by Section 28-A of the Act because even if the Clarifications/Circulars in question are treated to be those authorised by Section 28-A, they cannot have any effect over and above the interpretation of Section 7-A of the Act by the Courts. In other words, applicability of Section 7-A to the turnover in question could only be decided on the interpretation of the provision and its application to the given fact situation and not on the basis of Clarifications/Circulars in question. Put differently, the so-called Clarifications dated 09.11.1989 and 27.12.2000 had not been of explaining the meaning of any doubtful term or expression in the statutory provision nor they were explaining the object and purport of the provision concerned. The said Clarifications/Circulars had merely been the expression of the understanding of the concerned officer, be it SCCT or PCCT, about operation of Section 7-A of the Act vis-à-vis the purchase turnover of the empty bottles purchased by the assessee. However, such understanding of the officer concerned turns out to be a pure misunderstanding, when it stands at contradiction or incongruous to the declaration of law by the Courts; and could only be ignored. The latest Circular of the year 2002, issued after decision of the jurisdictional Tribunal in the case of Appollo Saline Pharmaceuticals (supra) could also be read only to the extent it is in conformity with the decision of the Tribunal (that came to be approved by the High Court) and in any case, even this circular cannot be decisive of the interpretation of Section 7-A of the Act. The decisive interpretation shall only be the one which is rendered in the binding decision/s of the Court. In continuity, we may also observe that various other decisions referred on behalf of the assessee, that modification of any particular circular or guideline or policy decision could only be made effective prospectively, have no application whatsoever to the present case. 62. In the aforesaid view of matter, we have no hesitation in concluding that the High Court, after having found that purchase tax was leviable on the turnover in question under Section 7-A of the Act, could not have issued directions for any benefit to the assessee with reference to the Clarifications/Circulars dated 09.11.1989 and 27.12.2000, particularly when such Clarifications/Circulars do not stand in conformity with the statutory provision and its interpretation by the Courts. 63. Hence, the impugned order of the High Court, on the second question as regards the operation and effect of Clarifications/Circulars dated 09.11.1989 and 27.12.2000, cannot be approved. 64. The net result of the discussion foregoing is that the purchase turnover of the empty bottles purchased by the assessee from the unregistered dealers under bought note is exigible to purchase tax under Section 7-A of the Tamil Nadu Act; and the assessee cannot escape such liability on the strength of the Clarifications/Circulars dated 09.11.1989 and 27.12.2000 which do not stand in conformity with the statutory provision as also declaration of law by the Courts. Other Question 65. So far as the other question regarding taxability of cash discount on the price offered by the assessee to the Tamil Nadu State Marketing Corporation Limited is concerned, the High Court has ruled in favour of the assessee with reference to the decision in the case of Neyvli Lignite Corporation Ltd. and the clear expressions in Explanation 2(iii) to Section 2(r) of the Act. 65.1. The relevant provision reads as under:- Section 2(r).- turnover means the aggregate amount for which goods are bought or sold, or delivered or supplied or otherwise disposed of in any of the ways referred to in clause (n), by a dealer either directly or through another, on his own account or on account of others whether for cash or for deferred payment or other valuable consideration, provided that the proceeds of the sale by a person of agricultural or horticultural produce, other than tea, and rubber (natural rubber, latex and all varieties and grades of raw rubber) grown within the State by himself or on any land in which he has an interest whether as owner, usufructuary mortgagee, tenant or otherwise, shall be excluded from his turnover. *** *** *** Explanation (2) Subject to such conditions and restrictions, if any, as may be prescribed in this behalf- *** *** *** (iii) any cash or other discount on the price allowed in respect of any sale and any amount refunded in respect of articles returned by customers shall not be included in the turnover; *** *** *** 65.2. In view of the clear phraseology of the above extracted Explanation, not much of discussion appears requisite as regards this issue that has rightly been decided by the High Court in favour of the assessee and not much of serious contentions have been put forward by the revenue in this regard. The impugned order of the High Court, to this extent, calls for no interference. CONCLUSION | 1[ds]17.2. As noticed, Section 7-A was inserted in the Tamil Nadu Act with effect from 27.11.1969. This provision has undergone several amendments from time to time but, for the present purpose, its sub-section (1), as examined by this Court in the judgment dated 15.07.1975 in the case of M.K. Kandaswami (supra) and then, as applicable to the present case pertaining to the assessment year 1996-97, may be noticed.18. For dealing with the rival contentions, we may also take note of various facets of interpretation of Section 7-A (1) of the Act in the relevant cited decisions. It may, however, be observed that so far as the text of Section 7-A (1) applicable to the case at hand is concerned, there has not been any direct interpretation by this Court or the jurisdictional High Court (except the order impugned). In two of the cited decisions, one by this Court in the case of M.K. Kandaswami (supra) (Decided on 15.07.1975) and another by the High Court in the case of Associated Pharmaceutical Industries (supra) (Decided on 18.01.1984) , Section 7-A (1) of the Tamil Nadu Act, as existing before its amendment by Tamil Nadu Act No. 78 of 1986 w.e.f. 01.01.1987, came up for consideration. The other cited decision in relation to Section 7-A (1) of the Tamil Nadu Act had been by the jurisdictional High Court in the case of Appollo Saline Pharmaceuticals (supra) (Decided on 14.09.2001) but that was rendered after further amendments to Section 7-A including that by Tamil Nadu Act No. 60 of 1997 w.e.f. 06.11.1997. Thus, the specific phraseology of Section 7-A (1) of the Tamil Nadu Act as applicable to the present case has not been dealt with by any of these decisions. Nevertheless, each of these decisions had come under reference in this case at every stage and, having regard to the questions involved, appropriate it would be to take note of the relevant ratio decidendi from these decisions.19. As regards the decisions of jurisdictional High Court dealing with Section 7-A (1) of the Act, in the case of Associated Pharmaceutical Industries (supra), the assessee had purchased and used the bottles for manufacture and sale of medicines, drugs or syrups. It was held by the High Court that though without bottling, the drugs and syrups manufactured could not be sold but, that could not be a reason for holding that the process of manufacture of drugs and syrups was not complete unless they were bottled or put in suitable containers and hence, it cannot be said that the bottles had been used up in the process of manufacture; and consequently, the purchase turnover of empty bottles could not be brought to charge under Section 7-A (1) (a) of the Act.20. The other decision concerning the provision contained in Section 7-A (1) of the Act but after yet another amendment to clause (a) had been by the Madras High Court in the case of Appollo Saline Pharmaceuticals (supra). Therein, the assessee was engaged in manufacturing and marketing of I.V. fluid and the turnover of the bottles containing I.V. fluid was included in the turnover relating to the fluid by reason of Section 3 (7) of the Act. The assessee was confronted with a demand for payment of purchase tax for the reason that the bottles in which I.V. fluid was packed and sold were those bottles which the assessee had purchased from unregistered dealers and therefore, those bottles had not been subjected to tax at the time of purchase. It was essentially contended before the Madras High Court on behalf of the assessee that if the goods in respect of which purchase tax was sought to be levied continued to be available for sale or purchase and were in fact sold, such goods cannot be brought to tax under Section 7-A of the Act.20.1. The High Court referred to the expansion of ambit and coverage of Section 7-A (1) of the Act and observed that after the amendments, recovery of purchase tax was permissible even in cases where goods which had not suffered tax at the time of purchase and are subsequently disposed of by the dealer in circumstances where value of turnover relating to those goods is also subject to tax by deeming the same as forming part of turnover of other taxable goods. The High Court observed that the inclusion of turnover relating to bottles in the total turnover of dealer and thereby, such turnover relating to bottles being also subjected to tax, did not enable the assessee to get out of the net of Section 7-A because the bottles were not sold as bottles but were sold as part of a composite unit namely, I.V. fluid packed in bottles. The High Court also observed that the amended Section 7-A of the Act referred to the consumption or use of goods in or for the manufacture of other goods; and having regard to the nature of goods and the need for a container to make those goods marketable, it was required to be held that the bottles were used in or for the manufacture of I.V. fluid.20.2. The High Court also found that it was not the case of assessee that the fluids manufactured by it could be sold in the market without the aid of bottles. Thus, while reiterating that the bottling of I.V. fluid was necessary to make it marketable, the High Court held that the bottles were clearly the goods which were used in or for the manufacture of fluid.21. Turning over to the cited decisions of this Court, it may be observed that the 3-Judge Bench decision of this Court in the case of M.K. Kandaswami (supra) has a material bearing and is of utmost significance because the root purpose as also the sweep of this provision for levy of purchase tax have been succinctly explained by this Court while illuminating several of its basic and essential ingredients.21.1. In the case of M. K. Kandaswami (supra), the respondent dealers had purchased a variety of goods, namely, arecanuts, gingelly seeds, turmeric, grams, castor seeds and butter in such circumstances where their sales were not liable to tax in the hands of the respective sellers although the goods were such, whose sale or purchase was generally liable to tax under the Act. Against the respondent dealers, either pre-assessment proceedings had been initiated or assessments had been made under Section 7-A of the Act on the purchase turnover of these goods on the assertions by revenue that the gingelly seeds and castor seeds were crushed into oil and the butter was converted into ghee by the respective dealers and by such action, the goods in question were consumed in the manufacture of other goods for sale; and hence, this action was covered under clause (a) of Section 7-A (1). It was also asserted that the other goods namely, arecanuts, turmeric and gram, were transported by the respective dealers outside the State for sale on consignment basis and thereby, those cases were covered by clause (b) or clause (c) of Section 7-A (1). In the backdrop of these facts, when Section 7-A came up for interpretation in the writ petitions under Article 226 of the Constitution of India, the High Court found the phraseology of Section 7-A to be rather carrying contradiction in terms and the language being far from clear as to its intention.27. Keeping the aforementioned principles in view and having regard to the questions of construction involved in the present case, it appears appropriate to recapitulate the texts of the relevant provisions concerning purchase tax as occurring in different State enactments which have come in reference in the present case; and for proper appreciation, it would be useful to put the relevant texts in juxtaposition to notice their similarities and akin features as also the dissimilarities and distinctive features.28. As noticed, so far as the text of Section 7-A (1) applicable to the case at hand is concerned, there has not been any direct interpretation by this Court or the jurisdictional High Court (except the order impugned). We may also usefully reiterate that so far decision of Madras High Court in the case of Associated Pharmaceuticals Industries (supra) is concerned, the same was rendered before the relevant amendments to Section 7-A of the Act and particularly when the expression or uses was not there in clause (a) of Section 7-A (1). Only the expression consumes was considered therein and the High Court held that the bottles were not consumed in manufacture of drugs or syrups. So far the decision of Madras High Court in the case of Appollo Saline Pharmaceuticals (supra) is concerned, as noticed, the same was rendered after further amendment to Section 7-A whereby, the expression or for was added to clause (a), which expression was not there in the provision applicable to the present case. This apart, the activity examined in the case of Appollo Saline Pharmaceuticals had been of the sale of I.V. fluid packed in bottles.29.1. It needs hardly any re-emphasis that the scope and ambit of the provisions of purchase tax in different State enactments had been different on material particulars; and it is apparent that for difference in phraseology, interpretation of one particular State Sales Tax Act cannot be ipso facto imported for interpreting another enactment. Learned senior counsel for the assessee has endeavoured to persuade us that the observations made in Hotel Balaji (supra) in relation to Haryana Act may apply to the present case too but, we are afraid, the submissions cannot be accepted because of a fundamental difference in the ambit and scope of the Haryana Act compared to the ambit and scope of Tamil Nadu Act with which we are concerned in these appeals. We may, therefore move on to the other decisions of this Court for the purpose of interpretation of Section 7-A of the Act and for finding out the principles to be applied to the present case.30. As noticed, the 3-Judge Bench decision of this Court in the case of M. K. Kandaswami (supra) was rendered in relation to the provision of Section 7-A of the Tamil Nadu Act, as existing at the relevant time. The later amendment of this provision (w.e.f. 01.01.1987), with which we are concerned in this case, has only enlarged its width by insertion of the expression or uses after the expression consumes and thereby, not only consumption but even use in the manner envisaged by the provision would provide coverage thereunder. Therefore, when the later amendment has not altered the basics of Section 7-A of the Act and had only enlarged its scope, the principles applicable to the present case could be culled out from the enunciation in M. K. Kandaswami, with necessary variation, rather enlargement.31. As held in M. K. Kandaswami (supra), Section 7-A of the Act is a charging as well as a remedial provision, its main object being to plug leakage and prevent evasion of tax; and in interpreting such a provision, a construction which would defeat its purpose or render it otiose should be eschewed. As regards workability of Section 7-A of the Act, this Court catalogued its ingredients in a point-wise break up and pointed out that it would apply only if all such ingredients are cumulatively satisfied. We have extracted the analysis so made by this Court hereinbefore (Vide paragraph 19.2. ibid.) . The same analysis shall apply to the provision of Section 7-A with which we are concerned in the present case with necessary variation and with major difference that in point No. 6(a), the expression or uses shall also get added because of the amendment above- noted. Therefore, applying the analysis in M.K. Kandaswami with necessary modification, Section 7-A (1), as existing in the statute during the period relevant for the present case, would become applicable if the following basic ingredients are cumulatively satisfied: -(1) The person who purchases the goods is a dealer and is covered under Section 3(1) of the Act;(2) the purchase is made by him in the course of his business;(3) such purchase is either from a registered dealer or from any other person;(4) the goods purchased are those goods whose sale or purchase is liable to tax under the Act;(5) such purchase is in circumstances in which no tax is payable under Section 3 or 4, as the case may be (but not being the excepted circumstance with reference to the point of purchase); and(6) the dealer either-(a) consumes or uses such goods in the manufacture of other goods for sale or otherwise, or(b) disposes of such goods in any manner other than by way of sale in the State, or(c) despatches or carries them to a place outside the State except as a direct result of sale or purchase in the course of inter-State trade or commerce.32. The analysis as above fairly gives insight as to the ambit and scope of Section 7-A (1) of the Act but it is the expression or otherwise, as occurring in clause (a) of this provision [point No. 6(a) ibid.] that, perforce, calls for yet deeper exploration to understand the range of coverage of this provision. However, this exploration does not require any lengthy discussion for the directly applicable dictum of the Constitution Bench in the case of Nandanam Construction Co. (supra).33. As noticed, the relevant clauses in Section 6-A of the Andhra Pradesh Act had been more or less similar to those contained in Section 7-A of the Tamil Nadu Act and while construing the same in Nandanam Construction Co. (supra), the Constitution Bench specifically held that the object of the said provision was to levy purchase tax on goods consumed either for the purpose of manufacture of other goods for sale or consumed otherwise. (vide paragraph 23.3.3 ibid) Be it noted that the additional expression or uses was not there in the said Section 6-A of the Andhra Pradesh Act either. In other words, the phraseology examined by the Constitution Bench in Nandanam Construction Co. was akin to that of Section 7-A of the Tamil Nadu Act as existing earlier and as examined in M.K. Kandaswami. Further, noticeably, in M.K. Kandaswami, the 3-Judge Bench held that the decision in Ganesh Prasad Dixit, wherein the provision contained in Section 7 of the Madhya Pradesh Act had been interpreted by this Court, was apposite guide for construing Section 7-A of the Tamil Nadu Act; and then, in Nandanam Construction Co., the Constitution Bench approved the enunciation in Ganesh Prasad Dixit as regards the interpretation of the expression or otherwise while making it absolutely clear that this expression or otherwise provided alternative to the expression manufacture and not to the expression sale; and the converse interpretation as regards this expression or otherwise in Pio Food Packers was overruled. The provision in Section 7 of the Madhya Pradesh Act had also been similar to the original Section 7-A of the Tamil Nadu Act.33.1. As noticed, by the amendment with effect from 01.01.1987, the scope of Section 7-A (1) has only been enlarged with addition of the expression or uses. Looking to the expressions of Section 7-A (1) of the Tamil Nadu Act, as existing earlier and as existing after the amendment, we are clearly of the view that the enunciation by the Constitution Bench in Nandanam Construction Co., read with the approved interpretation in Ganesh Prasad Dixit, would equally apply to the amended provision with necessary modulation after its expansion.34. When the principles laid down by the Constitution Bench in Nandanam Construction Co. coupled with the approved interpretation in Ganesh Prasad Dixit are read with the analysis in M.K. Kandaswami and are applied to the amended Section 7-A of the Tamil Nadu Act with which we are concerned in this case, the end-product of synthesis is that the expression or otherwise qualifies, and provides alternative to, the action of manufacture; and therefore, consumption of the goods in question for manufacture or otherwise as also use of the goods in question for manufacture or otherwise are the acts/actions covered under clause ( a ) of sub-section (1) of Section 7-A of the Tamil Nadu Act.34.1. In other words, when we apply the principles laid down by the Constitution Bench in Nandanam Construction Co. to the phraseology of clause (a) of sub-section (1) of Section 7-A of the Tamil Nadu Act, four eventualities are covered thereunder, with reference to the treatment of the goods in question (which had been purchased by the dealer in the circumstances where sales tax had not been paid at the time of their purchase), viz.,(i) when they are consumed in manufacture of other goods for sale; or(ii) when they are consumed otherwise; or(iii) when they are used in manufacture of other goods for sale; or(iv) when they are used otherwise.Application of the relevant principles to the case at hand35. Put in a nutshell, with the discussion foregoing, we have found that for applicability of Section 7-A (1) of the Act, as existing in the statute during the period relevant for the present case, basic ingredients (compiled in paragraph 31 hereinbefore) ought to be cumulatively satisfied; and for coverage of any case under clause (a) of sub-section (1) of Section 7-A of the Act, one or more of the eventualities envisaged therein (catalogued in paragraph 34.1. hereinabove) ought to exist. Having thus deduced the necessary ingredients/elements and relevant principles, we may now embark upon the enquiry as to whether purchase tax under Section 7-A of the Act is leviable over the turnover in question.36. As noticed, for the purpose of its business of manufacture and sale of Beer and IMFL, the assessee had purchased empty bottles from unregistered dealers situated outside the State as well as from non-dealers for the bottling of Beer and IMFL. The assessee would assert that purchase tax on the turnover in question is not leviable for the reason the said empty bottles were recycled after use by the consumers and were re-filled with Beer/IMFL; and that the said bottles had not been consumed or used in the manufacture of liquor and they were only used as containers in which already manufactured liquor was bottled for carrying and sale. The counter stand of revenue is that use of the said bottles is imperative in the manufacture of Beer/IMFL and packaging of Beer/IMFL in glass bottles has to be seen as an inseparable composite unit; and therefore, purchase tax on the turnover of purchase of such empty bottles is leviable, for being covered by Section 7-A (1) (a) of the Act.37. Taking up the first limb of submissions with reference to the activity in question, when we examine the ingredients for applicability of Section 7-A (1) of the Act, it is not in dispute that: (1) the assessee, who has purchased the goods in question (the empty bottles), is a dealer and is covered under Section 3 (1) of the Act; (2) the said purchase has been made by the assessee in the course of its business; (3) such purchase has been from unregistered dealers situated outside the State as well as from non-dealers; (4) sale or purchase of the goods purchased (the empty bottles) is liable to tax under the Act; and (5) such purchase has been in circumstances in which no tax is payable under Section 3 or 4 and has not been in any excepted circumstance with reference to the point of purchase. These indisputable features unfailingly lead to the position that ingredients (1) to (5) of Section 7-A (1) of the Act, as mentioned in paragraph 31 hereinbefore, are satisfied.37.1. However, as noticed, for applicability of Section 7-A (1) of the Act, all the six ingredients need to be cumulatively satisfied. The ingredient (6) has three alternatives viz., the dealer has either (a) consumed or used the goods in question in the manufacture of other goods for sale or otherwise, or (b) has disposed of such goods in any manner other than by way of sale in the State, or (c) has despatched or carried them to a place outside the State except as a direct result of sale or purchase in the course of inter-State trade or commerce. It is not in dispute that clauses (b) or (c) of this ingredient are not attracted in this case, for the entire manufactured Beer/IMFL, after bottling, having been sold by the assessee only to the Tamil Nadu State Marketing Corporation Limited (TASMAC) within the State of Tamil Nadu.As already noticed, as per the language used, this provision comes in operation when the dealer consumes or uses such goods in the manufacture of other goods for sale or otherwise. Hence, the activity in question would be so covered if any one of the four elements of clause (a) exists, i.e., (i) if the goods in question are consumed in manufacture of other goods for sale; or (ii) if they are consumed otherwise; or (iii) if they are used in manufacture of other goods for sale; or (iv) if they are used otherwise.39.4.2. We need not enter deeply into the nitty-gritty of semantics but this much is clear that with the said later amendment and modification of prepositions to in or for, coverage is provided in the provision not only to the activity of use of the particular goods in the manufacture but also to the activity when the particular goods are merely used for the manufacture. However, as noticed, this amendment with insertion of the expressions or for is not applicable to the present case. Therefore, for the present purpose, it shall have to be examined if the goods in question (empty bottles) have either been consumed or been used as an integral part of the activity of manufacture of other goods for sale.40. As noticed, several of the meanings of the expressions consume and consumption denote using up a particular thing in a way that results in complete exhaustion of that thing. On the other hand, the expression use denotes the application or deployment of a particular thing as a means of achieving something or for accomplishment of a purpose. Undoubtedly, the word use is of wider import than consumption (vide Kathiawar Industries Ltd. (supra)) .42. We need not multiply on the citations as the fundamental principles remain clear that, on the question as to whether manufacture has taken place or not, the relevant enquiry would be to find if a new substance has come into existence which is a different commercial commodity or whereby identity of the original commodity has ceased to exist.The decision of this Court in the case of Mohan Meakin Breweries Ltd. (supra) is sufficient to be noticed in this regard wherein it was clearly held that bottling takes place after brewing of Beer is complete. This Court said as under :-. What has been observed in relation to brewing and bottling of Beer would equally apply to distillation and bottling of IMFL.44. Applying the relevant tests concerning the expressions consumes, uses and in the manufacture to the present case, it remains hardly a matter of doubt that so far the empty bottles are concerned, even after being filled with liquor, they remain bottles only, retaining their original elements including shape, size and character. They are not consumed at all; and there arise no question of they being consumed in the manufacture. Therefore, we have no hesitation in accepting the submissions of assessee that the bottles in question have not been consumed in manufacture of other goods for sale.44.1. In continuity with the above, we are also inclined to accept the submission of the assessee that the empty bottles have not even been used in manufacture. This is for the reason that for operation and application of the phrase uses in manufacture, it has to be shown that the bottles in question have been deployed as a means of achieving the purpose of manufacture. As noticed, the phrase manufacture of other goods for sale, in the present case, refers to the goods manufactured by the assessee, i.e., Beer/IMFL; and, in fact, use of the bottles in question comes up in the activity of the assessee only after manufacture of liquor (Beer/IMFL) has already been accomplished by brewing or distillation. Needless to reiterate that in relation to the activity of assessee, the action of bottling is a separate process and is undertaken only after the process of manufacture by way of brewing or distillation is complete. Thus understood, we are clearly of the view that the goods in question (empty bottles) cannot be said to have been used in manufacture.45. For what has been discussed hereinabove, we have no hesitation in concluding that the bottles in question have neither been consumed in manufacture of Beer/IMFL nor they could be said to have been used in such manufacture of Beer/IMFL. Hence, elements (i) and (iii) pertaining to clause (a) of sub-section (1) of Section 7-A of the Act do not exist in this case.This area of examination takes us to the words or otherwise used in clause (a) of sub-section (1) of Section 7-A of the Act. In this regard, we need again to look at etymology related with the expression in question.47. The variety of meanings assigned to the expression otherwise makes one aspect absolutely clear that this expression is intended to denote something different than the thing/s to which it is employed; and that this expression is essentially general in nature. In the phraseology of clause (a) of sub-section (1) of Section 7-A of the Act, the words or otherwise have been placed after the particular words consumes, uses and manufacture. Obviously, these words or otherwise are intended to convey that not only the activities envisaged by the particular words preceding but, even the other activities would also be covered thereunder.48. The aforesaid general principles are also not decisive of the matter because when an expression generally of wide amplitude like otherwise is used, the question still arises about its construction, particularly when it is placed after particular/specific words. In this process of construction, one may feel inclined to rely upon and apply the rule of ejusdem generis whereby and whereunder when a particular word pertaining to a class, category or genus are followed by general words, the general words are construed as limited to the things of the same kind as those specified. Even as regards the words or otherwise, in some of the interpretations, they have been treated as limited in their scope with reference to the context (Like in the cases of S. Prakasha Rao and Anr v. Commissioner of Commercial Taxes and Ors.: (1990) 2 SCC 259 and George Da Costa v. Controller of Estate Duty Mysore : AIR 1967 SC 849 ) but the Constitution Bench of this Court in the case of Smt. Lila Vati Bai v. State of Bombay: AIR 1957 SC 521 , while construing the words or otherwise occurring in Explanation (a) to Section 6 of the Bombay Land Requisition Act, held that these words were intended to cover all possible cases of vacancy occurring due to any reason whatsoever. The Constitution Bench observed that far from using these words ejusdem generis with the preceding clauses, the Legislature had used them in an all-inclusive sense; and, in the given context and looking to the object and the mischief sought to be dealt with by the enactment, there was no room for application of the rule of ejusdem generis.48.2. The principles enunciated in the aforesaid cases make it clear that even the rule of ejusdem generis cannot be picked up and applied as an abstract proposition whenever general words are used after particular words and expressions. As regards the words or otherwise, though, ordinarily, the class or category to be covered thereby may have to be kindred to the particular class or category preceding them but, such kinship could be even of general relatedness to the particular words and need not be that of cognates or agnates or analogues.48.3. In our view, looking to the context as also the object of the provision in question, as regards the words or otherwise, the rule of ejusdem generis would apply in a very limited sense and only to the extent that the class or category to be covered thereunder may not be dissimilar or incongruent to the particular class or category of the expressions preceding it. As already noticed, in the case of Nandanam Construction Co. (supra), the Constitution Bench has construed these words or otherwise in relation to the pari materia provisions of the Andhra Pradesh Act and held that the expression otherwise qualifies the word manufacture and, therefore, consumption of the goods in question, even if not in manufacture, would lead to coverage for levy of purchase tax. We may usefully reiterate that in Nandanam Construction Co. (supra), the assessee was engaged in the business of building houses/flats and had consumed the goods like bricks and sand in such construction. The Constitution Bench found that such consumption was clearly a consumption otherwise than manufacture but was covered under the provisions for levy of purchase tax. The Constitution Bench also stated the reason for such construction that the goods in question were consumed and ceased to exist in their original form so as to be sold in that original form.49. Keeping the principle aforesaid in view, we may now take up elements (ii) and (iv) of clause (a) of sub-section (1) of Section 7-A of the Act.49.1. As already noticed, consumption requires the thing in question being exhausted or ceasing to exist for being used up. The bottles in question, even when used as containers of the liquor manufactured by the assessee, had neither been exhausted nor had ceased to exist; they have rather continued to exist while retaining their basic identity and character as bottles. Of course, they (empty bottles) had been filled up with liquor but such filling up has not resulted in the bottles themselves being used up. Hence, the activity in question does not fall within the ambit of element (ii). However, the very same logic does not apply to element (iv) because it cannot be said that the bottles in question have not been used otherwise.49.2. As noticed, the expression use is of wide amplitude and it refers to the usage or engagement of an article for the accomplishment of a purpose irrespective of whether the article itself undergoes a visible change or not. The fact that the bottles in question have indeed been used by the assessee in its overall activity of manufacture and sale of liquor is clear from the fact that the manufacture of liquor by the process of brewing or distillation did not conclude the activity of the assessee. Undoubtedly, for the sale of such manufactured liquor to TASMAC, the assessee was required to put the same into the bottles; and the sale by assessee could have taken place only after such bottling of the liquor. The assessee has, indisputably, undertaken this process of bottling by the use of the goods in question, i.e., the empty bottles purchased from unregistered dealers. Hence, it is but apparent that the goods in question (empty bottles) have been used by the assessee, and for that matter, have been used for an activity closely connected and co-related with the main activity of manufacture of liquor as also as necessary ingredient of the end-purpose of sale of liquor. Significantly, after such use for bottling, the goods in question (empty bottles) did not remain available for sale in the form in which they were purchased by the assessee.49.3. In other words, the process of bottling with the use of bottles in question has been an unalienable part of the complete chain of processes that the assessee was obliged to undertake for its business, i.e., manufacturing and selling the liquor. By this process, the bottles in question were used by the assessee in such a manner that they were no longer available for sale in the form they were purchased from unregistered dealers. That being the position, the bottles in question have indeed been used otherwise by the assessee. The assessee cannot avoid operation of the words or otherwise so far use of the bottles is concerned by merely establishing that they have not been consumed in manufacture or otherwise and further that they have not been used in manufacture. Even when these three elements viz., consumed in manufacture; consumed otherwise; and used in manufacture do not exist as regards the bottles in question in the business activity of the assessee, it is but apparent the activity of the assessee clearly entails the use of bottles for the purpose of bottling and sale of liquor manufactured by it. This activity clearly takes the bottles in question within the fourth element i.e., used otherwise.49.4. Hence, though the bottles in question have not been consumed otherwise, they have indeed been used otherwise; and therefore, the activity of assessee in relation to the bottles in question is clearly covered by element (iv) of clause (a) of sub-section (1) of Section 7-A of the Act.50. To summarise the discussion aforesaid and to put our views in a nutshell, the goods in question (empty bottles) have not been consumed in the manufacture of other goods for sale nor they have been consumed otherwise because of having retained their identity. They have also not been used in the manufacture of other goods for sale because manufacture of Beer/IMFL was complete without their use. However, they have been used for bottling and when bottling remains an integral part of the business activity of the assessee, i.e., of manufacturing the liquor by the process of brewing/distillation and then, selling the manufactured liquor by putting the same in bottles, they have been used otherwise. That being the position, use of the goods in question for bottling takes the turnover of their purchase within the net of Section 7-A of the Act.50.1. To put it more simply, if we read clause (a) of sub-section (1) of Section 7-A of the Act sliced down to the elements uses in manufacture or otherwise, it is clear that the goods in question (empty bottles) have been used for bottling, which use, even if not for manufacture, had been a use otherwise which has been closely connected with the business of the assessee and whereby the bottles in question did not remain available for sale in the form in which they were purchased. This is the plain and clear operation of the dictum of Constitution Bench in the case of Nandanam Construction Co. (supra). Hence, applicability of Section 7-A of the Act is complete and remains beyond the realm of doubt.51. Having thus arrived at the conclusion that ingredients (1) to (5) and (6)(a) for applicability of Section 7-A (1) are cumulatively satisfied, the inescapable result is that the turnover in question is exigible to purchase tax. However, there remains another limb of submissions on the part of assessee that when the bottles have not been disposed of in any manner other than by way of sale in the State and had been disposed of only by way of sale to TASMAC within the State of Tamil Nadu itself; and they had been subjected to sales tax at the same rate as that of the contents, purchase tax would not be leviable. This line of submissions on the part of assessee, in our view, remains entirely baseless.52. As already noticed, the goods in question (empty bottles) have been used to complete the process of making the manufactured goods (Beer/IMFL) marketable. It is also clear that the bottles have not been sold by the assessee simply as bottles. They have been sold as an essential component of the marketable commodity. That being the position, charging of sales tax on these bottles comes into operation by virtue of Section 3 (1) read with Section 3 (7) of the Tamil Nadu Act. As noticed, the assessee is indisputably a dealer covered under sub-section (1) of Section 3 of the Act. By virtue of sub-section (7) of Section 3, when the assessee has sold the goods (Beer/IMFL) together with the bottles as containers or packing material, turnover of Beer/IMFL was bound to include the price, cost or value of such bottles whether such price, cost or value had been charged separately or not; and sales tax was bound to be levied thereupon at the rate applicable to the goods contained, i.e., Beer/IMFL. The Explanation to Section 3 of the Act puts it beyond doubt that the expression containers includes bottles.52.1 Another relevant feature of the provisions in question is that applicability of Section 7-A of the Act has not been made dependent on the event of levy of sales tax on the goods for which purchase tax is to be levied. As noticed, levy of purchase tax is dependent on cumulative existence of the necessary ingredients of Section 7-A of the Act; and no exception or exclusion is provided with reference to the factum of levy of sales tax on the goods in question at the time of their sale. In fact, not much of elaborate discussion in this regard appears requisite, for a direct answer being available in a 3-Judge Bench decision of this Court in the case of Premier Breweries (supra) wherein, pari materia provisions of the Kerala Act as regards levy of sales tax were considered. In the said case of Premier Breweries, the appellant had sold liquor packed in cardboard cartons. It was contended that such cardboard cartons had already borne tax under the entry paper other than the newsprint cardboard and their products and hence, such cartons could not have been taxed again when sold along with Beer. This Court examined sub-sections (5) and (6) of Section 5 of the Kerala Act, which had been more or less akin to sub-sections (7) and (8) of Section 3 of the Tamil Nadu Act, and negatived the contention of the dealer. The relevant paragraphs of the said decision, taking note of sub-sections (5) and (6) of Section 5 of the Kerala Act and rejecting this part of the contentions of assessee, could be usefully noticed as follows (at pp.602 and 607-608 of STC):-5. Before examining the decisions, it will be useful to refer to the relevant provisions of the Kerala General Sales Tax Act. Tax on sale or purchase of goods has been imposed by section 5 of the Act. Sub-sections (5) and (6) of section 5 of the Act provide:5. (5) Notwithstanding anything contained in sub-section (1) or sub-section (2), but subject to sub-section (6), where goods sold are contained in containers or are packed in any packing materials, the rate of tax and the point of levy applicable to the containers or packing materials, as the case may be, shall, whether the price of the containers or packing materials is charged separately or not, be the same as those applicable to goods contained or packed, and in determining turnover of the goods, the turnover in respect of the containers or packing materials shall be included therein.(6) Where the sale or purchase of goods contained in any containers or packed in any packing materials is exempt from tax, then the sale or purchase of such containers or packing materials shall also be exempt from tax.*** *** ***22. We shall now deal with another point urged on behalf of the appellant. It has been contended that the cardboard cartons have already borne tax under the entry paper, other than the newsprint, cardboard and their products in the First Schedule of the Act. It is a single-point tax. The cardboard cartons cannot be taxed once again when sold along with the beer.23. There are two answers to this contention. Sub-section (5) of section 5 specifically provides that the rate of tax and point of levy applicable to the containers shall be the same as those applicable to the goods sold. Therefore, even if the cartons have already been subjected to tax by virtue of specific provision of section 5(5) they will be liable to tax at the same point and at the same rate as the goods contained therein.24. Moreover, the packing materials as such are not being taxed under sub-section (5) of section 5 of the Act. The subject-matter of tax are the goods packed in the containers. In calculating the turnover of the goods, packing materials will have to be taken into account. The packing materials will be taxed at the same rate and at the same point as the goods contained in the packing material. This is because the goods are sold packed in containers and are charged accordingly. This is a rule of computation of the turnover of the goods. If no tax is ultimately found leviable on the goods then no tax can be levied on the containers in which the goods are contained.52.2 As already noticed, this question was also examined by the High Court in the case of Appollo Saline Pharmaceuticals (supra) although the said decision was rendered in relation to the bottles used for packing of I.V. fluid and the provision examined therein was that as existing after amendment of clause (a) of sub-section (1) of Section 7-A with insertion of the words or for but, such amendment is of no effect so far as this limb of contentions is concerned. In the said decision, the High Court repelled such a contention against levy of purchase tax on bottles because of the bottles being subjected to sales tax when being sold with I.V. fluid while observing that such sales tax was nevertheless leviable even in relation to the bottles which were purchased from a registered dealer after payment of sales tax. The relevant portion in paragraph 11 of the said decision of the High Court in Appollo Saline Pharmaceuticals (extracted in paragraph 20.2 hereinbefore) obviously conforms to the ratio of Premier Breweries (supra), which, in our view, is a direct and complete answer to the contention of the assessee. As noticed, in the entire scheme of Section 7-A of the Act, nowhere any exception is provided that if a particular commodity or goods would be subjected to sales tax in the event of their sale, they may not be liable to purchase tax. On the contrary, as rightly observed by the High Court, even if the bottles had been purchased after payment of sales tax, the turnover of such purchase was nevertheless required to be included in the total turnover at the time of sale of the contents with the containers.52.3 In other words, the fact that the bottles in question were subjected to sales tax at the same rate as applicable to their contents is entirely irrelevant and has no bearing on the exigibility of the turnover in question to purchase tax. In this regard, we may also observe that even though the provision relating to the purchase tax was initially inserted to plug the loss of revenue in relation to the goods that were consumed in manufacture or were consumed otherwise, its scope and amplitude has been widened with insertion of the expression or uses and thereby, not only consumption but even use in manufacture or use otherwise of the goods has been made subject to the levy of purchase tax. We need not expand more on these aspects of the matter. Suffice it to observe for the present purpose that merely because the bottles in question were to be subjected to sales tax, when being sold as containers of the liquor, liability of purchase tax cannot be obviated.52.4. To put it differently, it is apparent that so far as sales tax on the bottles in question at the time of their sale is concerned, the same is leviable by virtue of Section 3 (7) of the Act and there is nothing in Section 7-A to even suggest that levy of sales tax at the time of sale of the goods in question would exclude them from the net of purchase tax. That being the position, the second limb of submissions on the part of assessee turns out to be hollow and baseless, and cannot be accepted.53. Therefore, the final result of the discussion aforesaid is that purchase tax under Section 7-A of the Act is leviable on the purchase turnover of empty bottles purchased by the assessee in the course of its business of manufacture and sale of Beer and IMFL.OPERATION AND EFFECT OF DEPARTMENTS CLARIFICATIONS/CIRCULARS54. As noticed, the High Court in its impugned order dated 10.09.2004 did reach to the conclusion that purchase tax was leviable on the purchase turnover of the empty bottles but found the assessee entitled to the benefit of Clarifications/Circulars issued by the revenue on 09.11.1989 and 27.12.2000. The revenue has questioned this part of the order of the High Court on the grounds and contentions as noticed hereinabove. In order to examine the rival contentions in this regard and the correctness of proposition adopted by the High Court, we may take note of the statutory provision in the Tamil Nadu Act on the power of the Commissioner of Commercial Taxes to issue clarification as also the particular Clarifications/Circulars relevant to the present case.56. As noticed, in support of its conclusion that the revenue cannot refuse the benefit of Clarifications dated 09.11.1989 and 27.12.2000 to the assessee, the High Court has relied upon various decisions including that of the Constitution Bench of this Court in the case of Dhiren Chemical Industries (supra).57. Having regard to the reasoning of High Court and the contentions of rival parties as also for dealing with the operation and effect of the Clarifications/Circulars aforesaid, we need to imbibe the principles enunciated in the binding decisions of this Court, particularly the dictum in two Constitution Bench decisions in Dhiren Chemical Industries (Rendered on 12.12.2001) and Ratan Melting & Wire Industries (Rendered on 14.10.2008) .57.1. In Dhiren Chemical Industries (supra), the questions referred to the Constitution Bench were relating to the interpretation of the phrase on which the appropriate amount of duty of excise has already been paid ; and operation of the exemption notification issued by the Central Government, exempting iron or steel products made out of fresh unused re-rollable scrap if appropriate amount of duty had already been paid. In the context of such questions and the exemption notification calling for interpretation, though the Constitution Bench placed the interpretation in favour of the revenue but also observed as follows (at p. 125 of STC):. The aforesaid observations in Dhiren Chemical Industries led to certain misunderstanding as regards operation and effect of the circulars and as to whether effect can be given to the circular of the Government in preference to the binding precedents of High Court and of this Court. This led to the other reference to the Constitution Bench and the issue came to be resolved in the case of Ratan Melting & Wire Industries (supra).57.3. In Ratan Melting & Wire Industries (supra), the Constitution Bench referred to the above-quoted observations in Dhiren Chemical Industries and also noted that those observations had been explained in another decision in the case of Kalyani Packaging Industries v. Union of India: (2004) 6 SCC 719 . The Constitution Bench observed and noted as follows:-3. …… In Kalyani Packaging Industry v. Union of India it was noted as follows: (SCC p. 721, para 6)6. We have noticed that para 11 of Dhiren Chemical case is being misunderstood. It, therefore, becomes necessary to clarify para 11 of Dhiren Chemical case. One of us (Variava, J.) was a party to the judgment of Dhiren Chemical case and knows what was the intention in incorporating para 11. It must be remembered that law laid down by this Court is law of the land. The law so laid down is binding on all courts/tribunals and bodies. It is clear that circulars of the Board cannot prevail over the law laid down by this Court. However, it was pointed out that during hearing of Dhiren Chemical case because of the circulars of the Board in many cases the Department had granted benefits of exemption notifications. It was submitted that on the interpretation now given by this Court in Dhiren Chemical case the Revenue was likely to reopen cases. Thus para 11 was incorporated to ensure that in cases where benefits of exemption notification had already been granted, the Revenue would remain bound. The purpose was to see that such cases were not reopened. However, this did not mean that even in cases where the Revenue/Department had already contended that the benefit of an exemption notification was not available, and the matter was sub judice before a court or a tribunal, the court or tribunal would also give effect to circulars of the Board in preference to a decision of the Constitution Bench of this Court. Where as a result of dispute the matter is sub judice, a court/tribunal is, after Dhiren Chemical case, bound to interpret as set out in that judgment. To hold otherwise and to interpret in the manner suggested would mean that courts/tribunals have to ignore a judgment of this Court and follow circulars of the Board. That was not what was meant by para 11 of Dhiren Chemical case.57.4. Taking note of the above and clarifying the law on the subject, the Constitution Bench of this Court in Ratan Melting & Wire Industries (supra) laid down the principles in no uncertain terms as follows :7. Circulars and instructions issued by the Board are no doubt binding in law on the authorities under the respective statutes, but when the Supreme Court or the High Court declares the law on the question arising for consideration, it would not be appropriate for the court to direct that the circular should be given effect to and not the view expressed in a decision of this Court or the High Court. So far as the clarifications/circulars issued by the Central Government and of the State Government are concerned they represent merely their understanding of the statutory provisions. They are not binding upon the court. It is for the court to declare what the particular provision of statute says and it is not for the executive. Looked at from another angle, a circular which is contrary to the statutory provisions has really no existence in law.(emphasis in bold supplied)58. In view of the aforesaid pronouncement by the Constitution Bench of this Court in Ratan Melting & Wire Industries (supra), there remains hardly any doubt on the principles that Clarifications/Circulars/Instructions issued by the competent authority are binding on the authorities under the respective statutes but so far as declaration of law in regard to any particular statutory provision is concerned, the view expressed in the binding decision of this Court or the High Court is to be given effect to; and no direction can be issued to enforce a clarification or circular contrary to the declaration of law by the Courts.59. In view of the above, the decisions relied upon by the learned senior counsel for the assessee do not require much dilation. However, we may refer to a few representative decisions as infra.60. The aforesaid and other decisions, essentially dealing with exemption notifications, have no application to the present case; and in any event, none of the decisions, as referred on behalf of the assessee or as referred by the High Court, could be read for any principle contrary to that laid down by the Constitution Bench in Ratan Melting & Wire Industries (supra).61. For what has been discussed hereinabove, we need not examine as to whether the Clarifications/Circulars in question could be said to be such clarification as envisaged by Section 28-A of the Act because even if the Clarifications/Circulars in question are treated to be those authorised by Section 28-A, they cannot have any effect over and above the interpretation of Section 7-A of the Act by the Courts. In other words, applicability of Section 7-A to the turnover in question could only be decided on the interpretation of the provision and its application to the given fact situation and not on the basis of Clarifications/Circulars in question. Put differently, the so-called Clarifications dated 09.11.1989 and 27.12.2000 had not been of explaining the meaning of any doubtful term or expression in the statutory provision nor they were explaining the object and purport of the provision concerned. The said Clarifications/Circulars had merely been the expression of the understanding of the concerned officer, be it SCCT or PCCT, about operation of Section 7-A of the Act vis-à-vis the purchase turnover of the empty bottles purchased by the assessee. However, such understanding of the officer concerned turns out to be a pure misunderstanding, when it stands at contradiction or incongruous to the declaration of law by the Courts; and could only be ignored. The latest Circular of the year 2002, issued after decision of the jurisdictional Tribunal in the case of Appollo Saline Pharmaceuticals (supra) could also be read only to the extent it is in conformity with the decision of the Tribunal (that came to be approved by the High Court) and in any case, even this circular cannot be decisive of the interpretation of Section 7-A of the Act. The decisive interpretation shall only be the one which is rendered in the binding decision/s of the Court. In continuity, we may also observe that various other decisions referred on behalf of the assessee, that modification of any particular circular or guideline or policy decision could only be made effective prospectively, have no application whatsoever to the present case.62. In the aforesaid view of matter, we have no hesitation in concluding that the High Court, after having found that purchase tax was leviable on the turnover in question under Section 7-A of the Act, could not have issued directions for any benefit to the assessee with reference to the Clarifications/Circulars dated 09.11.1989 and 27.12.2000, particularly when such Clarifications/Circulars do not stand in conformity with the statutory provision and its interpretation by the Courts.63. Hence, the impugned order of the High Court, on the second question as regards the operation and effect of Clarifications/Circulars dated 09.11.1989 and 27.12.2000, cannot be approved.64. The net result of the discussion foregoing is that the purchase turnover of the empty bottles purchased by the assessee from the unregistered dealers under bought note is exigible to purchase tax under Section 7-A of the Tamil Nadu Act; and the assessee cannot escape such liability on the strength of the Clarifications/Circulars dated 09.11.1989 and 27.12.2000 which do not stand in conformity with the statutory provision as also declaration of law by the Courts.65. So far as the other question regarding taxability of cash discount on the price offered by the assessee to the Tamil Nadu State Marketing Corporation Limited is concerned, the High Court has ruled in favour of the assessee with reference to the decision in the case of Neyvli Lignite Corporation Ltd. and the clear expressions in Explanation 2(iii) to Section 2(r) of the Act.65.2. In view of the clear phraseology of the above extracted Explanation, not much of discussion appears requisite as regards this issue that has rightly been decided by the High Court in favour of the assessee and not much of serious contentions have been put forward by the revenue in this regard. The impugned order of the High Court, to this extent, calls for no interference. | 1 | 33,631 | 10,364 | ### Instruction:
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Cements Limited, the circular in question was not found to be in conflict with any statutory provision or the applicable schemes and, therefore, the same was held binding on the adjudicating authority in the following words: – 30. In the present case, it is not the case of the Revenue that the Circular dated 1-5-2000 is in conflict with either any statutory provision or the deferral schemes announced under the aforementioned government orders. We, therefore, hold that the said circular is binding in law on the adjudicating authority under the TNGST Act. 60. The aforesaid and other decisions, essentially dealing with exemption notifications, have no application to the present case; and in any event, none of the decisions, as referred on behalf of the assessee or as referred by the High Court, could be read for any principle contrary to that laid down by the Constitution Bench in Ratan Melting & Wire Industries (supra). 61. For what has been discussed hereinabove, we need not examine as to whether the Clarifications/Circulars in question could be said to be such clarification as envisaged by Section 28-A of the Act because even if the Clarifications/Circulars in question are treated to be those authorised by Section 28-A, they cannot have any effect over and above the interpretation of Section 7-A of the Act by the Courts. In other words, applicability of Section 7-A to the turnover in question could only be decided on the interpretation of the provision and its application to the given fact situation and not on the basis of Clarifications/Circulars in question. Put differently, the so-called Clarifications dated 09.11.1989 and 27.12.2000 had not been of explaining the meaning of any doubtful term or expression in the statutory provision nor they were explaining the object and purport of the provision concerned. The said Clarifications/Circulars had merely been the expression of the understanding of the concerned officer, be it SCCT or PCCT, about operation of Section 7-A of the Act vis-à-vis the purchase turnover of the empty bottles purchased by the assessee. However, such understanding of the officer concerned turns out to be a pure misunderstanding, when it stands at contradiction or incongruous to the declaration of law by the Courts; and could only be ignored. The latest Circular of the year 2002, issued after decision of the jurisdictional Tribunal in the case of Appollo Saline Pharmaceuticals (supra) could also be read only to the extent it is in conformity with the decision of the Tribunal (that came to be approved by the High Court) and in any case, even this circular cannot be decisive of the interpretation of Section 7-A of the Act. The decisive interpretation shall only be the one which is rendered in the binding decision/s of the Court. In continuity, we may also observe that various other decisions referred on behalf of the assessee, that modification of any particular circular or guideline or policy decision could only be made effective prospectively, have no application whatsoever to the present case. 62. In the aforesaid view of matter, we have no hesitation in concluding that the High Court, after having found that purchase tax was leviable on the turnover in question under Section 7-A of the Act, could not have issued directions for any benefit to the assessee with reference to the Clarifications/Circulars dated 09.11.1989 and 27.12.2000, particularly when such Clarifications/Circulars do not stand in conformity with the statutory provision and its interpretation by the Courts. 63. Hence, the impugned order of the High Court, on the second question as regards the operation and effect of Clarifications/Circulars dated 09.11.1989 and 27.12.2000, cannot be approved. 64. The net result of the discussion foregoing is that the purchase turnover of the empty bottles purchased by the assessee from the unregistered dealers under bought note is exigible to purchase tax under Section 7-A of the Tamil Nadu Act; and the assessee cannot escape such liability on the strength of the Clarifications/Circulars dated 09.11.1989 and 27.12.2000 which do not stand in conformity with the statutory provision as also declaration of law by the Courts. Other Question 65. So far as the other question regarding taxability of cash discount on the price offered by the assessee to the Tamil Nadu State Marketing Corporation Limited is concerned, the High Court has ruled in favour of the assessee with reference to the decision in the case of Neyvli Lignite Corporation Ltd. and the clear expressions in Explanation 2(iii) to Section 2(r) of the Act. 65.1. The relevant provision reads as under:- Section 2(r).- turnover means the aggregate amount for which goods are bought or sold, or delivered or supplied or otherwise disposed of in any of the ways referred to in clause (n), by a dealer either directly or through another, on his own account or on account of others whether for cash or for deferred payment or other valuable consideration, provided that the proceeds of the sale by a person of agricultural or horticultural produce, other than tea, and rubber (natural rubber, latex and all varieties and grades of raw rubber) grown within the State by himself or on any land in which he has an interest whether as owner, usufructuary mortgagee, tenant or otherwise, shall be excluded from his turnover. *** *** *** Explanation (2) Subject to such conditions and restrictions, if any, as may be prescribed in this behalf- *** *** *** (iii) any cash or other discount on the price allowed in respect of any sale and any amount refunded in respect of articles returned by customers shall not be included in the turnover; *** *** *** 65.2. In view of the clear phraseology of the above extracted Explanation, not much of discussion appears requisite as regards this issue that has rightly been decided by the High Court in favour of the assessee and not much of serious contentions have been put forward by the revenue in this regard. The impugned order of the High Court, to this extent, calls for no interference. CONCLUSION
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in no uncertain terms as follows :7. Circulars and instructions issued by the Board are no doubt binding in law on the authorities under the respective statutes, but when the Supreme Court or the High Court declares the law on the question arising for consideration, it would not be appropriate for the court to direct that the circular should be given effect to and not the view expressed in a decision of this Court or the High Court. So far as the clarifications/circulars issued by the Central Government and of the State Government are concerned they represent merely their understanding of the statutory provisions. They are not binding upon the court. It is for the court to declare what the particular provision of statute says and it is not for the executive. Looked at from another angle, a circular which is contrary to the statutory provisions has really no existence in law.(emphasis in bold supplied)58. In view of the aforesaid pronouncement by the Constitution Bench of this Court in Ratan Melting & Wire Industries (supra), there remains hardly any doubt on the principles that Clarifications/Circulars/Instructions issued by the competent authority are binding on the authorities under the respective statutes but so far as declaration of law in regard to any particular statutory provision is concerned, the view expressed in the binding decision of this Court or the High Court is to be given effect to; and no direction can be issued to enforce a clarification or circular contrary to the declaration of law by the Courts.59. In view of the above, the decisions relied upon by the learned senior counsel for the assessee do not require much dilation. However, we may refer to a few representative decisions as infra.60. The aforesaid and other decisions, essentially dealing with exemption notifications, have no application to the present case; and in any event, none of the decisions, as referred on behalf of the assessee or as referred by the High Court, could be read for any principle contrary to that laid down by the Constitution Bench in Ratan Melting & Wire Industries (supra).61. For what has been discussed hereinabove, we need not examine as to whether the Clarifications/Circulars in question could be said to be such clarification as envisaged by Section 28-A of the Act because even if the Clarifications/Circulars in question are treated to be those authorised by Section 28-A, they cannot have any effect over and above the interpretation of Section 7-A of the Act by the Courts. In other words, applicability of Section 7-A to the turnover in question could only be decided on the interpretation of the provision and its application to the given fact situation and not on the basis of Clarifications/Circulars in question. Put differently, the so-called Clarifications dated 09.11.1989 and 27.12.2000 had not been of explaining the meaning of any doubtful term or expression in the statutory provision nor they were explaining the object and purport of the provision concerned. The said Clarifications/Circulars had merely been the expression of the understanding of the concerned officer, be it SCCT or PCCT, about operation of Section 7-A of the Act vis-à-vis the purchase turnover of the empty bottles purchased by the assessee. However, such understanding of the officer concerned turns out to be a pure misunderstanding, when it stands at contradiction or incongruous to the declaration of law by the Courts; and could only be ignored. The latest Circular of the year 2002, issued after decision of the jurisdictional Tribunal in the case of Appollo Saline Pharmaceuticals (supra) could also be read only to the extent it is in conformity with the decision of the Tribunal (that came to be approved by the High Court) and in any case, even this circular cannot be decisive of the interpretation of Section 7-A of the Act. The decisive interpretation shall only be the one which is rendered in the binding decision/s of the Court. In continuity, we may also observe that various other decisions referred on behalf of the assessee, that modification of any particular circular or guideline or policy decision could only be made effective prospectively, have no application whatsoever to the present case.62. In the aforesaid view of matter, we have no hesitation in concluding that the High Court, after having found that purchase tax was leviable on the turnover in question under Section 7-A of the Act, could not have issued directions for any benefit to the assessee with reference to the Clarifications/Circulars dated 09.11.1989 and 27.12.2000, particularly when such Clarifications/Circulars do not stand in conformity with the statutory provision and its interpretation by the Courts.63. Hence, the impugned order of the High Court, on the second question as regards the operation and effect of Clarifications/Circulars dated 09.11.1989 and 27.12.2000, cannot be approved.64. The net result of the discussion foregoing is that the purchase turnover of the empty bottles purchased by the assessee from the unregistered dealers under bought note is exigible to purchase tax under Section 7-A of the Tamil Nadu Act; and the assessee cannot escape such liability on the strength of the Clarifications/Circulars dated 09.11.1989 and 27.12.2000 which do not stand in conformity with the statutory provision as also declaration of law by the Courts.65. So far as the other question regarding taxability of cash discount on the price offered by the assessee to the Tamil Nadu State Marketing Corporation Limited is concerned, the High Court has ruled in favour of the assessee with reference to the decision in the case of Neyvli Lignite Corporation Ltd. and the clear expressions in Explanation 2(iii) to Section 2(r) of the Act.65.2. In view of the clear phraseology of the above extracted Explanation, not much of discussion appears requisite as regards this issue that has rightly been decided by the High Court in favour of the assessee and not much of serious contentions have been put forward by the revenue in this regard. The impugned order of the High Court, to this extent, calls for no interference.
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OKHLA ENCLAVE PLOT HOLDERS WEL. ASON Vs. UNION OF INDIA THROUGH SECRETARY | licensed area and other incidental expenses. If the above amount is not paid by the sixth respondent-Colonizer, it is for the State of Haryana to proceed against the sixth respondent to recover the amount as fee which is a land revenue.51. Surplus plots, if any, left – Entitlement of respondent No.6-Colonizer:- It has been submitted by Respondent No.6- Colonizer that a joint technological survey was conducted by the State and the Colonizer as per order dated 07.05.2016 of the Arbitrator. In this survey, electoral and electricity records of the encroached area were taken and tallied with the names in the scrutiny report to determine the genuineness of plot holders. It was found that a considerably large number of petitioners before this Court are already living on the licensed land* Under Point No.4 at Pg.3 of submissions on behalf of R6 to clarifications sought by the Supreme Court vide order dated 14.02.2019. . Respondent No.6 is required to submit a final list of such claimants before the Arbitrator. It is clarified that if it is found that any allottee is already living on the encroached land, they would not be entitled from claiming any further allotment in their favour.52. Surplus plot if any – Entitlement of Respondent No.6- Colonizer:- One last issue as to the entitlement over the surplus land, if any, left after allotment of land to eligible allottees has to be settled. In this context, it is observed that though there are various claims as to who is the present Director of M/s Durga Builders Private Limited, there is no serious dispute that the land in question was owned by said M/s Durga Builders Private Limited and its associate companies. Licenses were also granted to them by the State of Haryana. These licenses have long since expired and have not been renewed after 1999. However, till date no action has been taken against these companies on account of non-renewal of license. According to the State of Haryana, an amount of Rs. 21,86,97,901/- (as on 28.02.2019) is outstanding against licence renewal fee. On payment of this outstanding amount against the license renewal fee with interest from 28.02.2019 and also on payment of expenses borne by DCTP in engaging the security agencies for watch and ward of the licensed area, M/s Durga Builders Private Limited and its associate companies would be entitled to claim the surplus plots.53. Additionally, in case, if any of the allottees are not in a position to pay the apportioned internal and external development charges and expresses willingness to quit and consequently the plot falls vacant, the same shall be considered being allotted to the sixth respondent-Colonizer, of course, striking a balance between the allottee of the plot and the Colonizer. The Arbitrator shall determine the compensation payable by the sixth respondent-Colonizer and direct the sixth respondent-Colonizer to compensate the allottee of the plot by directing the sixth respondent-Colonizer to pay adequate compensation in lieu of the claim for the plot falling vacant. In order to make a claim for such plots falling vacant, the sixth respondent- Colonizer is to pay:- (i) the compensation to allottee as directed by the learned arbitrator; and (ii) to pay the apportioned amount of internal and external development charges.Question No.4:- The last direction as sought by the Arbitrator is to pass appropriate directions for converting these proceedings to that of a Special Committee:-54. In this context, we may usefully refer to the order of appointment of the Arbitrator dated 27.01.2016 wherein, this Court provided that all the parties shall submit their respective proposed terms of reference before the Arbitrator who shall first settle the terms of reference and thereafter, resolve the disputes involved between the parties. On completion of the arbitral proceedings, the Arbitrator was directed to submit a report to the Supreme Court.55. Arbitration is a mechanism to settle the disputes of the parties on the basis of the terms of arbitration agreement between the parties. In the present case, there is no agreement between the parties. The matter was referred to Justice Vikramjit Sen only as a remedial measure to solve the grievance of the petitioners who were aggrieved by the non-allotment of the plots by Colonizer and to resolve the lengthy issue involved in such allotment. Thus, the instant arbitration proceedings cannot be strictly called so and the term ‘arbitration? in this context is a misnomer and the proceedings actually are one of a Special Committee.56. In his letter dated 23.01.2018, the Arbitrator has also observed that ?these proceedings are not in the nature of arbitration and essentially, in the nature of a Special Committee of the Hon?ble Supreme Court of India.? We fully agree with the views expressed by Justice Vikramjit Sen. It is made clear that the present proceedings are not in the nature of arbitration within the meaning of the Arbitration and Conciliation Act, 1996; but essentially, in the nature of a Special Committee constituted by the Hon?ble Supreme Court of India.Other observations relevant for determination of the issue:-57. Remuneration payable to the Arbitrator:- As to the question of remuneration payable to the Arbitrator, reference can be made to the order dated 27.01.2016 wherein, it was provided that the fee shall be decided by the Arbitrator and be borne equally by all the parties. Accordingly, the Arbitrator shall decide his fee to be payable by the parties as directed by the learned arbitrator.58. Summary of Conclusion:-Number of claimants settled by the Scrutiny Committee:- The number of eligible allottees are to be decided by the Arbitrator applying the parameters as set out in the order of the Arbitrator dated 07.05.2016 and the learned Arbitrator to determine the final list of eligible plot owners in all the categories – NPNL, Economic Weaker Sections (EWS) and General and also commercial. Once the allottees are identified and the allottees pay the apportioned development charges, the learned Arbitrator shall direct the Director to execute necessary documents in favour of the allottees in terms of Section 8(4) of the HDRA Act. | 1[ds]14. Issue of Ownership:- As per the report of Sh. H.P. Sharma, Court Commissioner, appointed by the Supreme Court, Sh. Arun Mehra father of Sh. Divij Mehra, on behalf of M/s Hindustan Commercial Investment Trust Ltd. and M/s Class Sales Pvt. Ltd. had filed claim for 87 plots (65 plots + 22 plots), which he claimed to have purchased from M/s Durga Builder Pvt. Ltd. This claim of plots was rejected by Court Commissioner. Pg.No.4 of the reply dated 19.08.2019 filed by DTCP, Haryana Sh. Arun Mehra filed an application of impleadment in WP(C) No.113 of 1996 in the Supreme Court on behalf of M/s Rajdhani Housing Syndicate Pvt. Ltd. in January, 2014. In its reply, the State of Haryana has stated that it has received an e-mail dated 18.07.2014 from Advocate Deepak Khosla mentioning that as per the decision of the Company Law Board dated 11.03.2014, Sh. Arun Mehra and Sh. Divij Mehra are the present Directors of M/s Durga Builder Pvt. Ltd. It is stated that one Sh. R.K. Nanda claims to have become the Director of M/s Durga Builder Pvt. Ltd. who attended the proceedings before the Director General, Town and Country Planning, Haryana at Chandigarh as Director of M/s Durga Builder Pvt. Ltd. It was submitted that by the Gazette Notification dated 24.09.2018, the name of M/s Durga Builder Pvt. Ltd. has been struck off from the Registrar of Companies and dissolved by the Government of India, Ministry of Company Affairs, New Delhi. On behalf of the Colonizer, an order dated 24.01.2019 passed by the National Company Law Tribunal has been produced to show that in the Gazette Notification dated 24.08.2018 qua M/s Durga Builder Pvt. Ltd. has been kept in abeyance. (Under Point No.1 at Pg. No.4-5 of Reply filed by DTCP, Haryana on 19.08.2019)far as the claim of Mr. Arun Mehra in respect of 87 plots, liberty is granted to Mr. Arun Mehra to work out his remedy in accordance with law by agitating the matter before the competent court. However, it is made clear that the claim of Mr. Arun Mehra in respect of 87 plots shall not come in the way of the claim of the beneficiaries identified by the Scrutiny Committee.17. Though the Commissioner rejected the claim of the sixth respondent-Colonizer, the correctness of the same shall be examined with reference to documents. The area claimed by the Colonizer can be considered by the arbitrator by considering the layout plan now produced by DTCP, Haryana.18. The claim of the sixth respondent can be considered by the arbitrator only subject to the condition that he is paying the licence renewal fee of Rs.21,86,97,901/- (as on 28.02.2019) payable with interest @ 6% from 28.02.2019 plus Rs.1.25 crores borne by DTCP, Haryana in maintaining the security as per the order of the Court dated 18.07.2013. The area claimed by the sixth respondent- Colonizer shall be considered by the learned arbitrator only after examining by the rightful claim of the beneficiaries identified by Scrutiny Committee (to be finalised and approved by the learned arbitrator).As discussed above, a total of Rs.117,00,00,000/- is required for completion of internal and external development works. Since the completion of internal and external development works would take some time, suitable provision has to be made for increase in cost of internal and external development works and other incidental expenses. In our view, in addition to Rs.117,00,00,000/- (Rs.70,00,00,000/-plus Rs.47,00,00,000/-) for internal and external development works, another 10% i.e. Rs.11,70,00,000/- is to be added to the total cost of internal and external development works. Thus, the amount of Rs.128,70,00,000/- (Rs.117,00,00,000/- + Rs.11,70,00,000/-) is payable to the Director General, Town and Country Planning (DGTCP), Haryana for undertaking and completing the internal and external development works.Apportionment of the total cost for internal and external developmentt of the total cost for internal and external developmente learned senior counselappearing for the petitioners submitted that the members of the petitioner association are ready to proportionately bear the cost of the internal and external development works.Taking the total amount as Rs. 128,70,00,000/- and the total extent of area to be allotted to the eligible allottees, the Arbitrator shall determine the cost for the square meter and proportionately apportion the total cost amongst the eligible plot owners. Each one of the eligible plot owners shall file individual affidavit undertaking to make the payment before the DTCP within the time frame fixed by the Arbitrator. If the proportionate amount so apportioned to the individual plot owners is not paid within the stipulated time frame, they shall forfeit the right over the plot. The format of the affidavit shall be finalised by the learned Arbitrator. In case if any of the eligible allottees are having difficulty in paying the amount, two or three eligible allottees are at liberty to join together depending upon the size of the plot and pay the development charges and share their proportionate right over the plot. It is made clear that the payment of the development charges will have to be time bound and in case, the amount is not paid within the time bound, the said allottee shall forfeit the right for the plot.33. From out of the above amount of Rs.1,28,70,00,000/-, Rs.70 lakhs to be kept apart to enable the Director, Town and Country Planning, Haryana to adjust the expenditure so far borne by DTCP in issuing various advertisements and other such incidental expenses. The details of such expenditure so far made by DTCP along with necessary bills/vouchers be produced before the learned Arbitrator and the learned Arbitrator to pass appropriate orders for adjustment of the expenditure amount so far borne by DTCP,request for one more opportunity to deposit the apportioned amount payable cannot be accepted since the matter is pending for more than two decades. The payment of apportioned amount should be a time bound one. In case if any of the plot owner (who has already obtained the sale deed) does not pay the apportioned external and internal development charges within the time frame, the developments/amenities like sewerage, water connection, electricity and other developments shall not be extended tothere are number of beneficiaries, it is necessary to clarify the consequence if the claimants do not pay the amount stipulated within the prescribed time frame. In case the claimants express unwillingness to pay the proportionate development charges or fail to give an undertaking within the given time frame, the land allotted to them will revert to the Colonizer on certain conditions viz. – colonizer will pay the claimant the amount paid towards the cost of land with interest from the date on which such payment was made at a rate which may be considered appropriate by the arbitrator. The Colonizer in addition to the above, shall also pay the proportionate amount towards development works payable for the said plot to the government of Haryana. On the order passed by the arbitrator, such payment shall be made within six weeks from the date of failure of payment by the claimant.36. Insofar as the other categories of allottees who have not been identified and who are yet to have the sale deed, in case if they do not pay the development charges within the time frame, as discussed earlier, they shall forfeit the right over the plot. The Colonizer has undertaken to refund the amount to the allottees in case of failure to pay the apportioned amount by the individual plot owners. The Colonizer has also undertaken to refund the amount to the allottees who cannot pay the due amount to DTCP, Haryana. In case of the plot owner who cannot pay the apportioned development charges or committed default in payment of the apportioned amount, the colonizer shall pay the consideration amount paid by the allottee along with the reasonable interest. Additionally, the Colonizer shall also pay the apportioned amount of the development charges qua those plots.37. Number of claimants settled by the Scrutiny Committee appointed by the learned Arbitratorper order dated 18.07.2013 of the Supreme Court, it was directed that fresh exercise to prepare a final list of claimants be undertaken by the Director General, Town and Country Planning. This was accordingly done and 3002 eligible plot holders were identified. This information was submitted to the Supreme Court through affidavit dated 15.11.2013. The Arbitrator vide order dated 07.05.2016 set the following conditions to determine the entitlement of each plot) Plot holders should have made bookings alongwith entire payments towards cost of land prior to 07.04.1997.b) Such plot holders should have paid/deposited the entire development charges with the Haryana Government upto 31.12.1999, in terms of the order of the Supreme Court dated 02.12.1999.c) The plot holders who have made bookings alongwith the entire payment towards cost of land prior to 07.04.1997 but had not made payments towards the development charges in terms of the order of the Supreme Court dated 02.12.1999, can be considered provided they are willing to pay the development charges as would be required on the date of carrying out the actual development.d) Multiplicity and duplicity of claims, i.e. more than one claim from one family will not be considered as eligible. Further, if any person is already in occupation of a plot illegally or by encroachment, he will similarly not be considered for any further allotment.(Para Nos.3-5 of the Order dated 07.05.2016 of Arbitrator)The exercise of deciding eligible candidates was started with the NPNL category. The Director, Town and Country Planning, Haryana issued a public notice on 18.08.2016 in the newspaper inviting applications to file claims accompanied with supporting documents regarding allotment/booking of plot in NPNL category. The Scrutiny Committee decided that an amount of Rs. 550/- be taken as development charge for scrutiny of claims. (Under Point No.6 at Pg 4 of submission of R6 dated 22.07.2019) The Scrutiny Committee received 2690 applications for the purpose of scrutiny before the cut-off date. However, 523 applicants did not appear before the Committee for the purpose of scrutiny. After scrutiny of applications, the Committee found total 1932 NPNL category applicants, 73 general category applicants, 165 commercial category applicants and 2 EWS category applicants.(Pg 23 of vol. 1 of scrutiny committee report dated 28.10.2017) 39. NPNL Category were divided into five categories as under (Under Point No.3 at Pg.9 of the Reply filed by DTCP, Haryana on 19.08.2019)40. Thereafter, scrutiny qua general and EWS category claimants was started. Vide order No.20 dated 13.07.2018, the Arbitrator directed the State to again give state-level advertisements inviting representation from all parties alongwith documents supporting their allotment in General and EWS category by 31.07.2018. The cut-off date for submitting application/claims was four weeks from the date of advertisement. In compliance of this order, public notice was advertised on 04.08.2018 in Amar Ujala, Dainik Jagran (Hindi) and Tribune (English). The last date for receipt of application was 03.09.2018 but since 03.09.2018 being a gazetted holiday, the applications received upto 04.09.2018 were considered by the Committee.(Pg 3 of scrutiny committee report qua general and EWS category).Under the EWS category, draw was held on 30.07.1994 and 18.11.1995 where 350 persons were successful. Only 106 applicants applied for allotment.(Pg.6 of scrutiny committee report qua general and EWS category) 41. General Category:- During scrutiny of documents, it was observed that in the general category plots where Builder Buyer Agreement has been executed, the rate for plot size more than 263 sq. yards had been fixed @ 425 per sq. yards.The Scrutiny Committee consisting of Senior Town Planners and others have thus identified the number of eligible plot owners. The number of eligible allottees have to be decided by the Arbitrator applying the parameters as set out in the order of the Arbitrator dated 07.05.2016 and the learned Arbitrator to determine the final list of eligible plot owners in all the categories – NPNL, Economic Weaker Sections (EWS) and General and also commercial.43. Once the number of allottees are identified, as discussed earlier, the amount of internal and external development cost has to be proportionately apportioned amongst each one of the eligible allottees. It is seen from the Scrutiny Committee Report and the status report filed by the State of Haryana, about 452 plot owners have got the sale deed from the Colonizer; some of the allottees are yet to get the sale deed. Section 8 of the Haryana Development and Regulation Urban Areas Act, 1975 (HDRA Act) inter alia provides for cancellation of licences if the Colonizer contravenes any of the conditions of the licence or the provisions of the HDRA Act and also provides for mode of carrying out the development works in the colony. Section 8(4) of the HDRA Act enables the Director to transfer the possession and title of the land to the plot owners.Out of the total 234.675 acres licensed land under seven licences, 46.85 acres land is under encroachment/unauthorised construction and 187.825 acres land is stated to be available for planning. In the report filed by the DTCP, Haryana dated 19.08.2019, it is stated that out of the above 187.825 acres area,43.68 acres area was reserved for general category plots, 23.475 acres area was reserved for community/infrastructure sites. Balance, 120.67 acres was planned for EWS and NPNL category plots.On behalf of the Director, Town and Country Planning, Haryana, it is stated that as per the revised layout plan of Phase-I and Phase-II, the plotted area shall not exceed 55% of the net planned area of the colony. The commercial area shall also be included in this plotted area for calculations of the area under the plots. In Phase-I, the total area under the scheme is 126.724 acres out of which the area under the residential plot is 61.64 acres. In Phase-II, the total area under the scheme is 107.95 acres out of which 51.03 acres is the area in residential plots.* Under Point No.2 at Pg. 3 in the status affidavit filed by DTCP, Haryana dated 07.03.201946. Insofar as the question raised by the learned Arbitrator that whether the present density norms can be relaxed for the project, Mr. Maninder Singh, learned Senior counsel appearing for the State of Haryana has submitted that the density norms like the area reserved for roads, common purposes, etc. cannot be reduced. Insofar as the density of the plots, the learned Arbitrator if need be, shall make appropriate adjustments of the plots in conformity with the existing rules. The adjustments of the plot area will have to be done from amongst the plot owners. The State of Haryana shall render its co-operation in adjustment of the plot sizes in the approved layout of course, subject to the conformity with the existing rules and governing sanction of the scheme.Licence fee payable by the Colonizer, issue of encroachment and the expenses met by the Director, Town and Country Planning, Haryana in engaging the watch and ward of the licensed area and other issues.47. Licence fee:- As discussed earlier, seven licences were issued to M/s Durga Builders Private Limited and its associate companies for the total area measuring 234.674 acres under Section 3 of the Haryana Development and Regulation of Urban Areas Act, 1975 (HD&RUA Act). The above said licensed areas are in two pockets i.e. as Okhla Enclave Phase-I (Area 126.724 acres) and Okhla Enclave Phase-II (Area 107.95 acres). The copies of the approved layout plans of Okhla Enclave Phase-I and Phase-II are revised on 24.09.1997. In terms of the provisions of the Act and as per the conditions of the licence, the Colonizer has to pay the licence fee and the licence renewal fee. In the status affidavit filed by the Director, Town and Country Planning, Haryana in March, 2019, it is stated that an amount of Rs.21,86,97,901/- (as on 28.02.2019) is outstanding from the Colonizer. As per the terms and the conditions of the licence, the Colonizer/Developer is bound to bear the expenses to carry out the internal development works in the colony and to clear the government dues of fee for renewal of licence and other expenses borne by the State of Haryana. However, with a view to move forward with the development, the allottees of the plots have undertaken to pay the cost of the internal and the external developments. But the Colonizer cannot be allowed to go scot free. The sixth respondent-Colonizer is bound to pay the licence fee of Rs. 21,86,97,901/- (as on 28.02.2019) towards the fee for renewal of licence which is payable with interest @ 6% per annum from 28.02.2019. If the amount is not paid by the sixth respondent, it is for the State of Haryana to proceed against the sixth respondent to recover the amount as if it is a land revenue. For the said amount of 21,86,97,901/- (as on 28.02.2019), there would be a charge on the properties of the sixth respondent- Colonizer.In this regard, DTCP, Haryana has pointed out that an amount of Rs.1.25 crores already spent by the Department towards the watch and ward and the same is also payable by the sixth respondent-Colonizer. Thus, the total amount payable by the Colonizer to the Department is Rs.21,86,97,901/- (as on 28.02.2019) which is payable with interest @ 6% per annum from 28.02.2019 Plus Rs.1.25 crores borne by the Department to the security agency till August, 2019-the date of filing of the affidavit before the Supreme Court and further expenses borne by the Department for watch and ward of the licensed area and other incidental expenses. If the above amount is not paid by the sixth respondent-Colonizer, it is for the State of Haryana to proceed against the sixth respondent to recover the amount as fee which is a land revenue.51. Surplus plots, if any, left – Entitlement of respondent No.6-Colonizer:- It has been submitted by Respondent No.6- Colonizer that a joint technological survey was conducted by the State and the Colonizer as per order dated 07.05.2016 of the Arbitrator. In this survey, electoral and electricity records of the encroached area were taken and tallied with the names in the scrutiny report to determine the genuineness of plot holders. It was found that a considerably large number of petitioners before this Court are already living on the licensed land* Under Point No.4 at Pg.3 of submissions on behalf of R6 to clarifications sought by the Supreme Court vide order dated 14.02.2019. . Respondent No.6 is required to submit a final list of such claimants before the Arbitrator. It is clarified that if it is found that any allottee is already living on the encroached land, they would not be entitled from claiming any further allotment in their favour.52. Surplus plot if any – Entitlement of Respondent No.6- Colonizer:- One last issue as to the entitlement over the surplus land, if any, left after allotment of land to eligible allottees has to be settled. In this context, it is observed that though there are various claims as to who is the present Director of M/s Durga Builders Private Limited, there is no serious dispute that the land in question was owned by said M/s Durga Builders Private Limited and its associate companies. Licenses were also granted to them by the State of Haryana. These licenses have long since expired and have not been renewed after 1999. However, till date no action has been taken against these companies on account of non-renewal of license. According to the State of Haryana, an amount of Rs. 21,86,97,901/- (as on 28.02.2019) is outstanding against licence renewal fee. On payment of this outstanding amount against the license renewal fee with interest from 28.02.2019 and also on payment of expenses borne by DCTP in engaging the security agencies for watch and ward of the licensed area, M/s Durga Builders Private Limited and its associate companies would be entitled to claim the surplus plots.53. Additionally, in case, if any of the allottees are not in a position to pay the apportioned internal and external development charges and expresses willingness to quit and consequently the plot falls vacant, the same shall be considered being allotted to the sixth respondent-Colonizer, of course, striking a balance between the allottee of the plot and the Colonizer. The Arbitrator shall determine the compensation payable by the sixth respondent-Colonizer and direct the sixth respondent-Colonizer to compensate the allottee of the plot by directing the sixth respondent-Colonizer to pay adequate compensation in lieu of the claim for the plot falling vacant. In order to make a claim for such plots falling vacant, the sixth respondent- Colonizer is to pay:- (i) the compensation to allottee as directed by the learned arbitrator; and (ii) to pay the apportioned amount of internal and external development charges.In this context, we may usefully refer to the order of appointment of the Arbitrator dated 27.01.2016 wherein, this Court provided that all the parties shall submit their respective proposed terms of reference before the Arbitrator who shall first settle the terms of reference and thereafter, resolve the disputes involved between the parties. On completion of the arbitral proceedings, the Arbitrator was directed to submit a report to the Supreme Court.55. Arbitration is a mechanism to settle the disputes of the parties on the basis of the terms of arbitration agreement between the parties. In the present case, there is no agreement between the parties. The matter was referred to Justice Vikramjit Sen only as a remedial measure to solve the grievance of the petitioners who were aggrieved by the non-allotment of the plots by Colonizer and to resolve the lengthy issue involved in such allotment. Thus, the instant arbitration proceedings cannot be strictly called so and the term ‘arbitration? in this context is a misnomer and the proceedings actually are one of a Special Committee.56. In his letter dated 23.01.2018, the Arbitrator has also observed that?these proceedings are not in the nature of arbitration and essentially, in the nature of a Special Committee of the Hon?ble Supreme Court of India.?We fully agree with the views expressed by Justice Vikramjit Sen. It is made clear that the present proceedings are not in the nature of arbitration within the meaning of the Arbitration and Conciliation Act, 1996; but essentially, in the nature of a Special Committee constituted by the Hon?ble Supreme Court of India.Other observations relevant for determination of theRemuneration payable to the Arbitrator:- As to the question of remuneration payable to the Arbitrator, reference can be made to the order dated 27.01.2016 wherein, it was provided that the fee shall be decided by the Arbitrator and be borne equally by all the parties. Accordingly, the Arbitrator shall decide his fee to be payable by the parties as directed by the learned arbitrator.ber of claimants settled by the Scrutinynumber of eligible allottees are to be decided by the Arbitrator applying the parameters as set out in the order of the Arbitrator dated 07.05.2016 and the learned Arbitrator to determine the final list of eligible plot owners in all the categories – NPNL, Economic Weaker Sections (EWS) and General and also commercial.The learned amicus curiae submitted that as per the affidavit dated 19.08.2019 filed by DTCP, Haryana and e-mail dated 18.07.2014 received by the Department from the advocate Deepak Khosla mentioning that as per the decision of the Company Law Board dated 11.03.2014, Mr. Arun Mehra and Divij Mehra are the present Directors of M/s Durga Builders Pvt. Ltd. The learned amicus submitted that when Mr. Arun Mehra is claiming to be the Director of M/s Durga Builders Pvt. Ltd. of which he is a Director, the claim of Mr. Arun Mehra need not be considered as it has been rejected by the Court Commissioner. Sofar as the claim of Mr. Arun Mehra in respect of 87 plots, liberty is granted to Mr. Arun Mehra to work out his remedy in accordance with law by agitating the matter before the competent court. However, it is made clear that the claim of Mr. Arun Mehra in respect of 87 plots shall not come in the way of the claim of the beneficiaries identified by the Scrutinyit is submitted that an amount of Rs.37.739 crores is outstanding against External Development Charges. As per rough estimate given by the Superintending Engineer, HSVP Circle, Faridabad, about Rs.47.00 crores would be required for completion of the external development works around the colony area and connecting the services with the internal works to be executed in the colony. (Para No.2 at Pg.4-6 of Status Affidavit filed by DTCP, Haryana filed on 07.03.2019)12. Before we consider the claim of M/s Durga Builder Pvt. Ltd., it is necessary to point out that M/s Durga Builder Pvt. Ltd. had not renewed the licence by paying necessary fee. The above seven licences i.e. licence Nos.1-3 of 1991, 65 of 1992 to 68 of 1992 were not renewed after 1999. In its reply, the State of Haryana stated that an amount of Rs.21,86,97,901/- is outstanding against the licence renewal fee.(Under Point No.1 at Pg. 2 of reply filed by DTCP, Haryana on 19.08.2019)This amount is payable by the sixth respondent-Colonizer to DTCP, Haryana. There are also other charges payable by the sixth respondent-Colonizer to the DTCP, Haryana. DTCP, Haryana has spent about Rs.1.25 crores in keeping watch and ward over the property and this amount is also payable by the sixth respondent. The claim of the sixth respondent- colonizer could be considered only if respondent No.6-Colonizer pays the licence renewal fee of Rs.21.89 crores and other amount spent by DTCP, Haryana towards keeping watch and ward of the licensed area and other charges.Once the number of allottees are identified, as discussed earlier, the amount of internal and external development cost has to be proportionately apportioned amongst each one of the eligible allottees. It is seen from the Scrutiny Committee Report and the status report filed by the State of Haryana, about 452 plot owners have got the sale deed from the Colonizer; some of the allottees are yet to get the sale deed. Section 8 of the Haryana Development and Regulation Urban Areas Act, 1975 (HDRA Act) inter alia provides for cancellation of licences if the Colonizer contravenes any of the conditions of the licence or the provisions of the HDRA Act and also provides for mode of carrying out the development works in the colony. Section 8(4) of the HDRA Act enables the Director to transfer the possession and title of the land to the plotthe allottees are identified and the allottees pay the apportioned development charges, the learned Arbitrator shall direct the Director to execute necessary documents in favour of the allottees in terms of Section 8(4) of the HDRA Act.Issue of encroachment and the expenses met by the Director, Town and Country Planning, Haryana in engaging the watch and ward of the licensedof claimants settled by the Scrutinynumber of eligible allottees are to be decided by the Arbitrator applying the parameters as set out in the order of the Arbitrator dated 07.05.2016 and the learned Arbitrator to determine the final list of eligible plot owners in all the categories – NPNL, Economic Weaker Sections (EWS) and General and also commercial.the allottees are identified and the allottees pay the apportioned development charges, the learned Arbitrator shall direct the Director to execute necessary documents in favour of the allottees in terms of Section 8(4) of the HDRAof claimants settled by the Scrutinynumber of eligible allottees are to be decided by the Arbitrator applying the parameters as set out in the order of the Arbitrator dated 07.05.2016 and the learned Arbitrator to determine the final list of eligible plot owners in all the categories – NPNL, Economic Weaker Sections (EWS) and General and alsothe allottees are identified and the allottees pay the apportioned development charges, the learned Arbitrator shall direct the Director to execute necessary documents in favour of the allottees in terms of Section 8(4) of the HDRA | 1 | 10,830 | 5,102 | ### Instruction:
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licensed area and other incidental expenses. If the above amount is not paid by the sixth respondent-Colonizer, it is for the State of Haryana to proceed against the sixth respondent to recover the amount as fee which is a land revenue.51. Surplus plots, if any, left – Entitlement of respondent No.6-Colonizer:- It has been submitted by Respondent No.6- Colonizer that a joint technological survey was conducted by the State and the Colonizer as per order dated 07.05.2016 of the Arbitrator. In this survey, electoral and electricity records of the encroached area were taken and tallied with the names in the scrutiny report to determine the genuineness of plot holders. It was found that a considerably large number of petitioners before this Court are already living on the licensed land* Under Point No.4 at Pg.3 of submissions on behalf of R6 to clarifications sought by the Supreme Court vide order dated 14.02.2019. . Respondent No.6 is required to submit a final list of such claimants before the Arbitrator. It is clarified that if it is found that any allottee is already living on the encroached land, they would not be entitled from claiming any further allotment in their favour.52. Surplus plot if any – Entitlement of Respondent No.6- Colonizer:- One last issue as to the entitlement over the surplus land, if any, left after allotment of land to eligible allottees has to be settled. In this context, it is observed that though there are various claims as to who is the present Director of M/s Durga Builders Private Limited, there is no serious dispute that the land in question was owned by said M/s Durga Builders Private Limited and its associate companies. Licenses were also granted to them by the State of Haryana. These licenses have long since expired and have not been renewed after 1999. However, till date no action has been taken against these companies on account of non-renewal of license. According to the State of Haryana, an amount of Rs. 21,86,97,901/- (as on 28.02.2019) is outstanding against licence renewal fee. On payment of this outstanding amount against the license renewal fee with interest from 28.02.2019 and also on payment of expenses borne by DCTP in engaging the security agencies for watch and ward of the licensed area, M/s Durga Builders Private Limited and its associate companies would be entitled to claim the surplus plots.53. Additionally, in case, if any of the allottees are not in a position to pay the apportioned internal and external development charges and expresses willingness to quit and consequently the plot falls vacant, the same shall be considered being allotted to the sixth respondent-Colonizer, of course, striking a balance between the allottee of the plot and the Colonizer. The Arbitrator shall determine the compensation payable by the sixth respondent-Colonizer and direct the sixth respondent-Colonizer to compensate the allottee of the plot by directing the sixth respondent-Colonizer to pay adequate compensation in lieu of the claim for the plot falling vacant. In order to make a claim for such plots falling vacant, the sixth respondent- Colonizer is to pay:- (i) the compensation to allottee as directed by the learned arbitrator; and (ii) to pay the apportioned amount of internal and external development charges.Question No.4:- The last direction as sought by the Arbitrator is to pass appropriate directions for converting these proceedings to that of a Special Committee:-54. In this context, we may usefully refer to the order of appointment of the Arbitrator dated 27.01.2016 wherein, this Court provided that all the parties shall submit their respective proposed terms of reference before the Arbitrator who shall first settle the terms of reference and thereafter, resolve the disputes involved between the parties. On completion of the arbitral proceedings, the Arbitrator was directed to submit a report to the Supreme Court.55. Arbitration is a mechanism to settle the disputes of the parties on the basis of the terms of arbitration agreement between the parties. In the present case, there is no agreement between the parties. The matter was referred to Justice Vikramjit Sen only as a remedial measure to solve the grievance of the petitioners who were aggrieved by the non-allotment of the plots by Colonizer and to resolve the lengthy issue involved in such allotment. Thus, the instant arbitration proceedings cannot be strictly called so and the term ‘arbitration? in this context is a misnomer and the proceedings actually are one of a Special Committee.56. In his letter dated 23.01.2018, the Arbitrator has also observed that ?these proceedings are not in the nature of arbitration and essentially, in the nature of a Special Committee of the Hon?ble Supreme Court of India.? We fully agree with the views expressed by Justice Vikramjit Sen. It is made clear that the present proceedings are not in the nature of arbitration within the meaning of the Arbitration and Conciliation Act, 1996; but essentially, in the nature of a Special Committee constituted by the Hon?ble Supreme Court of India.Other observations relevant for determination of the issue:-57. Remuneration payable to the Arbitrator:- As to the question of remuneration payable to the Arbitrator, reference can be made to the order dated 27.01.2016 wherein, it was provided that the fee shall be decided by the Arbitrator and be borne equally by all the parties. Accordingly, the Arbitrator shall decide his fee to be payable by the parties as directed by the learned arbitrator.58. Summary of Conclusion:-Number of claimants settled by the Scrutiny Committee:- The number of eligible allottees are to be decided by the Arbitrator applying the parameters as set out in the order of the Arbitrator dated 07.05.2016 and the learned Arbitrator to determine the final list of eligible plot owners in all the categories – NPNL, Economic Weaker Sections (EWS) and General and also commercial. Once the allottees are identified and the allottees pay the apportioned development charges, the learned Arbitrator shall direct the Director to execute necessary documents in favour of the allottees in terms of Section 8(4) of the HDRA Act.
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essentially, in the nature of a Special Committee of the Hon?ble Supreme Court of India.?We fully agree with the views expressed by Justice Vikramjit Sen. It is made clear that the present proceedings are not in the nature of arbitration within the meaning of the Arbitration and Conciliation Act, 1996; but essentially, in the nature of a Special Committee constituted by the Hon?ble Supreme Court of India.Other observations relevant for determination of theRemuneration payable to the Arbitrator:- As to the question of remuneration payable to the Arbitrator, reference can be made to the order dated 27.01.2016 wherein, it was provided that the fee shall be decided by the Arbitrator and be borne equally by all the parties. Accordingly, the Arbitrator shall decide his fee to be payable by the parties as directed by the learned arbitrator.ber of claimants settled by the Scrutinynumber of eligible allottees are to be decided by the Arbitrator applying the parameters as set out in the order of the Arbitrator dated 07.05.2016 and the learned Arbitrator to determine the final list of eligible plot owners in all the categories – NPNL, Economic Weaker Sections (EWS) and General and also commercial.The learned amicus curiae submitted that as per the affidavit dated 19.08.2019 filed by DTCP, Haryana and e-mail dated 18.07.2014 received by the Department from the advocate Deepak Khosla mentioning that as per the decision of the Company Law Board dated 11.03.2014, Mr. Arun Mehra and Divij Mehra are the present Directors of M/s Durga Builders Pvt. Ltd. The learned amicus submitted that when Mr. Arun Mehra is claiming to be the Director of M/s Durga Builders Pvt. Ltd. of which he is a Director, the claim of Mr. Arun Mehra need not be considered as it has been rejected by the Court Commissioner. Sofar as the claim of Mr. Arun Mehra in respect of 87 plots, liberty is granted to Mr. Arun Mehra to work out his remedy in accordance with law by agitating the matter before the competent court. However, it is made clear that the claim of Mr. Arun Mehra in respect of 87 plots shall not come in the way of the claim of the beneficiaries identified by the Scrutinyit is submitted that an amount of Rs.37.739 crores is outstanding against External Development Charges. As per rough estimate given by the Superintending Engineer, HSVP Circle, Faridabad, about Rs.47.00 crores would be required for completion of the external development works around the colony area and connecting the services with the internal works to be executed in the colony. (Para No.2 at Pg.4-6 of Status Affidavit filed by DTCP, Haryana filed on 07.03.2019)12. Before we consider the claim of M/s Durga Builder Pvt. Ltd., it is necessary to point out that M/s Durga Builder Pvt. Ltd. had not renewed the licence by paying necessary fee. The above seven licences i.e. licence Nos.1-3 of 1991, 65 of 1992 to 68 of 1992 were not renewed after 1999. In its reply, the State of Haryana stated that an amount of Rs.21,86,97,901/- is outstanding against the licence renewal fee.(Under Point No.1 at Pg. 2 of reply filed by DTCP, Haryana on 19.08.2019)This amount is payable by the sixth respondent-Colonizer to DTCP, Haryana. There are also other charges payable by the sixth respondent-Colonizer to the DTCP, Haryana. DTCP, Haryana has spent about Rs.1.25 crores in keeping watch and ward over the property and this amount is also payable by the sixth respondent. The claim of the sixth respondent- colonizer could be considered only if respondent No.6-Colonizer pays the licence renewal fee of Rs.21.89 crores and other amount spent by DTCP, Haryana towards keeping watch and ward of the licensed area and other charges.Once the number of allottees are identified, as discussed earlier, the amount of internal and external development cost has to be proportionately apportioned amongst each one of the eligible allottees. It is seen from the Scrutiny Committee Report and the status report filed by the State of Haryana, about 452 plot owners have got the sale deed from the Colonizer; some of the allottees are yet to get the sale deed. Section 8 of the Haryana Development and Regulation Urban Areas Act, 1975 (HDRA Act) inter alia provides for cancellation of licences if the Colonizer contravenes any of the conditions of the licence or the provisions of the HDRA Act and also provides for mode of carrying out the development works in the colony. Section 8(4) of the HDRA Act enables the Director to transfer the possession and title of the land to the plotthe allottees are identified and the allottees pay the apportioned development charges, the learned Arbitrator shall direct the Director to execute necessary documents in favour of the allottees in terms of Section 8(4) of the HDRA Act.Issue of encroachment and the expenses met by the Director, Town and Country Planning, Haryana in engaging the watch and ward of the licensedof claimants settled by the Scrutinynumber of eligible allottees are to be decided by the Arbitrator applying the parameters as set out in the order of the Arbitrator dated 07.05.2016 and the learned Arbitrator to determine the final list of eligible plot owners in all the categories – NPNL, Economic Weaker Sections (EWS) and General and also commercial.the allottees are identified and the allottees pay the apportioned development charges, the learned Arbitrator shall direct the Director to execute necessary documents in favour of the allottees in terms of Section 8(4) of the HDRAof claimants settled by the Scrutinynumber of eligible allottees are to be decided by the Arbitrator applying the parameters as set out in the order of the Arbitrator dated 07.05.2016 and the learned Arbitrator to determine the final list of eligible plot owners in all the categories – NPNL, Economic Weaker Sections (EWS) and General and alsothe allottees are identified and the allottees pay the apportioned development charges, the learned Arbitrator shall direct the Director to execute necessary documents in favour of the allottees in terms of Section 8(4) of the HDRA
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Union Of India Vs. Manik Lal Banerjee | no order as to costs." 17. Our attention has also been drawn to the fact that the Central Administration Tribunal, Principal Bench in OA No. 700 of 2004 in the matter of Federation of Central Government Pensioners Association Organisations, Calcutta v. Union of India by a judgment and order dated 1st October, 2004 held that the decision of the Tribunal in Pritam Singh was rendered per incuriam and, thus, did not create any binding precedent. The Railway Administration in terms of its speaking order dated 4.6.2004 also held so. The Tribunal, unfortunately, did not apply its mind to that aspect of the matter and proceeded to grant relief to the Respondent herein solely relying on or on the basis of the said decision. Pritam Singh, in our opinion, did not create any binding precedent. Only because this Court dismissed the special leave petition, the same would not mean that any law within the meaning of Article 14 of the Constitution was laid down thereby. Pritam Singh was evidently rendered per incuriam as the statutory provisions relevant for determining the issue had not been taken into consideration. 18. It is well-settled that a decision is an authority for what it decides and not what can logically be deduced therefrom. The decision in Pritam Singh having indisputably not taken into consideration, the exclusionary clause contained in Section 2(e) of the 1972 Act cannot be held to be an authority for the proposition that despite the provisions of the 1993 Rules, the 1972 Act would apply in the case of the railway servants. 19. It is now well-settled that if a decision has been rendered without taking into account the statutory provision, the same cannot be considered to be a binding precedent. This Court, in Pritam Singh, while exercising its discretionary jurisdiction, might have refused to interfere with the decision. The same, therefore, did not constitute any binding precedent. The Tribunal and consequently the High Court, therefore, committed a manifest error in holding otherwise. 20. Submission of Mr. Banerjee that if the 1972 Act applies to an establishment belonging to a railway company and the persons specified in Section 2(f) are the employers, despite exclusion of railway servants governed by the provisions of the 1993 Rules from the purview of the definition of employee in terms of Section 2(e) of the Act, the case shall be governed by the 1972 Act, cannot be accepted. 21. The High Court noticed the definition of employee contained in Section 2(e) of the 1972 Act but while deciding the issue it fell into an error in coming to the conclusion that there was nothing in the 1972 Act so as to exclude the benefit thereof to a railway employee. It failed to properly construe the said provision. 22. The Kerala High Court in M.P. Sankara Pillai (supra), whereupon strong reliance has been placed by Mr. Banerjee, was considering a case of casual labour. Indian Railway Administration although was held to be an establishment within the meaning of the 1972 Act, it was clearly stated that where the person was employed in Railway Administration as casual labourer on wages not exceeding Rs. 1000/- per mensem and was holding Civil Post in the Central Government, but subsequently absorbed in temporary regular service as temporary laskar in the same establishment; it would be impossible to escape the conclusion that the person was not an employee as defined in Section 2(e) and he would be entitled to claim gratuity allowance in respect of the period of his service as casual labourer in Railway Administration under Section 4, even in the Central Government at the time of retirement. 23. The decision of the Kerala High Court, thus, does not advance the case of the Respondent herein. Therein the question raised herein was not raised. 24. Reliance of Mr. Banerjee upon Rule 15(4)(ii) of the 1993 Rules is misplaced. Rule 15 provides for recovery and adjustment of Government or railway dues from pensionary benefits. Sub-rule (1) of Rule 15 enjoins a duty on the Head of Office to ascertain and assess Government or railway dues payable by a railway servant due for retirement, whereas sub-rule (2) thereof provides for recovery of the dues against the retiring railway servant in terms of sub-rule (4). Clause (ii) of sub-rule (4) of Rule 15 stipulates recovery of losses specified in sub-clause (a) of clause (i) of sub-rule (4) and which has nothing to do with the computation of the amount of payment of gratuity. 25. We have noticed hereinbefore that in terms of the 1993 Rules the emoluments were to be paid in terms of the recommendations made by the Fourth Pay Commission. The Fifth Pay Commission no doubt recommended that dearness pay be linked to All India Consumer Price Index of 12.1.1966 as on 1.7.1993 but, the entitlements of the employees in terms thereof was directed to be prospectively affected with effect from 1.4.1995. The Central Government accepted the said recommendations only with prospective effect from 1.4.1995 in terms whereof 97% of the dearness allowance was to be paid to those who were drawing salary up to Rs. 3500/- as basic pay. The Respondent retired on 31.1.1995. The recommendations of the Fifth Pay Commission, thus, were not applicable in his case.26. It is now a well-settled principle of law that financial implication is a relevant factor for accepting revision of pay. [See Hec Voluntary Retd. Emps. Welfare Soc. & Anr. v. Heavy Engineering Corporation Ltd. & Ors., 2006 (2) SCALE 660 and State of Andhra Pradesh and Anr. v. A.P. Pensioners Association & Ors., JT 2005 (10) SC 115 ]. 27. The matter might have been different if the revised scale of pay in terms of the recommendations of the Fifth Pay Commission would have been made applicable to the cases of the employees who had also retired prior to 1.4.1995 as was noticed by this Court in U.P. Raghavendra Acharya and Ors. v. State of Karnataka & Ors, [2006 (6) SCALE 23 ]. 28. | 1[ds]We have noticed hereinbefore that in terms of the 1993 Rules the emoluments were to be paid in terms of the recommendations made by the Fourth Pay Commission. The Fifth Pay Commission no doubt recommended that dearness pay be linked to All India Consumer Price Index of 12.1.1966 as on 1.7.1993 but, the entitlements of the employees in terms thereof was directed to be prospectively affected with effect from 1.4.1995. The Central Government accepted the said recommendations only with prospective effect from 1.4.1995 in terms whereof 97% of the dearness allowance was to be paid to those who were drawing salary up to Rs. 3500/- as basic pay. The Respondent retired on 31.1.1995. The recommendations of the Fifth Pay Commission, thus, were not applicable in his case. | 1 | 2,939 | 141 | ### Instruction:
Conjecture the end result of the case (acceptance (1) or non-acceptance (0) of the appeal), followed by a detailed explanation using crucial sentences from the case proceeding.
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no order as to costs." 17. Our attention has also been drawn to the fact that the Central Administration Tribunal, Principal Bench in OA No. 700 of 2004 in the matter of Federation of Central Government Pensioners Association Organisations, Calcutta v. Union of India by a judgment and order dated 1st October, 2004 held that the decision of the Tribunal in Pritam Singh was rendered per incuriam and, thus, did not create any binding precedent. The Railway Administration in terms of its speaking order dated 4.6.2004 also held so. The Tribunal, unfortunately, did not apply its mind to that aspect of the matter and proceeded to grant relief to the Respondent herein solely relying on or on the basis of the said decision. Pritam Singh, in our opinion, did not create any binding precedent. Only because this Court dismissed the special leave petition, the same would not mean that any law within the meaning of Article 14 of the Constitution was laid down thereby. Pritam Singh was evidently rendered per incuriam as the statutory provisions relevant for determining the issue had not been taken into consideration. 18. It is well-settled that a decision is an authority for what it decides and not what can logically be deduced therefrom. The decision in Pritam Singh having indisputably not taken into consideration, the exclusionary clause contained in Section 2(e) of the 1972 Act cannot be held to be an authority for the proposition that despite the provisions of the 1993 Rules, the 1972 Act would apply in the case of the railway servants. 19. It is now well-settled that if a decision has been rendered without taking into account the statutory provision, the same cannot be considered to be a binding precedent. This Court, in Pritam Singh, while exercising its discretionary jurisdiction, might have refused to interfere with the decision. The same, therefore, did not constitute any binding precedent. The Tribunal and consequently the High Court, therefore, committed a manifest error in holding otherwise. 20. Submission of Mr. Banerjee that if the 1972 Act applies to an establishment belonging to a railway company and the persons specified in Section 2(f) are the employers, despite exclusion of railway servants governed by the provisions of the 1993 Rules from the purview of the definition of employee in terms of Section 2(e) of the Act, the case shall be governed by the 1972 Act, cannot be accepted. 21. The High Court noticed the definition of employee contained in Section 2(e) of the 1972 Act but while deciding the issue it fell into an error in coming to the conclusion that there was nothing in the 1972 Act so as to exclude the benefit thereof to a railway employee. It failed to properly construe the said provision. 22. The Kerala High Court in M.P. Sankara Pillai (supra), whereupon strong reliance has been placed by Mr. Banerjee, was considering a case of casual labour. Indian Railway Administration although was held to be an establishment within the meaning of the 1972 Act, it was clearly stated that where the person was employed in Railway Administration as casual labourer on wages not exceeding Rs. 1000/- per mensem and was holding Civil Post in the Central Government, but subsequently absorbed in temporary regular service as temporary laskar in the same establishment; it would be impossible to escape the conclusion that the person was not an employee as defined in Section 2(e) and he would be entitled to claim gratuity allowance in respect of the period of his service as casual labourer in Railway Administration under Section 4, even in the Central Government at the time of retirement. 23. The decision of the Kerala High Court, thus, does not advance the case of the Respondent herein. Therein the question raised herein was not raised. 24. Reliance of Mr. Banerjee upon Rule 15(4)(ii) of the 1993 Rules is misplaced. Rule 15 provides for recovery and adjustment of Government or railway dues from pensionary benefits. Sub-rule (1) of Rule 15 enjoins a duty on the Head of Office to ascertain and assess Government or railway dues payable by a railway servant due for retirement, whereas sub-rule (2) thereof provides for recovery of the dues against the retiring railway servant in terms of sub-rule (4). Clause (ii) of sub-rule (4) of Rule 15 stipulates recovery of losses specified in sub-clause (a) of clause (i) of sub-rule (4) and which has nothing to do with the computation of the amount of payment of gratuity. 25. We have noticed hereinbefore that in terms of the 1993 Rules the emoluments were to be paid in terms of the recommendations made by the Fourth Pay Commission. The Fifth Pay Commission no doubt recommended that dearness pay be linked to All India Consumer Price Index of 12.1.1966 as on 1.7.1993 but, the entitlements of the employees in terms thereof was directed to be prospectively affected with effect from 1.4.1995. The Central Government accepted the said recommendations only with prospective effect from 1.4.1995 in terms whereof 97% of the dearness allowance was to be paid to those who were drawing salary up to Rs. 3500/- as basic pay. The Respondent retired on 31.1.1995. The recommendations of the Fifth Pay Commission, thus, were not applicable in his case.26. It is now a well-settled principle of law that financial implication is a relevant factor for accepting revision of pay. [See Hec Voluntary Retd. Emps. Welfare Soc. & Anr. v. Heavy Engineering Corporation Ltd. & Ors., 2006 (2) SCALE 660 and State of Andhra Pradesh and Anr. v. A.P. Pensioners Association & Ors., JT 2005 (10) SC 115 ]. 27. The matter might have been different if the revised scale of pay in terms of the recommendations of the Fifth Pay Commission would have been made applicable to the cases of the employees who had also retired prior to 1.4.1995 as was noticed by this Court in U.P. Raghavendra Acharya and Ors. v. State of Karnataka & Ors, [2006 (6) SCALE 23 ]. 28.
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### Explanation:
We have noticed hereinbefore that in terms of the 1993 Rules the emoluments were to be paid in terms of the recommendations made by the Fourth Pay Commission. The Fifth Pay Commission no doubt recommended that dearness pay be linked to All India Consumer Price Index of 12.1.1966 as on 1.7.1993 but, the entitlements of the employees in terms thereof was directed to be prospectively affected with effect from 1.4.1995. The Central Government accepted the said recommendations only with prospective effect from 1.4.1995 in terms whereof 97% of the dearness allowance was to be paid to those who were drawing salary up to Rs. 3500/- as basic pay. The Respondent retired on 31.1.1995. The recommendations of the Fifth Pay Commission, thus, were not applicable in his case.
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Commissioner Of Expenditure Tax, Andhra Pradesh Vs. Shri Pvg Raju, Rajah Of Vizianagaram | the Purpose of the business, profession, vocation, or occupation carried on by him or for the purpose of earning income from any other source;(j) any expenditure incurred by the assessee by way of, or in respect of, any gift, donation or settlement on trust or otherwise for the benefit of any other person ........"6. The assessee was party chairman and politics was undoubtedly his profession or occupation, it being admitted that his interest in politics was not casual nor sporadic but abiding and ambitious.7. The contention of the respondent which met with success before the High Court was that the election expenses of other candidates set up by him as chairman of the socialist party, loosely described as " party expenditure ", were incurred wholly and exclusively for the purpose of his " profession " or " occupation ". So, the first point which arrests our attention in examining this contention is as to whether politics of the socialist brand or otherwise is a profession or occupation.8. There can hardly be any doubt that it is either, or both. Harold Laski treated politics as a science and wrote his well-known book on the Grammar of Politics, but the art of politics at a practical level has also been the subject of comment and has been praised and denounced on the basis that it is a profession. To Gandhiji it is sacred as religion. In Lincoln it rises to noble heights of statesmanship. Lenin, Nehru and a galaxy of other great visionaries and makers and moulders of the modern world have dedicated themselves to politics as a profession. Of course, in its vulgar and vicious manifestations, this occupation has been regarded by literary giants like Dr. Johnson as " the last refuge of a scoundrel ". Robert Louis Stevenson has used barbed words : " Politics is perhaps the only profession for which no preparation is thought necessary (Familiar Studies of Man and Books, " Yoshida-Torajiro "). George Benard Shaw uses stinging language in Major Barbara: " He knows nothing; and he thinks he knows everything. That points clearly to a political career." It is thus clear, without reference to the wealth of case law relied on by the High Court, that politics has been a profession and, indeed, under modern conditions in India, perhaps the most popular and uninhibited occupation with--its perils, of course. Law cannot take leave of realities and, therefore, section 5(a) must bear the construction that politics is a profession or occupationThe next question is whether the expenditure incurred by the assessee for the election of candidates set up by him as chairman of his party can be legitimately regarded as incurred " wholly and exclusively " for the purpose of his profession or occupation. We have grave doubts whether meeting the expenses of other candidates can be fulfilment of his professional expenses, but this question deserves no deeper probe for the simple reason that section 5(j) embraces the expenditure as it does answer the description of a donation. When a person gives money to another without any material return, he donates that sum. An act by which the owner of a thing voluntarily transfers the title and possession of the same from himself to another, without any consideration, is a donation. A gift or gratuitous payment is, in simple English, a donation. We do not require lexicographic learning nor precedential erudition to understand the meaning of what many people do every day, viz , giving donations to some fund or other, or to some person or other. Political donations are not only common, but are assuming deleterious dimensions in the public life of our country. It is, therefore, clear that when this Raja, assessee, gave money to the candidates of his party for them to meet their election expenses, he made donations. Even if he met their election expenditure, it was money gratuitously given on their behalf and, therefore, amounted to donation. Without straining language, we reach the natural conclusion that what the respondent expended for the other candidates during the elections was " donation " in the language of the law. There is no suggestion nor evidence that any material return was in contemplation when he spent these sums. Being a politically important man with plenty of money and vitally interested in boosting his partys standing in the State, he donated liberally for candidates set up by the party. In this view section 5(j) applies to these donations which earn exemption from the expenditure-taxThe next item relates to sums given to the Socialist Party. It is reasonable to assume that the amount, paid to the office-bearers of the party were without an eye on any material return other than royalty or gratitude. They were outright gifts. Indeed, many rich people out of diverse motives make donations to political parties. The hope of spiritual benefit or political goodwill, the spontaneous affection that benefaction brings, the popularisation of a good cause or the prestige that publicised bounty fetches--these and other myriad consequences or feelings may not mar a donation to make it a grant for a quid pro quo. Wholly motiveless donation is rare, but material return alone negates a gift or donation. We need not investigate the propriety of political donations " unlimited " and often invisible. All that we need consider is whether such sums are gifts and donations or are non-gratuitous payments with a tag of return. We have no doubt that on the question as framed, and on the facts and circumstances present, these sums were paid purely as gifts and donations to his party by the repondent. It is not surprising either, because he was the chairman of the said party, had a long and liberal purse from which to draw and a large circle of support to build up in the long run.9. The inevitable conclusion from our discussion is that both the heads of expenditure fall under section 5(j) of the Act and, therefore, flow out of the assessable zone. | 0[ds]There can hardly be any doubt that it is either, oris thus clear, without reference to the wealth of case law relied on by the High Court, that politics has been a profession and, indeed, under modern conditions in India, perhaps the most popular and uninhibited occupation with--its perils, of course. Law cannot take leave of realities and, therefore, section 5(a) must bear the construction that politics is a profession or occupationThe next question is whether the expenditure incurred by the assessee for the election of candidates set up by him as chairman of his party can be legitimately regarded as incurred " wholly and exclusively " for the purpose of his profession or occupation. We have grave doubts whether meeting the expenses of other candidates can be fulfilment of his professional expenses, but this question deserves no deeper probe for the simple reason that section 5(j) embraces the expenditure as it does answer the description of a donation. When a person gives money to another without any material return, he donates that sum. An act by which the owner of a thing voluntarily transfers the title and possession of the same from himself to another, without any consideration, is a donation. A gift or gratuitous payment is, in simple English, a donation. We do not require lexicographic learning nor precedential erudition to understand the meaning of what many people do every day, viz , giving donations to some fund or other, or to some person or other. Political donations are not only common, but are assuming deleterious dimensions in the public life of our country. It is, therefore, clear that when this Raja, assessee, gave money to the candidates of his party for them to meet their election expenses, he made donations. Even if he met their election expenditure, it was money gratuitously given on their behalf and, therefore, amounted to donation. Without straining language, we reach the natural conclusion that what the respondent expended for the other candidates during the elections was " donation " in the language of the law. There is no suggestion nor evidence that any material return was in contemplation when he spent these sums. Being a politically important man with plenty of money and vitally interested in boosting his partys standing in the State, he donated liberally for candidates set up by the party. In this view section 5(j) applies to these donations which earn exemption from the expenditure-taxThe next item relates to sums given to the Socialist Party. It is reasonable to assume that the amount, paid to the office-bearers of the party were without an eye on any material return other than royalty or gratitude. They were outright gifts. Indeed, many rich people out of diverse motives make donations to political parties. The hope of spiritual benefit or political goodwill, the spontaneous affection that benefaction brings, the popularisation of a good cause or the prestige that publicised bounty fetches--these and other myriad consequences or feelings may not mar a donation to make it a grant for a quid pro quo. Wholly motiveless donation is rare, but material return alone negates a gift or donation. We need not investigate the propriety of political donations " unlimited " and often invisible. All that we need consider is whethersuch sums are gifts and donations or are non-gratuitous payments with a tag of return.We have no doubt that on the question as framed, and on the facts and circumstances present, these sums were paid purely as gifts and donations to his party by the repondent. It is not surprising either, because he was the chairman of the said party, had a long and liberal purse from which to draw and a large circle of support to build up in the longinevitable conclusion from our discussion is that both the heads of expenditure fall under section 5(j) of the Act and, therefore, flow out of the assessable zone. | 0 | 1,866 | 734 | ### Instruction:
Predict whether the case will result in an affirmative (1) or negative (0) decision for the appeal, and then provide a thorough explanation using key sentences to support your prediction.
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the Purpose of the business, profession, vocation, or occupation carried on by him or for the purpose of earning income from any other source;(j) any expenditure incurred by the assessee by way of, or in respect of, any gift, donation or settlement on trust or otherwise for the benefit of any other person ........"6. The assessee was party chairman and politics was undoubtedly his profession or occupation, it being admitted that his interest in politics was not casual nor sporadic but abiding and ambitious.7. The contention of the respondent which met with success before the High Court was that the election expenses of other candidates set up by him as chairman of the socialist party, loosely described as " party expenditure ", were incurred wholly and exclusively for the purpose of his " profession " or " occupation ". So, the first point which arrests our attention in examining this contention is as to whether politics of the socialist brand or otherwise is a profession or occupation.8. There can hardly be any doubt that it is either, or both. Harold Laski treated politics as a science and wrote his well-known book on the Grammar of Politics, but the art of politics at a practical level has also been the subject of comment and has been praised and denounced on the basis that it is a profession. To Gandhiji it is sacred as religion. In Lincoln it rises to noble heights of statesmanship. Lenin, Nehru and a galaxy of other great visionaries and makers and moulders of the modern world have dedicated themselves to politics as a profession. Of course, in its vulgar and vicious manifestations, this occupation has been regarded by literary giants like Dr. Johnson as " the last refuge of a scoundrel ". Robert Louis Stevenson has used barbed words : " Politics is perhaps the only profession for which no preparation is thought necessary (Familiar Studies of Man and Books, " Yoshida-Torajiro "). George Benard Shaw uses stinging language in Major Barbara: " He knows nothing; and he thinks he knows everything. That points clearly to a political career." It is thus clear, without reference to the wealth of case law relied on by the High Court, that politics has been a profession and, indeed, under modern conditions in India, perhaps the most popular and uninhibited occupation with--its perils, of course. Law cannot take leave of realities and, therefore, section 5(a) must bear the construction that politics is a profession or occupationThe next question is whether the expenditure incurred by the assessee for the election of candidates set up by him as chairman of his party can be legitimately regarded as incurred " wholly and exclusively " for the purpose of his profession or occupation. We have grave doubts whether meeting the expenses of other candidates can be fulfilment of his professional expenses, but this question deserves no deeper probe for the simple reason that section 5(j) embraces the expenditure as it does answer the description of a donation. When a person gives money to another without any material return, he donates that sum. An act by which the owner of a thing voluntarily transfers the title and possession of the same from himself to another, without any consideration, is a donation. A gift or gratuitous payment is, in simple English, a donation. We do not require lexicographic learning nor precedential erudition to understand the meaning of what many people do every day, viz , giving donations to some fund or other, or to some person or other. Political donations are not only common, but are assuming deleterious dimensions in the public life of our country. It is, therefore, clear that when this Raja, assessee, gave money to the candidates of his party for them to meet their election expenses, he made donations. Even if he met their election expenditure, it was money gratuitously given on their behalf and, therefore, amounted to donation. Without straining language, we reach the natural conclusion that what the respondent expended for the other candidates during the elections was " donation " in the language of the law. There is no suggestion nor evidence that any material return was in contemplation when he spent these sums. Being a politically important man with plenty of money and vitally interested in boosting his partys standing in the State, he donated liberally for candidates set up by the party. In this view section 5(j) applies to these donations which earn exemption from the expenditure-taxThe next item relates to sums given to the Socialist Party. It is reasonable to assume that the amount, paid to the office-bearers of the party were without an eye on any material return other than royalty or gratitude. They were outright gifts. Indeed, many rich people out of diverse motives make donations to political parties. The hope of spiritual benefit or political goodwill, the spontaneous affection that benefaction brings, the popularisation of a good cause or the prestige that publicised bounty fetches--these and other myriad consequences or feelings may not mar a donation to make it a grant for a quid pro quo. Wholly motiveless donation is rare, but material return alone negates a gift or donation. We need not investigate the propriety of political donations " unlimited " and often invisible. All that we need consider is whether such sums are gifts and donations or are non-gratuitous payments with a tag of return. We have no doubt that on the question as framed, and on the facts and circumstances present, these sums were paid purely as gifts and donations to his party by the repondent. It is not surprising either, because he was the chairman of the said party, had a long and liberal purse from which to draw and a large circle of support to build up in the long run.9. The inevitable conclusion from our discussion is that both the heads of expenditure fall under section 5(j) of the Act and, therefore, flow out of the assessable zone.
### Response:
0
### Explanation:
There can hardly be any doubt that it is either, oris thus clear, without reference to the wealth of case law relied on by the High Court, that politics has been a profession and, indeed, under modern conditions in India, perhaps the most popular and uninhibited occupation with--its perils, of course. Law cannot take leave of realities and, therefore, section 5(a) must bear the construction that politics is a profession or occupationThe next question is whether the expenditure incurred by the assessee for the election of candidates set up by him as chairman of his party can be legitimately regarded as incurred " wholly and exclusively " for the purpose of his profession or occupation. We have grave doubts whether meeting the expenses of other candidates can be fulfilment of his professional expenses, but this question deserves no deeper probe for the simple reason that section 5(j) embraces the expenditure as it does answer the description of a donation. When a person gives money to another without any material return, he donates that sum. An act by which the owner of a thing voluntarily transfers the title and possession of the same from himself to another, without any consideration, is a donation. A gift or gratuitous payment is, in simple English, a donation. We do not require lexicographic learning nor precedential erudition to understand the meaning of what many people do every day, viz , giving donations to some fund or other, or to some person or other. Political donations are not only common, but are assuming deleterious dimensions in the public life of our country. It is, therefore, clear that when this Raja, assessee, gave money to the candidates of his party for them to meet their election expenses, he made donations. Even if he met their election expenditure, it was money gratuitously given on their behalf and, therefore, amounted to donation. Without straining language, we reach the natural conclusion that what the respondent expended for the other candidates during the elections was " donation " in the language of the law. There is no suggestion nor evidence that any material return was in contemplation when he spent these sums. Being a politically important man with plenty of money and vitally interested in boosting his partys standing in the State, he donated liberally for candidates set up by the party. In this view section 5(j) applies to these donations which earn exemption from the expenditure-taxThe next item relates to sums given to the Socialist Party. It is reasonable to assume that the amount, paid to the office-bearers of the party were without an eye on any material return other than royalty or gratitude. They were outright gifts. Indeed, many rich people out of diverse motives make donations to political parties. The hope of spiritual benefit or political goodwill, the spontaneous affection that benefaction brings, the popularisation of a good cause or the prestige that publicised bounty fetches--these and other myriad consequences or feelings may not mar a donation to make it a grant for a quid pro quo. Wholly motiveless donation is rare, but material return alone negates a gift or donation. We need not investigate the propriety of political donations " unlimited " and often invisible. All that we need consider is whethersuch sums are gifts and donations or are non-gratuitous payments with a tag of return.We have no doubt that on the question as framed, and on the facts and circumstances present, these sums were paid purely as gifts and donations to his party by the repondent. It is not surprising either, because he was the chairman of the said party, had a long and liberal purse from which to draw and a large circle of support to build up in the longinevitable conclusion from our discussion is that both the heads of expenditure fall under section 5(j) of the Act and, therefore, flow out of the assessable zone.
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SHRIRANG YADAVRAO WAGHMARE Vs. THE STATE OF MAHARASHTRA AND ORS | Services (Discipline and Appeal) Rules, 1979, especially Rule ‘5? thereof. We are concerned with the portion dealing with major penalties, which reads as follows:?Major Penalties -(vii) compulsory retirement;(viii) removal from Service which shall not be a disqualification for future employment under Government;(ix) dismissal from Service which shall ordinarily be a disqualification for future employment under Government:Provided that, in every case in which the charge of acceptance from any person of any gratification, other than legal remuneration, as a motive or reward for doing or forbearing to do any official act is established, the penalty mentioned in clause (viii) or (ix) shall be imposed;Provided further that, in any exceptional case and for special reasons recorded in writing any other penalty may be imposed?4. Emphasis of the learned counsel for the appellant is on the first proviso wherein it is stated that if an employee is held guilty of accepting gratification other than legal remuneration, as a motive or reward for doing or forbearing to do any official act, the penalty mentioned in clause (viii) or (ix), i.e., removal from service or dismissal from service shall be imposed.5. We are only concerned with the issue of penalty and we need not go into the entire gamut of facts. However, for the purpose of deciding this appeal, it would be necessary to mention the core allegation made against the appellant. The allegation was that he had a proximate relationship with a lady lawyer and due to this relationship he passed certain judicial orders in favour of her clients, including her mother and brother when they were parties to certain proceedings. Those findings of fact have been upheld by all courts and even this Court has not interfered with those findings and issued notice limited to the quantum of punishment.6. The first and foremost quality required in a Judge is integrity. The need of integrity in the judiciary is much higher than in other institutions. The judiciary is an institution whose foundations are based on honesty and integrity. It is, therefore, necessary that judicial officers should possess the sterling quality of integrity. This Court in Tarak Singh v. Jyoti Basu [(2005) 1 SCC 201] held as follows:-?Integrity is the hallmark of judicial discipline, apart from others. It is high time the judiciary took utmost care to see that the temple of justice does not crack from inside, which will lead to a catastrophe in the judicial- delivery system resulting in the failure of public confidence in the system. It must be remembered that woodpekers inside pose a larger threat than the storm outside.?7. The behavior of a Judge has to of an exacting standard, both inside and outside the Court. This Court in Daya Shankar v. High Court of Allahabad and Others [(1987) 3 SCC 1] held thus:?Judicial Officers cannot have two standards, one in the court and other outside the court. They must have only one standard of rectitude, honesty and integrity. They cannot act even remotely unworthy of the office they occupy.?8. Judges are also public servants. A Judge should always remember that he is there to serve the public. A Judge is judged not only by his quality of judgments but also by the quality and purity of his character. Impeccable integrity should be reflected both in public and personal life of a Judge. One who stands in judgments over others should be incorruptible. That is the high standard which is expected of Judges.9. Judges must remember that they are not merely employees but hold high public office. In R. C. Chandel v. High Court of Madhya Pradesh [(2012) 8 SCC 58] , this Court held that the standard of conduct expected of a Judge is much higher than that of an ordinary person. The following observations of this Court are relevant:?37. Judicial service is not an ordinary government service and the Judges are not employees as such. Judges hold the public office; their function is one of the essential functions of the State. In discharge of their functions and duties, the Judges represent the State. The office that a Judge holds is an office of public trust. A Judge must be a person of impeccable integrity and unimpeachable independence. He must be honest to the core with high moral values. When a litigant enters the courtroom, he must feel secure that Judge before whom his matter has come, would deliver justice impartially and uninfluenced by any consideration. The standard of conduct expected of a Judge is much higher than an ordinary man. This is no excuse that since the standards in the society have fallen, the Judges who are drawn from the society cannot be expected to have high standards and ethical firmness required of a Judge. A Judge like Caesar?s wife, must be above suspicion. The credibility of the judicial system is dependent upon the Judges who man it. For a democracy to thrive and rule of law to survive, judicial system and the judicial process have to be strong and every Judge must discharge his judicial functions with integrity, impartially and intellectual honesty.?10. There can be no manner of doubt that a judge must decide the case only on the basis of the facts on record and the law applicable to the case. If a judge decides a case for any extraneous reasons then he is not performing his duty in accordance with law.11. In our view the word ‘gratification? does not only mean monetary gratification. Gratification can be of various types. It can be gratification of money, gratification of power, gratification of lust etc.,etc. In this case the officer decided the cases because of his proximate relationship with a lady lawyer and not because the law required him to do so. This is also gratification of a different kind.12. The Judicial Officer concerned did not live upto the expectations of integrity, behavior and probity expected of him. His conduct is as such that no leniency can be shown and he cannot be visited with a lesser punishment. | 0[ds]6. The first and foremost quality required in a Judge is integrity. The need of integrity in the judiciary is much higher than in other institutions. The judiciary is an institution whose foundations are based on honesty and integrity. It is, therefore, necessary that judicial officers should possess the sterling quality of integrity.The behavior of a Judge has to of an exacting standard, both inside and outside the Court.Judges are also public servants. A Judge should always remember that he is there to serve the public. A Judge is judged not only by his quality of judgments but also by the quality and purity of his character. Impeccable integrity should be reflected both in public and personal life of a Judge. One who stands in judgments over others should be incorruptible. That is the high standard which is expected of Judges.9. Judges must remember that they are not merely employees but hold high public office. In R. C. Chandel v. High Court of Madhya Pradesh [(2012) 8 SCC 58] , this Court held that the standard of conduct expected of a Judge is much higher than that of an ordinary person. The following observations of this Court areJudicial service is not an ordinary government service and the Judges are not employees as such. Judges hold the public office; their function is one of the essential functions of the State. In discharge of their functions and duties, the Judges represent the State. The office that a Judge holds is an office of public trust. A Judge must be a person of impeccable integrity and unimpeachable independence. He must be honest to the core with high moral values. When a litigant enters the courtroom, he must feel secure that Judge before whom his matter has come, would deliver justice impartially and uninfluenced by any consideration. The standard of conduct expected of a Judge is much higher than an ordinary man. This is no excuse that since the standards in the society have fallen, the Judges who are drawn from the society cannot be expected to have high standards and ethical firmness required of a Judge. A Judge like Caesar?s wife, must be above suspicion. The credibility of the judicial system is dependent upon the Judges who man it. For a democracy to thrive and rule of law to survive, judicial system and the judicial process have to be strong and every Judge must discharge his judicial functions with integrity, impartially and intellectual honesty.There can be no manner of doubt that a judge must decide the case only on the basis of the facts on record and the law applicable to the case. If a judge decides a case for any extraneous reasons then he is not performing his duty in accordance with law.11. In our view the word ‘gratification? does not only mean monetary gratification. Gratification can be of various types. It can be gratification of money, gratification of power, gratification of lust etc.,etc. In this case the officer decided the cases because of his proximate relationship with a lady lawyer and not because the law required him to do so. This is also gratification of a different kind.12. The Judicial Officer concerned did not live upto the expectations of integrity, behavior and probity expected of him. His conduct is as such that no leniency can be shown and he cannot be visited with a lesser punishment. | 0 | 1,267 | 627 | ### Instruction:
Ascertain if the court will uphold (1) or dismiss (0) the appeal in the case proceeding, and then clarify this prediction by discussing critical sentences from the text.
### Input:
Services (Discipline and Appeal) Rules, 1979, especially Rule ‘5? thereof. We are concerned with the portion dealing with major penalties, which reads as follows:?Major Penalties -(vii) compulsory retirement;(viii) removal from Service which shall not be a disqualification for future employment under Government;(ix) dismissal from Service which shall ordinarily be a disqualification for future employment under Government:Provided that, in every case in which the charge of acceptance from any person of any gratification, other than legal remuneration, as a motive or reward for doing or forbearing to do any official act is established, the penalty mentioned in clause (viii) or (ix) shall be imposed;Provided further that, in any exceptional case and for special reasons recorded in writing any other penalty may be imposed?4. Emphasis of the learned counsel for the appellant is on the first proviso wherein it is stated that if an employee is held guilty of accepting gratification other than legal remuneration, as a motive or reward for doing or forbearing to do any official act, the penalty mentioned in clause (viii) or (ix), i.e., removal from service or dismissal from service shall be imposed.5. We are only concerned with the issue of penalty and we need not go into the entire gamut of facts. However, for the purpose of deciding this appeal, it would be necessary to mention the core allegation made against the appellant. The allegation was that he had a proximate relationship with a lady lawyer and due to this relationship he passed certain judicial orders in favour of her clients, including her mother and brother when they were parties to certain proceedings. Those findings of fact have been upheld by all courts and even this Court has not interfered with those findings and issued notice limited to the quantum of punishment.6. The first and foremost quality required in a Judge is integrity. The need of integrity in the judiciary is much higher than in other institutions. The judiciary is an institution whose foundations are based on honesty and integrity. It is, therefore, necessary that judicial officers should possess the sterling quality of integrity. This Court in Tarak Singh v. Jyoti Basu [(2005) 1 SCC 201] held as follows:-?Integrity is the hallmark of judicial discipline, apart from others. It is high time the judiciary took utmost care to see that the temple of justice does not crack from inside, which will lead to a catastrophe in the judicial- delivery system resulting in the failure of public confidence in the system. It must be remembered that woodpekers inside pose a larger threat than the storm outside.?7. The behavior of a Judge has to of an exacting standard, both inside and outside the Court. This Court in Daya Shankar v. High Court of Allahabad and Others [(1987) 3 SCC 1] held thus:?Judicial Officers cannot have two standards, one in the court and other outside the court. They must have only one standard of rectitude, honesty and integrity. They cannot act even remotely unworthy of the office they occupy.?8. Judges are also public servants. A Judge should always remember that he is there to serve the public. A Judge is judged not only by his quality of judgments but also by the quality and purity of his character. Impeccable integrity should be reflected both in public and personal life of a Judge. One who stands in judgments over others should be incorruptible. That is the high standard which is expected of Judges.9. Judges must remember that they are not merely employees but hold high public office. In R. C. Chandel v. High Court of Madhya Pradesh [(2012) 8 SCC 58] , this Court held that the standard of conduct expected of a Judge is much higher than that of an ordinary person. The following observations of this Court are relevant:?37. Judicial service is not an ordinary government service and the Judges are not employees as such. Judges hold the public office; their function is one of the essential functions of the State. In discharge of their functions and duties, the Judges represent the State. The office that a Judge holds is an office of public trust. A Judge must be a person of impeccable integrity and unimpeachable independence. He must be honest to the core with high moral values. When a litigant enters the courtroom, he must feel secure that Judge before whom his matter has come, would deliver justice impartially and uninfluenced by any consideration. The standard of conduct expected of a Judge is much higher than an ordinary man. This is no excuse that since the standards in the society have fallen, the Judges who are drawn from the society cannot be expected to have high standards and ethical firmness required of a Judge. A Judge like Caesar?s wife, must be above suspicion. The credibility of the judicial system is dependent upon the Judges who man it. For a democracy to thrive and rule of law to survive, judicial system and the judicial process have to be strong and every Judge must discharge his judicial functions with integrity, impartially and intellectual honesty.?10. There can be no manner of doubt that a judge must decide the case only on the basis of the facts on record and the law applicable to the case. If a judge decides a case for any extraneous reasons then he is not performing his duty in accordance with law.11. In our view the word ‘gratification? does not only mean monetary gratification. Gratification can be of various types. It can be gratification of money, gratification of power, gratification of lust etc.,etc. In this case the officer decided the cases because of his proximate relationship with a lady lawyer and not because the law required him to do so. This is also gratification of a different kind.12. The Judicial Officer concerned did not live upto the expectations of integrity, behavior and probity expected of him. His conduct is as such that no leniency can be shown and he cannot be visited with a lesser punishment.
### Response:
0
### Explanation:
6. The first and foremost quality required in a Judge is integrity. The need of integrity in the judiciary is much higher than in other institutions. The judiciary is an institution whose foundations are based on honesty and integrity. It is, therefore, necessary that judicial officers should possess the sterling quality of integrity.The behavior of a Judge has to of an exacting standard, both inside and outside the Court.Judges are also public servants. A Judge should always remember that he is there to serve the public. A Judge is judged not only by his quality of judgments but also by the quality and purity of his character. Impeccable integrity should be reflected both in public and personal life of a Judge. One who stands in judgments over others should be incorruptible. That is the high standard which is expected of Judges.9. Judges must remember that they are not merely employees but hold high public office. In R. C. Chandel v. High Court of Madhya Pradesh [(2012) 8 SCC 58] , this Court held that the standard of conduct expected of a Judge is much higher than that of an ordinary person. The following observations of this Court areJudicial service is not an ordinary government service and the Judges are not employees as such. Judges hold the public office; their function is one of the essential functions of the State. In discharge of their functions and duties, the Judges represent the State. The office that a Judge holds is an office of public trust. A Judge must be a person of impeccable integrity and unimpeachable independence. He must be honest to the core with high moral values. When a litigant enters the courtroom, he must feel secure that Judge before whom his matter has come, would deliver justice impartially and uninfluenced by any consideration. The standard of conduct expected of a Judge is much higher than an ordinary man. This is no excuse that since the standards in the society have fallen, the Judges who are drawn from the society cannot be expected to have high standards and ethical firmness required of a Judge. A Judge like Caesar?s wife, must be above suspicion. The credibility of the judicial system is dependent upon the Judges who man it. For a democracy to thrive and rule of law to survive, judicial system and the judicial process have to be strong and every Judge must discharge his judicial functions with integrity, impartially and intellectual honesty.There can be no manner of doubt that a judge must decide the case only on the basis of the facts on record and the law applicable to the case. If a judge decides a case for any extraneous reasons then he is not performing his duty in accordance with law.11. In our view the word ‘gratification? does not only mean monetary gratification. Gratification can be of various types. It can be gratification of money, gratification of power, gratification of lust etc.,etc. In this case the officer decided the cases because of his proximate relationship with a lady lawyer and not because the law required him to do so. This is also gratification of a different kind.12. The Judicial Officer concerned did not live upto the expectations of integrity, behavior and probity expected of him. His conduct is as such that no leniency can be shown and he cannot be visited with a lesser punishment.
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M/s. A.P.T. Ispat Pvt. Ltd Vs. U.P. Small Industrial Corporation Ltd. & Another | and, therefore, the provisions of section 3 of the Act are not applicable. There is no dispute about the fact that there is no written agreement between the petitioner and respondent Company for supply of raw materials to the petitioner. It is, however, admitted that respondent company had been supplying raw materials to the petitioner-company for carrying all its business. In writ petition no.Nil of 1987, in re: R.K. & Sons, Bhadoi vs. The Collector, Varanasi and Others, decided on 12.3.1987, it has been held by a Division Bench of this Court that although there was no agreement executed in writing as such, an agreement may be said to have come into being as a result of mutual contact of the parties accompanied with delivery of goods which were admittedly on credit and this was to enable the petitioner to run the industrial unit held by him. In this manner his case is covered under Section 3(1) (a) read with Section 2(b) of the Act. In the instant case also as a result of mutual contract between the parties delivery of goods were made to the petitioner by respondent company. The petitioner obtained huge quantity of raw materials without making payment and thus, the respondent company is claiming the price of the goods sold to the petitioner by way of financial assistance. The case of the petitioner is therefore, also covered under Section 3(1)(a) read with Section 2(b) of the Act." (emphasis added) 13. We are completely unable to accept the view taken by the High Court. If the appellant company was purchasing wire rods as raw material from the Corporation we fail to see how the sale of the goods would become financial assistance rendered to the appellant unless it is shown that the supply of the goods was as a loan or grant or by way of hire purchase in terms of some agreement. We are, therefore, unable to follow the observation by the High court that "Thus the raw materials, that is, wire rods, were sold, to the petitioner by the respondent company by way of financial assistance". We also find no basis for the observation made by the High Court that "it is, however, admitted that respondent company (sic Corporation) had been supplying raw materials to the petitioner-company for carrying all its business" and further that the goods supplied "were admittedly on credit". There is no such admission by the appellant. On the contrary the case of the appellant is that it used to purchase wire rods from the Corporation on payment of price and it made payment for all the purchases from the Corporation.14. We think that the High Court has stretched the meaning of "financial assistance" as defined in section 2 and the scope of section 3 of the Act beyond reasonable limits. From a bare reading of section 3 it is evident that the dues must arise from an agreement to which the person from whom recovery is to be made is a party. Sub clause (a) of sub-section 1 then enumerates the kinds of agreement under which the transaction should have taken place. It needs also to be borne in mind that in the scheme of the Act there is no provision for any adjudication. Once there is any default under an agreement, the designated authority is authorized to issue a recovery certificate and send it to the Collector who is obliged to recover the certificate amount together with interest from the certificate debtor as arrears of land revenue. At no stage the certificate debtor is given an opportunity to put up his case. Such being the legal position, the recovery certificate must be based on a tangible agreement and it should even prima facie appear that the dues arise from a breach of the terms of the agreement. A proceeding under section 3 of the Act cannot be sustained by piling up assumptions in favour of the certificate holder and against the judgment debtor.15. In the present case it is evident that the dues of which recovery is sought by the impugned certificates do not pertain to any loan, advance or grant given to the appellant or to any credit concerning any hire purchase of goods sold to the appellant by the Corporation under any agreement, express or implied. The dues do not relate to any financial assistance.16. We also cannot overlook the fact that in this case the so called supplies were not even made in the normal course of business. A reference to the FIR makes it clear that according to the Corporation the goods were taken away by the appellant in a criminal action constituting a number of offences under the Penal Code. The U.P. Public Moneys (Recovery of Dues) Act, 1972 was clearly not intended to recover the goods or the monetary value of goods taken away in course of theft or dacoity or lost as a result of dishonest appropriation or any other alleged criminal action.17. For the reasons discussed above, we are of the view that in the facts of this case the two impugned recovery certificates are quite illegal and untenable and we are unable to sustain the High Court order coming under appeal.18. There is another point and though it was not raised before the High Court, we think proper to mention it since it is crucial to the proceeding under section 3 of the U.P. Public Moneys (Recovery of Dues) Act, 1972. In a decision by this court in Unique Butyle Tube Industries (P) Ltd. vs. U.P. Financial Corporation and Others, (2003) 2 SCC 455 , it was held that after the coming into force of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, recourse cannot be taken for recovery of dues to the provisions of U.P. Public Moneys (Recovery of Dues) Act, 1972 because the U.P. Act does not find mention in section 34(2) of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993. | 1[ds]13. We are completely unable to accept the view taken by the High Court. If the appellant company was purchasing wire rods as raw material from the Corporation we fail to see how the sale of the goods would become financial assistance rendered to the appellant unless it is shown that the supply of the goods was as a loan or grant or by way of hire purchase in terms of some agreement. We are, therefore, unable to follow the observation by the High court that "Thus the raw materials, that is, wire rods, were sold, to the petitioner by the respondent company by way of financial assistance". We also find no basis for the observation made by the High Court that "it is, however, admitted that respondent company (sic Corporation) had been supplying raw materials to the petitioner-company for carrying all its business" and further that the goods supplied "were admittedly on credit". There is no such admission by the appellant. On the contrary the case of the appellant is that it used to purchase wire rods from the Corporation on payment of price and it made payment for all the purchases from the Corporation.14. We think that the High Court has stretched the meaning of "financial assistance" as defined in section 2 and the scope of section 3 of the Act beyond reasonable limits. From a bare reading of section 3 it is evident that the dues must arise from an agreement to which the person from whom recovery is to be made is a party. Sub clause (a) of sub-section 1 then enumerates the kinds of agreement under which the transaction should have taken place. It needs also to be borne in mind that in the scheme of the Act there is no provision for any adjudication. Once there is any default under an agreement, the designated authority is authorized to issue a recovery certificate and send it to the Collector who is obliged to recover the certificate amount together with interest from the certificate debtor as arrears of land revenue. At no stage the certificate debtor is given an opportunity to put up his case. Such being the legal position, the recovery certificate must be based on a tangible agreement and it should even prima facie appear that the dues arise from a breach of the terms of the agreement. A proceeding under section 3 of the Act cannot be sustained by piling up assumptions in favour of the certificate holder and against the judgment debtor.15. In the present case it is evident that the dues of which recovery is sought by the impugned certificates do not pertain to any loan, advance or grant given to the appellant or to any credit concerning any hire purchase of goods sold to the appellant by the Corporation under any agreement, express or implied. The dues do not relate to any financial assistance.16. We also cannot overlook the fact that in this case the so called supplies were not even made in the normal course of business. A reference to the FIR makes it clear that according to the Corporation the goods were taken away by the appellant in a criminal action constituting a number of offences under the Penal Code. The U.P. Public Moneys (Recovery of Dues) Act, 1972 was clearly not intended to recover the goods or the monetary value of goods taken away in course of theft or dacoity or lost as a result of dishonest appropriation or any other alleged criminal action.17. For the reasons discussed above, we are of the view that in the facts of this case the two impugned recovery certificates are quite illegal and untenable and we are unable to sustain the High Court order coming under appeal.18. There is another point and though it was not raised before the High Court, we think proper to mention it since it is crucial to the proceeding under section 3 of the U.P. Public Moneys (Recovery of Dues) Act, 1972. In a decision by this court in Unique Butyle Tube Industries (P) Ltd. vs. U.P. Financial Corporation and Others, (2003) 2 SCC 455 , it was held that after the coming into force of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, recourse cannot be taken for recovery of dues to the provisions of U.P. Public Moneys (Recovery of Dues) Act, 1972 because the U.P. Act does not find mention in section 34(2) of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993. | 1 | 3,429 | 838 | ### Instruction:
Estimate the outcome of the case (positive (1) or negative (0) for the appellant) and then give a reasoned explanation by examining important sentences within the case documentation.
### Input:
and, therefore, the provisions of section 3 of the Act are not applicable. There is no dispute about the fact that there is no written agreement between the petitioner and respondent Company for supply of raw materials to the petitioner. It is, however, admitted that respondent company had been supplying raw materials to the petitioner-company for carrying all its business. In writ petition no.Nil of 1987, in re: R.K. & Sons, Bhadoi vs. The Collector, Varanasi and Others, decided on 12.3.1987, it has been held by a Division Bench of this Court that although there was no agreement executed in writing as such, an agreement may be said to have come into being as a result of mutual contact of the parties accompanied with delivery of goods which were admittedly on credit and this was to enable the petitioner to run the industrial unit held by him. In this manner his case is covered under Section 3(1) (a) read with Section 2(b) of the Act. In the instant case also as a result of mutual contract between the parties delivery of goods were made to the petitioner by respondent company. The petitioner obtained huge quantity of raw materials without making payment and thus, the respondent company is claiming the price of the goods sold to the petitioner by way of financial assistance. The case of the petitioner is therefore, also covered under Section 3(1)(a) read with Section 2(b) of the Act." (emphasis added) 13. We are completely unable to accept the view taken by the High Court. If the appellant company was purchasing wire rods as raw material from the Corporation we fail to see how the sale of the goods would become financial assistance rendered to the appellant unless it is shown that the supply of the goods was as a loan or grant or by way of hire purchase in terms of some agreement. We are, therefore, unable to follow the observation by the High court that "Thus the raw materials, that is, wire rods, were sold, to the petitioner by the respondent company by way of financial assistance". We also find no basis for the observation made by the High Court that "it is, however, admitted that respondent company (sic Corporation) had been supplying raw materials to the petitioner-company for carrying all its business" and further that the goods supplied "were admittedly on credit". There is no such admission by the appellant. On the contrary the case of the appellant is that it used to purchase wire rods from the Corporation on payment of price and it made payment for all the purchases from the Corporation.14. We think that the High Court has stretched the meaning of "financial assistance" as defined in section 2 and the scope of section 3 of the Act beyond reasonable limits. From a bare reading of section 3 it is evident that the dues must arise from an agreement to which the person from whom recovery is to be made is a party. Sub clause (a) of sub-section 1 then enumerates the kinds of agreement under which the transaction should have taken place. It needs also to be borne in mind that in the scheme of the Act there is no provision for any adjudication. Once there is any default under an agreement, the designated authority is authorized to issue a recovery certificate and send it to the Collector who is obliged to recover the certificate amount together with interest from the certificate debtor as arrears of land revenue. At no stage the certificate debtor is given an opportunity to put up his case. Such being the legal position, the recovery certificate must be based on a tangible agreement and it should even prima facie appear that the dues arise from a breach of the terms of the agreement. A proceeding under section 3 of the Act cannot be sustained by piling up assumptions in favour of the certificate holder and against the judgment debtor.15. In the present case it is evident that the dues of which recovery is sought by the impugned certificates do not pertain to any loan, advance or grant given to the appellant or to any credit concerning any hire purchase of goods sold to the appellant by the Corporation under any agreement, express or implied. The dues do not relate to any financial assistance.16. We also cannot overlook the fact that in this case the so called supplies were not even made in the normal course of business. A reference to the FIR makes it clear that according to the Corporation the goods were taken away by the appellant in a criminal action constituting a number of offences under the Penal Code. The U.P. Public Moneys (Recovery of Dues) Act, 1972 was clearly not intended to recover the goods or the monetary value of goods taken away in course of theft or dacoity or lost as a result of dishonest appropriation or any other alleged criminal action.17. For the reasons discussed above, we are of the view that in the facts of this case the two impugned recovery certificates are quite illegal and untenable and we are unable to sustain the High Court order coming under appeal.18. There is another point and though it was not raised before the High Court, we think proper to mention it since it is crucial to the proceeding under section 3 of the U.P. Public Moneys (Recovery of Dues) Act, 1972. In a decision by this court in Unique Butyle Tube Industries (P) Ltd. vs. U.P. Financial Corporation and Others, (2003) 2 SCC 455 , it was held that after the coming into force of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, recourse cannot be taken for recovery of dues to the provisions of U.P. Public Moneys (Recovery of Dues) Act, 1972 because the U.P. Act does not find mention in section 34(2) of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993.
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1
### Explanation:
13. We are completely unable to accept the view taken by the High Court. If the appellant company was purchasing wire rods as raw material from the Corporation we fail to see how the sale of the goods would become financial assistance rendered to the appellant unless it is shown that the supply of the goods was as a loan or grant or by way of hire purchase in terms of some agreement. We are, therefore, unable to follow the observation by the High court that "Thus the raw materials, that is, wire rods, were sold, to the petitioner by the respondent company by way of financial assistance". We also find no basis for the observation made by the High Court that "it is, however, admitted that respondent company (sic Corporation) had been supplying raw materials to the petitioner-company for carrying all its business" and further that the goods supplied "were admittedly on credit". There is no such admission by the appellant. On the contrary the case of the appellant is that it used to purchase wire rods from the Corporation on payment of price and it made payment for all the purchases from the Corporation.14. We think that the High Court has stretched the meaning of "financial assistance" as defined in section 2 and the scope of section 3 of the Act beyond reasonable limits. From a bare reading of section 3 it is evident that the dues must arise from an agreement to which the person from whom recovery is to be made is a party. Sub clause (a) of sub-section 1 then enumerates the kinds of agreement under which the transaction should have taken place. It needs also to be borne in mind that in the scheme of the Act there is no provision for any adjudication. Once there is any default under an agreement, the designated authority is authorized to issue a recovery certificate and send it to the Collector who is obliged to recover the certificate amount together with interest from the certificate debtor as arrears of land revenue. At no stage the certificate debtor is given an opportunity to put up his case. Such being the legal position, the recovery certificate must be based on a tangible agreement and it should even prima facie appear that the dues arise from a breach of the terms of the agreement. A proceeding under section 3 of the Act cannot be sustained by piling up assumptions in favour of the certificate holder and against the judgment debtor.15. In the present case it is evident that the dues of which recovery is sought by the impugned certificates do not pertain to any loan, advance or grant given to the appellant or to any credit concerning any hire purchase of goods sold to the appellant by the Corporation under any agreement, express or implied. The dues do not relate to any financial assistance.16. We also cannot overlook the fact that in this case the so called supplies were not even made in the normal course of business. A reference to the FIR makes it clear that according to the Corporation the goods were taken away by the appellant in a criminal action constituting a number of offences under the Penal Code. The U.P. Public Moneys (Recovery of Dues) Act, 1972 was clearly not intended to recover the goods or the monetary value of goods taken away in course of theft or dacoity or lost as a result of dishonest appropriation or any other alleged criminal action.17. For the reasons discussed above, we are of the view that in the facts of this case the two impugned recovery certificates are quite illegal and untenable and we are unable to sustain the High Court order coming under appeal.18. There is another point and though it was not raised before the High Court, we think proper to mention it since it is crucial to the proceeding under section 3 of the U.P. Public Moneys (Recovery of Dues) Act, 1972. In a decision by this court in Unique Butyle Tube Industries (P) Ltd. vs. U.P. Financial Corporation and Others, (2003) 2 SCC 455 , it was held that after the coming into force of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, recourse cannot be taken for recovery of dues to the provisions of U.P. Public Moneys (Recovery of Dues) Act, 1972 because the U.P. Act does not find mention in section 34(2) of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993.
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Icici Home Finance Company Limited Vs. Assistant Commissioner of Income Tax 10(1), Mumbai & Another | be noticed that the reasons for which the assessment for the assessment year 2006-2007 is sought to be reopened by communication dated 12.10.2011 are identical to the objection of the audit authority dated 29.12.2009. The reasons do not rely upon any tangible material in the audit report but merely upon an opinion and the existing material already on record. This itself indicates that there was no independent application of mind by the Assessing Officer before he issued the impugned notice. On this ground alone, the assumption of jurisdiction by the Assessing Officer can be faulted.7. However, as submissions were made on other issues also we are examining them also. It is a settled position in law that where assessment sought to be reopened is before the expiry of four years from the end of the relevant assessment year, then in such cases the power to reopen an assessment is very wide. However, even though such a power is very wide yet such a power would not justify a review of the assessment order already passed. The Supreme Court in the matter of the Commissioner of Income Tax v. Kelvinator (India) Ltd, reported in 320 ITR page 561 has observed that the power to reassess is conceptually different from a power to review. The Assessing Officer under the said Act has only power to reassess on fulfillment of certain precondition namely, he must have reason to believe that income has escaped assessment and that there must be tangible material to come to the conclusion that there is an escapement of income from assessment. The Apex Court cautioned that in the garb of reopening an assessment review should not take place.This court following the Apex Court in the matter of Cartini India Ltd. v. Addl. C.I.T. reported in 314 ITR 275 has also held that even where reassessment is sought to be done within four years from the end of the relevant assessment year, there must be reason to believe that income has escaped assessment and such reason to believe should not be on account of mere change of opinion. Therefore, where facts have been viewed during the original proceeding and an assessment order has been passed then in such cases, reopening of an assessment on the same facts without anything more would be a review and not permitted under the garb of reassessment. This would be a mere change of opinion in the absence of any tangible material and is not sufficient to assume jurisdiction to issue the impugned notice. In fact, our court in the matter of Idea Cellular Ltd v. Deputy Commissioner of Income tax reported in 301 ITR 407 has held that once all the material with regard to particular issue is before the Assessing Officer and he chooses not to deal with the same, it cannot be said that he had not applied his mind to all the material before him. Further, as observed by the Full Bench of Delhi High Court in the matter of C.I.T. v. Kelvinator of India Ltd. Reported in 256 ITR 1 , when the entire material is placed before the Assessing Officer at the time of original assessment and he passes an assessment order under Section 143(3) of the Act a presumption can be raised that he applied his mind to all the facts involved in the assessment.8. Therefore, in the present facts one would have to examine the contention of the Petitioner that the impugned notice is without jurisdiction as the self same facts were not only before the Assessing Officer but he had also viewed the very issues on which the assessment is sought to be reopened. So far as, the issue in respect of provisions claimed as deduction for arriving at taxable profit aggregating to Rs.52.87 crores is concerned, the same was not only disclosed in the notes to account filed with the return of Income but also in response to specific queries raised during the assessment proceeding. It was reiterated at the hearing that on the aforesaid account of provision, the tax had already been paid in the earlier years and the amounts were merely written back in this year to the extent they were in excess of the provisions required. So far as, failure to deduct TDS on advertisement and sales promotion are concerned leading to disallowance of the entire amount of Rs.22.48 crores under Section 40(a)(ia) the same was also subject to scrutiny by the Assessing Officer during the assessment proceedings.In fact, the clause 17(f) of the tax audit report submitted alongwith return of income clearly brings out the fact that where tax has not been deducted, then the entire amount of payment has been offered for disallowance under Section 40(a)(ia). In fact, by letters dated 10.11.2008 and 26.12.2008 in response to specific queries of the Assessing Officer during assessment proceedings the petitioner had pointed out alongwith details the expenses in respect of which the tax had not been deducted and which were offered to tax. So far as, the reason to reopen the assessment on the ground that the petitioner had declared short term capital gains of Rs.3.63 crores in respect of income earned out of investments had to be taxed/classified as business Income is concerned, it is not disputed before us that the treatment given was consistent with the earlier year practice and accepted by the Respondent. Further, it is not disputed before us that the short term capital gains have been assessed to the maximum marginal rate and even if considered as business income, the tax effect would be the same. Consequently, there could be no reasonable basis to have a belief that there is any escapement of Income.9. Therefore, in view of the above, we are of the view that the impugned notice is without jurisdiction and the impugned order dealing with the objection of the Petitioner is non speaking order in as much as it does not deal with any of the objections raised by the Petitioner in its objections. | 0[ds]6. The power to reopen a completed assessment under Section 147 of the Act has been bestowed on the Assessing Officer, if he has reason to believe that any income chargeable to tax has escaped assessment for any assessment year. However, this belief that income has escaped assessment has to be the reasonable belief of the Assessing Officer himself and cannot be an opinion and/or belief of some other authority. In fact, the Supreme Court in the matter of India Eastern Newspaper Society v. Commissioner of Income Tax, New Delhi, reported in 119 ITR page 996 has held that whether an assessment has escaped assessment or not must be determined by the Assessing Officer himself. The Assessing Officer cannot blindly follow the opinion of an audit authority for the purpose of arriving at a belief that income has escaped assessment. In the present facts, it would be noticed that the reasons for which the assessment for the assessment yearis sought to be reopened by communication dated 12.10.2011 are identical to the objection of the audit authority dated 29.12.2009. The reasons do not rely upon any tangible material in the audit report but merely upon an opinion and the existing material already on record. This itself indicates that there was no independent application of mind by the Assessing Officer before he issued the impugned notice. On this ground alone, the assumption of jurisdiction by the Assessing Officer can be faulted.Therefore, in the present facts one would have to examine the contention of the Petitioner that the impugned notice is without jurisdiction as the self same facts were not only before the Assessing Officer but he had also viewed the very issues on which the assessment is sought to be reopened. So far as, the issue in respect of provisions claimed as deduction for arriving at taxable profit aggregating to Rs.52.87 crores is concerned, the same was not only disclosed in the notes to account filed with the return of Income but also in response to specific queries raised during the assessment proceeding. It was reiterated at the hearing that on the aforesaid account of provision, the tax had already been paid in the earlier years and the amounts were merely written back in this year to the extent they were in excess of the provisions required. So far as, failure to deduct TDS on advertisement and sales promotion are concerned leading to disallowance of the entire amount of Rs.22.48 crores under Section 40(a)(ia) the same was also subject to scrutiny by the Assessing Officer during the assessment proceedings.In fact, the clause 17(f) of the tax audit report submitted alongwith return of income clearly brings out the fact that where tax has not been deducted, then the entire amount of payment has been offered for disallowance under Section 40(a)(ia). In fact, by letters dated 10.11.2008 and 26.12.2008 in response to specific queries of the Assessing Officer during assessment proceedings the petitioner had pointed out alongwith details the expenses in respect of which the tax had not been deducted and which were offered to tax. So far as, the reason to reopen the assessment on the ground that the petitioner had declared short term capital gains of Rs.3.63 crores in respect of income earned out of investments had to be taxed/classified as business Income is concerned, it is not disputed before us that the treatment given was consistent with the earlier year practice and accepted by the Respondent. Further, it is not disputed before us that the short term capital gains have been assessed to the maximum marginal rate and even if considered as business income, the tax effect would be the same. Consequently, there could be no reasonable basis to have a belief that there is any escapement of Income.9. Therefore, in view of the above, we are of the view that the impugned notice is without jurisdiction and the impugned order dealing with the objection of the Petitioner is non speaking order in as much as it does not deal with any of the objections raised by the Petitioner in its objections. | 0 | 3,478 | 741 | ### Instruction:
Speculate on the likely judgment (yes (1) or no (0) to the appeal) and then delve into the case proceeding to elucidate your prediction, focusing on critical sentences.
### Input:
be noticed that the reasons for which the assessment for the assessment year 2006-2007 is sought to be reopened by communication dated 12.10.2011 are identical to the objection of the audit authority dated 29.12.2009. The reasons do not rely upon any tangible material in the audit report but merely upon an opinion and the existing material already on record. This itself indicates that there was no independent application of mind by the Assessing Officer before he issued the impugned notice. On this ground alone, the assumption of jurisdiction by the Assessing Officer can be faulted.7. However, as submissions were made on other issues also we are examining them also. It is a settled position in law that where assessment sought to be reopened is before the expiry of four years from the end of the relevant assessment year, then in such cases the power to reopen an assessment is very wide. However, even though such a power is very wide yet such a power would not justify a review of the assessment order already passed. The Supreme Court in the matter of the Commissioner of Income Tax v. Kelvinator (India) Ltd, reported in 320 ITR page 561 has observed that the power to reassess is conceptually different from a power to review. The Assessing Officer under the said Act has only power to reassess on fulfillment of certain precondition namely, he must have reason to believe that income has escaped assessment and that there must be tangible material to come to the conclusion that there is an escapement of income from assessment. The Apex Court cautioned that in the garb of reopening an assessment review should not take place.This court following the Apex Court in the matter of Cartini India Ltd. v. Addl. C.I.T. reported in 314 ITR 275 has also held that even where reassessment is sought to be done within four years from the end of the relevant assessment year, there must be reason to believe that income has escaped assessment and such reason to believe should not be on account of mere change of opinion. Therefore, where facts have been viewed during the original proceeding and an assessment order has been passed then in such cases, reopening of an assessment on the same facts without anything more would be a review and not permitted under the garb of reassessment. This would be a mere change of opinion in the absence of any tangible material and is not sufficient to assume jurisdiction to issue the impugned notice. In fact, our court in the matter of Idea Cellular Ltd v. Deputy Commissioner of Income tax reported in 301 ITR 407 has held that once all the material with regard to particular issue is before the Assessing Officer and he chooses not to deal with the same, it cannot be said that he had not applied his mind to all the material before him. Further, as observed by the Full Bench of Delhi High Court in the matter of C.I.T. v. Kelvinator of India Ltd. Reported in 256 ITR 1 , when the entire material is placed before the Assessing Officer at the time of original assessment and he passes an assessment order under Section 143(3) of the Act a presumption can be raised that he applied his mind to all the facts involved in the assessment.8. Therefore, in the present facts one would have to examine the contention of the Petitioner that the impugned notice is without jurisdiction as the self same facts were not only before the Assessing Officer but he had also viewed the very issues on which the assessment is sought to be reopened. So far as, the issue in respect of provisions claimed as deduction for arriving at taxable profit aggregating to Rs.52.87 crores is concerned, the same was not only disclosed in the notes to account filed with the return of Income but also in response to specific queries raised during the assessment proceeding. It was reiterated at the hearing that on the aforesaid account of provision, the tax had already been paid in the earlier years and the amounts were merely written back in this year to the extent they were in excess of the provisions required. So far as, failure to deduct TDS on advertisement and sales promotion are concerned leading to disallowance of the entire amount of Rs.22.48 crores under Section 40(a)(ia) the same was also subject to scrutiny by the Assessing Officer during the assessment proceedings.In fact, the clause 17(f) of the tax audit report submitted alongwith return of income clearly brings out the fact that where tax has not been deducted, then the entire amount of payment has been offered for disallowance under Section 40(a)(ia). In fact, by letters dated 10.11.2008 and 26.12.2008 in response to specific queries of the Assessing Officer during assessment proceedings the petitioner had pointed out alongwith details the expenses in respect of which the tax had not been deducted and which were offered to tax. So far as, the reason to reopen the assessment on the ground that the petitioner had declared short term capital gains of Rs.3.63 crores in respect of income earned out of investments had to be taxed/classified as business Income is concerned, it is not disputed before us that the treatment given was consistent with the earlier year practice and accepted by the Respondent. Further, it is not disputed before us that the short term capital gains have been assessed to the maximum marginal rate and even if considered as business income, the tax effect would be the same. Consequently, there could be no reasonable basis to have a belief that there is any escapement of Income.9. Therefore, in view of the above, we are of the view that the impugned notice is without jurisdiction and the impugned order dealing with the objection of the Petitioner is non speaking order in as much as it does not deal with any of the objections raised by the Petitioner in its objections.
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0
### Explanation:
6. The power to reopen a completed assessment under Section 147 of the Act has been bestowed on the Assessing Officer, if he has reason to believe that any income chargeable to tax has escaped assessment for any assessment year. However, this belief that income has escaped assessment has to be the reasonable belief of the Assessing Officer himself and cannot be an opinion and/or belief of some other authority. In fact, the Supreme Court in the matter of India Eastern Newspaper Society v. Commissioner of Income Tax, New Delhi, reported in 119 ITR page 996 has held that whether an assessment has escaped assessment or not must be determined by the Assessing Officer himself. The Assessing Officer cannot blindly follow the opinion of an audit authority for the purpose of arriving at a belief that income has escaped assessment. In the present facts, it would be noticed that the reasons for which the assessment for the assessment yearis sought to be reopened by communication dated 12.10.2011 are identical to the objection of the audit authority dated 29.12.2009. The reasons do not rely upon any tangible material in the audit report but merely upon an opinion and the existing material already on record. This itself indicates that there was no independent application of mind by the Assessing Officer before he issued the impugned notice. On this ground alone, the assumption of jurisdiction by the Assessing Officer can be faulted.Therefore, in the present facts one would have to examine the contention of the Petitioner that the impugned notice is without jurisdiction as the self same facts were not only before the Assessing Officer but he had also viewed the very issues on which the assessment is sought to be reopened. So far as, the issue in respect of provisions claimed as deduction for arriving at taxable profit aggregating to Rs.52.87 crores is concerned, the same was not only disclosed in the notes to account filed with the return of Income but also in response to specific queries raised during the assessment proceeding. It was reiterated at the hearing that on the aforesaid account of provision, the tax had already been paid in the earlier years and the amounts were merely written back in this year to the extent they were in excess of the provisions required. So far as, failure to deduct TDS on advertisement and sales promotion are concerned leading to disallowance of the entire amount of Rs.22.48 crores under Section 40(a)(ia) the same was also subject to scrutiny by the Assessing Officer during the assessment proceedings.In fact, the clause 17(f) of the tax audit report submitted alongwith return of income clearly brings out the fact that where tax has not been deducted, then the entire amount of payment has been offered for disallowance under Section 40(a)(ia). In fact, by letters dated 10.11.2008 and 26.12.2008 in response to specific queries of the Assessing Officer during assessment proceedings the petitioner had pointed out alongwith details the expenses in respect of which the tax had not been deducted and which were offered to tax. So far as, the reason to reopen the assessment on the ground that the petitioner had declared short term capital gains of Rs.3.63 crores in respect of income earned out of investments had to be taxed/classified as business Income is concerned, it is not disputed before us that the treatment given was consistent with the earlier year practice and accepted by the Respondent. Further, it is not disputed before us that the short term capital gains have been assessed to the maximum marginal rate and even if considered as business income, the tax effect would be the same. Consequently, there could be no reasonable basis to have a belief that there is any escapement of Income.9. Therefore, in view of the above, we are of the view that the impugned notice is without jurisdiction and the impugned order dealing with the objection of the Petitioner is non speaking order in as much as it does not deal with any of the objections raised by the Petitioner in its objections.
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U.P.State Brassware Corpn. Ltd. Vs. Udai Narain Pandey | service was held to have been made in violation of Section 25F of the Industrial Disputes Act, 1947 stating: ... A host of factors like the manner and method of selection and appointment i.e. whether after proper advertisement of the vacancy or inviting applications from the employment exchange, nature of appointment, namely, whether and hoc, short term, daily wage, temporary or permanent in character, any special qualification required for the job and the like should be weighed and balanced in taking a decision regarding award of back wages. One of the important factors, which has to be taken into consideration, is the length of service, which the workman had rendered with the employer. If the workman has rendered a considerable period of service and his services are wrongfully terminated, he may be awarded full or partial back wages keeping in view the fact that at his age and the qualification possessed by him he may not be in a position to get another employment. However, where the total length of service rendered by a workman is very small, the award of back wages for the complete period i.e. from the date of termination till the date of the award, which our experience shows is often quite large, would be wholly inappropriate. Another important factor, which requires to be taken into consideration is the nature of employment. A regular service of permanent character cannot be compared to short or intermittent daily-wage employment though it may be for 240 days in a calendar year. 57. In A.P. State Road Transport Corporation and Others vs. Abdul Kareem [(2005) 6 SCC 36] while the Labour Court directed reinstatement with continuity of service of the Respondent but without back wages, this Court denied even the continuity of service. 58. A Division Bench of this Court In M.L. Binjolkar vs. State of Madhya Pradesh [JT 2005 (6) SC 461 : (2005) 6 SCC 224] , referring to a large number of decisions, held: 7... The earlier view was that whenever there is interference with the order of termination or retirement, full back wages were the natural corollary. It has been laid down in the cases noted above that it would depend upon several factors and the Court has to weigh the pros and cons of each case and to take a pragmatic view... 59. In Management of Madurantakam Coop. Sugar Mills Ltd. vs. S. Viswanathan [(2005) 3 SCC 193] , quantum of back wages was confined to 50% stating: 19..It is an undisputed fact that the workman had since attained the age of superannuation and the question of reinstatement does not arise. Because of the award, the respondent workman will be entitled to this retiral benefits like gratuity, etc. and accepting the statement of the learned Senior Counsel for the appellant Mills that it is undergoing a financial crisis, on the facts of this case we think it appropriate that the full back wages granted by the Labour Court be reduced to 50% of the back wages.. 60. In State of U.P. and others vs. Ram Bachan Tripathi (2005) 6 SCC 496) , this Court denied the service benefits for the period the employee remained absent. 61. In Rajasthan State Road Transport Corpn. and Others vs. Shyam Bihari Lal Gupta (2005) 7 SCC 406, it was observed: 3. According to the learned counsel for the appellant Corporation, the decree is absolutely silent so far as the back wages are concerned. The decree in essence contains only a declaratory relief without any consequential payment for monetary benefits. That being so, the executing court and the High Court were not justified in granting the relief sought for. Learned counsel for the respondent on the other hand submitted that when the decree clearly indicated that the termination was illegal non est, as a natural corollary the plaintiff was entitled to the back wages. 62. In the instant case, we have noticed hereinbefore that the establishment of the Appellant wherein the Respondent could be directed to be reinstated had been sold on 26.3.1993. In that view of the matter, Section 60 of the U.P. Industrial Disputes Act would apply in terms whereof compensation will be payable in the same manner as if he was retrenched under Section 6N thereof. 63. It is not in dispute that the Respondent did not arise any plea in his written statement that he was not gainfully employed during the said period. It is now well-settled by various decisions of this Court that although earlier this Court insisted that it was for the employer to raise the aforementioned plea but having regard to the provisions of Section 106 of the Indian Evidence Act or the provisions analogous thereto, such a plea should be raised by the workman. In Kendriya Vidyalaya Sangathan (supra), this Court held: ... When the question of determining the entitlement of a person to back wages is concerned, the employee has to show that he was not gainfully employed. The initial burden is on him. After and if he places materials in that regard, the employer can bring on record materials to rebut the claim. In the instant case, the respondent had neither pleaded nor placed any material in that regard. (See also Allahabad Jal Sansthan (supra) para 6) 64. The only question is whether the Respondent would be entitled to back wages from the date of his termination of service till the aforementioned date. The decision to close down the establishment by the State of Uttar Pradesh like other public sector organizations had been taken as far back on 17.11.1990 wherefor a GO had been issued. It had further been averred, which has been noticed hereinbefore, that the said GO has substantially been implemented. In this view of the matter, we are of the opinion that interest of justice would be subserved if the back wages payable to the Respondent for the period 1. 4.1987 to 26.3.1993 is confined to 25% of the total back wages payable during the said period. | 1[ds]13. It is not in dispute that the Respondent was appointed on daily wages. He on his own showing was appointed in a project work to look after the construction of building16. The Labour Court in its impugned award has not arrived at any finding that the order of appointment dated 8.1.1987 whereby the Respondent was appointed afresh in the Non Ferrous Rolling Mill was by way of unfair labour practice. It is, however, true that the Appellant relying on or on the basis of the aforementioned order dated 12/13.2.1987 in terms whereof the Respondents services were approved for appointment in the said mill on minimum daily wages for the period 8.1.1987 till 31.3.1987 terminated his services without giving any notice or paying salary of one month in lieu thereof. No compensation in terms of Section 6-N of the U.P Industrial Disputes Act was also paid17. Before adverting to the decisions relied upon by the learned counsel for the parties, we may observe that although direction to pay full back wages on a declaration that the order of termination was invalid used to be the usual result but now, with the passage of time, a pragmatic view of the matter is being taken by the court realizing that an industry may not be compelled to pay to the workman for the period during which he apparently contributed little or nothing at all to it and/or for a period that was spent unproductively as a result whereof the employer would be compelled to go back to a situation which prevailed many years ago, namely, when the workman was retrenchedIt is not disputed that the Respondent did not plead that he after his purported retrenchment was wholly unemployed21. The Labour Court although passed its award relying on or on the basis of the certificate issued by the Appellant, it did not hold that during the preceding 12 months, namely, for the period 1st April, 1986 to 31st March, 1987 the workman had completed 240 days of service. Unfortunately, neither the Labour Court nor the High Court considered this aspect of the matter in right perspective22. No precise formula can be laid down as to under what circumstances payment of entire back wages should be allowed. Indisputably, it depends upon the facts and circumstances of each case. It would, however, not be correct to contend that it is automatic. It should not be granted mechanically only because on technical grounds or otherwise an order of termination is found to be in contravention of the provisions of Section 6-N of the U.P. Industrial Disputes Act39. The decisions of this Court strongly relied upon by Mr. Sangal, therefore, do not speak in one voice that the industrial court or for that matter the High Court or this Court would not have any discretionary role to play in the matter of moulding the relief. If a judgment is rendered merely having regard to the fact situation obtaining therein, the same, in our opinion, could not be a declaration of law within the meaning of Article 141 of the Constitution of India62. In the instant case, we have noticed hereinbefore that the establishment of the Appellant wherein the Respondent could be directed to be reinstated had been sold on 26.3.1993. In that view of the matter, Section 60 of the U.P. Industrial Disputes Act would apply in terms whereof compensation will be payable in the same manner as if he was retrenched under Section 6N thereof63. It is not in dispute that the Respondent did not arise any plea in his written statement that he was not gainfully employed during the said period. It is now well-settled by various decisions of this Court that although earlier this Court insisted that it was for the employer to raise the aforementioned plea but having regard to the provisions of Section 106 of the Indian Evidence Act or the provisions analogous thereto, such a plea should be raised by the workman64. The only question is whether the Respondent would be entitled to back wages from the date of his termination of service till the aforementioned date. The decision to close down the establishment by the State of Uttar Pradesh like other public sector organizations had been taken as far back on 17.11.1990 wherefor a GO had been issued. It had further been averred, which has been noticed hereinbefore, that the said GO has substantially been implemented. In this view of the matter, we are of the opinion that interest of justice would be subserved if the back wages payable to the Respondent for the period 1. 4.1987 to 26.3.1993 is confined to 25% of the total back wages payable during the said periodIn that view of the matter, although no notice was required to be service in view of the proviso to Clause (a) of Section 6-N of the U.P. Industrial Disputes Act, compensation therefor as provided for in Clause (b) was payable. But, it is not necessary for us to go into the correctness or otherwise of the said decision as it is not disputed that before the provisions of Section 6-N of the U.P. Industrial Disputes Act can be invoked, the concerned workman must work at least for 240 days during a period of twelve calendar months preceding the date with reference to which calculation is to be made48. The Court, therefore, emphasized that while granting relief application of mind on the part of the industrial court is imperative. Payment of full back wages, therefore, cannot be the natural consequence. | 1 | 7,036 | 998 | ### Instruction:
Make a prediction on the court's ruling (acceptance (1) or rejection (0) of the petition), and then dissect the proceeding to provide a detailed explanation using key textual passages.
### Input:
service was held to have been made in violation of Section 25F of the Industrial Disputes Act, 1947 stating: ... A host of factors like the manner and method of selection and appointment i.e. whether after proper advertisement of the vacancy or inviting applications from the employment exchange, nature of appointment, namely, whether and hoc, short term, daily wage, temporary or permanent in character, any special qualification required for the job and the like should be weighed and balanced in taking a decision regarding award of back wages. One of the important factors, which has to be taken into consideration, is the length of service, which the workman had rendered with the employer. If the workman has rendered a considerable period of service and his services are wrongfully terminated, he may be awarded full or partial back wages keeping in view the fact that at his age and the qualification possessed by him he may not be in a position to get another employment. However, where the total length of service rendered by a workman is very small, the award of back wages for the complete period i.e. from the date of termination till the date of the award, which our experience shows is often quite large, would be wholly inappropriate. Another important factor, which requires to be taken into consideration is the nature of employment. A regular service of permanent character cannot be compared to short or intermittent daily-wage employment though it may be for 240 days in a calendar year. 57. In A.P. State Road Transport Corporation and Others vs. Abdul Kareem [(2005) 6 SCC 36] while the Labour Court directed reinstatement with continuity of service of the Respondent but without back wages, this Court denied even the continuity of service. 58. A Division Bench of this Court In M.L. Binjolkar vs. State of Madhya Pradesh [JT 2005 (6) SC 461 : (2005) 6 SCC 224] , referring to a large number of decisions, held: 7... The earlier view was that whenever there is interference with the order of termination or retirement, full back wages were the natural corollary. It has been laid down in the cases noted above that it would depend upon several factors and the Court has to weigh the pros and cons of each case and to take a pragmatic view... 59. In Management of Madurantakam Coop. Sugar Mills Ltd. vs. S. Viswanathan [(2005) 3 SCC 193] , quantum of back wages was confined to 50% stating: 19..It is an undisputed fact that the workman had since attained the age of superannuation and the question of reinstatement does not arise. Because of the award, the respondent workman will be entitled to this retiral benefits like gratuity, etc. and accepting the statement of the learned Senior Counsel for the appellant Mills that it is undergoing a financial crisis, on the facts of this case we think it appropriate that the full back wages granted by the Labour Court be reduced to 50% of the back wages.. 60. In State of U.P. and others vs. Ram Bachan Tripathi (2005) 6 SCC 496) , this Court denied the service benefits for the period the employee remained absent. 61. In Rajasthan State Road Transport Corpn. and Others vs. Shyam Bihari Lal Gupta (2005) 7 SCC 406, it was observed: 3. According to the learned counsel for the appellant Corporation, the decree is absolutely silent so far as the back wages are concerned. The decree in essence contains only a declaratory relief without any consequential payment for monetary benefits. That being so, the executing court and the High Court were not justified in granting the relief sought for. Learned counsel for the respondent on the other hand submitted that when the decree clearly indicated that the termination was illegal non est, as a natural corollary the plaintiff was entitled to the back wages. 62. In the instant case, we have noticed hereinbefore that the establishment of the Appellant wherein the Respondent could be directed to be reinstated had been sold on 26.3.1993. In that view of the matter, Section 60 of the U.P. Industrial Disputes Act would apply in terms whereof compensation will be payable in the same manner as if he was retrenched under Section 6N thereof. 63. It is not in dispute that the Respondent did not arise any plea in his written statement that he was not gainfully employed during the said period. It is now well-settled by various decisions of this Court that although earlier this Court insisted that it was for the employer to raise the aforementioned plea but having regard to the provisions of Section 106 of the Indian Evidence Act or the provisions analogous thereto, such a plea should be raised by the workman. In Kendriya Vidyalaya Sangathan (supra), this Court held: ... When the question of determining the entitlement of a person to back wages is concerned, the employee has to show that he was not gainfully employed. The initial burden is on him. After and if he places materials in that regard, the employer can bring on record materials to rebut the claim. In the instant case, the respondent had neither pleaded nor placed any material in that regard. (See also Allahabad Jal Sansthan (supra) para 6) 64. The only question is whether the Respondent would be entitled to back wages from the date of his termination of service till the aforementioned date. The decision to close down the establishment by the State of Uttar Pradesh like other public sector organizations had been taken as far back on 17.11.1990 wherefor a GO had been issued. It had further been averred, which has been noticed hereinbefore, that the said GO has substantially been implemented. In this view of the matter, we are of the opinion that interest of justice would be subserved if the back wages payable to the Respondent for the period 1. 4.1987 to 26.3.1993 is confined to 25% of the total back wages payable during the said period.
### Response:
1
### Explanation:
13. It is not in dispute that the Respondent was appointed on daily wages. He on his own showing was appointed in a project work to look after the construction of building16. The Labour Court in its impugned award has not arrived at any finding that the order of appointment dated 8.1.1987 whereby the Respondent was appointed afresh in the Non Ferrous Rolling Mill was by way of unfair labour practice. It is, however, true that the Appellant relying on or on the basis of the aforementioned order dated 12/13.2.1987 in terms whereof the Respondents services were approved for appointment in the said mill on minimum daily wages for the period 8.1.1987 till 31.3.1987 terminated his services without giving any notice or paying salary of one month in lieu thereof. No compensation in terms of Section 6-N of the U.P Industrial Disputes Act was also paid17. Before adverting to the decisions relied upon by the learned counsel for the parties, we may observe that although direction to pay full back wages on a declaration that the order of termination was invalid used to be the usual result but now, with the passage of time, a pragmatic view of the matter is being taken by the court realizing that an industry may not be compelled to pay to the workman for the period during which he apparently contributed little or nothing at all to it and/or for a period that was spent unproductively as a result whereof the employer would be compelled to go back to a situation which prevailed many years ago, namely, when the workman was retrenchedIt is not disputed that the Respondent did not plead that he after his purported retrenchment was wholly unemployed21. The Labour Court although passed its award relying on or on the basis of the certificate issued by the Appellant, it did not hold that during the preceding 12 months, namely, for the period 1st April, 1986 to 31st March, 1987 the workman had completed 240 days of service. Unfortunately, neither the Labour Court nor the High Court considered this aspect of the matter in right perspective22. No precise formula can be laid down as to under what circumstances payment of entire back wages should be allowed. Indisputably, it depends upon the facts and circumstances of each case. It would, however, not be correct to contend that it is automatic. It should not be granted mechanically only because on technical grounds or otherwise an order of termination is found to be in contravention of the provisions of Section 6-N of the U.P. Industrial Disputes Act39. The decisions of this Court strongly relied upon by Mr. Sangal, therefore, do not speak in one voice that the industrial court or for that matter the High Court or this Court would not have any discretionary role to play in the matter of moulding the relief. If a judgment is rendered merely having regard to the fact situation obtaining therein, the same, in our opinion, could not be a declaration of law within the meaning of Article 141 of the Constitution of India62. In the instant case, we have noticed hereinbefore that the establishment of the Appellant wherein the Respondent could be directed to be reinstated had been sold on 26.3.1993. In that view of the matter, Section 60 of the U.P. Industrial Disputes Act would apply in terms whereof compensation will be payable in the same manner as if he was retrenched under Section 6N thereof63. It is not in dispute that the Respondent did not arise any plea in his written statement that he was not gainfully employed during the said period. It is now well-settled by various decisions of this Court that although earlier this Court insisted that it was for the employer to raise the aforementioned plea but having regard to the provisions of Section 106 of the Indian Evidence Act or the provisions analogous thereto, such a plea should be raised by the workman64. The only question is whether the Respondent would be entitled to back wages from the date of his termination of service till the aforementioned date. The decision to close down the establishment by the State of Uttar Pradesh like other public sector organizations had been taken as far back on 17.11.1990 wherefor a GO had been issued. It had further been averred, which has been noticed hereinbefore, that the said GO has substantially been implemented. In this view of the matter, we are of the opinion that interest of justice would be subserved if the back wages payable to the Respondent for the period 1. 4.1987 to 26.3.1993 is confined to 25% of the total back wages payable during the said periodIn that view of the matter, although no notice was required to be service in view of the proviso to Clause (a) of Section 6-N of the U.P. Industrial Disputes Act, compensation therefor as provided for in Clause (b) was payable. But, it is not necessary for us to go into the correctness or otherwise of the said decision as it is not disputed that before the provisions of Section 6-N of the U.P. Industrial Disputes Act can be invoked, the concerned workman must work at least for 240 days during a period of twelve calendar months preceding the date with reference to which calculation is to be made48. The Court, therefore, emphasized that while granting relief application of mind on the part of the industrial court is imperative. Payment of full back wages, therefore, cannot be the natural consequence.
|
Voltas Limited Vs. Union of India | the Company is entitled to such deduction. The submission is entirely devoid of any merit for more than one reason. In the first instance, the claim that the Company did not produce enough documents to support the claim of deduction of maintenance service charges is incorrect. The Company filed revised price list and the price lists demonstrated the amount charged towards maintenance service contract from the customer. In addition to the price lists, the Company filed certificate in respect of maintenance service dated February 6, 1984 issued by the Chartered Accountant in support of the claim. The Assistant Collector not only did not reject the certificate but accepted the same in respect of deduction sought by the Company on account of additional tax on sales tax. Shri Desai made a faint attempt to urge that the production of certificate by Chartered accountant is not sufficient documentary evidence to substantiate the claim. The submission is not correct. After the decision of the Supreme Court in Bombay Tyres International Limited delivered on October 7, 1983, the Government of India, Ministry of Finance issued circular dated December 3, 1983 to all the Collectors of Central Excise. The circular, inter alia, recites that the Assistant Collectors and the Collectors would be required to take up large number of cases for settling the claims arising out of decision of the Supreme Court. The Circular states that it would be very difficult to verify the claims of deductions with reference to each and every voucher/bill and, therefore, the manufacturers should be requested to give a consolidated statement explaining the expenses incurred and which statement should be duly verified and certified by the Chartered Accountant. The Collectors were directed to accept such statements without going into much details with regard to the verification of the individual/voucher etc. The assistant Collector in the present case accepted the statement duly verified and certified by the chartered Accountant of the Company and in fact granted relief of deduction under the heading of additional tax on sales tax. It is, therefore, futile for Shri Desai to suggest that reliance on the certificate issued by the Chartered Accountant was not justified and the certificate itself is not suffice to establish the claim. It also cannot be overlooked that the Assistant Collector had not declined relief on the ground of insufficiency of the material. The Assistant Collector turned down the claim on the basis that the maintenance service charges amount to after-sale service for promoting the article and, therefore, should be included while assessing the value of the article for the purpose of excise duty. The Assistant Collector never doubted or disputed the correctness of the statement made in the price list or in the certificate issued by the Chartered Accountant. In our judgment, the Assistant Collector was clearly in error in not granting deduction in respect of maintenance service charges recovered by the Company in respect of manufactured articles and the order of the Assistant Collector on this count cannot be sustained.( 9 ) SHRI Andhyarujina then submitted that the conclusion of the Assistant Collector that site service charges also cannot be deducted while determining the assessable value is erroneous. The submission is correct and deserves acceptance. Before examining the submission, it is necessary to understand what service is rendered by the Company in respect of contract for site service. The Company carries out several functions to ensure that the Units are maintained property at site by the dealer. The Company provides design assistance to the dealer for special type of installation. The Company also inspects the actual installation of the Units and also helps the dealer in solving special problems encountered after installation. The site service also includes attending to customers complaints received directly by Voltas in respect of Units serviced by the dealer. The Company sells the air-conditioners/water coolers to recognised dealers on a principle to principle basis and the dealer fulfills the warranty obligations to its customers. The site services rendered by the Company are independent of the warranty obligations and maintenance service. The Assistant Collector did not furnish any reasons apart from those which were mentioned hereinabove for rejecting the claim for deduction in respect of maintenance charges to turn down this claim also. Shri Desai submitted that site service charges also should be included in the assessable value for the identical reasons which were urged in respect of maintenance service charges. In other words, the submission was that site service charges is nothing different from the services rendered under the warranty obligations. We are unable to find any merit in the submission. The warranty obligation does not require the Company to provide design assistance to the dealer for special type of installation or to inspect the actual installation. In our judgment, the site service charges are recovered by the Company for rendering special service for giving advice in regard to the manner of installation and the charges recovered for rendering such service cannot be included while determining the assessable value of the Unit. The customer is not bound to purchase the air-conditioner or water cooler from the company even though the design assistance for special type of installation is secured from the Company by payment of site service charges. In our judgment, the site service charges are required to be excluded while determining the assessable value of the article. The Assistant Collector was, therefore, in error in not excluding the maintenance service charges and site service charges while approving the revised price lists for the period commencing from May 19, 1980 and ending with December 29, 1983. Shri Desai made a brave attempt to submit the matter should be remitted back to the Assistant collector for re-consideration but we fail to appreciate why such course should be adopted, nor shri Desai could give a convincing answer. The matters are not remitted back to the Assistant collector for fresh consideration only because the Department so desires. In our judgment, there is no occasion whatsoever to grant such request. | 1[ds]There is considerable merit in the submission of the learnedis not possible to accede to the submission of the learned counsel. As mentioned hereinabove, there is clear line of distinction between the obligations under the warranty and the obligations under the maintenanceis also clear from the perusal of the brochure that the warranty does not assure the customer of service machine during the period of repair and also requires the customer to produce the machine at the service station, while the facility of availability of service machine is available in terms of contract of maintenance of service. It is, therefore, futile for Shri Desai to urge that the services rendered under the warranty and under maintenance service contract are similar. The services are different and distinct and though the Company is bound to furnish warranty and the customer is liable to pay for the warranty charges, the maintenance service is purely optional. Shri Desai submitted with reference to decision of the Supreme Court in Bombay Tyres international Limited (A. I. R. 1984 Supreme Court 420) that the charges for other services after delivery to the buyer cannot be deducted and in support of the submission placed strong reliance upon the observation made by the Supreme Court in paragraph 51 of theis not possible to accede to the submission of Shri Desai that maintenance service offered by the company promote the marketability of the article and, therefore, should enter into its value. It was also not possible to appreciate the observation made by the Assistant Collector that the maintenance service charges are not deductible because the Supreme Court has expressly laid down that no other expenses except trade discount, excise duty and average freight will be deductible for the purpose of determining the value of the excisable goods. On the other hand in paragraph 57 of the judgment in the case of Bombay Tyres International Limited, it was specifically observed that the Supreme Court had considered only those claims of deduction as sought by the assessee in that case and the judgment is confined only to those items and no other head of expenses had been examined by the Supreme Court. In these circumstances, it was wrong on the part of the Assistant Collector to refuse to grant relief of deduction in respect of maintenance service charges and the order on this count cannot be sustained. Shri Desai in support of his submission that whatever charges are recovered by the Company during the warranty period shall be included in the price to be determined as assessable value, referred to the decision in the case of Collector of Central Excise v. Kelvinator of India Ltd. reported in 1988 (36) Excise Law Times 517 . We are unable to appreciate how the judgment supports the claim of the learned counsel. In the case before the Supreme Court after the free warranty of one year is over, the manufacturer offered a four year service contract only for the sealed system or parts of the refrigerators. The service offered was not free but on payment and the contract was not compulsory but optional. The Supreme Court held that since four year warranty service is optional and this is entered into after the date of sale, that was clearlyfacility and the charges cannot be included in the assessable value of the refrigerator. In our judgment, the decision of the Supreme Court instead of supporting Shri Desai goes against his submission that every item in respect ofservice is required to be included in the assessable value of thesubmission is notis, therefore, futile for Shri Desai to suggest that reliance on the certificate issued by the Chartered Accountant was not justified and the certificate itself is not suffice to establish the claim. It also cannot be overlooked that the Assistant Collector had not declined relief on the ground of insufficiency of the material. The Assistant Collector turned down the claim on the basis that the maintenance service charges amount toservice for promoting the article and, therefore, should be included while assessing the value of the article for the purpose of excise duty. The Assistant Collector never doubted or disputed the correctness of the statement made in the price list or in the certificate issued by the Chartered Accountant. In our judgment, the Assistant Collector was clearly in error in not granting deduction in respect of maintenance service charges recovered by the Company in respect of manufactured articles and the order of the Assistant Collector on this count cannot besubmission is correct and deservesare unable to find any merit in the submission. The warranty obligation does not require the Company to provide design assistance to the dealer for special type of installation or to inspect the actual installation. In our judgment, the site service charges are recovered by the Company for rendering special service for giving advice in regard to the manner of installation and the charges recovered for rendering such service cannot be included while determining the assessable value of the Unit. The customer is not bound to purchase theor water cooler from the company even though the design assistance for special type of installation is secured from the Company by payment of site service charges. In our judgment, the site service charges are required to be excluded while determining the assessable value of the article. The Assistant Collector was, therefore, in error in not excluding the maintenance service charges and site service charges while approving the revised price lists for the period commencing from May 19, 1980 and ending with December 29, 1983. Shri Desai made a brave attempt to submit the matter should be remitted back to the Assistant collector forbut we fail to appreciate why such course should be adopted, nor shri Desai could give a convincing answer. The matters are not remitted back to the Assistant collector for fresh consideration only because the Department so desires. In our judgment, there is no occasion whatsoever to grant such request. | 1 | 4,379 | 1,060 | ### Instruction:
Ascertain if the court will uphold (1) or dismiss (0) the appeal in the case proceeding, and then clarify this prediction by discussing critical sentences from the text.
### Input:
the Company is entitled to such deduction. The submission is entirely devoid of any merit for more than one reason. In the first instance, the claim that the Company did not produce enough documents to support the claim of deduction of maintenance service charges is incorrect. The Company filed revised price list and the price lists demonstrated the amount charged towards maintenance service contract from the customer. In addition to the price lists, the Company filed certificate in respect of maintenance service dated February 6, 1984 issued by the Chartered Accountant in support of the claim. The Assistant Collector not only did not reject the certificate but accepted the same in respect of deduction sought by the Company on account of additional tax on sales tax. Shri Desai made a faint attempt to urge that the production of certificate by Chartered accountant is not sufficient documentary evidence to substantiate the claim. The submission is not correct. After the decision of the Supreme Court in Bombay Tyres International Limited delivered on October 7, 1983, the Government of India, Ministry of Finance issued circular dated December 3, 1983 to all the Collectors of Central Excise. The circular, inter alia, recites that the Assistant Collectors and the Collectors would be required to take up large number of cases for settling the claims arising out of decision of the Supreme Court. The Circular states that it would be very difficult to verify the claims of deductions with reference to each and every voucher/bill and, therefore, the manufacturers should be requested to give a consolidated statement explaining the expenses incurred and which statement should be duly verified and certified by the Chartered Accountant. The Collectors were directed to accept such statements without going into much details with regard to the verification of the individual/voucher etc. The assistant Collector in the present case accepted the statement duly verified and certified by the chartered Accountant of the Company and in fact granted relief of deduction under the heading of additional tax on sales tax. It is, therefore, futile for Shri Desai to suggest that reliance on the certificate issued by the Chartered Accountant was not justified and the certificate itself is not suffice to establish the claim. It also cannot be overlooked that the Assistant Collector had not declined relief on the ground of insufficiency of the material. The Assistant Collector turned down the claim on the basis that the maintenance service charges amount to after-sale service for promoting the article and, therefore, should be included while assessing the value of the article for the purpose of excise duty. The Assistant Collector never doubted or disputed the correctness of the statement made in the price list or in the certificate issued by the Chartered Accountant. In our judgment, the Assistant Collector was clearly in error in not granting deduction in respect of maintenance service charges recovered by the Company in respect of manufactured articles and the order of the Assistant Collector on this count cannot be sustained.( 9 ) SHRI Andhyarujina then submitted that the conclusion of the Assistant Collector that site service charges also cannot be deducted while determining the assessable value is erroneous. The submission is correct and deserves acceptance. Before examining the submission, it is necessary to understand what service is rendered by the Company in respect of contract for site service. The Company carries out several functions to ensure that the Units are maintained property at site by the dealer. The Company provides design assistance to the dealer for special type of installation. The Company also inspects the actual installation of the Units and also helps the dealer in solving special problems encountered after installation. The site service also includes attending to customers complaints received directly by Voltas in respect of Units serviced by the dealer. The Company sells the air-conditioners/water coolers to recognised dealers on a principle to principle basis and the dealer fulfills the warranty obligations to its customers. The site services rendered by the Company are independent of the warranty obligations and maintenance service. The Assistant Collector did not furnish any reasons apart from those which were mentioned hereinabove for rejecting the claim for deduction in respect of maintenance charges to turn down this claim also. Shri Desai submitted that site service charges also should be included in the assessable value for the identical reasons which were urged in respect of maintenance service charges. In other words, the submission was that site service charges is nothing different from the services rendered under the warranty obligations. We are unable to find any merit in the submission. The warranty obligation does not require the Company to provide design assistance to the dealer for special type of installation or to inspect the actual installation. In our judgment, the site service charges are recovered by the Company for rendering special service for giving advice in regard to the manner of installation and the charges recovered for rendering such service cannot be included while determining the assessable value of the Unit. The customer is not bound to purchase the air-conditioner or water cooler from the company even though the design assistance for special type of installation is secured from the Company by payment of site service charges. In our judgment, the site service charges are required to be excluded while determining the assessable value of the article. The Assistant Collector was, therefore, in error in not excluding the maintenance service charges and site service charges while approving the revised price lists for the period commencing from May 19, 1980 and ending with December 29, 1983. Shri Desai made a brave attempt to submit the matter should be remitted back to the Assistant collector for re-consideration but we fail to appreciate why such course should be adopted, nor shri Desai could give a convincing answer. The matters are not remitted back to the Assistant collector for fresh consideration only because the Department so desires. In our judgment, there is no occasion whatsoever to grant such request.
### Response:
1
### Explanation:
There is considerable merit in the submission of the learnedis not possible to accede to the submission of the learned counsel. As mentioned hereinabove, there is clear line of distinction between the obligations under the warranty and the obligations under the maintenanceis also clear from the perusal of the brochure that the warranty does not assure the customer of service machine during the period of repair and also requires the customer to produce the machine at the service station, while the facility of availability of service machine is available in terms of contract of maintenance of service. It is, therefore, futile for Shri Desai to urge that the services rendered under the warranty and under maintenance service contract are similar. The services are different and distinct and though the Company is bound to furnish warranty and the customer is liable to pay for the warranty charges, the maintenance service is purely optional. Shri Desai submitted with reference to decision of the Supreme Court in Bombay Tyres international Limited (A. I. R. 1984 Supreme Court 420) that the charges for other services after delivery to the buyer cannot be deducted and in support of the submission placed strong reliance upon the observation made by the Supreme Court in paragraph 51 of theis not possible to accede to the submission of Shri Desai that maintenance service offered by the company promote the marketability of the article and, therefore, should enter into its value. It was also not possible to appreciate the observation made by the Assistant Collector that the maintenance service charges are not deductible because the Supreme Court has expressly laid down that no other expenses except trade discount, excise duty and average freight will be deductible for the purpose of determining the value of the excisable goods. On the other hand in paragraph 57 of the judgment in the case of Bombay Tyres International Limited, it was specifically observed that the Supreme Court had considered only those claims of deduction as sought by the assessee in that case and the judgment is confined only to those items and no other head of expenses had been examined by the Supreme Court. In these circumstances, it was wrong on the part of the Assistant Collector to refuse to grant relief of deduction in respect of maintenance service charges and the order on this count cannot be sustained. Shri Desai in support of his submission that whatever charges are recovered by the Company during the warranty period shall be included in the price to be determined as assessable value, referred to the decision in the case of Collector of Central Excise v. Kelvinator of India Ltd. reported in 1988 (36) Excise Law Times 517 . We are unable to appreciate how the judgment supports the claim of the learned counsel. In the case before the Supreme Court after the free warranty of one year is over, the manufacturer offered a four year service contract only for the sealed system or parts of the refrigerators. The service offered was not free but on payment and the contract was not compulsory but optional. The Supreme Court held that since four year warranty service is optional and this is entered into after the date of sale, that was clearlyfacility and the charges cannot be included in the assessable value of the refrigerator. In our judgment, the decision of the Supreme Court instead of supporting Shri Desai goes against his submission that every item in respect ofservice is required to be included in the assessable value of thesubmission is notis, therefore, futile for Shri Desai to suggest that reliance on the certificate issued by the Chartered Accountant was not justified and the certificate itself is not suffice to establish the claim. It also cannot be overlooked that the Assistant Collector had not declined relief on the ground of insufficiency of the material. The Assistant Collector turned down the claim on the basis that the maintenance service charges amount toservice for promoting the article and, therefore, should be included while assessing the value of the article for the purpose of excise duty. The Assistant Collector never doubted or disputed the correctness of the statement made in the price list or in the certificate issued by the Chartered Accountant. In our judgment, the Assistant Collector was clearly in error in not granting deduction in respect of maintenance service charges recovered by the Company in respect of manufactured articles and the order of the Assistant Collector on this count cannot besubmission is correct and deservesare unable to find any merit in the submission. The warranty obligation does not require the Company to provide design assistance to the dealer for special type of installation or to inspect the actual installation. In our judgment, the site service charges are recovered by the Company for rendering special service for giving advice in regard to the manner of installation and the charges recovered for rendering such service cannot be included while determining the assessable value of the Unit. The customer is not bound to purchase theor water cooler from the company even though the design assistance for special type of installation is secured from the Company by payment of site service charges. In our judgment, the site service charges are required to be excluded while determining the assessable value of the article. The Assistant Collector was, therefore, in error in not excluding the maintenance service charges and site service charges while approving the revised price lists for the period commencing from May 19, 1980 and ending with December 29, 1983. Shri Desai made a brave attempt to submit the matter should be remitted back to the Assistant collector forbut we fail to appreciate why such course should be adopted, nor shri Desai could give a convincing answer. The matters are not remitted back to the Assistant collector for fresh consideration only because the Department so desires. In our judgment, there is no occasion whatsoever to grant such request.
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Commissioner of Customs, Mumbai Vs. M/s. Aban Loyd Chiles Offshore Ltd. & Others | Bombay High Court in Pride Foramer (supra) was upheld. In this case the rig was operational and used outside the territorial waters limits, but in the designated areas of the continental self and exclusive economic zones, which have been declared by the notification to be a part of the territory of India for limited purpose. The natural consequence of the said notification was to extend the Customs Act and the Customs Tariff Act to the designated areas outside the territorial waters to introduce the custom regime in such areas resulting in levy and collection of custom duty. The issue raised in the said case related to consumption of goods or stores imported by the drilling contractor and supplied to the rig. The stores used for consumption onboard the oil rigs, when stationed in the notified or designated areas, which were deemed to be territorial waters, was chargeable and customs duty was payable. 28. In the case at hand, neither the adjudication order nor the order passed by the tribunal has elucidated or held that the rig in question was in operation in the territorial waters or the designated/deemed territorial waters pursuant to the notification. The issue of chargeability and liability to pay customs duty has been on different precepts and grounds. 29. The adjudication order refers to and is predicated on the rig being brought to the port for repairs in February, 1996 for which permission was sought from the Commissioner of Customs vide letter dated 12th February, 1996 under the provisions of notification No. 153/94 Cus. The rig subsequently moved out of the port after repairs. The rig was brought for the second time to the Mumbai port for repair on 9th November, 1996 and had remained there till 2nd December, 1996. The rig thereafter was taken out and removed from the territorial waters of India as is evincible from the adjudication order. The rig was for the third time brought to the outer anchorage in Mumbai/Mumbai port on 9th December, 1998 and removed from the customs area. On this occasion, for the first time, the authorities felt that the rig had been imported into India when the rig was brought within the territorial waters for repairs. The adjudication order does not record that the rig was in operation within the territorial waters of India. On the other hand, the adjudication order does not spell out that the rig did not operate outside the territorial waters of India. The contention raised by the owner in this regard was neither specifically rejected not a different finding was recorded. The finding was that the rig when it is repaired in India, it is imported into India for home consumption. The adjudication order holds that the repairs undertaken would complete the act of import, for the requirement of home consumption was satisfied. The said finding, in our opinion, is unacceptable and faulty. Mere repair of a vessel is not putting the vessel to use in India and would not result in home consumption as the vessel was not utilized within the territory of India. Repairs are carried on the vessel and not to utilize the vessel. It would not amount to utilization or operation of the vessel/rig in India. Thus, it cannot be said that the vessel, i.e., the rig, was imported into India when it had anchored twice in 1996 and once in 1998 for the purpose of repair, for the element of home consumption is missing even when the vessel, i.e., the rig, had entered the territorial waters. Thus, it would be incorrect to hold that mere repair of the vessel in 1996 or in 1998 would constitute taxable import. 30. The authorities have laid emphasis on the factum that the rig was purchased for being used in the oil field of ONGC and for this purpose the owner had made an application and permission/licence for import was granted by the Ministry of Industry. The rig was purchased from foreign exchange released by the Government on the basis of the import licence for the rig. If the rig was not to be used in India, foreign exchange would not have been released and import licence would not have been granted. This argument on behalf of the department does not further the stand. It cannot be regarded as conclusive. Release of foreign exchange, approval and licence, etc. are prior to the import. Import may not take place in spite of this aforesaid clearances/licence and release of foreign exchange. There may have been violation of another enactment/provision as the rig was not imported, albeit for deciding the question whether the rig was imported into India, the requirement of home consumption has to be satisfied. Then alone, the `good, i.e., the vessel/rig would be taxable and customs duty payable under the Act. Pertinently, the adjudication order does not hold that the import had taken place in 1987 when the rig first put into operation in the high seas. This was not treated as the date of import or home consumption. The import as per the authorities had taken place when the rig was brought for repairs. The evaluation of the rig has been done on the basis of the last visit of the rig for repair in 1998. 31. While we are disposed to accept that there was no import, we would not on the said finding hold that the owner had not violated the provisions of the Act, which are much broader and wider in scope. The Act regulates and mandates compliance by the foreign going vessels when they enter the territorial waters. Provisions of the Act are required to be met and complied with even when no goods are to be unloaded for import into India or the vessel is not a `good meant for home consumption. Thus, violations recorded by the tribunal cannot be found fault with. 32. Thus analysed, we are of the indubitable opinion, that the decision rendered by the tribunal deserves our concurrence and we so do. | 0[ds]Goods for the purpose of the Act includes vessels, aircrafts and vehicles as defined in sub-section (22) to Section 2, yet the distinction has to be recognized between a vessel or an aircraft as a mere good and when the vessel or an aircraft comes to India as a conveyance carrying imported goods. When a vessel or an aircraft is imported into India as a good, customs duty is payable thereon. However, when a vessel is used as a conveyance of an imported good, the position would be different.In this context, reference to Section 43 of the Act would be profitable.14. As per the said provision, Sections 30, 41 and 42 shall not apply to a vehicle, which carries no goods other than the luggage of the occupants. The term `vehicle as defined in sub-section (42) to Section 2 means conveyance of any type used on land. As a logical corollary, it would not include a ship or vessel. Sub-section (2) to Section 43 states that the Central Government may by notification in the Official Gazette exempt the different classes of conveyances from all or any other provisions of the Act. However, we do find some difficulty as taxation or taxability of the `foreign going vessels when they enter Indian territorial waters is not directly addressed in the fasciculus of the Sections from 29 to 43 of the Act. These provisions do make a distinction between goods imported to be unloaded at the port for India and those which are not to be unloaded and in transit.15. At this stage, we would like to first adumbrate on the definition of the term foreign going vessel or aircraft as defined in sub-section (21) of Section 216. The aforesaid expansive definition by way of deeming fiction includes any vessel engaged in fishing or any other operations outside the territorial waters of India. By legal fiction, a vessel engaged in fishing outside the territorial waters of India or any other operations outside the territorial waters of India is to be treated for the purpose of the said Act as a foreign going vessel. When the said conditions are satisfied, whether the said vessel for the time being is engaged in carriage of goods or passengers between a port in India and a port outside India, is not of any relevance. Consequently, a rig which is engaged in operations outside the territorial waters of India would be a foreign going vessel. However, a rig carrying on operations within the territorial waters of India would not be a foreign going vessel. Be it clarified, it is not necessary to dilate and examine the issue whether rigs are vessels, for it is an accepted and admitted position settled beyond doubt.18. The expression import is a wide expression, which would include cognate expressions and means bringing into India from a place outside India. The word India for the purpose of the Act includes the land mass as well as territorial waters. The term dutiable goods are goods which are chargeable to duty and on which duty has not been paid. Once duty has been paid, the goods cease to be dutiable goods. Section 12 of the Act begins with the words Except as otherwise provided in this Act or any other law for the time being in force. Thus, it gives primacy to any other law being in force, and records that the said provision would apply when otherwise not provided in the said Act. Therefore, when any other provision of the Act or other law for the time being provides differently, that would not attract customs duty under Section 12. Duty of custom, subject to the above, is levied at the rates specified under the Customs Tariff Act, 1975 or any other law for the time being in force on the goods imported into or exported from India.23. As is noticeable, in the said case, the vessel was in operation and primarily used within the territorial waters of India and was not used as an ocean going vessel. As a sequitur, it was held that the vessel were goods imported into India for home consumption for they were primarily to be used as a vessel in India, i.e., in the territorial waters. However, the Court was conscious and expressly guarded the said proposition clarifying that it was not pronouncing any dictum as to what would be the position if these goods (the vessel) were not intended to be primarily used in India or used occasionally for short period in India and whether in such situation, the vessel should be treated as a good for home consumption. As the vessel in the said case was brought in India and was primarily used as a transshipper and occasionally in the open seas, it was held to be a good imported for home consumption24. This aforesaid authority, in our opinion, answers the contention raised by the owner that rig in question was not meant for home consumption as the rig never entered the land mass. As long as the rig was used for operations within the territorial waters of India, the rig would meet the requirement and satisfy the condition that it was an imported good meant for home consumption. There would be no doubt on the said legal position in view of the subsequent pronouncement in V.M. Salgaoncar (supra), wherein dwelling on the question of home consumption it was held that the expression `consumption does not involve complete using up of the commodity and would include putting the commodity to use to any type of utility within the territory of India. Even when this condition is satisfied, it would amount to home consumption. The question raised in V.M. Salgaoncar (supra) was whether the vessels used as transshippers can be treated as ocean going vessels and reference was made to the larger Bench of three Judges to consider the ratio in Chowgule and Co. Pvt Ltd (supra). While deciding the said issue, it has been held as under:-25. There is no dispute for the department that by design and equipment, transhippers are intended to be used mostly to carry the cargo from harbours to the high seas and vice versa. That such transhippers often move into the open sea is also not disputed by the department. Thus considering the question from all the different angles, it is reasonable to take the view that merely because transhippers are used for carrying cargo for loading into the bulk carriers (those being unable to touch the port) they cannot be excluded from the category of ocean-going vessels. At any rate it has been demonstrated by the Government that it was not very much interested in segregating transhippers from the category of ocean-going vessels as the Government brought out a new notification enveloping all vessels including transhippers within the ambit of ocean-going vessels, almost immediately after pronouncement of the decision in ChowguleCo. (P) Ltd. That subsequent development on account of its close proximity to time cannot be overlooked as of no impact26. In the result we accept the contention of the owners of the trans-shippers that such vessels are entitled to the benefit of the notification dated 11-10-1958. The appeals are disposed of in the above terms.. The aforesaid passage refers to the Governments decision that had brought out a new notification to envelop all vessels including a transshippers within the ambit of ocean going vessels immediately after the pronouncement in Chowgule and Co. Pvt Ltd (supra)26. The decision in V.M. Salgaoncar (supra) refers to the limits of territorial waters fixed under Section 3(2) of the 1976 Act, which is distance of 12 nautical miles from the nearest point of the appropriate baseline27. In Aban Lyod Chiles Offshore Limited and another v. Union of India and Others, (2008) 11 SCC 439 the view of Division Bench of the Bombay High Court in Pride Foramer (supra) was upheld. In this case the rig was operational and used outside the territorial waters limits, but in the designated areas of the continental self and exclusive economic zones, which have been declared by the notification to be a part of the territory of India for limited purpose. The natural consequence of the said notification was to extend the Customs Act and the Customs Tariff Act to the designated areas outside the territorial waters to introduce the custom regime in such areas resulting in levy and collection of custom duty. The issue raised in the said case related to consumption of goods or stores imported by the drilling contractor and supplied to the rig. The stores used for consumption onboard the oil rigs, when stationed in the notified or designated areas, which were deemed to be territorial waters, was chargeable and customs duty was payable28. In the case at hand, neither the adjudication order nor the order passed by the tribunal has elucidated or held that the rig in question was in operation in the territorial waters or the designated/deemed territorial waters pursuant to the notification. The issue of chargeability and liability to pay customs duty has been on different precepts and grounds29. The adjudication order refers to and is predicated on the rig being brought to the port for repairs in February, 1996 for which permission was sought from the Commissioner of Customs vide letter dated 12th February, 1996 under the provisions of notification No. 153/94 Cus. The rig subsequently moved out of the port after repairs. The rig was brought for the second time to the Mumbai port for repair on 9th November, 1996 and had remained there till 2nd December, 1996. The rig thereafter was taken out and removed from the territorial waters of India as is evincible from the adjudication order. The rig was for the third time brought to the outer anchorage in Mumbai/Mumbai port on 9th December, 1998 and removed from the customs area. On this occasion, for the first time, the authorities felt that the rig had been imported into India when the rig was brought within the territorial waters for repairs. The adjudication order does not record that the rig was in operation within the territorial waters of India. On the other hand, the adjudication order does not spell out that the rig did not operate outside the territorial waters of India. The contention raised by the owner in this regard was neither specifically rejected not a different finding was recorded. The finding was that the rig when it is repaired in India, it is imported into India for home consumption. The adjudication order holds that the repairs undertaken would complete the act of import, for the requirement of home consumption was satisfied. The said finding, in our opinion, is unacceptable and faulty. Mere repair of a vessel is not putting the vessel to use in India and would not result in home consumption as the vessel was not utilized within the territory of India. Repairs are carried on the vessel and not to utilize the vessel. It would not amount to utilization or operation of the vessel/rig in India. Thus, it cannot be said that the vessel, i.e., the rig, was imported into India when it had anchored twice in 1996 and once in 1998 for the purpose of repair, for the element of home consumption is missing even when the vessel, i.e., the rig, had entered the territorial waters. Thus, it would be incorrect to hold that mere repair of the vessel in 1996 or in 1998 would constitute taxable import30. The authorities have laid emphasis on the factum that the rig was purchased for being used in the oil field of ONGC and for this purpose the owner had made an application and permission/licence for import was granted by the Ministry of Industry. The rig was purchased from foreign exchange released by the Government on the basis of the import licence for the rig. If the rig was not to be used in India, foreign exchange would not have been released and import licence would not have been granted. This argument on behalf of the department does not further the stand. It cannot be regarded as conclusive. Release of foreign exchange, approval and licence, etc. are prior to the import. Import may not take place in spite of this aforesaid clearances/licence and release of foreign exchange. There may have been violation of another enactment/provision as the rig was not imported, albeit for deciding the question whether the rig was imported into India, the requirement of home consumption has to be satisfied. Then alone, the `good, i.e., the vessel/rig would be taxable and customs duty payable under the Act. Pertinently, the adjudication order does not hold that the import had taken place in 1987 when the rig first put into operation in the high seas. This was not treated as the date of import or home consumption. The import as per the authorities had taken place when the rig was brought for repairs. The evaluation of the rig has been done on the basis of the last visit of the rig for repair in 199831. While we are disposed to accept that there was no import, we would not on the said finding hold that the owner had not violated the provisions of the Act, which are much broader and wider in scope. The Act regulates and mandates compliance by the foreign going vessels when they enter the territorial waters. Provisions of the Act are required to be met and complied with even when no goods are to be unloaded for import into India or the vessel is not a `good meant for home consumption. Thus, violations recorded by the tribunal cannot be found fault with.32. Thus analysed, we are of the indubitable opinion, that the decision rendered by the tribunal deserves our concurrence and we so do.19. In Chowgule and Co. Pvt. Ltd. (supra) on the question of chargeability of customs duty on a vessel which was being used to ship iron ore from Mormugao Harbour to ocean going carriers, it was held as under:-6. We may now refer to the relevant provisions of the Customs Act. Section 2(22) of the Customs Act defines that unless the context otherwise requires, goods includes - (a) vessels, aircrafts and vehicles; (b) stores; (c) baggage; (d) currency and negotiable instruments; and (e) any other kind of moveable property. Import is defined as meaning bringing into India from a place outside India. India is defined as including the territorial waters of India. Imported goods are defined to mean any goods brought into India from a place outside India but not including goods which have been cleared for home consumption. Importer is defined, in relation to any goods at any time between their importation and the time when they are cleared for home consumption as including the owner or any person holding himself out to be the importer. Conveyance is defined to include a vessel, an aircraft and a vehicle. Bill of entry is defined to mean a bill of entry referred to in Section 46. A bill of export is defined to mean a bill of export referred to in Section 50. An import manifest or import report is defined to mean the manifest or report required to be delivered under Section 30. Stores are defined to mean goods for use in a vessel or aircraft and includes fuel and spare parts and other articles of equipment whether or not for immediate fitting. | 0 | 8,558 | 2,837 | ### Instruction:
Determine the likely decision of the case (acceptance (1) or rejection (0)) and follow up with an explanation highlighting key sentences that support this prediction.
### Input:
Bombay High Court in Pride Foramer (supra) was upheld. In this case the rig was operational and used outside the territorial waters limits, but in the designated areas of the continental self and exclusive economic zones, which have been declared by the notification to be a part of the territory of India for limited purpose. The natural consequence of the said notification was to extend the Customs Act and the Customs Tariff Act to the designated areas outside the territorial waters to introduce the custom regime in such areas resulting in levy and collection of custom duty. The issue raised in the said case related to consumption of goods or stores imported by the drilling contractor and supplied to the rig. The stores used for consumption onboard the oil rigs, when stationed in the notified or designated areas, which were deemed to be territorial waters, was chargeable and customs duty was payable. 28. In the case at hand, neither the adjudication order nor the order passed by the tribunal has elucidated or held that the rig in question was in operation in the territorial waters or the designated/deemed territorial waters pursuant to the notification. The issue of chargeability and liability to pay customs duty has been on different precepts and grounds. 29. The adjudication order refers to and is predicated on the rig being brought to the port for repairs in February, 1996 for which permission was sought from the Commissioner of Customs vide letter dated 12th February, 1996 under the provisions of notification No. 153/94 Cus. The rig subsequently moved out of the port after repairs. The rig was brought for the second time to the Mumbai port for repair on 9th November, 1996 and had remained there till 2nd December, 1996. The rig thereafter was taken out and removed from the territorial waters of India as is evincible from the adjudication order. The rig was for the third time brought to the outer anchorage in Mumbai/Mumbai port on 9th December, 1998 and removed from the customs area. On this occasion, for the first time, the authorities felt that the rig had been imported into India when the rig was brought within the territorial waters for repairs. The adjudication order does not record that the rig was in operation within the territorial waters of India. On the other hand, the adjudication order does not spell out that the rig did not operate outside the territorial waters of India. The contention raised by the owner in this regard was neither specifically rejected not a different finding was recorded. The finding was that the rig when it is repaired in India, it is imported into India for home consumption. The adjudication order holds that the repairs undertaken would complete the act of import, for the requirement of home consumption was satisfied. The said finding, in our opinion, is unacceptable and faulty. Mere repair of a vessel is not putting the vessel to use in India and would not result in home consumption as the vessel was not utilized within the territory of India. Repairs are carried on the vessel and not to utilize the vessel. It would not amount to utilization or operation of the vessel/rig in India. Thus, it cannot be said that the vessel, i.e., the rig, was imported into India when it had anchored twice in 1996 and once in 1998 for the purpose of repair, for the element of home consumption is missing even when the vessel, i.e., the rig, had entered the territorial waters. Thus, it would be incorrect to hold that mere repair of the vessel in 1996 or in 1998 would constitute taxable import. 30. The authorities have laid emphasis on the factum that the rig was purchased for being used in the oil field of ONGC and for this purpose the owner had made an application and permission/licence for import was granted by the Ministry of Industry. The rig was purchased from foreign exchange released by the Government on the basis of the import licence for the rig. If the rig was not to be used in India, foreign exchange would not have been released and import licence would not have been granted. This argument on behalf of the department does not further the stand. It cannot be regarded as conclusive. Release of foreign exchange, approval and licence, etc. are prior to the import. Import may not take place in spite of this aforesaid clearances/licence and release of foreign exchange. There may have been violation of another enactment/provision as the rig was not imported, albeit for deciding the question whether the rig was imported into India, the requirement of home consumption has to be satisfied. Then alone, the `good, i.e., the vessel/rig would be taxable and customs duty payable under the Act. Pertinently, the adjudication order does not hold that the import had taken place in 1987 when the rig first put into operation in the high seas. This was not treated as the date of import or home consumption. The import as per the authorities had taken place when the rig was brought for repairs. The evaluation of the rig has been done on the basis of the last visit of the rig for repair in 1998. 31. While we are disposed to accept that there was no import, we would not on the said finding hold that the owner had not violated the provisions of the Act, which are much broader and wider in scope. The Act regulates and mandates compliance by the foreign going vessels when they enter the territorial waters. Provisions of the Act are required to be met and complied with even when no goods are to be unloaded for import into India or the vessel is not a `good meant for home consumption. Thus, violations recorded by the tribunal cannot be found fault with. 32. Thus analysed, we are of the indubitable opinion, that the decision rendered by the tribunal deserves our concurrence and we so do.
### Response:
0
### Explanation:
was brought for the second time to the Mumbai port for repair on 9th November, 1996 and had remained there till 2nd December, 1996. The rig thereafter was taken out and removed from the territorial waters of India as is evincible from the adjudication order. The rig was for the third time brought to the outer anchorage in Mumbai/Mumbai port on 9th December, 1998 and removed from the customs area. On this occasion, for the first time, the authorities felt that the rig had been imported into India when the rig was brought within the territorial waters for repairs. The adjudication order does not record that the rig was in operation within the territorial waters of India. On the other hand, the adjudication order does not spell out that the rig did not operate outside the territorial waters of India. The contention raised by the owner in this regard was neither specifically rejected not a different finding was recorded. The finding was that the rig when it is repaired in India, it is imported into India for home consumption. The adjudication order holds that the repairs undertaken would complete the act of import, for the requirement of home consumption was satisfied. The said finding, in our opinion, is unacceptable and faulty. Mere repair of a vessel is not putting the vessel to use in India and would not result in home consumption as the vessel was not utilized within the territory of India. Repairs are carried on the vessel and not to utilize the vessel. It would not amount to utilization or operation of the vessel/rig in India. Thus, it cannot be said that the vessel, i.e., the rig, was imported into India when it had anchored twice in 1996 and once in 1998 for the purpose of repair, for the element of home consumption is missing even when the vessel, i.e., the rig, had entered the territorial waters. Thus, it would be incorrect to hold that mere repair of the vessel in 1996 or in 1998 would constitute taxable import30. The authorities have laid emphasis on the factum that the rig was purchased for being used in the oil field of ONGC and for this purpose the owner had made an application and permission/licence for import was granted by the Ministry of Industry. The rig was purchased from foreign exchange released by the Government on the basis of the import licence for the rig. If the rig was not to be used in India, foreign exchange would not have been released and import licence would not have been granted. This argument on behalf of the department does not further the stand. It cannot be regarded as conclusive. Release of foreign exchange, approval and licence, etc. are prior to the import. Import may not take place in spite of this aforesaid clearances/licence and release of foreign exchange. There may have been violation of another enactment/provision as the rig was not imported, albeit for deciding the question whether the rig was imported into India, the requirement of home consumption has to be satisfied. Then alone, the `good, i.e., the vessel/rig would be taxable and customs duty payable under the Act. Pertinently, the adjudication order does not hold that the import had taken place in 1987 when the rig first put into operation in the high seas. This was not treated as the date of import or home consumption. The import as per the authorities had taken place when the rig was brought for repairs. The evaluation of the rig has been done on the basis of the last visit of the rig for repair in 199831. While we are disposed to accept that there was no import, we would not on the said finding hold that the owner had not violated the provisions of the Act, which are much broader and wider in scope. The Act regulates and mandates compliance by the foreign going vessels when they enter the territorial waters. Provisions of the Act are required to be met and complied with even when no goods are to be unloaded for import into India or the vessel is not a `good meant for home consumption. Thus, violations recorded by the tribunal cannot be found fault with.32. Thus analysed, we are of the indubitable opinion, that the decision rendered by the tribunal deserves our concurrence and we so do.19. In Chowgule and Co. Pvt. Ltd. (supra) on the question of chargeability of customs duty on a vessel which was being used to ship iron ore from Mormugao Harbour to ocean going carriers, it was held as under:-6. We may now refer to the relevant provisions of the Customs Act. Section 2(22) of the Customs Act defines that unless the context otherwise requires, goods includes - (a) vessels, aircrafts and vehicles; (b) stores; (c) baggage; (d) currency and negotiable instruments; and (e) any other kind of moveable property. Import is defined as meaning bringing into India from a place outside India. India is defined as including the territorial waters of India. Imported goods are defined to mean any goods brought into India from a place outside India but not including goods which have been cleared for home consumption. Importer is defined, in relation to any goods at any time between their importation and the time when they are cleared for home consumption as including the owner or any person holding himself out to be the importer. Conveyance is defined to include a vessel, an aircraft and a vehicle. Bill of entry is defined to mean a bill of entry referred to in Section 46. A bill of export is defined to mean a bill of export referred to in Section 50. An import manifest or import report is defined to mean the manifest or report required to be delivered under Section 30. Stores are defined to mean goods for use in a vessel or aircraft and includes fuel and spare parts and other articles of equipment whether or not for immediate fitting.
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Karbalai Begum Vs. Mohd. Sayeed and Another | adverse possession to the other co-sharer in possession. Indeed even if this fact be admitted, then the legal position would be that Mohd. Basir and Mohd. Rashid, being co-sharers of plaintiff, would become constructive trustees on behalf of the plaintiff and the right of the plaintiff would be deemed to be protected by the trustees. The learned counsel appearing for the respondent was unable to contest this position of law. In the present case, it is therefore manifest that the possession of the defendants, apart from being in the nature of constructive trustees, would be in law the possession of the plaintiff.6. Apart from this, the fact remains that the District Judge has come to a clear finding of fact after consideration of the evidence that a clear fraud was committed during the consolidation operation either by the defendants or by somebody else as a result of which the rights of the plaintiff were sought to be extinguished. In this connection, the learned District Judge found as follows:-"This shows that a planned fraud was made to drop the appellants name from the revenue records and full advantage was taken of the consolidation operations in the village by the respondents. In para 20 of the written statement, paper 31A, it was pleaded by the respondents that they acquired the suit plot through litigation and the plaintiffs right extinguished during the consolidation proceedings. There is no evidence before me to show that there was any litigation with the subtenants and the defendants acquired the plots exclusively. Even if it is accepted for the sake of arguments that the respondents did obtain the plots through litigation, even then it cannot be said that the plaintiffs rights extinguished."7. This finding of the learned District Judge was a clear finding of fact and even if it was wrong (though in our opinion it is absolutely correct) it was not open to the High Court to interfere with this finding of fact in second appeal. Furthermore, the District Judge at another place found that there was no evidence on the record to prove that the plaintiff was not given any share out of the produce and, therefore, the conclusion that the plaintiff should be deemed to be ousted from possession, was not correct. In this connection, the learned Judge observed as follows:-"The argument advanced by the counsel for the respondents that there is no evidence on the record that the plaintiff was given any share out of the produce and, therefore, the plaintiff should be deemed to be ousted from possession, is fallacious."8. This was also a finding o f fact which was binding in second appeal. The High Court seems to have relied on the fact that there was no evidence to prove that the plaintiff was prevented from filing a petition under s. 9 of the U.P. Consolidation of Holdings Act, 1953 or that the defendants assured the plaintiff that her name shall be entered in the record during the consolidation proceedings. Here also, the High Court committed an error of record because the clear evidence of PW, Karbalai Begum, is to the effect that she was not at all informed about the consolidation proceedings and was assured by the defendants that they would take proper care of her share in any proceedings that may be instituted. This was accepted by the District Judge and should not have been interfered with by the High Court in second appeal.9. The High Court proceeded on the basis that there was nothing to show that any fraud was practised upon the consolidation authorities so as to make the order a nullity. Here the High Court completely misunderstood the case made out by the plaintiff. It was never the case of the plaintiff that any fraud was committed on the consolidation authorities. What she had stated in her plaint and in her evidence was that the defendants had practised a fraud on her by giving her an assurance that her share would be properly looked after by them and on this distinct understanding she had left the entire management of the properties to the defendant s who also used to manage them. The trial court did not fully appreciate this part of the case made out by the plaintiff and the District Judge in clear terms accepted the same. In these circumstances, therefore, the finding of the High Court regarding fraud having been committed in the consolidation proceedings was not legally sound.The last ground on which the High Court non-suited the appellant was that after the chakbandi was completed under the U.P. Consolidation of Holdings Act , the suit was barred by s. 49 of the said Act. It is well settled that unless there is an express provision barring a suit on the basis of title, the courts will not easily infer a bar of suit to establish the title of the parties. In Subha Singh v. Mahendra Singh &Ors. this Court made the following observations:-"It was thus abundantly clear that an application for mutation on the basis of inheritance when the cause of action arose, after the finalisation and publication of the scheme under Section 23, is not a matter in regard to which an application could be filed "under the provisions of this Act" within the meaning of clause 2 of Section 49. Thus, the other limb of Section 49, also is not attracted. The result is that the plea of the bar of the civil courts jurisdiction to investigate and adjudicate upon the title to the land or the sonship of the plaintiff has no substance."10. In view of the clear decision of this Court, referred to above, the High Court erred in law in holding that the present suit was barred by s. 49 of the U.P. Consolidation of Holdings Act.11. Thus, the grounds on which the High Court reversed the decision of the District Judge are not sustainable in law and the judgment of the High Court cannot be allowed to stand.12. | 1[ds]It is well settled that merein the rent and profits of the land of adoes not amount to an ouster so as to give title by adverse possession to the otherin possession. Indeed even if this fact be admitted, then the legal position would be that Mohd. Basir and Mohd. Rashid, beingof plaintiff, would become constructive trustees on behalf of the plaintiff and the right of the plaintiff would be deemed to be protected by the trustees. The learned counsel appearing for the respondent was unable to contest this position of law. In the present case, it is therefore manifest that the possession of the defendants, apart from being in the nature of constructive trustees, would be in law the possession of thefrom this, the fact remains that the District Judge has come to a clear finding of fact after consideration of the evidence that a clear fraud was committed during the consolidation operation either by the defendants or by somebody else as a result of which the rights of the plaintiff were sought to befinding of the learned District Judge was a clear finding of fact and even if it was wrong (though in our opinion it is absolutely correct) it was not open to the High Court to interfere with this finding of fact in second appeal. Furthermore, the District Judge at another place found that there was no evidence on the record to prove that the plaintiff was not given any share out of the produce and, therefore, the conclusion that the plaintiff should be deemed to be ousted from possession, was notwas also a finding o f fact which was binding in second appeal. The High Court seems to have relied on the fact that there was no evidence to prove that the plaintiff was prevented from filing a petition under s. 9 of the U.P. Consolidation of Holdings Act, 1953 or that the defendants assured the plaintiff that her name shall be entered in the record during the consolidation proceedings. Here also, the High Court committed an error of record because the clear evidence of PW, Karbalai Begum, is to the effect that she was not at all informed about the consolidation proceedings and was assured by the defendants that they would take proper care of her share in any proceedings that may be instituted. This was accepted by the District Judge and should not have been interfered with by the High Court in secondHigh Court proceeded on the basis that there was nothing to show that any fraud was practised upon the consolidation authorities so as to make the order a nullity. Here the High Court completely misunderstood the case made out by thewas never the case of the plaintiff that any fraud was committed on the consolidationshe had stated in her plaint and in her evidence was that the defendants had practised a fraud on her by giving her an assurance that her share would be properly looked after by them and on this distinct understanding she had left the entire management of the properties to the defendant s who also used to manage them. The trial court did not fully appreciate this part of the case made out by the plaintiff and the District Judge in clear terms accepted the same. In these circumstances, therefore, the finding of the High Court regarding fraud having been committed in the consolidation proceedings was not legally sound.The last ground on which the High Courtthe appellant was that after the chakbandi was completed under the U.P. Consolidation of Holdings Act , the suit was barred by s. 49 of the said Act. It is well settled that unless there is an express provision barring a suit on the basis of title, the courts will not easily infer a bar of suit to establish the title of theview of the clear decision of this Court, referred to above, the High Court erred in law in holding that the present suit was barred by s. 49 of the U.P. Consolidation of Holdingsthe grounds on which the High Court reversed the decision of the District Judge are not sustainable in law and the judgment of the High Court cannot be allowed to stand. | 1 | 2,324 | 748 | ### Instruction:
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adverse possession to the other co-sharer in possession. Indeed even if this fact be admitted, then the legal position would be that Mohd. Basir and Mohd. Rashid, being co-sharers of plaintiff, would become constructive trustees on behalf of the plaintiff and the right of the plaintiff would be deemed to be protected by the trustees. The learned counsel appearing for the respondent was unable to contest this position of law. In the present case, it is therefore manifest that the possession of the defendants, apart from being in the nature of constructive trustees, would be in law the possession of the plaintiff.6. Apart from this, the fact remains that the District Judge has come to a clear finding of fact after consideration of the evidence that a clear fraud was committed during the consolidation operation either by the defendants or by somebody else as a result of which the rights of the plaintiff were sought to be extinguished. In this connection, the learned District Judge found as follows:-"This shows that a planned fraud was made to drop the appellants name from the revenue records and full advantage was taken of the consolidation operations in the village by the respondents. In para 20 of the written statement, paper 31A, it was pleaded by the respondents that they acquired the suit plot through litigation and the plaintiffs right extinguished during the consolidation proceedings. There is no evidence before me to show that there was any litigation with the subtenants and the defendants acquired the plots exclusively. Even if it is accepted for the sake of arguments that the respondents did obtain the plots through litigation, even then it cannot be said that the plaintiffs rights extinguished."7. This finding of the learned District Judge was a clear finding of fact and even if it was wrong (though in our opinion it is absolutely correct) it was not open to the High Court to interfere with this finding of fact in second appeal. Furthermore, the District Judge at another place found that there was no evidence on the record to prove that the plaintiff was not given any share out of the produce and, therefore, the conclusion that the plaintiff should be deemed to be ousted from possession, was not correct. In this connection, the learned Judge observed as follows:-"The argument advanced by the counsel for the respondents that there is no evidence on the record that the plaintiff was given any share out of the produce and, therefore, the plaintiff should be deemed to be ousted from possession, is fallacious."8. This was also a finding o f fact which was binding in second appeal. The High Court seems to have relied on the fact that there was no evidence to prove that the plaintiff was prevented from filing a petition under s. 9 of the U.P. Consolidation of Holdings Act, 1953 or that the defendants assured the plaintiff that her name shall be entered in the record during the consolidation proceedings. Here also, the High Court committed an error of record because the clear evidence of PW, Karbalai Begum, is to the effect that she was not at all informed about the consolidation proceedings and was assured by the defendants that they would take proper care of her share in any proceedings that may be instituted. This was accepted by the District Judge and should not have been interfered with by the High Court in second appeal.9. The High Court proceeded on the basis that there was nothing to show that any fraud was practised upon the consolidation authorities so as to make the order a nullity. Here the High Court completely misunderstood the case made out by the plaintiff. It was never the case of the plaintiff that any fraud was committed on the consolidation authorities. What she had stated in her plaint and in her evidence was that the defendants had practised a fraud on her by giving her an assurance that her share would be properly looked after by them and on this distinct understanding she had left the entire management of the properties to the defendant s who also used to manage them. The trial court did not fully appreciate this part of the case made out by the plaintiff and the District Judge in clear terms accepted the same. In these circumstances, therefore, the finding of the High Court regarding fraud having been committed in the consolidation proceedings was not legally sound.The last ground on which the High Court non-suited the appellant was that after the chakbandi was completed under the U.P. Consolidation of Holdings Act , the suit was barred by s. 49 of the said Act. It is well settled that unless there is an express provision barring a suit on the basis of title, the courts will not easily infer a bar of suit to establish the title of the parties. In Subha Singh v. Mahendra Singh &Ors. this Court made the following observations:-"It was thus abundantly clear that an application for mutation on the basis of inheritance when the cause of action arose, after the finalisation and publication of the scheme under Section 23, is not a matter in regard to which an application could be filed "under the provisions of this Act" within the meaning of clause 2 of Section 49. Thus, the other limb of Section 49, also is not attracted. The result is that the plea of the bar of the civil courts jurisdiction to investigate and adjudicate upon the title to the land or the sonship of the plaintiff has no substance."10. In view of the clear decision of this Court, referred to above, the High Court erred in law in holding that the present suit was barred by s. 49 of the U.P. Consolidation of Holdings Act.11. Thus, the grounds on which the High Court reversed the decision of the District Judge are not sustainable in law and the judgment of the High Court cannot be allowed to stand.12.
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It is well settled that merein the rent and profits of the land of adoes not amount to an ouster so as to give title by adverse possession to the otherin possession. Indeed even if this fact be admitted, then the legal position would be that Mohd. Basir and Mohd. Rashid, beingof plaintiff, would become constructive trustees on behalf of the plaintiff and the right of the plaintiff would be deemed to be protected by the trustees. The learned counsel appearing for the respondent was unable to contest this position of law. In the present case, it is therefore manifest that the possession of the defendants, apart from being in the nature of constructive trustees, would be in law the possession of thefrom this, the fact remains that the District Judge has come to a clear finding of fact after consideration of the evidence that a clear fraud was committed during the consolidation operation either by the defendants or by somebody else as a result of which the rights of the plaintiff were sought to befinding of the learned District Judge was a clear finding of fact and even if it was wrong (though in our opinion it is absolutely correct) it was not open to the High Court to interfere with this finding of fact in second appeal. Furthermore, the District Judge at another place found that there was no evidence on the record to prove that the plaintiff was not given any share out of the produce and, therefore, the conclusion that the plaintiff should be deemed to be ousted from possession, was notwas also a finding o f fact which was binding in second appeal. The High Court seems to have relied on the fact that there was no evidence to prove that the plaintiff was prevented from filing a petition under s. 9 of the U.P. Consolidation of Holdings Act, 1953 or that the defendants assured the plaintiff that her name shall be entered in the record during the consolidation proceedings. Here also, the High Court committed an error of record because the clear evidence of PW, Karbalai Begum, is to the effect that she was not at all informed about the consolidation proceedings and was assured by the defendants that they would take proper care of her share in any proceedings that may be instituted. This was accepted by the District Judge and should not have been interfered with by the High Court in secondHigh Court proceeded on the basis that there was nothing to show that any fraud was practised upon the consolidation authorities so as to make the order a nullity. Here the High Court completely misunderstood the case made out by thewas never the case of the plaintiff that any fraud was committed on the consolidationshe had stated in her plaint and in her evidence was that the defendants had practised a fraud on her by giving her an assurance that her share would be properly looked after by them and on this distinct understanding she had left the entire management of the properties to the defendant s who also used to manage them. The trial court did not fully appreciate this part of the case made out by the plaintiff and the District Judge in clear terms accepted the same. In these circumstances, therefore, the finding of the High Court regarding fraud having been committed in the consolidation proceedings was not legally sound.The last ground on which the High Courtthe appellant was that after the chakbandi was completed under the U.P. Consolidation of Holdings Act , the suit was barred by s. 49 of the said Act. It is well settled that unless there is an express provision barring a suit on the basis of title, the courts will not easily infer a bar of suit to establish the title of theview of the clear decision of this Court, referred to above, the High Court erred in law in holding that the present suit was barred by s. 49 of the U.P. Consolidation of Holdingsthe grounds on which the High Court reversed the decision of the District Judge are not sustainable in law and the judgment of the High Court cannot be allowed to stand.
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Jugal Kishore Baldeo Sarai Vs. Commissioner Of Income-Tax, U.P., Lucknow | benefit of the minor, and in this case there is no finding that the agreement entered into on behalf of the Hindu undivided family including, the minors by Babu Ram and Gobardhandas was in any way prejudicial to the interests of the minor members. On the other hand, the facts found show that some of the minors subsequently attained majority and none of them challenged the validity of this agreement on the ground that it had been executed during their minority and that it was against their interest. In fact it was found that subsequently, when there was a partition in which even the sons of Babu Ram separated from him, the amount to the credit of Babu Ram in the accounts was treated as his separate asset and was not included in the assets of the Hindu undivided family without any objection from any of the members of the family who were minors at the earlier stage when the agreement was entered into. Consequently we are unable to hold that the agreement by which Babu Ram was allowed this remuneration of Rs. 1,000/-p. m., was in any way vitiated, and, as we have already held above, it was an agreement executed in the interest of the family. 8. In our view if a remuneration is paid to the karta of the family under a valid agreement which is bona fide and in the interest of, and expedient for, the business of the family and the payment is genuine and not excessive, such remuneration must be held to be an expenditure laid out wholly and exclusively for the purpose of the business of the family and must be allowed as an expenditure under S. 10 (2) (xv) of the Act. 9. In this connection, we may take notice, of a decision in the Patna case, Commr. of Income-tax, Bihar and Orissa v. Jainarain Jagannath, (1945) 13 ITR 410 : (AIR 1946 Pat 68 ) wherein also it was held that "a member of a joint Hindu family might conceivably do business in his individual capacity and in that capacity might render services to the joint family trading firm in consideration of which the film might pay him such remuneration as it would pay to an outsider. If such remuneration is not excessive and is reasonable and is not a device to escape Income-tax, then it will be a legitimate deduction in computing the profits of the business. If, on the other hand, the amount paid is unreasonably high and disproportionate to the services rendered by him, then it may be treated as part of the profits of the firm distributed in a particular manner. In the present case, there is no indication of any finding that the payment to Babu Ram was at all high, or was not commensurate with the services rendered by him. 10. An alternative ground, on which Mr. Desai on behalf of the department challenged this deduction under S. 10 (2) (xv) was that the remuneration was being paid to Babu Ram not only to manage the Hindu undivided family business carried on under the name of Jugal Kishore Baldeo Sahai, but also for other businesses, including those of the partnership firms in which Babu Ram was a partner in his own name, though representing the Hindu undivided family. In support of this proposition, learned counsel relied on the decision of the Patna High Court in Jitmal Bhuramal v. Commr. of Income-tax, Bihar and Orissa (1959) 37 ITR 528 : (AIR 1959 Pat 395 ), which judgment was affirmed by this Court as reported in (1962) 44 ITR 887 (SC) (supra). In that case, there was a finding of fact that two junior members of the Hindu undivided family, Gulzarilal and Madanlal were employed in the partnership business in which the Karta of the family was a partner and had rendered services to that business. This Court, while recognising the principle that"a Hindu undivided family is allowed to deduct salaries paid to members of the family, if the payment is made as a matter of commercial or business expediency," laid down the exception that the services rendered must be to the family. It was held that since the services had been rendered not to the family, but to the partnership firm, the remuneration paid to those members was not a legitimate deduction under S. 10 (2) (xv) from the income of the Hindu undivided family, and that it could be a valid deduction only when computing the income of the partnership business. 11. It is true that in the case before us the statement of the case mentions that the agreement for payment of remuneration to Babu Ram was to the effect that he was to get Rs. 1,000/- p.m. for looking after the businesses of the Hindu undivided family. It is because of the use of the word "businesses" in the plural that learned counsel urged that the remuneration given to Babu Ram was not merely for looking after the Hindu undivided family business, but also for rendering services to the partnership firms in which Babu Ram was a partner. We do not consider that this interpretation of the agreement is correct. The agreement does not envisage any payment to Babu Ram for services rendered to the partnership firms. The language used was that Babu Ram should receive the remuneration for managing all the business of the Hindu undivided family, which can only mean that he was to manage the affairs of the Hindu undivided family firm and also to look after the interests of the Hindu undivided family in other businesses. Thus; the remuneration was not intended to cover any services rendered by him to the partnership firms apart from whatever he was required to do in the capacity of looking after and managing the affairs of the Hindu undivided family. The principle laid down in the case of (1962) 44 ITR 887 (SC) (supra) is, therefore, not applicable to the case before us. | 1[ds]We are unable to understand the meaning of the expression "valid special agreement". It is, of course, necessary that before a karta receives remuneration, it should be under a valid agreement. In judging what is a valid or proper agreement which would justify the payment of remuneration paid to a karta of the Hindu undivided family for managing the business of the family to be deductible as an expenditure under S. 10 (2) (xv) of the Income-tax Act, the test, we think, which should be applied, is whether the agreement has been made by or on behalf of all the members of the Hindu undivided family and whether it was in the interest of the business of the family, so that it could be justified on grounds of commercial expediency. That is the test which has always to be applied when considering whether a particular expenditure claimed as a deduction under S. 10 (2) (xv) of the Income-tax Act has been incurred wholly and exclusively for the purpose of the business6. We do not consider that the decision given by this Court in that case needs to be given a narrow interpretation so as to confine the right of deducting the remuneration paid by a Hindu undivided family to junior members only. There seems to be no reason at all why if a karta is paid remuneration he should be in a position different from that of any junior member. It: is true that a karta has a right to manage the property of the Hindu undivided family on behalf of all the coparceners but there is no obligation or duty on him to carry on a particular business of the family. It is well established that any member of a Hindu undivided family including a karta can have a separate personal source of income if that income is earned independently of the Hindu undivided family assets or business. It is primarily on this basis that it has been held that salary or remuneration paid to the junior member of the family for services rendered to the family business becomes his separate income and consequently a deductible expenditure under S. 10 (2) (xv) of the Act when computing the income of the family. In similar circumstances if a karta offers his services to the family instead of choosing an independent career to earn his separate income an and receives remuneration from the family, there is no reason why the remuneration so paid to him cannot be treated as an expenditure for carrying on the business of the family and consequently expended wholly and exclusively for the purpose of the business and deductible under S. 10 (2) (xv) of the Act7. As we have already indicated above, the general view expressed by commentators on Hindu Law as well as in decided cases is that even the karta of a family can be paid remuneration for carrying on family business, provided it is under some agreement. There seems to he no reason wily, if all persons competent in a Hindu undivided family to enter into an agreement on its behalf consider it appropriate that the karta should he paid remuneration and enter into an agreement to pay remuneration to him that remuneration should not be held to be an expenditure incurred in the interest of the family, and consequently, all expenditure deductible under S. 10 (2) (xv) of the Act. In the present case Babu Ram received remuneration when he and his brother Gobardhandas agreed that such remuneration should be payable. The other members of the Hindu undivided family were minor sons of Babu Ram himself or of Gobardhandas. Babu Ram and Gobardhandas, being the only two members of the family competent to act on behalf of the family including the minors, entered into this agreement, obviously because it was considered in the interest of the family that Babu Ram should receive this payment. We are not at all impressed by the argument urged on behalf of the department that, since some of the coparceners were minors, no valid agreement at all on their behalf could have been entered into by Babu Ram or Gobardhandas so as to allow payment of remuneration to the karta, Babu Ram. The minor sons of Babu Ram could certainly be represented by himself and the minor sons of Gobardhandas could either be represented by him, being his sons, or, in the alternative, Babu Ram could represent them in the agreement as the karta of the family to which they belonged. It is true that under the agreement, some payment was to be made out of the income of the family to Babu Ram so as to become his separate property. But that circumstance would not in our opinion invalidate the agreement merely because Babu Ram represented some of the minors on whose behalf the agreement was made. If the agreement is held to be in the interest of the family, the agreement would not be invalidated when executed on behalf of the minors by the person authorised to act on their behalf simply because the minors happened to be represented by a person who receives some benefit under the agreement. The test of the validity of an agreement on behalf of a minor is that it should be for the benefit of the minor, and in this case there is no finding that the agreement entered into on behalf of the Hindu undivided family including, the minors by Babu Ram and Gobardhandas was in any way prejudicial to the interests of the minor members. On the other hand, the facts found show that some of the minors subsequently attained majority and none of them challenged the validity of this agreement on the ground that it had been executed during their minority and that it was against their interest. In fact it was found that subsequently, when there was a partition in which even the sons of Babu Ram separated from him, the amount to the credit of Babu Ram in the accounts was treated as his separate asset and was not included in the assets of the Hindu undivided family without any objection from any of the members of the family who were minors at the earlier stage when the agreement was entered into. Consequently we are unable to hold that the agreement by which Babu Ram was allowed this remuneration of Rs. 1,000/-p. m., was in any way vitiated, and, as we have already held above, it was an agreement executed in the interest of the family8. In our view if a remuneration is paid to the karta of the family under a valid agreement which is bona fide and in the interest of, and expedient for, the business of the family and the payment is genuine and not excessive, such remuneration must be held to be an expenditure laid out wholly and exclusively for the purpose of the business of the family and must be allowed as an expenditure under S. 10 (2) (xv) of the ActIn the present case, there is no indication of any finding that the payment to Babu Ram was at all high, or was not commensurate with the services rendered by him11. It is true that in the case before us the statement of the case mentions that the agreement for payment of remuneration to Babu Ram was to the effect that he was to get Rs. 1,000/- p.m. for looking after the businesses of the Hindu undivided family. It is because of the use of the word "businesses" in the plural that learned counsel urged that the remuneration given to Babu Ram was not merely for looking after the Hindu undivided family business, but also for rendering services to the partnership firms in which Babu Ram was a partner. We do not consider that this interpretation of the agreement is correct. The agreement does not envisage any payment to Babu Ram for services rendered to the partnership firms. The language used was that Babu Ram should receive the remuneration for managing all the business of the Hindu undivided family, which can only mean that he was to manage the affairs of the Hindu undivided family firm and also to look after the interests of the Hindu undivided family in other businesses. Thus; the remuneration was not intended to cover any services rendered by him to the partnership firms apart from whatever he was required to do in the capacity of looking after and managing the affairs of the Hindu undivided family. The principle laid down in the case of (1962) 44 ITR 887 (SC) (supra) is, therefore, not applicable to the case before us. | 1 | 3,083 | 1,565 | ### Instruction:
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benefit of the minor, and in this case there is no finding that the agreement entered into on behalf of the Hindu undivided family including, the minors by Babu Ram and Gobardhandas was in any way prejudicial to the interests of the minor members. On the other hand, the facts found show that some of the minors subsequently attained majority and none of them challenged the validity of this agreement on the ground that it had been executed during their minority and that it was against their interest. In fact it was found that subsequently, when there was a partition in which even the sons of Babu Ram separated from him, the amount to the credit of Babu Ram in the accounts was treated as his separate asset and was not included in the assets of the Hindu undivided family without any objection from any of the members of the family who were minors at the earlier stage when the agreement was entered into. Consequently we are unable to hold that the agreement by which Babu Ram was allowed this remuneration of Rs. 1,000/-p. m., was in any way vitiated, and, as we have already held above, it was an agreement executed in the interest of the family. 8. In our view if a remuneration is paid to the karta of the family under a valid agreement which is bona fide and in the interest of, and expedient for, the business of the family and the payment is genuine and not excessive, such remuneration must be held to be an expenditure laid out wholly and exclusively for the purpose of the business of the family and must be allowed as an expenditure under S. 10 (2) (xv) of the Act. 9. In this connection, we may take notice, of a decision in the Patna case, Commr. of Income-tax, Bihar and Orissa v. Jainarain Jagannath, (1945) 13 ITR 410 : (AIR 1946 Pat 68 ) wherein also it was held that "a member of a joint Hindu family might conceivably do business in his individual capacity and in that capacity might render services to the joint family trading firm in consideration of which the film might pay him such remuneration as it would pay to an outsider. If such remuneration is not excessive and is reasonable and is not a device to escape Income-tax, then it will be a legitimate deduction in computing the profits of the business. If, on the other hand, the amount paid is unreasonably high and disproportionate to the services rendered by him, then it may be treated as part of the profits of the firm distributed in a particular manner. In the present case, there is no indication of any finding that the payment to Babu Ram was at all high, or was not commensurate with the services rendered by him. 10. An alternative ground, on which Mr. Desai on behalf of the department challenged this deduction under S. 10 (2) (xv) was that the remuneration was being paid to Babu Ram not only to manage the Hindu undivided family business carried on under the name of Jugal Kishore Baldeo Sahai, but also for other businesses, including those of the partnership firms in which Babu Ram was a partner in his own name, though representing the Hindu undivided family. In support of this proposition, learned counsel relied on the decision of the Patna High Court in Jitmal Bhuramal v. Commr. of Income-tax, Bihar and Orissa (1959) 37 ITR 528 : (AIR 1959 Pat 395 ), which judgment was affirmed by this Court as reported in (1962) 44 ITR 887 (SC) (supra). In that case, there was a finding of fact that two junior members of the Hindu undivided family, Gulzarilal and Madanlal were employed in the partnership business in which the Karta of the family was a partner and had rendered services to that business. This Court, while recognising the principle that"a Hindu undivided family is allowed to deduct salaries paid to members of the family, if the payment is made as a matter of commercial or business expediency," laid down the exception that the services rendered must be to the family. It was held that since the services had been rendered not to the family, but to the partnership firm, the remuneration paid to those members was not a legitimate deduction under S. 10 (2) (xv) from the income of the Hindu undivided family, and that it could be a valid deduction only when computing the income of the partnership business. 11. It is true that in the case before us the statement of the case mentions that the agreement for payment of remuneration to Babu Ram was to the effect that he was to get Rs. 1,000/- p.m. for looking after the businesses of the Hindu undivided family. It is because of the use of the word "businesses" in the plural that learned counsel urged that the remuneration given to Babu Ram was not merely for looking after the Hindu undivided family business, but also for rendering services to the partnership firms in which Babu Ram was a partner. We do not consider that this interpretation of the agreement is correct. The agreement does not envisage any payment to Babu Ram for services rendered to the partnership firms. The language used was that Babu Ram should receive the remuneration for managing all the business of the Hindu undivided family, which can only mean that he was to manage the affairs of the Hindu undivided family firm and also to look after the interests of the Hindu undivided family in other businesses. Thus; the remuneration was not intended to cover any services rendered by him to the partnership firms apart from whatever he was required to do in the capacity of looking after and managing the affairs of the Hindu undivided family. The principle laid down in the case of (1962) 44 ITR 887 (SC) (supra) is, therefore, not applicable to the case before us.
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(xv) of the Act7. As we have already indicated above, the general view expressed by commentators on Hindu Law as well as in decided cases is that even the karta of a family can be paid remuneration for carrying on family business, provided it is under some agreement. There seems to he no reason wily, if all persons competent in a Hindu undivided family to enter into an agreement on its behalf consider it appropriate that the karta should he paid remuneration and enter into an agreement to pay remuneration to him that remuneration should not be held to be an expenditure incurred in the interest of the family, and consequently, all expenditure deductible under S. 10 (2) (xv) of the Act. In the present case Babu Ram received remuneration when he and his brother Gobardhandas agreed that such remuneration should be payable. The other members of the Hindu undivided family were minor sons of Babu Ram himself or of Gobardhandas. Babu Ram and Gobardhandas, being the only two members of the family competent to act on behalf of the family including the minors, entered into this agreement, obviously because it was considered in the interest of the family that Babu Ram should receive this payment. We are not at all impressed by the argument urged on behalf of the department that, since some of the coparceners were minors, no valid agreement at all on their behalf could have been entered into by Babu Ram or Gobardhandas so as to allow payment of remuneration to the karta, Babu Ram. The minor sons of Babu Ram could certainly be represented by himself and the minor sons of Gobardhandas could either be represented by him, being his sons, or, in the alternative, Babu Ram could represent them in the agreement as the karta of the family to which they belonged. It is true that under the agreement, some payment was to be made out of the income of the family to Babu Ram so as to become his separate property. But that circumstance would not in our opinion invalidate the agreement merely because Babu Ram represented some of the minors on whose behalf the agreement was made. If the agreement is held to be in the interest of the family, the agreement would not be invalidated when executed on behalf of the minors by the person authorised to act on their behalf simply because the minors happened to be represented by a person who receives some benefit under the agreement. The test of the validity of an agreement on behalf of a minor is that it should be for the benefit of the minor, and in this case there is no finding that the agreement entered into on behalf of the Hindu undivided family including, the minors by Babu Ram and Gobardhandas was in any way prejudicial to the interests of the minor members. On the other hand, the facts found show that some of the minors subsequently attained majority and none of them challenged the validity of this agreement on the ground that it had been executed during their minority and that it was against their interest. In fact it was found that subsequently, when there was a partition in which even the sons of Babu Ram separated from him, the amount to the credit of Babu Ram in the accounts was treated as his separate asset and was not included in the assets of the Hindu undivided family without any objection from any of the members of the family who were minors at the earlier stage when the agreement was entered into. Consequently we are unable to hold that the agreement by which Babu Ram was allowed this remuneration of Rs. 1,000/-p. m., was in any way vitiated, and, as we have already held above, it was an agreement executed in the interest of the family8. In our view if a remuneration is paid to the karta of the family under a valid agreement which is bona fide and in the interest of, and expedient for, the business of the family and the payment is genuine and not excessive, such remuneration must be held to be an expenditure laid out wholly and exclusively for the purpose of the business of the family and must be allowed as an expenditure under S. 10 (2) (xv) of the ActIn the present case, there is no indication of any finding that the payment to Babu Ram was at all high, or was not commensurate with the services rendered by him11. It is true that in the case before us the statement of the case mentions that the agreement for payment of remuneration to Babu Ram was to the effect that he was to get Rs. 1,000/- p.m. for looking after the businesses of the Hindu undivided family. It is because of the use of the word "businesses" in the plural that learned counsel urged that the remuneration given to Babu Ram was not merely for looking after the Hindu undivided family business, but also for rendering services to the partnership firms in which Babu Ram was a partner. We do not consider that this interpretation of the agreement is correct. The agreement does not envisage any payment to Babu Ram for services rendered to the partnership firms. The language used was that Babu Ram should receive the remuneration for managing all the business of the Hindu undivided family, which can only mean that he was to manage the affairs of the Hindu undivided family firm and also to look after the interests of the Hindu undivided family in other businesses. Thus; the remuneration was not intended to cover any services rendered by him to the partnership firms apart from whatever he was required to do in the capacity of looking after and managing the affairs of the Hindu undivided family. The principle laid down in the case of (1962) 44 ITR 887 (SC) (supra) is, therefore, not applicable to the case before us.
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Lawrence Joachim Joseph D Vs. The State Of Bombay | which would enable him to make the representation."The fact that he had made no such application for particulars is, therefore a, circumstance which may well be taken into consideration, in deciding whether the grounds can be considered to be vague. In the circumstances and having regard to the fact that what is alleged is espionage activity at a time when relations between the two Governments on the affairs of Goa were somewhat delicate, we are inclined to think with the High Court, that the grounds cannot be considered to be vague.5. Assuming however that the grounds furnished in this case are open to the challenge of vagueness, the further question which arises is whether the validity of the order of detention can be sustained by reason of the claim, in public interest, of non-disclosure of facts made by the Under-Secretary to the Government of Bombay by means of his affidavit filed in the High Court. Now it has been held in [1951] SC 157 (164) (AIR V 38) (A), by the majority of the Court, that the constitution right of a detenu under Art. 22 (5) comprises two distinct components.1. The right to be furnished grounds of detention as soon as may be; and2. The right to be afforded the earliest opportunity of making a representation against his detention which implies, the right to be furnished adequate particulars of the grounds of detention, to enable a proper representation being made. These rights involve corresponding obligations on the part of the detaining authority. It follows that the authority is under a constitutional obligation to furnish reasonable definite grounds, as well as adequate particulars then and there, or shortly thereafter,but the right of the detenu to be furnished particulars, is subject to the limitation under Art. 22(6) whereby disclosure of facts considered to be against public interest cannot be required. It is however to be observed that under Art. 22 (6) the facts which cannot be required to be disclosed are those "which such authority considers to be against public interest to disclose."Hence it follows that both the obligation to furnished particulars and the duty to consider whether the disclosure of any facts involved therein is against public interest, are vested in the detaining authority not in any other. It was accordingly attempted to be argued in the High Court that the claim of non-disclosure made in the affidavit of the Under Secretary indicated a decision for non-disclosure, by the Under-Secretary himself and that too at the time of filing the affidavit. On this assumption it was contended that the claim for non-disclosure was invalid. The High Court, however, on a consideration of the materials, felt satisfied that what was stated in the affidavit related to the decision of the detaining authority itself, taken at the time. The learned Judges expressed their conclusion as follows :"There is nothing in the affidavit of Mr. Bambawala to suggest that it is now that the detaining authority is claiming privilege or applying its mind to the question of privilege .......... The meaning is clear that at no time it was in public interest to disclose the details referred to in the particular paragraph of the affidavit and there is nothing to suggest that his question was not considered by the detaining authority at the time when the grounds were furnished."No argument has been addressed to us how this conclusion is incorrect. But what has been urged before is that the decision not to disclose the facts as well as the ambit of the non-disclosure must be clearly communicated to the detenu at the time when the grounds are furnished. It is urged that if the detenu is furnished information at least to that extent, it will enable him to present to the Advisory Board his difficulties in making a proper representation and to convey to it a request for obtaining the requisite particulars from the State under S. 10 of the Act for their own information and consideration. We are unable to imply any such obligation under Article 22(5) and (6). The necessity for such a communication would arise only if the detenu, feeling the grounds to be vague, asks for particulars. An obligation to communicate the decision not to disclose facts considered prejudicial to public interest may well be implied in such a situation. But in the absence of any such request by the detenu, the non-communication of the decision cannot be held to have hampered his constitutional right of representation and an obligation to communicate cannot be implied in these circumstances. In the present case there is no merit in this contention. If the appellant had exercised his right to ask for particulars, at the time, from the detaining authority, there can be no doubt that he would have been furnished then the very information which has been supplied in paragraph 12 of the Under - Secretary affidavit in answer to para 15 (g) of the appellants petition both of which have been already set out above.6. A faint suggestion has been made in the course of the arguments before us that the decision not to disclose particulars is mala fide and that such mala fides has to be imputed in a case where no particulars are at all furnished. It is suggested that the power not to disclose facts considered against public interest cannot be so exercised as to nullify the constitutional right of the detenu for being afforded a proper opportunity of representation. Such a contention as to the mala fide exercise of the powers untenable in the present case having regard to the nature of the grounds on which the detention is based and the nature of activities imputed therein to the appellant. It is unnecessary, therefore, to deal in this case with a theoretical contention as to whether or not Art. 22(6) of the Constitution overrides the constitutional right to be furnished particulars under Art. 22(5) to the extent of denying all particulars and leaving the grounds absolutely vague. | 0[ds]We have been taken through all the material relating to the above allegation and have given our consideration to the same. It is enough to say that we are unable to see any reason for disagreeing with the conclusion of the High Court to the effect that the material is not enough to make out that the detaining authority was acting otherwise than bona fide. We also agree with the view of the High Court that, what has got to be made out is not the want of bona fides on the part of the police, but want of bona fides as well as the non-application of mind, on the part of the detaining authority, viz the Government, which for this purpose must be taken to be different from the police. It is also clear that the allegation of non-application of mind of the detaining authority is without any basis, in view of the affidavit of the Chief Secretary.is true that these allegations are not as precise and specific as might have been desired.But having regard to the nature of the alleged activities of the appellant, it is not unlikely that no more could be gathered or furnished. In this context it is relevant to notice that the appellant himself does not appear to have felt that the grounds furnished were so vague as to hamper him in his right to make a representation under Article 22(5) and section 7 of the Act.It does not appear that he applied to the Government to be supplied with particulars, of the grounds furnished tofact that he had made no such application for particulars is, therefore a, circumstance which may well be taken into consideration, in deciding whether the grounds can be considered to be vague. In the circumstances and having regard to the fact that what is alleged is espionage activity at a time when relations between the two Governments on the affairs of Goa were somewhat delicate, we are inclined to think with the High Court, that the grounds cannot be considered to beit follows that both the obligation to furnished particulars and the duty to consider whether the disclosure of any facts involved therein is against public interest, are vested in the detaining authority not in any other. It was accordingly attempted to be argued in the High Court that the claim of non-disclosure made in the affidavit of the Under Secretary indicated a decision for non-disclosure, by the Under-Secretary himself and that too at the time of filing theare unable to imply any such obligation under Article 22(5) and (6). The necessity for such a communication would arise only if the detenu, feeling the grounds to be vague, asks for particulars. An obligation to communicate the decision not to disclose facts considered prejudicial to public interest may well be implied in such a situation. But in the absence of any such request by the detenu, the non-communication of the decision cannot be held to have hampered his constitutional right of representation and an obligation to communicate cannot be implied in thesethe appellant had exercised his right to ask for particulars, at the time, from the detaining authority, there can be no doubt that he would have been furnished then the very information which has been supplied in paragraph 12 of the Under - Secretary affidavit in answer to para 15 (g) of the appellants petition both of which have been already set out above. | 0 | 3,632 | 623 | ### Instruction:
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which would enable him to make the representation."The fact that he had made no such application for particulars is, therefore a, circumstance which may well be taken into consideration, in deciding whether the grounds can be considered to be vague. In the circumstances and having regard to the fact that what is alleged is espionage activity at a time when relations between the two Governments on the affairs of Goa were somewhat delicate, we are inclined to think with the High Court, that the grounds cannot be considered to be vague.5. Assuming however that the grounds furnished in this case are open to the challenge of vagueness, the further question which arises is whether the validity of the order of detention can be sustained by reason of the claim, in public interest, of non-disclosure of facts made by the Under-Secretary to the Government of Bombay by means of his affidavit filed in the High Court. Now it has been held in [1951] SC 157 (164) (AIR V 38) (A), by the majority of the Court, that the constitution right of a detenu under Art. 22 (5) comprises two distinct components.1. The right to be furnished grounds of detention as soon as may be; and2. The right to be afforded the earliest opportunity of making a representation against his detention which implies, the right to be furnished adequate particulars of the grounds of detention, to enable a proper representation being made. These rights involve corresponding obligations on the part of the detaining authority. It follows that the authority is under a constitutional obligation to furnish reasonable definite grounds, as well as adequate particulars then and there, or shortly thereafter,but the right of the detenu to be furnished particulars, is subject to the limitation under Art. 22(6) whereby disclosure of facts considered to be against public interest cannot be required. It is however to be observed that under Art. 22 (6) the facts which cannot be required to be disclosed are those "which such authority considers to be against public interest to disclose."Hence it follows that both the obligation to furnished particulars and the duty to consider whether the disclosure of any facts involved therein is against public interest, are vested in the detaining authority not in any other. It was accordingly attempted to be argued in the High Court that the claim of non-disclosure made in the affidavit of the Under Secretary indicated a decision for non-disclosure, by the Under-Secretary himself and that too at the time of filing the affidavit. On this assumption it was contended that the claim for non-disclosure was invalid. The High Court, however, on a consideration of the materials, felt satisfied that what was stated in the affidavit related to the decision of the detaining authority itself, taken at the time. The learned Judges expressed their conclusion as follows :"There is nothing in the affidavit of Mr. Bambawala to suggest that it is now that the detaining authority is claiming privilege or applying its mind to the question of privilege .......... The meaning is clear that at no time it was in public interest to disclose the details referred to in the particular paragraph of the affidavit and there is nothing to suggest that his question was not considered by the detaining authority at the time when the grounds were furnished."No argument has been addressed to us how this conclusion is incorrect. But what has been urged before is that the decision not to disclose the facts as well as the ambit of the non-disclosure must be clearly communicated to the detenu at the time when the grounds are furnished. It is urged that if the detenu is furnished information at least to that extent, it will enable him to present to the Advisory Board his difficulties in making a proper representation and to convey to it a request for obtaining the requisite particulars from the State under S. 10 of the Act for their own information and consideration. We are unable to imply any such obligation under Article 22(5) and (6). The necessity for such a communication would arise only if the detenu, feeling the grounds to be vague, asks for particulars. An obligation to communicate the decision not to disclose facts considered prejudicial to public interest may well be implied in such a situation. But in the absence of any such request by the detenu, the non-communication of the decision cannot be held to have hampered his constitutional right of representation and an obligation to communicate cannot be implied in these circumstances. In the present case there is no merit in this contention. If the appellant had exercised his right to ask for particulars, at the time, from the detaining authority, there can be no doubt that he would have been furnished then the very information which has been supplied in paragraph 12 of the Under - Secretary affidavit in answer to para 15 (g) of the appellants petition both of which have been already set out above.6. A faint suggestion has been made in the course of the arguments before us that the decision not to disclose particulars is mala fide and that such mala fides has to be imputed in a case where no particulars are at all furnished. It is suggested that the power not to disclose facts considered against public interest cannot be so exercised as to nullify the constitutional right of the detenu for being afforded a proper opportunity of representation. Such a contention as to the mala fide exercise of the powers untenable in the present case having regard to the nature of the grounds on which the detention is based and the nature of activities imputed therein to the appellant. It is unnecessary, therefore, to deal in this case with a theoretical contention as to whether or not Art. 22(6) of the Constitution overrides the constitutional right to be furnished particulars under Art. 22(5) to the extent of denying all particulars and leaving the grounds absolutely vague.
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### Explanation:
We have been taken through all the material relating to the above allegation and have given our consideration to the same. It is enough to say that we are unable to see any reason for disagreeing with the conclusion of the High Court to the effect that the material is not enough to make out that the detaining authority was acting otherwise than bona fide. We also agree with the view of the High Court that, what has got to be made out is not the want of bona fides on the part of the police, but want of bona fides as well as the non-application of mind, on the part of the detaining authority, viz the Government, which for this purpose must be taken to be different from the police. It is also clear that the allegation of non-application of mind of the detaining authority is without any basis, in view of the affidavit of the Chief Secretary.is true that these allegations are not as precise and specific as might have been desired.But having regard to the nature of the alleged activities of the appellant, it is not unlikely that no more could be gathered or furnished. In this context it is relevant to notice that the appellant himself does not appear to have felt that the grounds furnished were so vague as to hamper him in his right to make a representation under Article 22(5) and section 7 of the Act.It does not appear that he applied to the Government to be supplied with particulars, of the grounds furnished tofact that he had made no such application for particulars is, therefore a, circumstance which may well be taken into consideration, in deciding whether the grounds can be considered to be vague. In the circumstances and having regard to the fact that what is alleged is espionage activity at a time when relations between the two Governments on the affairs of Goa were somewhat delicate, we are inclined to think with the High Court, that the grounds cannot be considered to beit follows that both the obligation to furnished particulars and the duty to consider whether the disclosure of any facts involved therein is against public interest, are vested in the detaining authority not in any other. It was accordingly attempted to be argued in the High Court that the claim of non-disclosure made in the affidavit of the Under Secretary indicated a decision for non-disclosure, by the Under-Secretary himself and that too at the time of filing theare unable to imply any such obligation under Article 22(5) and (6). The necessity for such a communication would arise only if the detenu, feeling the grounds to be vague, asks for particulars. An obligation to communicate the decision not to disclose facts considered prejudicial to public interest may well be implied in such a situation. But in the absence of any such request by the detenu, the non-communication of the decision cannot be held to have hampered his constitutional right of representation and an obligation to communicate cannot be implied in thesethe appellant had exercised his right to ask for particulars, at the time, from the detaining authority, there can be no doubt that he would have been furnished then the very information which has been supplied in paragraph 12 of the Under - Secretary affidavit in answer to para 15 (g) of the appellants petition both of which have been already set out above.
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Dr. (Mrs.) Renuka Datla Vs. Solvay Pharmaceutical B.V. | have been drafted after obtaining expert legal advice does not even necessarily imply that special weightage in the form of control premium has to be given to these 4.91 per cent shares. If the petitioners had insisted on the incorporation of such a provision, it could very well be that the other party or parties would not have agreed to such stipulation. The Court cannot, therefore, give any direction in regard to control premium. 15. The next objection is directed against the non-inclusion of Vertin and Colopsa brands while valuing the intrinsic worth of the company DIL. In our view, the learned Valuer has given relevant reasons for non-inclusion of the said brand of drugs which stood transferred to Solvay Pharmaceuticals BV from Dupen Laboratories Pvt. Ltd. They are not the existing assets of DIL. In fact, the petitioners have put in issue in one of the suits filed by them the legality of transfer and sought for a declaration that DIL continuous to be the proprietor of the two brands. The petitioners have agreed to withdraw various suits. In any case, the petitioners cannot be permitted to thwart the terms of the settlement by inviting the Valuer or this Court to go into the extraneous issue as regards the validity of the transfer or incidental matters. The assets as per the relevant records have to be taken into account by the Valuer and that has been done. We, therefore, find no apparent error in excluding those brands.16. The other objection is about DCF method of valuation which the Valuer has described as a commonly accepted method in adopting future earning based valuation. This involves discounting the net free cash flow of a business at an appropriate discount rate". We have already adverted to the reasons given by the Valuer for not adopting this method of valuation. Those reasons cannot be said to be irrelevant. It is contended that if the data and projections furnished by the parties is not reliable the Valuer should have secured the relevant data from independent sources or could have called for further particulars. We find no merit in this argument. The DCF method is adopted while resorting to valuation based on future earnings. It is not the case of the petitioners that the future earning based valuation is the only reliable method of earnings based valuation. Moreover, the petitioners have not placed any facts and figures to show that such method of valuation would result in a definite increase in the share value going by independent projections. When there are vast discrepancies between the projection given by the parties and independent projections have not been provided, the Valuer has chosen the best possible method of evaluation by capitalizing the past earnings. In doing so, the future maintainable profits based on past performance is also an element that has gone into the calculation. No prejudice whatsoever is shown to have been caused to the petitioners by the earnings based valuation. 17. The petitioners have relied on the decision of this Court in Commissioner of Gift Tax, Bombay vs. Smt. Kusumben D. Mahadevia (1980) 2 SCC 238 ). After referring to Mahadeo Jalans case (1973) 3 SCC 157 ) wherein certain principles regarding valuation of shares were laid down, it was observed thus: "It is clear from this decision that where the shares in a public limited company are quoted on the stock exchange and there are dealings in them, the price prevailing on the valuation date would represent the value of the shares. But where the shares in a public limited company, are not quoted on the stock exchange or the shares are in a private limited company the proper method of valuation to be adopted would be the profit-earning method. This method may be applied by taking the dividends as reflecting the profit-earning capacity of the company on reasonable commercial basis but if it is fund that the dividends do not correctly reflect the profit-earning capacity because only a small proportion of the profits is distributed by way of dividends and a large amount of profits is systematically accumulated in the form of reserves, the dividend method of valuation may be rejected and the valuation may be made by reference to the profits. The profit earning method takes into account the profits which the company has been making and should be capable of making and the valuation, according to this method is based on the average maintainable profits." 18. We do not think that the valuation in the instant case runs counter to the principles laid down therein. As seen from Enclosures 6.1 and 6.2 to the valuation report, the valuer had arrived at market based valuation in addition to the other modes of valuation and observed that the recommended value is the higher of the intrinsic value or the marked based value. Thus, the petitioners had the benefit of higher valuation. The first principle laid down in the above decision has been kept in view. Moreover, the profit earning method which has been referred to in the above decisions in the context of valuation of shares of a private limited Company has also been applied, though future earnings based valuation has not been done in the absence of reliable figures. As observed by us earlier, the profit earnings capacity of the Company has not been excluded from consideration. Thus, the Valuers mode of valuation does not in anyway infringe the principles laid down in the said decisions to the extant they are applicable.19. In final analysis, we are of the view that the Valuer approached the question of valuation having the regard to the terms of settlement and applying the standard methods of valuation. The valuation has been considered from all appropriate angles. No case has been made out that any irrelevant material has been taken into account or relevant material has been eschewed from consideration by the Valuer. The plea that the valuation is vitiated by fundamental errors cannot but be rejected. | 0[ds]15. The next objection is directed against theof Vertin and Colopsa brands while valuing the intrinsic worth of the company DIL. In our view, the learned Valuer has given relevant reasons forof the said brand of drugs which stood transferred to Solvay Pharmaceuticals BV from Dupen Laboratories Pvt. Ltd. They are not the existing assets of DIL. In fact, the petitioners have put in issue in one of the suits filed by them the legality of transfer and sought for a declaration that DIL continuous to be the proprietor of the two brands. The petitioners have agreed to withdraw various suits. In any case, the petitioners cannot be permitted to thwart the terms of the settlement by inviting the Valuer or this Court to go into the extraneous issue as regards the validity of the transfer or incidental matters. The assets as per the relevant records have to be taken into account by the Valuer and that has been done. We, therefore, find no apparent error in excluding those brands.16. The other objection is about DCF method of valuation which the Valuer has described as a commonly accepted method in adopting future earning based valuation. This involves discounting the net free cash flow of a business at an appropriate discount rate". We have already adverted to the reasons given by the Valuer for not adopting this method of valuation. Those reasons cannot be said to be irrelevant. It is contended that if the data and projections furnished by the parties is not reliable the Valuer should have secured the relevant data from independent sources or could have called for further particulars. We find no merit in this argument. The DCF method is adopted while resorting to valuation based on future earnings. It is not the case of the petitioners that the future earning based valuation is the only reliable method of earnings based valuation. Moreover, the petitioners have not placed any facts and figures to show that such method of valuation would result in a definite increase in the share value going by independent projections. When there are vast discrepancies between the projection given by the parties and independent projections have not been provided, the Valuer has chosen the best possible method of evaluation by capitalizing the past earnings. In doing so, the future maintainable profits based on past performance is also an element that has gone into the calculation. No prejudice whatsoever is shown to have been caused to the petitioners by the earnings based valuation.We do not think that the valuation in the instant case runs counter to the principles laid down therein. As seen from Enclosures 6.1 and 6.2 to the valuation report, the valuer had arrived at market based valuation in addition to the other modes of valuation and observed that the recommended value is the higher of the intrinsic value or the marked based value. Thus, the petitioners had the benefit of higher valuation. The first principle laid down in the above decision has been kept in view. Moreover, the profit earning method which has been referred to in the above decisions in the context of valuation of shares of a private limited Company has also been applied, though future earnings based valuation has not been done in the absence of reliable figures. As observed by us earlier, the profit earnings capacity of the Company has not been excluded from consideration. Thus, the Valuers mode of valuation does not in anyway infringe the principles laid down in the said decisions to the extant they are applicable.19. In final analysis, we are of the view that the Valuer approached the question of valuation having the regard to the terms of settlement and applying the standard methods of valuation. The valuation has been considered from all appropriate angles. No case has been made out that any irrelevant material has been taken into account or relevant material has been eschewed from consideration by the Valuer. The plea that the valuation is vitiated by fundamental errors cannot but be | 0 | 3,575 | 724 | ### Instruction:
Project the court's decision (favor (1) or against (0) the appeal) based on the case proceeding, and subsequently give an in-depth explanation by analyzing relevant sentences from the document.
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have been drafted after obtaining expert legal advice does not even necessarily imply that special weightage in the form of control premium has to be given to these 4.91 per cent shares. If the petitioners had insisted on the incorporation of such a provision, it could very well be that the other party or parties would not have agreed to such stipulation. The Court cannot, therefore, give any direction in regard to control premium. 15. The next objection is directed against the non-inclusion of Vertin and Colopsa brands while valuing the intrinsic worth of the company DIL. In our view, the learned Valuer has given relevant reasons for non-inclusion of the said brand of drugs which stood transferred to Solvay Pharmaceuticals BV from Dupen Laboratories Pvt. Ltd. They are not the existing assets of DIL. In fact, the petitioners have put in issue in one of the suits filed by them the legality of transfer and sought for a declaration that DIL continuous to be the proprietor of the two brands. The petitioners have agreed to withdraw various suits. In any case, the petitioners cannot be permitted to thwart the terms of the settlement by inviting the Valuer or this Court to go into the extraneous issue as regards the validity of the transfer or incidental matters. The assets as per the relevant records have to be taken into account by the Valuer and that has been done. We, therefore, find no apparent error in excluding those brands.16. The other objection is about DCF method of valuation which the Valuer has described as a commonly accepted method in adopting future earning based valuation. This involves discounting the net free cash flow of a business at an appropriate discount rate". We have already adverted to the reasons given by the Valuer for not adopting this method of valuation. Those reasons cannot be said to be irrelevant. It is contended that if the data and projections furnished by the parties is not reliable the Valuer should have secured the relevant data from independent sources or could have called for further particulars. We find no merit in this argument. The DCF method is adopted while resorting to valuation based on future earnings. It is not the case of the petitioners that the future earning based valuation is the only reliable method of earnings based valuation. Moreover, the petitioners have not placed any facts and figures to show that such method of valuation would result in a definite increase in the share value going by independent projections. When there are vast discrepancies between the projection given by the parties and independent projections have not been provided, the Valuer has chosen the best possible method of evaluation by capitalizing the past earnings. In doing so, the future maintainable profits based on past performance is also an element that has gone into the calculation. No prejudice whatsoever is shown to have been caused to the petitioners by the earnings based valuation. 17. The petitioners have relied on the decision of this Court in Commissioner of Gift Tax, Bombay vs. Smt. Kusumben D. Mahadevia (1980) 2 SCC 238 ). After referring to Mahadeo Jalans case (1973) 3 SCC 157 ) wherein certain principles regarding valuation of shares were laid down, it was observed thus: "It is clear from this decision that where the shares in a public limited company are quoted on the stock exchange and there are dealings in them, the price prevailing on the valuation date would represent the value of the shares. But where the shares in a public limited company, are not quoted on the stock exchange or the shares are in a private limited company the proper method of valuation to be adopted would be the profit-earning method. This method may be applied by taking the dividends as reflecting the profit-earning capacity of the company on reasonable commercial basis but if it is fund that the dividends do not correctly reflect the profit-earning capacity because only a small proportion of the profits is distributed by way of dividends and a large amount of profits is systematically accumulated in the form of reserves, the dividend method of valuation may be rejected and the valuation may be made by reference to the profits. The profit earning method takes into account the profits which the company has been making and should be capable of making and the valuation, according to this method is based on the average maintainable profits." 18. We do not think that the valuation in the instant case runs counter to the principles laid down therein. As seen from Enclosures 6.1 and 6.2 to the valuation report, the valuer had arrived at market based valuation in addition to the other modes of valuation and observed that the recommended value is the higher of the intrinsic value or the marked based value. Thus, the petitioners had the benefit of higher valuation. The first principle laid down in the above decision has been kept in view. Moreover, the profit earning method which has been referred to in the above decisions in the context of valuation of shares of a private limited Company has also been applied, though future earnings based valuation has not been done in the absence of reliable figures. As observed by us earlier, the profit earnings capacity of the Company has not been excluded from consideration. Thus, the Valuers mode of valuation does not in anyway infringe the principles laid down in the said decisions to the extant they are applicable.19. In final analysis, we are of the view that the Valuer approached the question of valuation having the regard to the terms of settlement and applying the standard methods of valuation. The valuation has been considered from all appropriate angles. No case has been made out that any irrelevant material has been taken into account or relevant material has been eschewed from consideration by the Valuer. The plea that the valuation is vitiated by fundamental errors cannot but be rejected.
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0
### Explanation:
15. The next objection is directed against theof Vertin and Colopsa brands while valuing the intrinsic worth of the company DIL. In our view, the learned Valuer has given relevant reasons forof the said brand of drugs which stood transferred to Solvay Pharmaceuticals BV from Dupen Laboratories Pvt. Ltd. They are not the existing assets of DIL. In fact, the petitioners have put in issue in one of the suits filed by them the legality of transfer and sought for a declaration that DIL continuous to be the proprietor of the two brands. The petitioners have agreed to withdraw various suits. In any case, the petitioners cannot be permitted to thwart the terms of the settlement by inviting the Valuer or this Court to go into the extraneous issue as regards the validity of the transfer or incidental matters. The assets as per the relevant records have to be taken into account by the Valuer and that has been done. We, therefore, find no apparent error in excluding those brands.16. The other objection is about DCF method of valuation which the Valuer has described as a commonly accepted method in adopting future earning based valuation. This involves discounting the net free cash flow of a business at an appropriate discount rate". We have already adverted to the reasons given by the Valuer for not adopting this method of valuation. Those reasons cannot be said to be irrelevant. It is contended that if the data and projections furnished by the parties is not reliable the Valuer should have secured the relevant data from independent sources or could have called for further particulars. We find no merit in this argument. The DCF method is adopted while resorting to valuation based on future earnings. It is not the case of the petitioners that the future earning based valuation is the only reliable method of earnings based valuation. Moreover, the petitioners have not placed any facts and figures to show that such method of valuation would result in a definite increase in the share value going by independent projections. When there are vast discrepancies between the projection given by the parties and independent projections have not been provided, the Valuer has chosen the best possible method of evaluation by capitalizing the past earnings. In doing so, the future maintainable profits based on past performance is also an element that has gone into the calculation. No prejudice whatsoever is shown to have been caused to the petitioners by the earnings based valuation.We do not think that the valuation in the instant case runs counter to the principles laid down therein. As seen from Enclosures 6.1 and 6.2 to the valuation report, the valuer had arrived at market based valuation in addition to the other modes of valuation and observed that the recommended value is the higher of the intrinsic value or the marked based value. Thus, the petitioners had the benefit of higher valuation. The first principle laid down in the above decision has been kept in view. Moreover, the profit earning method which has been referred to in the above decisions in the context of valuation of shares of a private limited Company has also been applied, though future earnings based valuation has not been done in the absence of reliable figures. As observed by us earlier, the profit earnings capacity of the Company has not been excluded from consideration. Thus, the Valuers mode of valuation does not in anyway infringe the principles laid down in the said decisions to the extant they are applicable.19. In final analysis, we are of the view that the Valuer approached the question of valuation having the regard to the terms of settlement and applying the standard methods of valuation. The valuation has been considered from all appropriate angles. No case has been made out that any irrelevant material has been taken into account or relevant material has been eschewed from consideration by the Valuer. The plea that the valuation is vitiated by fundamental errors cannot but be
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CENTRAL BUREAU OF INVESTIGATION Vs. HARI SINGH RANKA | the appellant herein in order to avail of credit facilities beyond the limit to which the Company was entitled. The dispute involved herein has overtones of a civil dispute with certain criminal facets. The question which is required to be answered in this case is whether the power which independently lies with this Court to quash the criminal proceedings pursuant to the compromise arrived at, should at all be exercised? 31. On an overall view of the facts as indicated hereinabove and keeping in mind the decision of this Court in B.S. Joshis case (supra) and the compromise arrived at between the Company and the Bank as also clause 11 of the consent terms filed in the suit filed by the Bank, we are satisfied that this is a fit case where technicality should not be allowed to stand in the way in the quashing of the criminal proceedings, since, in our view, the continuance of the same after the compromise arrived at between the parties would be a futile exercise. 32. We, therefore, set aside the order passed by the High Court dismissing the petitioners revision application No.49 of 2003 in Special Case No.80 of 1998 and quash the proceedings against the appellant. The appeal is accordingly allowed. 24. In Ashok Sadaranganis case (supra) offence was registered by the CBI. Allegation was that they had secured the credit facility by submitting forged documents as collected, and utilized such facilities in a dishonest and fraudulent manner by obtaining letters of credit in respect of foreign suppliers of goods without actually bringing any goods but inducing the bank to negotiate letters of credit in favour of the foreign suppliers and also by exercising the cash credit facility. 25. This court has considered the various decision in Sushil Suris case (supra) and Gyan Singhs case (supra). This court also considered whether when the dispute has been settled by the bank, the continuance of criminal proceedings would be a futility. This court distinguished the decision of Nikhil Merchant (supra) as the case projected larger conspiracy then this court refused to grant the relief in the prayer of quashing of the case. 26. In Sushil Suri v. Central Bureau of Investigation & Anr. [(2011) 5 SCC 708] this court made following observations; 23. It is manifest from a bare reading of the Charge sheet, placed on record, that the gravamen of the allegations against the appellant as also the co-accused is that the Company, acting through its directors in concert with the Chartered Accountants and some other persons: (i) conceived a criminal conspiracy and executed it by forging and fabricating a number of documents, like photographs of old machines, purchase orders and invoices showing purchase of machinery in order to support their claim to avail hire-purchase loan from PSB; (ii) on the strength of these false documents, PSB parted with the money by issuing pay orders & demand drafts in favour of the Company; and (iii) the accused opened six fictitious accounts in the banks (four accounts in Bank of Rajasthan and two in Bank of Madura) to encash the pay orders/bank drafts issued by PSB in favour of the suppliers of machines, thereby directly rotating back the loan amount to the borrower from these fictitious accounts, and in the process committed a systematic fraud on the Bank (PSB) and obtained pecuniary advantage for themselves. Precise details of all the fictitious accounts as also the further flow of money realised on encashment of demand drafts/pay orders have been incorporated in the Charge-sheet. Additionally, by allegedly claiming depreciation on the new machinery, which was never purchased, on the basis of forged invoices, etc. the accused cheated the public exchequer as well. This court considered the modus operandi noted in afore-extracted para 23. Considering the allegations that accused had obtained pecuniary benefit by producing forged documents. The case was dismissed and the trial court was directed to decide the case expeditiously. The facts of the instant case are more or less similar. 27. Learned senior counsel appearing on behalf of the respondents has relied upon the decision of this court in Sadhu Ram Singhs case (supra), OTS was arrived at between the parties in the wake of that High Court had exercised the power of quashing, which order has been upheld by this Court. The case was registered under Sections 120-B/420/467/468/471 of the IPC read with Section 469 I.P.C. It was a case in which it could not be corroborated by the evidence that the company had been using credit facility against the hypothecation of the stock, which stock was lying at the port. It was found that the respondent company had fraudulently obtained higher limits which appear to be forged and false. The facts of Sadhu Ram Singhs case (supra) were totally different. Loss of the stock could not be established was one of the main consideration and facts were not similar. As laid down in Gyan Singhs case (supra) itself the power of quashing a criminal case has to be exercised considering the nature of allegation and facts and circumstances of each case. Thus, the decision in Gyan Singhs case (supra) fails to serve cause espoused by the accused. 28. Learned senior counsel has also relied upon CBI v. Narendra Lal Jain (2014) 5 SCC 364 in which also this court dealt with the question where quashing of criminal proceeding in respect of not compoundable offence on the basis of compromise is warranted. This court dealt with the offence under Section 420 I.P.C. which is a compoundable offence under Section 320 I.P.C. and other sections which were non-compoundable offence. The monetary loss suffered by the Bank has been mutually settled between the parties and both had accepted liability in this regard. The ratio of B.S. Joshis case (supra) and Nikhil Merchants case (supra) was applied and in the peculiar facts of the case, the order passed by the High Court was upheld. The facts of the instant case are totally different and quite serious. | 1[ds]12. We have gone through the orders passed by the High court and the orders passed by the trial court and the revisional court. The order passed by the trial court indicates that it has treated the main offence being that of cheating and it has also been observed that there is no such allegation that documents are forged and pecuniary advantage has been obtained on that basis. The trial court had heavily relied upon the OTS. Its observation that forged documents had not been used to defraud the Bank in our opinion is a palpably incorrect and perverse finding and cannot be sustained. There is overwhelming material placed on record along with charge sheet which indicates that a large number of documents had been forged in the instant case and accused persons thereby have induced the Bank for disbursing the working capital limits to M/s. Modern Denim Ltd. The accused persons had availed credit facility from the Bank in 33 specific instances during the period 19th June 1998 to June 1999 by submitting forged purchase orders purportedly placed on M/s Modern Denim Ltd. by the foreign buyers.13. There is also the allegation supported by documents that sales contract (purchase order) were prepared on the letter head of M/s. Modern Denim Ltd. It is further the case of the prosecution that the advances obtained by the accused persons were never utilized for the purchase of the material thereto to execute the aforesaid purchase orders, but were diverted by the accused persons to liquidate the outstanding dues of M/s. Modern Denim Ltd. against the L.Cs which has devolved. The banks had suffered the loss of Rs. 599.08 lakhs in the aforesaid 33 instances where packing credit was availed on the basis of false and forged purchase orders.14. It was further alleged by the CBI that in the case of FBP/FBD facility the accused persons discounted 12 bills during the period March, 1997 to July, 1998 which were returned unpaid by the foreign banks and remained unrealised. The banks thereby suffered a loss to the tune of USD 629.410 = INR 2,47,56,323/-.15. It was further alleged by the prosecution that during the period 25.5.1999 to 12.08.1999, M/s. Modern Denim Ltd.- Accused No.13, submitted 24 Inland Bills for discounting to the Bank which was supported by the false and forged lorry receipt purportedly issued by M/s. Kalwania Carrying Corporation (Transport firm of Dharmpal A. Kalwania (A-4). The CBI alleged that no supply of materials (denim fabric) was made by M/s. Modern Denim Ltd. against the aforesaid 24 bills drawn on eight paper companies. The forged nature of the lorry receipt is evident from the fact that vehicle numbers were mentioned, the LR were found to be those of tractors and two wheelers, it was also the case of the prosecution that the facilities disbursed by the Bank were used to liquidate the remaining outstanding dues of the accused against the earlier L.Cs in these 24 instances the Bank suffered a loss to the tune of Rs. 1,61,51,052/-.16. It was further alleged by the CBI that M/s. Modern Denim Ltd. - Accused No.13, got established 17 letters of credit in favour of three paper suppliers during the period of 7.9.1997 to 12.8.1999. The aforesaid L.Cs were opened for supply of raw materials to M/s. Modern Denim Ltd. However, no supplies were made instead false documents purported to was submitted which were supported by false and forged lorry receipts issued by M/s. Kalwania Carrying Corporation. It was further alleged that aforesaid L.Cs were discounted by the accused persons. On the respective due dates M/s. Modern Denim Ltd. did not arrange funds for payment of the LCS. In the aforesaid 17 instances, the bank suffered a loss of Rs. 356.00 lakhs.17. In the aforesaid backdrop of facts, we take into consideration the effect of OTS. It is apparent that a large number of documents were filed by the CBI along with the Charge sheet. There are serious allegations in the instant case leveled against the accused persons of using fabricated documents whereas there was no supply or no such transactions took place. The letter head of M/s. Modern Denim Ltd.- Accused 13 had also been used. It passes comprehension how the trial court has given a clean chit that offence falls short of constituting the conspiracy under Section 120B I.P.C. The trial court has not cared to refer to the aforesaid various materials which have been alleged to be fabricated /forged and as to how the misuse of bank funds was made. In our considered opinion, in the facts of the instant case, the manner in which the trial court has discharged the accused persons, in spite of the overwhelming materials on record, could not be said to be legally justified order at all. The OTS merely deals with the civil liability that too by making of payment of Rs. 25 crores whereas outstanding liability was Rs. 44 crores though it was submitted loss caused was approx. 13 crores. Be that as it may, we are not on the civil liability. Ultimately, the amount which has been settled in OTS Scheme cannot be legally sufficient to wipe out the criminal liability of the accused persons. The OTS could wipe off only the civil liability, of the accused not the criminal one. However, this may not be taken to be the ultimate conclusion on merits of the case, it would be open to the trial court to record any finding after the trial of the case.18. In Rumi Dhars case (supra), this court has observed that when settlement is arrived at between the creditors and the debtor, the offence, if committed, as such does not come to an end. Even a judgment rendered in the civil proceedings, when it is rendered on the basis of a settlement entered into between the parties, would not be of large relevance as per criminal offence required of Section 49 of the Evidence Act. The judgment of the civil court is admissible only for limited purposes.22. The principles laid down by this court in Gian Singh decision (supra) indicate that while exercising the power of quashing, when the offences are not compoundable, the facts and circumstances of each case have to be seen, and thereafter the power is to be exercised. In the instant case, considering the aforesaid principle and the facts and circumstances projected above, the power to discharge or that of quashment under Section 482 Cr.P.C. could not have been exercised at all. Where as the power of discharge exercised by the learned trial judge virtually amounts to the exercise of power under Section 482 Cr.P.C. which was not available to it and was totally uncalled for exercise that too without adverting to the materials on record.24. In Ashok Sadaranganis case (supra) offence was registered by the CBI. Allegation was that they had secured the credit facility by submitting forged documents as collected, and utilized such facilities in a dishonest and fraudulent manner by obtaining letters of credit in respect of foreign suppliers of goods without actually bringing any goods but inducing the bank to negotiate letters of credit in favour of the foreign suppliers and also by exercising the cash credit facility.25. This court has considered the various decision in Sushil Suris case (supra) and Gyan Singhs case (supra). This court also considered whether when the dispute has been settled by the bank, the continuance of criminal proceedings would be a futility. This court distinguished the decision of Nikhil Merchant (supra) as the case projected larger conspiracy then this court refused to grant the relief in the prayer of quashing of the case.26. In Sushil Suri v. Central Bureau of Investigation & Anr. [(2011) 5 SCC 708] this court made following observations;23. It is manifest from a bare reading of the Charge sheet, placed on record, that the gravamen of the allegations against the appellant as also the co-accused is that the Company, acting through its directors in concert with the Chartered Accountants and some other persons: (i) conceived a criminal conspiracy and executed it by forging and fabricating a number of documents, like photographs of old machines, purchase orders and invoices showing purchase of machinery in order to support their claim to avail hire-purchase loan from PSB;(ii) on the strength of these false documents, PSB parted with the money by issuing pay orders & demand drafts in favour of the Company; and(iii) the accused opened six fictitious accounts in the banks (four accounts in Bank of Rajasthan and two in Bank of Madura) to encash the pay orders/bank drafts issued by PSB in favour of the suppliers of machines, thereby directly rotating back the loan amount to the borrower from these fictitious accounts, and in the process committed a systematic fraud on the Bank (PSB) and obtained pecuniary advantage for themselves. Precise details of all the fictitious accounts as also the further flow of money realised on encashment of demand drafts/pay orders have been incorporated in the Charge-sheet. Additionally, by allegedly claiming depreciation on the new machinery, which was never purchased, on the basis of forged invoices, etc. the accused cheated the public exchequer as well.This court considered the modus operandi noted in afore-extracted para 23. Considering the allegations that accused had obtained pecuniary benefit by producing forged documents. The case was dismissed and the trial court was directed to decide the case expeditiously. The facts of the instant case are more or less similar.28. Learned senior counsel has also relied upon CBI v. Narendra Lal Jain (2014) 5 SCC 364 in which also this court dealt with the question where quashing of criminal proceeding in respect of not compoundable offence on the basis of compromise is warranted.This court dealt with the offence under Section 420 I.P.C. which is a compoundable offence under Section 320 I.P.C. and other sections which were non-compoundable offence. The monetary loss suffered by the Bank has been mutually settled between the parties and both had accepted liability in this regard. The ratio of B.S. Joshis case (supra) and Nikhil Merchants case (supra) was applied and in the peculiar facts of the case, the order passed by the High Court was upheld. The facts of the instant case are totally different and quite serious. | 1 | 9,355 | 1,888 | ### Instruction:
Judge the probable resolution of the case (approval (1) or disapproval (0)), and elaborate on this forecast by extracting and interpreting significant sentences from the proceeding.
### Input:
the appellant herein in order to avail of credit facilities beyond the limit to which the Company was entitled. The dispute involved herein has overtones of a civil dispute with certain criminal facets. The question which is required to be answered in this case is whether the power which independently lies with this Court to quash the criminal proceedings pursuant to the compromise arrived at, should at all be exercised? 31. On an overall view of the facts as indicated hereinabove and keeping in mind the decision of this Court in B.S. Joshis case (supra) and the compromise arrived at between the Company and the Bank as also clause 11 of the consent terms filed in the suit filed by the Bank, we are satisfied that this is a fit case where technicality should not be allowed to stand in the way in the quashing of the criminal proceedings, since, in our view, the continuance of the same after the compromise arrived at between the parties would be a futile exercise. 32. We, therefore, set aside the order passed by the High Court dismissing the petitioners revision application No.49 of 2003 in Special Case No.80 of 1998 and quash the proceedings against the appellant. The appeal is accordingly allowed. 24. In Ashok Sadaranganis case (supra) offence was registered by the CBI. Allegation was that they had secured the credit facility by submitting forged documents as collected, and utilized such facilities in a dishonest and fraudulent manner by obtaining letters of credit in respect of foreign suppliers of goods without actually bringing any goods but inducing the bank to negotiate letters of credit in favour of the foreign suppliers and also by exercising the cash credit facility. 25. This court has considered the various decision in Sushil Suris case (supra) and Gyan Singhs case (supra). This court also considered whether when the dispute has been settled by the bank, the continuance of criminal proceedings would be a futility. This court distinguished the decision of Nikhil Merchant (supra) as the case projected larger conspiracy then this court refused to grant the relief in the prayer of quashing of the case. 26. In Sushil Suri v. Central Bureau of Investigation & Anr. [(2011) 5 SCC 708] this court made following observations; 23. It is manifest from a bare reading of the Charge sheet, placed on record, that the gravamen of the allegations against the appellant as also the co-accused is that the Company, acting through its directors in concert with the Chartered Accountants and some other persons: (i) conceived a criminal conspiracy and executed it by forging and fabricating a number of documents, like photographs of old machines, purchase orders and invoices showing purchase of machinery in order to support their claim to avail hire-purchase loan from PSB; (ii) on the strength of these false documents, PSB parted with the money by issuing pay orders & demand drafts in favour of the Company; and (iii) the accused opened six fictitious accounts in the banks (four accounts in Bank of Rajasthan and two in Bank of Madura) to encash the pay orders/bank drafts issued by PSB in favour of the suppliers of machines, thereby directly rotating back the loan amount to the borrower from these fictitious accounts, and in the process committed a systematic fraud on the Bank (PSB) and obtained pecuniary advantage for themselves. Precise details of all the fictitious accounts as also the further flow of money realised on encashment of demand drafts/pay orders have been incorporated in the Charge-sheet. Additionally, by allegedly claiming depreciation on the new machinery, which was never purchased, on the basis of forged invoices, etc. the accused cheated the public exchequer as well. This court considered the modus operandi noted in afore-extracted para 23. Considering the allegations that accused had obtained pecuniary benefit by producing forged documents. The case was dismissed and the trial court was directed to decide the case expeditiously. The facts of the instant case are more or less similar. 27. Learned senior counsel appearing on behalf of the respondents has relied upon the decision of this court in Sadhu Ram Singhs case (supra), OTS was arrived at between the parties in the wake of that High Court had exercised the power of quashing, which order has been upheld by this Court. The case was registered under Sections 120-B/420/467/468/471 of the IPC read with Section 469 I.P.C. It was a case in which it could not be corroborated by the evidence that the company had been using credit facility against the hypothecation of the stock, which stock was lying at the port. It was found that the respondent company had fraudulently obtained higher limits which appear to be forged and false. The facts of Sadhu Ram Singhs case (supra) were totally different. Loss of the stock could not be established was one of the main consideration and facts were not similar. As laid down in Gyan Singhs case (supra) itself the power of quashing a criminal case has to be exercised considering the nature of allegation and facts and circumstances of each case. Thus, the decision in Gyan Singhs case (supra) fails to serve cause espoused by the accused. 28. Learned senior counsel has also relied upon CBI v. Narendra Lal Jain (2014) 5 SCC 364 in which also this court dealt with the question where quashing of criminal proceeding in respect of not compoundable offence on the basis of compromise is warranted. This court dealt with the offence under Section 420 I.P.C. which is a compoundable offence under Section 320 I.P.C. and other sections which were non-compoundable offence. The monetary loss suffered by the Bank has been mutually settled between the parties and both had accepted liability in this regard. The ratio of B.S. Joshis case (supra) and Nikhil Merchants case (supra) was applied and in the peculiar facts of the case, the order passed by the High Court was upheld. The facts of the instant case are totally different and quite serious.
### Response:
1
### Explanation:
that offence falls short of constituting the conspiracy under Section 120B I.P.C. The trial court has not cared to refer to the aforesaid various materials which have been alleged to be fabricated /forged and as to how the misuse of bank funds was made. In our considered opinion, in the facts of the instant case, the manner in which the trial court has discharged the accused persons, in spite of the overwhelming materials on record, could not be said to be legally justified order at all. The OTS merely deals with the civil liability that too by making of payment of Rs. 25 crores whereas outstanding liability was Rs. 44 crores though it was submitted loss caused was approx. 13 crores. Be that as it may, we are not on the civil liability. Ultimately, the amount which has been settled in OTS Scheme cannot be legally sufficient to wipe out the criminal liability of the accused persons. The OTS could wipe off only the civil liability, of the accused not the criminal one. However, this may not be taken to be the ultimate conclusion on merits of the case, it would be open to the trial court to record any finding after the trial of the case.18. In Rumi Dhars case (supra), this court has observed that when settlement is arrived at between the creditors and the debtor, the offence, if committed, as such does not come to an end. Even a judgment rendered in the civil proceedings, when it is rendered on the basis of a settlement entered into between the parties, would not be of large relevance as per criminal offence required of Section 49 of the Evidence Act. The judgment of the civil court is admissible only for limited purposes.22. The principles laid down by this court in Gian Singh decision (supra) indicate that while exercising the power of quashing, when the offences are not compoundable, the facts and circumstances of each case have to be seen, and thereafter the power is to be exercised. In the instant case, considering the aforesaid principle and the facts and circumstances projected above, the power to discharge or that of quashment under Section 482 Cr.P.C. could not have been exercised at all. Where as the power of discharge exercised by the learned trial judge virtually amounts to the exercise of power under Section 482 Cr.P.C. which was not available to it and was totally uncalled for exercise that too without adverting to the materials on record.24. In Ashok Sadaranganis case (supra) offence was registered by the CBI. Allegation was that they had secured the credit facility by submitting forged documents as collected, and utilized such facilities in a dishonest and fraudulent manner by obtaining letters of credit in respect of foreign suppliers of goods without actually bringing any goods but inducing the bank to negotiate letters of credit in favour of the foreign suppliers and also by exercising the cash credit facility.25. This court has considered the various decision in Sushil Suris case (supra) and Gyan Singhs case (supra). This court also considered whether when the dispute has been settled by the bank, the continuance of criminal proceedings would be a futility. This court distinguished the decision of Nikhil Merchant (supra) as the case projected larger conspiracy then this court refused to grant the relief in the prayer of quashing of the case.26. In Sushil Suri v. Central Bureau of Investigation & Anr. [(2011) 5 SCC 708] this court made following observations;23. It is manifest from a bare reading of the Charge sheet, placed on record, that the gravamen of the allegations against the appellant as also the co-accused is that the Company, acting through its directors in concert with the Chartered Accountants and some other persons: (i) conceived a criminal conspiracy and executed it by forging and fabricating a number of documents, like photographs of old machines, purchase orders and invoices showing purchase of machinery in order to support their claim to avail hire-purchase loan from PSB;(ii) on the strength of these false documents, PSB parted with the money by issuing pay orders & demand drafts in favour of the Company; and(iii) the accused opened six fictitious accounts in the banks (four accounts in Bank of Rajasthan and two in Bank of Madura) to encash the pay orders/bank drafts issued by PSB in favour of the suppliers of machines, thereby directly rotating back the loan amount to the borrower from these fictitious accounts, and in the process committed a systematic fraud on the Bank (PSB) and obtained pecuniary advantage for themselves. Precise details of all the fictitious accounts as also the further flow of money realised on encashment of demand drafts/pay orders have been incorporated in the Charge-sheet. Additionally, by allegedly claiming depreciation on the new machinery, which was never purchased, on the basis of forged invoices, etc. the accused cheated the public exchequer as well.This court considered the modus operandi noted in afore-extracted para 23. Considering the allegations that accused had obtained pecuniary benefit by producing forged documents. The case was dismissed and the trial court was directed to decide the case expeditiously. The facts of the instant case are more or less similar.28. Learned senior counsel has also relied upon CBI v. Narendra Lal Jain (2014) 5 SCC 364 in which also this court dealt with the question where quashing of criminal proceeding in respect of not compoundable offence on the basis of compromise is warranted.This court dealt with the offence under Section 420 I.P.C. which is a compoundable offence under Section 320 I.P.C. and other sections which were non-compoundable offence. The monetary loss suffered by the Bank has been mutually settled between the parties and both had accepted liability in this regard. The ratio of B.S. Joshis case (supra) and Nikhil Merchants case (supra) was applied and in the peculiar facts of the case, the order passed by the High Court was upheld. The facts of the instant case are totally different and quite serious.
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Sadanand S. Varde & Others Vs. State of Maharashtra & Others | Tax Act, 1961 would apply to a situation of sanction of an amalgamation scheme. The authorities entrusted with the administration of the statute (i.e. the Income Tax Act) also do not appear to have interpreted the provisions of Chapter XX-C to mean what is being contended now before us. By the principle of contemporanea expositio, the practical manner in which the provisions of Chapter XX-C have been interpreted over a considerably long period need not be upset by this Court, in our judgment. (See in this connection Raymond Synthetics Ltd. and others v. Union of India and others, A.I.R. 1992 S.C. 847 and N. Suresh Nathan and another v. Union of India and others, A.I.R. 1992 S.C. 564.(c) If this Court were to accept the contention of the petitioners and interpret the provisions of Chapter XX-C in the manner suggested by the petitioners, a large number of innocent persons who have been parties to amalgamation schemes would stand exposed to criminal prosecutions under section 276AB of the Income Tax Act. The Appropriate Authority has not placed any material before us that in any past case of sanction of an amalgamation scheme, they had insisted upon filing of a declaration in Form 37-I as required by the provisions of section 269BC, nor have they placed any material to show that any such parties have been subjected to criminal prosecutions under section 276AB for failure to do so.Thus, we are of the considered view that the contention of the petitioners, which was enthusiastically echoed by the fifth respondent, Appropriate Authority, that the transfer of the concerned land from the sixth to the ninth respondent under the scheme of amalgamation would be covered by the provisions of Chapter XX-C, though novel and ingenious, must be rejected.HISTORY OF LITIGATION114. Mr. Tulzapurkar, learned Counsel for the sixth and the ninth respondents, urged that the history of the litigation spanning about twenty long years covering several writ petitions and appeals from this Court to the Supreme Court, back and forth, the final decision of the Supreme Court in S.N. Raos case (supra) and the hanging sword of Damocles of this writ petition in which the petitioners have urged contentions after contentions, taken up by amendments after amendments, even though all contentions of petitioners were rejected at all stages by all courts, indicates that there is utter lack of bona fides on the part of the petitioners who claim to be pursuing this litigation in public interest. He also urged that, pursuant to the sanctioned plans, whose validity was upheld by the Supreme Court in S.N. Raos case (supra), the sixth and the ninth respondents have acted lawfully and in full compliance with all legal requirements and the applicable buildings Rules and Regulations. Obviously, this Court did not injunct the said respondents from continuing with the construction which started in 1984, despite repeated clamour for injunction orders by the petitioners. Perhaps being possessed with premonition that this writ petition has no substance, this Court merely made an order that the sixth and the ninth respondents may continue the construction at their risk upon filing an undertaking that they would claim no equities in the matter if the construction was allowed to continue. Mr. Tulzapurkar urges that the construction is complete and has resulted in a multistory seven star hotel, which was conceived off way back when the plans were submitted for sanction and there is no reason whatsoever to interfere with its functioning. On the other hand, he urges that the history of litigation from 1974 onwards, the repeated contentions and challenges in all available fora by the petitioners, contentions urged as to the applicability of Chapter XX-C of the Income Tax Act, 1961, taken together, suggest that there may be "something more than what meets the eye" as observed by the Supreme Court in Sachidanand Pandeys case (supra).115. There appears to be quite some legitimacy to the grievance made by the learned Counsel for the sixth and the ninth respondents. It appears to us that, what may have started as a bona fide Public Interest Litigation, soon degenerated into a case of private witch-hunting. If at all the petitioners were interested in pursuing the litigation as a Public Interest Litigation, after the observations of the Supreme Court in S.N. Raos case (supra), which we have reproduced above, the matter should have been put to rest. The annoying persistence with which the petitioners have pursued this writ petition certainly gives credence to the contention of the learned Counsel for the sixth and the ninth respondents that this writ petition was intended only as a PIL meaning Persecution Interest Litigation and not PIL meaning Public Interest Litigation.116. Though, this writ petition was seriously taken up for final hearing on 30th June 1998 and the hearing continued from 1st July 1998 to 5th August 1998 and the petition was finally reserved for judgment on 6th August 1998, the judgment could not be delivered earlier on account of several overriding reasons beyond our control. At one stage, following the dicta of the Supreme Court in (Bhagwandas Fatechand Daswani & others v. II P.A. International & others)42, J.T. 2000(1) S.C. 266, we even suggested to the parties and Counsel that we may treat this matter as not part-heard and set it down for re-hearing. However, we are glad to note that the parties and their Counsel reposed full faith in our ability to remember and decide the facts and the legal issues on the basis of our detailed notes supplemented by the efficient written submissions filed by the parties. At their request, we have decided the matter ourselves, though after a span of twenty two months. While regretting the unavoidable delay in delivering our judgment, we express our gratitude to the learned Counsel on both sides who have with consumable skill rendered invaluable help in unravelling several knotty and complicated legal issues. At the end of the day, in our considered judgment, the writ petition has no merit and must fail. | 0[ds]Mr. Kalsekar, learned Counsel for the petitioners, urged that the sanctioning of the Development Plans is contrary to the provisions of the CRZ Notification dated 19th February, 1991. There are several limbs to the argument.33. The first limb urged is that the Bandra Fort, which is situated at the tip of peninsular piece of land called Bandra Lands End, is a heritage fort and would, therefore, appropriately fall withinand the Notification dated 19th February, 1991 which prescribes norms for regulation of building activities, substantially prohibits new constructions within 500 meters of High Tide Line except such of the construction activities as are listed in paragraph 2(xii). It is contended that the Bandra Lands End is an area of outstanding natural beauty/historical heritage falling withincategory. The petitioners place reliance on certain letters placed on record as Exhibits to the writ petition in support of this contention. In the letter dated 1st July, 1985 written by Shri Salim Ali, President, Bombay Natural History Society (Exhibit "D" to the Writ Petition), it is pointed out that the Bandra Lands End, where the concerned plot is situated, is a place of natural beauty and the construction of a hotel on the said plot would disturb the ecological balance and scenic beauty of the spot. Reliance is also placed on a letter dated 26th July, 1985 addressed by Dr. Rashmi Mayur, Director, Urban Development Institute (Exhibit "D2" to the Writ Petition). A letter written in the Indian Express by Dr. P.J. Deoras of the Society for Clean Environment dated 31st August, 1985 and the letter of Dr. Rashmi Mayur dated 26th July, 1985 are the letters in support of this contention. Reliance is also placed on the letter of the then Prime Minister of India, Smt. Indira Gandhi, addressed to Shri. V.P. Naik, the then Chief Minister of Maharashtra, on 15th July, 1974. On the basis of these letters, it is contended that the entire Bandra Lands End area including the concerned plot would fall withinis no doubt that the Bandra Fort as such is an area of historical/heritage value. In fact, the Bandra Fort has been declared to be such by a Notification dated 23rd April, 1984 issued under section 4(3) of the Maharashtra Ancient Monuments and Archaeological Sites and Remains Act, 1960 (hereinafter referred to as "MAMA Act"). This Notification describes the name of the monument as "Bandra Fort Remains and adjoining open land". There was some error in the description of the particulars contained in the Notification dated 23rd April 1984 which has now been corrected after Writ Petition No. 1403 of 1998 came to be filed by Enjay Hotels Limited and Another challenging the dimensions indicated in the Notification. An affidavit came to be filed in the said Writ Petition by the Director of Archaeology and Museums, Mumbai, who admitted that there was a patent error in the dimensions originally mentioned in the Notification in respect of the Bandra Fort area on 23rd April, 1984. The actual dimensions of the Bandra Fort were also indicated. Writ Petition No. 1403 of 1998 came to be disposed of as withdrawn when it was clearly demonstrated by the petitioners in the said Writ Petition, with reference to the facts, figures and maps, that the dimensions of the Bandra Fort and remains and open land specified in the Notification dated 23rd April, 1984 were inherently improbable and that there was an apparent error in the dimensions specified in the said Notification. In fact, the present first petitioner was the second respondent in the said Writ Petition No. 1403 of 1998 and he agreed with the contention of the petitioners in Writ Petition No. 1403 of 1998 as a result of which the first respondent, State of Maharashtra, in the said writ petition, was permitted to issue a corrigendum under section 39 of the MAMA Act to indicate the correct dimensions of the Bandra Fort and surrounding area which was declared as a protected monument under section 4(3) of the MAMA Act. The corrigendum Notification is dated 31st July, 1998 and correctly specifies the dimensions of the Bandra Fort remains and the surrounding area falling within the MAMA Act as notified under section 4(3) of the MAMA Act.Mr. Kalsekar then urged the third limb of the argument, that even if the plot fell withinwas not accepted, there could be no doubt that the concerned plot fell withind setting up of new activities and expansion of new industries is totally prohibited within the Coastal Regulation Zone under paragraph 2(i) of the Notification dated 19th February, 1991. It is contended that setting up of a five or more star hotel is an "industry" and as such would fall within the prohibition of the meaning of paragraph 2(i) of the Coastal Regulation Zone Notification dated 19th February 1991. Mr. Kalsekar placed reliance on certain judgments rendered under the provisions of the Industrial Disputes Act, 1947 holding that a hotel would be an "industry" within the meaning of section 2(j) of the Industrial Disputes Act, 1947.The Court had occasion to inspect the concerned plot, and the construction on it, during the course of which it was noticed that the construction on the concerned plot is such that a straight line drawn from the Bandra Fort to the Father Agnel Ashram, or one of the high rise buildings (all authorised constructions) would put the disputed construction on the landward side when reckoned from East side. Despite the dispute raised by the learned Counsel form the petitioners, during the site inspection we had recorded our site inspection notes dated 17th July, 1998 which forms part of the record of the case. We are, therefore, satisfied that the construction on the concerned plot falls on the landward side of a straight line drawn between two existing authorised constructions, reckoned from Eastern side. Thus, in our view, the construction carried out by the sixth and the ninth respondents on the concerned plot does not conflict with the restrictions imposed on constructions inareas and is perfectly consistent with the permitted development activity inarea. The Notification dated 9th July, 1997 provides that buildings shall be permitted only on the landward side of the existing authorised structures subject to existing local Town and Country Planning Regulations including the existing norms of Floor Space Index/Floor Area Ratio. The prohibition here is only on constructions on the seaward side of the existing road or existing structure. If there was any doubt as to the manner in which the construction had to be carried out, even on the landward side, this is clarified by a subsequent notification which provides that construction shall be permitted on the landward side of an imaginary line between the two authorised constructions drawn parallel to the High Tide Line. Looked at this way also, we find that the construction does not contravene thee is no material on record to show that the hotel constructed by the sixth and the ninth respondents discharges untreated wastes and effluents into the sea. As to the grievance against the Bombay Municipal Corporation Sewerage Purification Plant, the grievance has no substance since the Bombay Municipal Corporation Sewerage Purification Plant is intended to treat city wastes and effluents and render them innocuous before being discharged into the sea. Hence, we see no violation of(v) of Clause 2 of 1991 CRZ Notification.s (viii) and (xii) of Clause 2 of the said notification are intended to permit land reclamation for limited purposes and to permit construction activity between Low Tide Line and High Tide Line for carrying of treated effluents and wastes water discharges into the sea. In our view, the Bombay Municipal Corporation Sewerage Purification Plant and the proposed pipeline fall within the activity permitted by these clauses. In fact, by the Notification dated 9th July, 1997,(viii) has been completely substituted and the activity of construction of the Bombay Municipal Corporation Sewerage Purification Plant is wholly permitted thereunder.The petitioners contend that the construction of the hotel on the concerned plot contravences the ULCA exemption order dated 25th July, 1978 as it contravenes the conditions of user of the land and the restrictions and conditions imposed in the said order. One of the conditions of the order dated 25th July, 1978 made under section 20 of ULCA granting exemption specifically stipulated was that "no transfer by way of sale mortgage, gift, lease or otherwise" shall be made of the exempted land and that in case of violation of this condition, the exemption order was liable to be revoked. There was also a condition that the sixth respondent was to give an area of 7000 square yards free of cost to the Bombay Municipal Corporation for being maintained as a public park. The petitioners contend that the building of the hotel on the concerned plot violates both these conditions.In our view, this contention is no longer Res Integra for the petitioners to urge in the present writ petition. This contention, in terms, was argued and rejected by the Division Bench of this Court in Review Petition No. 8 of 1985 (Per Konda Madhava Reddy, C.J. and S.M. Daud, J.). The Division Bench rejected the contention by saying, "that some encroachments have been made thereon and some buildings have been constructed by others does not in any way militate against that land still being reserved under Approved Plan for development into a garden". This judgment of this Court was specifically challenged before the Supreme Court in S.N. Raos case (supra) and the challenge was rejected by the Supreme Court.It is also not possible to say that the State Government was not alive to the fact of the existence of hutments on portions of Revenue Survey No. 6 which was shown as reserved for garden. In fact, the record suggests that the State Government seriously considered the Bombay Municipal Corporations suggestion regarding deletion of reservation for garden from other plots bearing CTS Nos. 919 to 924, but accepted the suggestion of the Bombay Municipal Corporation with regard to CTS No. 922. In other words, the State Government maintained the reservation for garden in respect of all other areas even after due consideration of the fact that there were hutments on the said plot of land. We are, therefore, satisfied that the sanction granted by the State Government to the development plan was not vitiated on account ofof mind as contended. The contention must, therefore, fail for that reason also.There is overwhelming authority of precedents suggesting that when an amalgamation takes place, the transfer of assets takes place by the force of the Company Courts order and/or by operation of law; it ceases to be a contractual or a consensual transfer. The contention, therefore, is that Chapteris not attracted to such a transfer by operation of law. This contention has substance and needs to be upheld.It is alternatively contended by the Counsel for the sixth and the ninth respondents that sectionis not intended to apply to all types of transfers, but only to some particular types of transfers as there is no reference therein to a transfer consequent upon an amalgamation scheme. Hence, it is contended that a transfer consequent upon amalgamation falls outside the sweep of sectionIn order to drive home this point, the learned Counsel drew our attention to section 2(1B) of the Income Tax Act, 1961 which defines the expression "amalgamation". Sections 45 and 47 of the Income Tax Act which deal with capital gains arising upon a transfer of a capital asset, expressly exclude a situation of amalgamation for the purposes of capital gains. Similarly, section 45 of the Gift Tax Act, 1958 provides that no gift tax will be leviable in a situation of amalgamation. The term "amalgamation" under the provisions of Gifts Tax Act has the same meaning as in section 2(1B) of the Income Tax Act. It is, therefore, contended that, in an amalgamation, there is neither any sale, nor any exchange of any immovable property, nor any lease thereof. See in this connection (Commissioner of Income Tax v. Rasiklal Manecklal HUF)31, A.I.R. 1989 S.C. 1333.98. It is true that in a case of amalgamation there is a share exchange ratio prescribed according to which the shareholders of the transferor company would be entitled to the shares of the transferee company. This, however, does not make it a situation of exchange of immovable property, or relinquishment of any right to immovable property so as to make the transaction amenable to sectionof the Income Tax Act. There is neither sale nor purchase in a case of amalgamation. Section 54 of the Transfer of Property Act defines "sale" as a transfer of ownership in exchange for a price, "price" being defined in section 2(10) of the Sale of Goods Act as any consideration paid for sale of the goods. In (CIT v. Motors and General Stores Pvt. Ltd.)32, 66 ITR 692 , it was pointed out by the Supreme Court that the presence of money consideration is an essential element of a transaction of sale. Tested by this yardstick, it would appear that in an amalgamation no consideration in any formmuch less in the form of moneyflows from the transferee company to the transferor company, which was the erstwhile owner of the assets. The shares are issued by the transferee company, not to the transferor company, but to the shareholders of the transferee company, who must necessarily be treated as distinct from the transferor company itself. The shareholders of the transferor company could not be deemed in law to be the owners of the assets of the transferee company, nor can they be said to have held any interest in the assets of the transferee company. See in this connection (Bacha Guzdar v. Commissioner of Income Tax)33, A.I.R. 1955 S.C. 74. Right from the time of Solomons case, a company has always been treated as a separate and distinct juristic person with a personality of its own different from that of its shareholders. No shareholder can legitimately claim to have an interest in any of the properties or assets held by the company. The judgment of the Supreme Court in (AccountantSecretarial Services Pvt. Ltd. v. Union of India)34, A.I.R. 1988 S.C. 1708, was pressed into service to contend that a bank constituted under the Banking Companies (Acquisition and Transfer of Undertaking) Act, 1970, though materially controlled by the Central Government, has a distinct personality of its own and its property cannot be said to be the property of the Union of India. Hence, it is contended that by the act of amalgamation, there was no sale of any assets by the transferor company (sixth respondent) to the transferee company (ninth respondent) in the amalgamation. Thus, it is urged that there being no sale or exchange or lease of immovable property in the case of amalgamation, the transfer of the assets of the sixth respondent to the ninth respondent does not fall within the ambit of Chapterof the Income Tax Act, 1961.The conclusions which we have arrived at on statutory interpretation, also appear backed by the following practical considerations:(a) It is significant that the Appropriate Authority has not bothered to take action under section 276ABof the Income Tax Act, 1961.Nor has it initiated any other action in connection with the aforesaid transfer for over such a long period ofWe can take judicial notice that several schemes of transfer are sanctioned every day by the Company Judge and no one seems to have seriously suggested, argued or held that Chapterof the Income Tax Act, 1961 would apply to a situation of sanction of an amalgamation scheme. The authorities entrusted with the administration of the statute (i.e. the Income Tax Act) also do not appear to have interpreted the provisions of Chapterto mean what is being contended now before us. By the principle of contemporanea expositio, the practical manner in which the provisions of Chapterhave been interpreted over a considerably long period need not be upset by this Court, in our judgment. (See in this connection Raymond Synthetics Ltd. and others v. Union of India and others, A.I.R. 1992 S.C. 847 and N. Suresh Nathan and another v. Union of India and others, A.I.R. 1992 S.C. 564.(c) If this Court were to accept the contention of the petitioners and interpret the provisions of Chapterin the manner suggested by the petitioners, a large number of innocent persons who have been parties to amalgamation schemes would stand exposed to criminal prosecutions under section 276AB of the Income Tax Act. The Appropriate Authority has not placed any material before us that in any past case of sanction of an amalgamation scheme, they had insisted upon filing of a declaration in Formas required by the provisions of section 269BC, nor have they placed any material to show that any such parties have been subjected to criminal prosecutions under section 276AB for failure to do so.Thus, we are of the considered view that the contention of the petitioners, which was enthusiastically echoed by the fifth respondent, Appropriate Authority, that the transfer of the concerned land from the sixth to the ninth respondent under the scheme of amalgamation would be covered by the provisions of Chapterthough novel and ingenious, must be rejected.There appears to be quite some legitimacy to the grievance made by the learned Counsel for the sixth and the ninth respondents. It appears to us that, what may have started as a bona fide Public Interest Litigation, soon degenerated into a case of privateIf at all the petitioners were interested in pursuing the litigation as a Public Interest Litigation, after the observations of the Supreme Court in S.N. Raos case (supra), which we have reproduced above, the matter should have been put to rest. The annoying persistence with which the petitioners have pursued this writ petition certainly gives credence to the contention of the learned Counsel for the sixth and the ninth respondents that this writ petition was intended only as a PIL meaning Persecution Interest Litigation and not PIL meaning Public Interest Litigation.116. Though, this writ petition was seriously taken up for final hearing on 30th June 1998 and the hearing continued from 1st July 1998 to 5th August 1998 and the petition was finally reserved for judgment on 6th August 1998, the judgment could not be delivered earlier on account of several overriding reasons beyond our control. At one stage, following the dicta of the Supreme Court in (Bhagwandas Fatechand Daswaniothers v. II P.A. Internationalothers)42, J.T. 2000(1) S.C. 266, we even suggested to the parties and Counsel that we may treat this matter as notand set it down forHowever, we are glad to note that the parties and their Counsel reposed full faith in our ability to remember and decide the facts and the legal issues on the basis of our detailed notes supplemented by the efficient written submissions filed by the parties. At their request, we have decided the matter ourselves, though after a span of twenty two months. While regretting the unavoidable delay in delivering our judgment, we express our gratitude to the learned Counsel on both sides who have with consumable skill rendered invaluable help in unravelling several knotty and complicated legal issues. At the end of the day, in our considered judgment, the writ petition has no merit and must fail. | 0 | 30,955 | 3,585 | ### Instruction:
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Tax Act, 1961 would apply to a situation of sanction of an amalgamation scheme. The authorities entrusted with the administration of the statute (i.e. the Income Tax Act) also do not appear to have interpreted the provisions of Chapter XX-C to mean what is being contended now before us. By the principle of contemporanea expositio, the practical manner in which the provisions of Chapter XX-C have been interpreted over a considerably long period need not be upset by this Court, in our judgment. (See in this connection Raymond Synthetics Ltd. and others v. Union of India and others, A.I.R. 1992 S.C. 847 and N. Suresh Nathan and another v. Union of India and others, A.I.R. 1992 S.C. 564.(c) If this Court were to accept the contention of the petitioners and interpret the provisions of Chapter XX-C in the manner suggested by the petitioners, a large number of innocent persons who have been parties to amalgamation schemes would stand exposed to criminal prosecutions under section 276AB of the Income Tax Act. The Appropriate Authority has not placed any material before us that in any past case of sanction of an amalgamation scheme, they had insisted upon filing of a declaration in Form 37-I as required by the provisions of section 269BC, nor have they placed any material to show that any such parties have been subjected to criminal prosecutions under section 276AB for failure to do so.Thus, we are of the considered view that the contention of the petitioners, which was enthusiastically echoed by the fifth respondent, Appropriate Authority, that the transfer of the concerned land from the sixth to the ninth respondent under the scheme of amalgamation would be covered by the provisions of Chapter XX-C, though novel and ingenious, must be rejected.HISTORY OF LITIGATION114. Mr. Tulzapurkar, learned Counsel for the sixth and the ninth respondents, urged that the history of the litigation spanning about twenty long years covering several writ petitions and appeals from this Court to the Supreme Court, back and forth, the final decision of the Supreme Court in S.N. Raos case (supra) and the hanging sword of Damocles of this writ petition in which the petitioners have urged contentions after contentions, taken up by amendments after amendments, even though all contentions of petitioners were rejected at all stages by all courts, indicates that there is utter lack of bona fides on the part of the petitioners who claim to be pursuing this litigation in public interest. He also urged that, pursuant to the sanctioned plans, whose validity was upheld by the Supreme Court in S.N. Raos case (supra), the sixth and the ninth respondents have acted lawfully and in full compliance with all legal requirements and the applicable buildings Rules and Regulations. Obviously, this Court did not injunct the said respondents from continuing with the construction which started in 1984, despite repeated clamour for injunction orders by the petitioners. Perhaps being possessed with premonition that this writ petition has no substance, this Court merely made an order that the sixth and the ninth respondents may continue the construction at their risk upon filing an undertaking that they would claim no equities in the matter if the construction was allowed to continue. Mr. Tulzapurkar urges that the construction is complete and has resulted in a multistory seven star hotel, which was conceived off way back when the plans were submitted for sanction and there is no reason whatsoever to interfere with its functioning. On the other hand, he urges that the history of litigation from 1974 onwards, the repeated contentions and challenges in all available fora by the petitioners, contentions urged as to the applicability of Chapter XX-C of the Income Tax Act, 1961, taken together, suggest that there may be "something more than what meets the eye" as observed by the Supreme Court in Sachidanand Pandeys case (supra).115. There appears to be quite some legitimacy to the grievance made by the learned Counsel for the sixth and the ninth respondents. It appears to us that, what may have started as a bona fide Public Interest Litigation, soon degenerated into a case of private witch-hunting. If at all the petitioners were interested in pursuing the litigation as a Public Interest Litigation, after the observations of the Supreme Court in S.N. Raos case (supra), which we have reproduced above, the matter should have been put to rest. The annoying persistence with which the petitioners have pursued this writ petition certainly gives credence to the contention of the learned Counsel for the sixth and the ninth respondents that this writ petition was intended only as a PIL meaning Persecution Interest Litigation and not PIL meaning Public Interest Litigation.116. Though, this writ petition was seriously taken up for final hearing on 30th June 1998 and the hearing continued from 1st July 1998 to 5th August 1998 and the petition was finally reserved for judgment on 6th August 1998, the judgment could not be delivered earlier on account of several overriding reasons beyond our control. At one stage, following the dicta of the Supreme Court in (Bhagwandas Fatechand Daswani & others v. II P.A. International & others)42, J.T. 2000(1) S.C. 266, we even suggested to the parties and Counsel that we may treat this matter as not part-heard and set it down for re-hearing. However, we are glad to note that the parties and their Counsel reposed full faith in our ability to remember and decide the facts and the legal issues on the basis of our detailed notes supplemented by the efficient written submissions filed by the parties. At their request, we have decided the matter ourselves, though after a span of twenty two months. While regretting the unavoidable delay in delivering our judgment, we express our gratitude to the learned Counsel on both sides who have with consumable skill rendered invaluable help in unravelling several knotty and complicated legal issues. At the end of the day, in our considered judgment, the writ petition has no merit and must fail.
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company, not to the transferor company, but to the shareholders of the transferee company, who must necessarily be treated as distinct from the transferor company itself. The shareholders of the transferor company could not be deemed in law to be the owners of the assets of the transferee company, nor can they be said to have held any interest in the assets of the transferee company. See in this connection (Bacha Guzdar v. Commissioner of Income Tax)33, A.I.R. 1955 S.C. 74. Right from the time of Solomons case, a company has always been treated as a separate and distinct juristic person with a personality of its own different from that of its shareholders. No shareholder can legitimately claim to have an interest in any of the properties or assets held by the company. The judgment of the Supreme Court in (AccountantSecretarial Services Pvt. Ltd. v. Union of India)34, A.I.R. 1988 S.C. 1708, was pressed into service to contend that a bank constituted under the Banking Companies (Acquisition and Transfer of Undertaking) Act, 1970, though materially controlled by the Central Government, has a distinct personality of its own and its property cannot be said to be the property of the Union of India. Hence, it is contended that by the act of amalgamation, there was no sale of any assets by the transferor company (sixth respondent) to the transferee company (ninth respondent) in the amalgamation. Thus, it is urged that there being no sale or exchange or lease of immovable property in the case of amalgamation, the transfer of the assets of the sixth respondent to the ninth respondent does not fall within the ambit of Chapterof the Income Tax Act, 1961.The conclusions which we have arrived at on statutory interpretation, also appear backed by the following practical considerations:(a) It is significant that the Appropriate Authority has not bothered to take action under section 276ABof the Income Tax Act, 1961.Nor has it initiated any other action in connection with the aforesaid transfer for over such a long period ofWe can take judicial notice that several schemes of transfer are sanctioned every day by the Company Judge and no one seems to have seriously suggested, argued or held that Chapterof the Income Tax Act, 1961 would apply to a situation of sanction of an amalgamation scheme. The authorities entrusted with the administration of the statute (i.e. the Income Tax Act) also do not appear to have interpreted the provisions of Chapterto mean what is being contended now before us. By the principle of contemporanea expositio, the practical manner in which the provisions of Chapterhave been interpreted over a considerably long period need not be upset by this Court, in our judgment. (See in this connection Raymond Synthetics Ltd. and others v. Union of India and others, A.I.R. 1992 S.C. 847 and N. Suresh Nathan and another v. Union of India and others, A.I.R. 1992 S.C. 564.(c) If this Court were to accept the contention of the petitioners and interpret the provisions of Chapterin the manner suggested by the petitioners, a large number of innocent persons who have been parties to amalgamation schemes would stand exposed to criminal prosecutions under section 276AB of the Income Tax Act. The Appropriate Authority has not placed any material before us that in any past case of sanction of an amalgamation scheme, they had insisted upon filing of a declaration in Formas required by the provisions of section 269BC, nor have they placed any material to show that any such parties have been subjected to criminal prosecutions under section 276AB for failure to do so.Thus, we are of the considered view that the contention of the petitioners, which was enthusiastically echoed by the fifth respondent, Appropriate Authority, that the transfer of the concerned land from the sixth to the ninth respondent under the scheme of amalgamation would be covered by the provisions of Chapterthough novel and ingenious, must be rejected.There appears to be quite some legitimacy to the grievance made by the learned Counsel for the sixth and the ninth respondents. It appears to us that, what may have started as a bona fide Public Interest Litigation, soon degenerated into a case of privateIf at all the petitioners were interested in pursuing the litigation as a Public Interest Litigation, after the observations of the Supreme Court in S.N. Raos case (supra), which we have reproduced above, the matter should have been put to rest. The annoying persistence with which the petitioners have pursued this writ petition certainly gives credence to the contention of the learned Counsel for the sixth and the ninth respondents that this writ petition was intended only as a PIL meaning Persecution Interest Litigation and not PIL meaning Public Interest Litigation.116. Though, this writ petition was seriously taken up for final hearing on 30th June 1998 and the hearing continued from 1st July 1998 to 5th August 1998 and the petition was finally reserved for judgment on 6th August 1998, the judgment could not be delivered earlier on account of several overriding reasons beyond our control. At one stage, following the dicta of the Supreme Court in (Bhagwandas Fatechand Daswaniothers v. II P.A. Internationalothers)42, J.T. 2000(1) S.C. 266, we even suggested to the parties and Counsel that we may treat this matter as notand set it down forHowever, we are glad to note that the parties and their Counsel reposed full faith in our ability to remember and decide the facts and the legal issues on the basis of our detailed notes supplemented by the efficient written submissions filed by the parties. At their request, we have decided the matter ourselves, though after a span of twenty two months. While regretting the unavoidable delay in delivering our judgment, we express our gratitude to the learned Counsel on both sides who have with consumable skill rendered invaluable help in unravelling several knotty and complicated legal issues. At the end of the day, in our considered judgment, the writ petition has no merit and must fail.
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Shamsher Singh Vs. Rajinder Prashad & Ors | deed sought to be declared as null and void, nor to the question whether the declaration sought does or does not fall within the purview of S. 42, Specific Relief Act, furnishes a satisfactory or conclusive test for determining the court fee payable in the suit of this description. When the plaintiff is a party to the decree or deed, the declaratory relief, if granted, necessarily relieves the plaintiff of his obligations under the decree or the deed and, hence it seems to have been held in such cases, that the declaration involves a consequential relief. In cases where the plaintiff is not a party to the decree or the deed, the declaratory relief does not ordinarily include any such consequential relief. But there are exceptional cases in which the plaintiff though not a party to the deed or the decree is nevertheless bound thereby. For instance, when a sale or mortgage of joint family property is effected by a manager of a joint Hindu family, the alienation is binding on the other members of the family (even if they are not parties to it) until and unless it is set aside. Similarly, a decree passed against the manager will be binding on the other members of the family. If therefore a coparcener sues for a declaration that such an alienation or decree is null and void, the declaration must I think be held to include consequential relief in the same way as in those cases in which the plaintiff is himself a party to the alienation or the decree, which is sought to be declared null and void. The case dealt with in AIR 1936 Lah 166 seems to have been of this description. The case of an alienation by a mutwalli of waqf property would also appear to stand on a similar footing. In the case of waqf property, it is only the trustee or the mutwalli who can alienate the property. If he makes an alienation it is binding on all concerned, until and unless it is set aside. If therefore a person sues to get such an alienation declared null and void, he can only do so by getting the deed invalidated. The relief claimed in such cases also may therefore be found to include a consequential relief."The decision of the Lahore High Court in Prithvi Raj v. D. C. Ralli, AIR 1945 Lah 13 is exactly in point. It was held that in a suit by the son for a declaration that the mortgage decree obtained against his father was not binding upon him it is essential for the son to ask for setting aside of the decree as a consequence of the declaration claimed and to pay ad valorem court fee under Section 7 (iv) (c). It was pointed out that a decree against the father is a good decree against the son and unless the decree is set aside it would remain executable against the son and it was essential for the son to ask for setting aside the decree. In Vinayakrao v. Mankunwarbai, AIR 1943 Nag 70 it was held that in a suit by the son for a declaration that decree against the father does not affect his interests in the family property, consequential relief is involved and ad valorem court fee would be necessary.5. We should now refer to certain decisions relied upon by the respondents. We do not consider that the decision of the learned Single Judge of the Madras High Court in Venkata Ramani v. Narayanasami, AIR 1925 Mad 713 lays down the correct law. It proceeds on the basis that the plaintiffs not being parties to the document they were not bound to get rid of it by having it actually cancelled, but it ignores the effect of Hindu Law in respect of a mortgage decree obtained against the father. As pointed out by the Lahore High Court, in such cases in suing for declaration that the decree is not binding on him the son is really asking for a cancellation of the decree. This aspect does not seem to have been taken into consideration by the learned Single Judge. The decision of a learned Single Judge of the Nagpur High Court in Pandurang Mangal v. Bhojalu Usanna, AIR 1949 Nag 37 suffers from the same error. Though it refers to the decision of the Full Bench of the Lahore High Court as well as the same High Courts decision in AIR 1945 Lah 13 it does not seek to distinguish them for holding otherwise. The learned Judge gives no reason whether and if so why he dissents from the view taken in the latter case. This decision also suffers from the learned Judges misapprehension that there is a difference between a simple money decree and a mortgage decree obtained against a Hindu father when it is questioned by the son and its view that in execution of a simple money decree the entire joint family property, inclusive of the interest of the sons, is liable to be sold in execution of the decree, but that in the case of a mortgage decree it is not necessary for a son to allege or prove that the debt was incurred for an illegal or an immoral purpose and he can succeed if it is proved that the mortgage was not for legal necessity or for the payment of antecedent debt. We have already referred to the decision of this Court on this point. We must also hold in view of the reasons already set forth that the decision of the Allahabad High Court in Ishwar Dayal v. Amba Prasad, AIR 1935 All 667 is not a good law. As regards the decision of the Full Bench of the Allahabad High Court in Bishan Sarup v. Musa Mal, AIR 1935 All 817 (FB) there is nothing to show whether the alienation was made by the manager of a joint Hindu family and therefore the decision is not in point. | 1[ds]4.As regards the main question that arises for decision it appears to us that while the court-fee payable on a plaint is certainly to be decided on the basis of the allegations and the prayer in the plaint and the question whether the plaintiffs suit will have to fail for failure to ask for consequential relief is of no concern to the Court at that stage, the Court in deciding the question of court-fee should look into the allegations in the plaint to see what is the substantive relief that is asked for. Mere astuteness in drafting the plaint will not be allowed to stand in the way of the Court looking at the substance of the relief asked for. In this case the relief asked for is on the basis that the property in dispute is a joint Hindu family property and there was no legal necessity to execute the mortgage. It is now well settled that under Hindu Law if the manager of a joint family is the father and the other members are the sons the father may by incurring a debt so long as it is not for an immoral purpose lay the joint family estate open to be taken in execution proceedings upon a decree for the payment of the debt not only where it is an unsecured debt and a simple money decree for the debt but also to a mortgage debt which the father is personally liable to pay and to a decree for the recovery of the mortgage debt by the sale of the property even where the mortgage is not for legal necessity or for payment of antecedentwhen the plaintiffs sued for a declaration that the decree obtained be the appellant against their father was not binding on them they were really asking either for setting aside the decree or for the consequential relief of injunction restraining the decree holder from executing the decree against the mortgaged property as he was entitled todecision of the Lahore High Court in Prithvi Raj v. D. C. Ralli, AIR 1945 Lah 13 is exactly in point. It was held that in a suit by the son for a declaration that the mortgage decree obtained against his father was not binding upon him it is essential for the son to ask for setting aside of the decree as a consequence of the declaration claimed and to pay ad valorem court fee under Section 7 (iv) (c). It was pointed out that a decree against the father is a good decree against the son and unless the decree is set aside it would remain executable against the son and it was essential for the son to ask for setting aside the decree. In Vinayakrao v. Mankunwarbai, AIR 1943 Nag 70 it was held that in a suit by the son for a declaration that decree against the father does not affect his interests in the family property, consequential relief is involved and ad valorem court fee would be necessary. | 1 | 2,712 | 522 | ### Instruction:
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deed sought to be declared as null and void, nor to the question whether the declaration sought does or does not fall within the purview of S. 42, Specific Relief Act, furnishes a satisfactory or conclusive test for determining the court fee payable in the suit of this description. When the plaintiff is a party to the decree or deed, the declaratory relief, if granted, necessarily relieves the plaintiff of his obligations under the decree or the deed and, hence it seems to have been held in such cases, that the declaration involves a consequential relief. In cases where the plaintiff is not a party to the decree or the deed, the declaratory relief does not ordinarily include any such consequential relief. But there are exceptional cases in which the plaintiff though not a party to the deed or the decree is nevertheless bound thereby. For instance, when a sale or mortgage of joint family property is effected by a manager of a joint Hindu family, the alienation is binding on the other members of the family (even if they are not parties to it) until and unless it is set aside. Similarly, a decree passed against the manager will be binding on the other members of the family. If therefore a coparcener sues for a declaration that such an alienation or decree is null and void, the declaration must I think be held to include consequential relief in the same way as in those cases in which the plaintiff is himself a party to the alienation or the decree, which is sought to be declared null and void. The case dealt with in AIR 1936 Lah 166 seems to have been of this description. The case of an alienation by a mutwalli of waqf property would also appear to stand on a similar footing. In the case of waqf property, it is only the trustee or the mutwalli who can alienate the property. If he makes an alienation it is binding on all concerned, until and unless it is set aside. If therefore a person sues to get such an alienation declared null and void, he can only do so by getting the deed invalidated. The relief claimed in such cases also may therefore be found to include a consequential relief."The decision of the Lahore High Court in Prithvi Raj v. D. C. Ralli, AIR 1945 Lah 13 is exactly in point. It was held that in a suit by the son for a declaration that the mortgage decree obtained against his father was not binding upon him it is essential for the son to ask for setting aside of the decree as a consequence of the declaration claimed and to pay ad valorem court fee under Section 7 (iv) (c). It was pointed out that a decree against the father is a good decree against the son and unless the decree is set aside it would remain executable against the son and it was essential for the son to ask for setting aside the decree. In Vinayakrao v. Mankunwarbai, AIR 1943 Nag 70 it was held that in a suit by the son for a declaration that decree against the father does not affect his interests in the family property, consequential relief is involved and ad valorem court fee would be necessary.5. We should now refer to certain decisions relied upon by the respondents. We do not consider that the decision of the learned Single Judge of the Madras High Court in Venkata Ramani v. Narayanasami, AIR 1925 Mad 713 lays down the correct law. It proceeds on the basis that the plaintiffs not being parties to the document they were not bound to get rid of it by having it actually cancelled, but it ignores the effect of Hindu Law in respect of a mortgage decree obtained against the father. As pointed out by the Lahore High Court, in such cases in suing for declaration that the decree is not binding on him the son is really asking for a cancellation of the decree. This aspect does not seem to have been taken into consideration by the learned Single Judge. The decision of a learned Single Judge of the Nagpur High Court in Pandurang Mangal v. Bhojalu Usanna, AIR 1949 Nag 37 suffers from the same error. Though it refers to the decision of the Full Bench of the Lahore High Court as well as the same High Courts decision in AIR 1945 Lah 13 it does not seek to distinguish them for holding otherwise. The learned Judge gives no reason whether and if so why he dissents from the view taken in the latter case. This decision also suffers from the learned Judges misapprehension that there is a difference between a simple money decree and a mortgage decree obtained against a Hindu father when it is questioned by the son and its view that in execution of a simple money decree the entire joint family property, inclusive of the interest of the sons, is liable to be sold in execution of the decree, but that in the case of a mortgage decree it is not necessary for a son to allege or prove that the debt was incurred for an illegal or an immoral purpose and he can succeed if it is proved that the mortgage was not for legal necessity or for the payment of antecedent debt. We have already referred to the decision of this Court on this point. We must also hold in view of the reasons already set forth that the decision of the Allahabad High Court in Ishwar Dayal v. Amba Prasad, AIR 1935 All 667 is not a good law. As regards the decision of the Full Bench of the Allahabad High Court in Bishan Sarup v. Musa Mal, AIR 1935 All 817 (FB) there is nothing to show whether the alienation was made by the manager of a joint Hindu family and therefore the decision is not in point.
### Response:
1
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4.As regards the main question that arises for decision it appears to us that while the court-fee payable on a plaint is certainly to be decided on the basis of the allegations and the prayer in the plaint and the question whether the plaintiffs suit will have to fail for failure to ask for consequential relief is of no concern to the Court at that stage, the Court in deciding the question of court-fee should look into the allegations in the plaint to see what is the substantive relief that is asked for. Mere astuteness in drafting the plaint will not be allowed to stand in the way of the Court looking at the substance of the relief asked for. In this case the relief asked for is on the basis that the property in dispute is a joint Hindu family property and there was no legal necessity to execute the mortgage. It is now well settled that under Hindu Law if the manager of a joint family is the father and the other members are the sons the father may by incurring a debt so long as it is not for an immoral purpose lay the joint family estate open to be taken in execution proceedings upon a decree for the payment of the debt not only where it is an unsecured debt and a simple money decree for the debt but also to a mortgage debt which the father is personally liable to pay and to a decree for the recovery of the mortgage debt by the sale of the property even where the mortgage is not for legal necessity or for payment of antecedentwhen the plaintiffs sued for a declaration that the decree obtained be the appellant against their father was not binding on them they were really asking either for setting aside the decree or for the consequential relief of injunction restraining the decree holder from executing the decree against the mortgaged property as he was entitled todecision of the Lahore High Court in Prithvi Raj v. D. C. Ralli, AIR 1945 Lah 13 is exactly in point. It was held that in a suit by the son for a declaration that the mortgage decree obtained against his father was not binding upon him it is essential for the son to ask for setting aside of the decree as a consequence of the declaration claimed and to pay ad valorem court fee under Section 7 (iv) (c). It was pointed out that a decree against the father is a good decree against the son and unless the decree is set aside it would remain executable against the son and it was essential for the son to ask for setting aside the decree. In Vinayakrao v. Mankunwarbai, AIR 1943 Nag 70 it was held that in a suit by the son for a declaration that decree against the father does not affect his interests in the family property, consequential relief is involved and ad valorem court fee would be necessary.
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Dr. Asim Kumar Bose Vs. Union of India and Others | thecase of candidatesotherwise well-qualified.)"The contention on behalf of the respondents is that the appellant could not be considered for appointment to the post of Associate Professor of Radiotherapy in Maulana Azad Medical College because the teaching experience gained by him while holding the post of Radiologist-cum Associate Professor of Radiology (ex-officio) in the Irwin Hospital since October 9, 1964 cannot be taken into consideration. It is urged that there is a distinction between the two posts of Radiologist and Associate Profess or of Radiology as the post of Radiologist is a clinical post while that of Associate Professor of Radiology is a teaching post. That being so, it was urged that the channels of promotion to the two posts are different and the appellant who had been substantively appointed to the post of Radiologist in the Irwin Hospital must seek his own channel of promotion in Supertime Grade II for a non-teaching job. It is further urged that since the appellant was not holding the post of a n Associate Professor, he was not drawing the teaching allowance of Rs. 200/- p.m. to which he would otherwise be entitled. It is also urged that the status of Associate Professor of Radiology (ex-officio) which the appellant holds in the Irwin Hospital is akin to that of honorary Professor or Associate Professor in the Willingdon Hospital or the Safdarjang Hospital and the mere designation of the appellant as Associate Professor of Radiology (ex- officio) by the University of Delhi does not give him a right to hold the post of Professor of Radiology in Maulana Azad Medical College. It is pointed out that a similar question arose in connection with the conferral of honorary teaching designations on certain medical officers in the Willingdon Hospital and Safdarjang Hospital, New Delhi in the year 1973. It is said that the President of India was pleased to direct that the conferral of such teaching designations would not entitle the Specialists to claim seniority or eligibility for promotion merely by virtue of these honorary designations, nor would it entitle the incumbent any special benefit with regard to any teaching allowance which may be given to the teachers in a medical college. By parity of reasoning, it is urged that the designation of the appellant as a Radiologist cum-Associate Professor of Radiology (ex-officio) did not make him eligible for appointment to the post of Associate Professor of Radiotherapy in Maulana Azad Medical College. We are afraid, we cannot subscribe to this line of argument.We find it rather difficult to support the impugned action of the Government of India in the Health Ministry in holding that the teaching experience gained by the appellant as Radiologist cum-Associate Professor or Radiology (ex- officio) with effect from October 9, 1964 cannot be taken into consideration. The view taken by the Health Ministry appears to proceed, on a misconstruction of r. 8 (2A) and paragraph 3 of Annexure I to the Second Schedule. As already stated, the word "as" in these provisions must, in the context in which it appears, be interpreted to mean "in the capacity of". The Ministry of Health cannot be heard t o say that the appellant has not acquired the status of an Associate Professor of Radiology with effect from October, 9, 1964, particularly when the Central Government have been utilizing his services as such for teaching the post- graduate and under graduate students of the Maulana Azad Medical College for the M.D., M.S., D.M.R.T. and M.B.B.S. courses of studies for the last 17 years. The arrangement has continued for all these years with the approval of the Delhi University and presumably with the tacit sanction of the Medical Council of India. In our opinion, the provisions contained in r. 8 (2A) and paragraph 3 of Annexure I to the Second Schedule must be interpreted in a broad and liberal sense as it would otherwise work great injustice to persons in Specialists Grade II like the appellant who, while holding a non-clinical post in a teaching hospital like the Irwin Hospital, has been actually teaching the students of the Maulana Azad Medical College to which it is affiliated. The contention that the position which the appellant enjoys as Radiologist-cum-Associate Professor of Radiology (ex-officio) in the Irwin Hospital is similar to that of honorary Professor or Associate Professor in the Willingdon Hospital or the Safdarjang Hospital and the mere designation of the appellant as such does not give him a right to hold the post of Associate Professor of Radiology, cannot prevail. There is no order placed before us of the President of India directing that conferral of honorary teaching designations on Specialists in the Willingdon Hospital and the Safdarjang Hospital would not entitle such Specialists to claim seniority or eligibility for promotion. Even if it were so, that would hardly make any difference. The submission overlooks the distinction between a teaching and a non-teaching hospital. There cannot be a medical college without a teaching hospital as its integral and inseparable part. The mere fact that the appellant was not drawing a teaching allowance of Rs. 200/- p.m. is of no legal consequence because the allowance is attached to the post of Associate Professor.We wish to make it clear that it is not for the Court to give the appellant promotion or make his appointment to the post of Professor of Radiotherapy. The Court can only on a true construction of r. 8 (2A) and paragraph 3 of Annexure I to the Second Schedule determine the question of his eligibility for such promotion or appointment. If the appellant is eligible to hold the post of Professor of Radiotherapy, he can always apply irrespective of the fact whether or not he is in the line of promotion. It is for the Union Public Service Commission to advertise the post of Professor of Radiotherapy and everyone who satisfies the required qualifications can make an application. That is because the Commission undoubtedly has the power to relax any of the qualifications. | 1[ds]We are afraid, we cannot subscribe to this line of argument.We find it rather difficult to support the impugned action of the Government of India in the Health Ministry in holding that the teaching experience gained by the appellant as RadiologistProfessor or Radiology (exofficio) with effect from October 9, 1964 cannot be taken into consideration. The view taken by the Health Ministry appears to proceed, on a misconstruction of r. 8 (2A) and paragraph 3 of Annexure I to the Second Schedule. As already stated, the word "as" in these provisions must, in the context in which it appears, be interpreted to mean "in the capacity of". The Ministry of Health cannot be heard t o say that the appellant has not acquired the status of an Associate Professor of Radiology with effect from October, 9, 1964, particularly when the Central Government have been utilizing his services as such for teaching the postgraduate and under graduate students of the Maulana Azad Medical College for the M.D., M.S., D.M.R.T. and M.B.B.S. courses of studies for the last 17 years. The arrangement has continued for all these years with the approval of the Delhi University and presumably with the tacit sanction of the Medical Council of India. In our opinion, the provisions contained in r. 8 (2A) and paragraph 3 of Annexure I to the Second Schedule must be interpreted in a broad and liberal sense as it would otherwise work great injustice to persons in Specialists Grade II like the appellant who, while holding apost in a teaching hospital like the Irwin Hospital, has been actually teaching the students of the Maulana Azad Medical College to which it is affiliated. The contention that the position which the appellant enjoys asProfessor of Radiologyin the Irwin Hospital is similar to that of honorary Professor or Associate Professor in the Willingdon Hospital or the Safdarjang Hospital and the mere designation of the appellant as such does not give him a right to hold the post of Associatecannot prevail. There is no order placed before us of the President of India directing that conferral of honorary teaching designations on Specialists in the Willingdon Hospital and the Safdarjang Hospital would not entitle such Specialists to claim seniority or eligibility for promotion. Even if it were so, that would hardly make any difference. The submission overlooks the distinction between a teaching and ap.m. is of no legal consequence because the allowance is attached to the post of Associate Professor.We wish to make it clear that it is not for the Court to give the appellant promotion or make his appointment to the post of Professor of Radiotherapy. The Court can only on a true construction of r. 8 (2A) and paragraph 3 of Annexure I to the Second Schedule determine the question of his eligibility for such promotion or appointment. If the appellant is eligible to hold the post of Professor of Radiotherapy, he can always apply irrespective of the fact whether or not he is in the line of promotion. It is for the Union Public Service Commission to advertise the post of Professor of Radiotherapy and everyone who satisfies the required qualifications can make an application. That is because the Commission undoubtedly has the power to relax any of the qualifications. | 1 | 9,728 | 598 | ### Instruction:
Assess the case to predict the court's ruling (favorably (1) or unfavorably (0)), and then expound on this prediction by highlighting and analyzing key textual elements from the proceeding.
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thecase of candidatesotherwise well-qualified.)"The contention on behalf of the respondents is that the appellant could not be considered for appointment to the post of Associate Professor of Radiotherapy in Maulana Azad Medical College because the teaching experience gained by him while holding the post of Radiologist-cum Associate Professor of Radiology (ex-officio) in the Irwin Hospital since October 9, 1964 cannot be taken into consideration. It is urged that there is a distinction between the two posts of Radiologist and Associate Profess or of Radiology as the post of Radiologist is a clinical post while that of Associate Professor of Radiology is a teaching post. That being so, it was urged that the channels of promotion to the two posts are different and the appellant who had been substantively appointed to the post of Radiologist in the Irwin Hospital must seek his own channel of promotion in Supertime Grade II for a non-teaching job. It is further urged that since the appellant was not holding the post of a n Associate Professor, he was not drawing the teaching allowance of Rs. 200/- p.m. to which he would otherwise be entitled. It is also urged that the status of Associate Professor of Radiology (ex-officio) which the appellant holds in the Irwin Hospital is akin to that of honorary Professor or Associate Professor in the Willingdon Hospital or the Safdarjang Hospital and the mere designation of the appellant as Associate Professor of Radiology (ex- officio) by the University of Delhi does not give him a right to hold the post of Professor of Radiology in Maulana Azad Medical College. It is pointed out that a similar question arose in connection with the conferral of honorary teaching designations on certain medical officers in the Willingdon Hospital and Safdarjang Hospital, New Delhi in the year 1973. It is said that the President of India was pleased to direct that the conferral of such teaching designations would not entitle the Specialists to claim seniority or eligibility for promotion merely by virtue of these honorary designations, nor would it entitle the incumbent any special benefit with regard to any teaching allowance which may be given to the teachers in a medical college. By parity of reasoning, it is urged that the designation of the appellant as a Radiologist cum-Associate Professor of Radiology (ex-officio) did not make him eligible for appointment to the post of Associate Professor of Radiotherapy in Maulana Azad Medical College. We are afraid, we cannot subscribe to this line of argument.We find it rather difficult to support the impugned action of the Government of India in the Health Ministry in holding that the teaching experience gained by the appellant as Radiologist cum-Associate Professor or Radiology (ex- officio) with effect from October 9, 1964 cannot be taken into consideration. The view taken by the Health Ministry appears to proceed, on a misconstruction of r. 8 (2A) and paragraph 3 of Annexure I to the Second Schedule. As already stated, the word "as" in these provisions must, in the context in which it appears, be interpreted to mean "in the capacity of". The Ministry of Health cannot be heard t o say that the appellant has not acquired the status of an Associate Professor of Radiology with effect from October, 9, 1964, particularly when the Central Government have been utilizing his services as such for teaching the post- graduate and under graduate students of the Maulana Azad Medical College for the M.D., M.S., D.M.R.T. and M.B.B.S. courses of studies for the last 17 years. The arrangement has continued for all these years with the approval of the Delhi University and presumably with the tacit sanction of the Medical Council of India. In our opinion, the provisions contained in r. 8 (2A) and paragraph 3 of Annexure I to the Second Schedule must be interpreted in a broad and liberal sense as it would otherwise work great injustice to persons in Specialists Grade II like the appellant who, while holding a non-clinical post in a teaching hospital like the Irwin Hospital, has been actually teaching the students of the Maulana Azad Medical College to which it is affiliated. The contention that the position which the appellant enjoys as Radiologist-cum-Associate Professor of Radiology (ex-officio) in the Irwin Hospital is similar to that of honorary Professor or Associate Professor in the Willingdon Hospital or the Safdarjang Hospital and the mere designation of the appellant as such does not give him a right to hold the post of Associate Professor of Radiology, cannot prevail. There is no order placed before us of the President of India directing that conferral of honorary teaching designations on Specialists in the Willingdon Hospital and the Safdarjang Hospital would not entitle such Specialists to claim seniority or eligibility for promotion. Even if it were so, that would hardly make any difference. The submission overlooks the distinction between a teaching and a non-teaching hospital. There cannot be a medical college without a teaching hospital as its integral and inseparable part. The mere fact that the appellant was not drawing a teaching allowance of Rs. 200/- p.m. is of no legal consequence because the allowance is attached to the post of Associate Professor.We wish to make it clear that it is not for the Court to give the appellant promotion or make his appointment to the post of Professor of Radiotherapy. The Court can only on a true construction of r. 8 (2A) and paragraph 3 of Annexure I to the Second Schedule determine the question of his eligibility for such promotion or appointment. If the appellant is eligible to hold the post of Professor of Radiotherapy, he can always apply irrespective of the fact whether or not he is in the line of promotion. It is for the Union Public Service Commission to advertise the post of Professor of Radiotherapy and everyone who satisfies the required qualifications can make an application. That is because the Commission undoubtedly has the power to relax any of the qualifications.
### Response:
1
### Explanation:
We are afraid, we cannot subscribe to this line of argument.We find it rather difficult to support the impugned action of the Government of India in the Health Ministry in holding that the teaching experience gained by the appellant as RadiologistProfessor or Radiology (exofficio) with effect from October 9, 1964 cannot be taken into consideration. The view taken by the Health Ministry appears to proceed, on a misconstruction of r. 8 (2A) and paragraph 3 of Annexure I to the Second Schedule. As already stated, the word "as" in these provisions must, in the context in which it appears, be interpreted to mean "in the capacity of". The Ministry of Health cannot be heard t o say that the appellant has not acquired the status of an Associate Professor of Radiology with effect from October, 9, 1964, particularly when the Central Government have been utilizing his services as such for teaching the postgraduate and under graduate students of the Maulana Azad Medical College for the M.D., M.S., D.M.R.T. and M.B.B.S. courses of studies for the last 17 years. The arrangement has continued for all these years with the approval of the Delhi University and presumably with the tacit sanction of the Medical Council of India. In our opinion, the provisions contained in r. 8 (2A) and paragraph 3 of Annexure I to the Second Schedule must be interpreted in a broad and liberal sense as it would otherwise work great injustice to persons in Specialists Grade II like the appellant who, while holding apost in a teaching hospital like the Irwin Hospital, has been actually teaching the students of the Maulana Azad Medical College to which it is affiliated. The contention that the position which the appellant enjoys asProfessor of Radiologyin the Irwin Hospital is similar to that of honorary Professor or Associate Professor in the Willingdon Hospital or the Safdarjang Hospital and the mere designation of the appellant as such does not give him a right to hold the post of Associatecannot prevail. There is no order placed before us of the President of India directing that conferral of honorary teaching designations on Specialists in the Willingdon Hospital and the Safdarjang Hospital would not entitle such Specialists to claim seniority or eligibility for promotion. Even if it were so, that would hardly make any difference. The submission overlooks the distinction between a teaching and ap.m. is of no legal consequence because the allowance is attached to the post of Associate Professor.We wish to make it clear that it is not for the Court to give the appellant promotion or make his appointment to the post of Professor of Radiotherapy. The Court can only on a true construction of r. 8 (2A) and paragraph 3 of Annexure I to the Second Schedule determine the question of his eligibility for such promotion or appointment. If the appellant is eligible to hold the post of Professor of Radiotherapy, he can always apply irrespective of the fact whether or not he is in the line of promotion. It is for the Union Public Service Commission to advertise the post of Professor of Radiotherapy and everyone who satisfies the required qualifications can make an application. That is because the Commission undoubtedly has the power to relax any of the qualifications.
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Anju Kalsi Vs. HDFC Ergo General Insurance Company Limited and Another | Policy bearing No.2999200570315100000 and the replying opposite party sent the entire terms and conditions along with the policy to the opposite party no.2 and it is pertinent to mention here that the said group insurance policy purchased by opposite party no.2 to protect its account holders who were interested to avail the benefits of platinum debit card, gold debit card, women advantage card, world card, business card etc. It is further pertinent lo mention here that the opposite party no.2 at the time of issuing the said card as described above the opposite party no. 2 also provide a debit card usage guide with the said card and this fact is clearly mentioned in the covering letter on which the complainant herself relied upon, there is specifically mentioned i.e. For Details and Terms and Conditions, Please Refer to the Usage Guide Enclosed and there is further specifically mentioned that Conditions Apply. Rest of para is incorrect, hence denied. 10. The contention of the appellant was that save and except for the covering letter which indicated that an insurance cover against personal accident was being provided to the account holder, neither the insurer nor the bank had ever furnished the insurance policy, its terms and conditions or any document related to the insurance cover to the account holder. The deceased was a customer of the bank and it was for the bank to establish that when it dispatched the debit card to its customer, both the covering letter as well as the debit card usage guide had been furnished to the deceased. The bank remained away from the proceedings. The insurer could not possibly have adduced any evidence in regard to whether the debit card usage guide had been actually furnished to the deceased account holder. 11. The evidence which was tendered by way of an affidavit on behalf of the insurer by its Manager (Legal), does not displace the burden which was cast on the bank, whose customer the deceased was, of establishing that the debit card usage guide containing the requisite terms and conditions had actually been furnished to the deceased account holder. The NCDRC upheld the decision of the SCDRC by holding that there was no specific averment in the complaint that the debit card usage guide was not enclosed to the forwarding letter. This finding proceeds on a misreading of the averments in the complaint. The NCDRC also held that the forwarding letter referred to the usage guide and if the guide had not been furnished, the deceased account holder would in the ordinary course of human conduct have written to the bank complaining that usage guide had not been made available. The specific averment of the appellant in the consumer complaint was that save and except for the covering letter, neither the insurance policy nor its terms and conditions were furnished to the account holder or the appellant. It was also averred that no document relating to the insurance cover was issued to the account holder or the appellant by the insurer or the banker. 12. The insurance cover was governed by a policy between the first and the second respondents. The terms of the insurance cover had to be specifically communicated to the account holder. The account holder had to be put on notice that the insurance cover would become available only after a transaction took place of the nature spelt out in the special conditions of the insurance policy. Insistence on communication to the account holder is necessary because the policy was issued to the bank by the insurer. The account holders are beneficiaries of the policy. In the present case, the bank did not choose to defend the proceedings at all. The insurer who also belongs to the HDFC group could well have applied for a summons to be issued to the bank for production of its records in the course of the evidence which would establish as to whether the debit card usage guide had been made available to the account holder. In this backdrop, and in the absence of such a course of action being adopted, the case of the appellant as set out in the complaint remained uncontroverted. Consequently, unless the respondents were able to establish on a cogent basis that the special conditions of the policy which was issued by the first respondent to the second respondent were drawn to the notice of the account holder for whose benefit the insurance cover extended, the claim ought not to have been rejected. 13. Mr Rajiv M Roy, learned counsel appearing on behalf of the insurer made an attempt to support the findings by urging that the debit card usage guide was suppressed by the appellant. We are unable to subscribe to this contention since, as a matter of fact, the case of the appellant was that save and except for the covering letter no further documentation had been furnished to the account holder. Learned counsel for the insurer has submitted in the alternate that the deficiency of service, if any, would be on the part of the bank and that there was no deficiency on the part of the insurer. We are not inclined to go into this aspect of whether or not there was deficiency of service on the part of the bank. The deficiency of service on the part of the insurer lies in the wrongful repudiation of the claim under the policy. The insurer would however be at liberty to work out its remedy against the second respondent – bank. 14. For the reasons which we have indicated, we find that the case which was set up by the appellant has not been displaced. Hence, the appellant was validly entitled to the award of the basic claim in the amount of Rs 5 lakhs together with interest as directed by the District Forum. The appellant would not be entitled to the claim under the enhanced cover since it was linked to purchases made against the debit card. | 1[ds]11. The evidence which was tendered by way of an affidavit on behalf of the insurer by its Manager (Legal), does not displace the burden which was cast on the bank, whose customer the deceased was, of establishing that the debit card usage guide containing the requisite terms and conditions had actually been furnished to the deceased account holder. The NCDRC upheld the decision of the SCDRC by holding that there was no specific averment in the complaint that the debit card usage guide was not enclosed to the forwarding letter. This finding proceeds on a misreading of the averments in the complaint. The NCDRC also held that the forwarding letter referred to the usage guide and if the guide had not been furnished, the deceased account holder would in the ordinary course of human conduct have written to the bank complaining that usage guide had not been made available. The specific averment of the appellant in the consumer complaint was that save and except for the covering letter, neither the insurance policy nor its terms and conditions were furnished to the account holder or the appellant. It was also averred that no document relating to the insurance cover was issued to the account holder or the appellant by the insurer or the banker.12. The insurance cover was governed by a policy between the first and the second respondents. The terms of the insurance cover had to be specifically communicated to the account holder. The account holder had to be put on notice that the insurance cover would become available only after a transaction took place of the nature spelt out in the special conditions of the insurance policy. Insistence on communication to the account holder is necessary because the policy was issued to the bank by the insurer. The account holders are beneficiaries of the policy. In the present case, the bank did not choose to defend the proceedings at all. The insurer who also belongs to the HDFC group could well have applied for a summons to be issued to the bank for production of its records in the course of the evidence which would establish as to whether the debit card usage guide had been made available to the account holder. In this backdrop, and in the absence of such a course of action being adopted, the case of the appellant as set out in the complaint remained uncontroverted. Consequently, unless the respondents were able to establish on a cogent basis that the special conditions of the policy which was issued by the first respondent to the second respondent were drawn to the notice of the account holder for whose benefit the insurance cover extended, the claim ought not to have been rejected.We are unable to subscribe to this contention since, as a matter of fact, the case of the appellant was that save and except for the covering letter no further documentation had been furnished to the account holder. Learned counsel for the insurer has submitted in the alternate that the deficiency of service, if any, would be on the part of the bank and that there was no deficiency on the part of the insurer. We are not inclined to go into this aspect of whether or not there was deficiency of service on the part of the bank. The deficiency of service on the part of the insurer lies in the wrongful repudiation of the claim under the policy. The insurer would however be at liberty to work out its remedy against the second respondent – bank.14. For the reasons which we have indicated, we find that the case which was set up by the appellant has not been displaced. Hence, the appellant was validly entitled to the award of the basic claim in the amount of Rs 5 lakhs together with interest as directed by the District Forum. The appellant would not be entitled to the claim under the enhanced cover since it was linked to purchases made against the debit card. | 1 | 2,082 | 714 | ### Instruction:
Project the court's decision (favor (1) or against (0) the appeal) based on the case proceeding, and subsequently give an in-depth explanation by analyzing relevant sentences from the document.
### Input:
Policy bearing No.2999200570315100000 and the replying opposite party sent the entire terms and conditions along with the policy to the opposite party no.2 and it is pertinent to mention here that the said group insurance policy purchased by opposite party no.2 to protect its account holders who were interested to avail the benefits of platinum debit card, gold debit card, women advantage card, world card, business card etc. It is further pertinent lo mention here that the opposite party no.2 at the time of issuing the said card as described above the opposite party no. 2 also provide a debit card usage guide with the said card and this fact is clearly mentioned in the covering letter on which the complainant herself relied upon, there is specifically mentioned i.e. For Details and Terms and Conditions, Please Refer to the Usage Guide Enclosed and there is further specifically mentioned that Conditions Apply. Rest of para is incorrect, hence denied. 10. The contention of the appellant was that save and except for the covering letter which indicated that an insurance cover against personal accident was being provided to the account holder, neither the insurer nor the bank had ever furnished the insurance policy, its terms and conditions or any document related to the insurance cover to the account holder. The deceased was a customer of the bank and it was for the bank to establish that when it dispatched the debit card to its customer, both the covering letter as well as the debit card usage guide had been furnished to the deceased. The bank remained away from the proceedings. The insurer could not possibly have adduced any evidence in regard to whether the debit card usage guide had been actually furnished to the deceased account holder. 11. The evidence which was tendered by way of an affidavit on behalf of the insurer by its Manager (Legal), does not displace the burden which was cast on the bank, whose customer the deceased was, of establishing that the debit card usage guide containing the requisite terms and conditions had actually been furnished to the deceased account holder. The NCDRC upheld the decision of the SCDRC by holding that there was no specific averment in the complaint that the debit card usage guide was not enclosed to the forwarding letter. This finding proceeds on a misreading of the averments in the complaint. The NCDRC also held that the forwarding letter referred to the usage guide and if the guide had not been furnished, the deceased account holder would in the ordinary course of human conduct have written to the bank complaining that usage guide had not been made available. The specific averment of the appellant in the consumer complaint was that save and except for the covering letter, neither the insurance policy nor its terms and conditions were furnished to the account holder or the appellant. It was also averred that no document relating to the insurance cover was issued to the account holder or the appellant by the insurer or the banker. 12. The insurance cover was governed by a policy between the first and the second respondents. The terms of the insurance cover had to be specifically communicated to the account holder. The account holder had to be put on notice that the insurance cover would become available only after a transaction took place of the nature spelt out in the special conditions of the insurance policy. Insistence on communication to the account holder is necessary because the policy was issued to the bank by the insurer. The account holders are beneficiaries of the policy. In the present case, the bank did not choose to defend the proceedings at all. The insurer who also belongs to the HDFC group could well have applied for a summons to be issued to the bank for production of its records in the course of the evidence which would establish as to whether the debit card usage guide had been made available to the account holder. In this backdrop, and in the absence of such a course of action being adopted, the case of the appellant as set out in the complaint remained uncontroverted. Consequently, unless the respondents were able to establish on a cogent basis that the special conditions of the policy which was issued by the first respondent to the second respondent were drawn to the notice of the account holder for whose benefit the insurance cover extended, the claim ought not to have been rejected. 13. Mr Rajiv M Roy, learned counsel appearing on behalf of the insurer made an attempt to support the findings by urging that the debit card usage guide was suppressed by the appellant. We are unable to subscribe to this contention since, as a matter of fact, the case of the appellant was that save and except for the covering letter no further documentation had been furnished to the account holder. Learned counsel for the insurer has submitted in the alternate that the deficiency of service, if any, would be on the part of the bank and that there was no deficiency on the part of the insurer. We are not inclined to go into this aspect of whether or not there was deficiency of service on the part of the bank. The deficiency of service on the part of the insurer lies in the wrongful repudiation of the claim under the policy. The insurer would however be at liberty to work out its remedy against the second respondent – bank. 14. For the reasons which we have indicated, we find that the case which was set up by the appellant has not been displaced. Hence, the appellant was validly entitled to the award of the basic claim in the amount of Rs 5 lakhs together with interest as directed by the District Forum. The appellant would not be entitled to the claim under the enhanced cover since it was linked to purchases made against the debit card.
### Response:
1
### Explanation:
11. The evidence which was tendered by way of an affidavit on behalf of the insurer by its Manager (Legal), does not displace the burden which was cast on the bank, whose customer the deceased was, of establishing that the debit card usage guide containing the requisite terms and conditions had actually been furnished to the deceased account holder. The NCDRC upheld the decision of the SCDRC by holding that there was no specific averment in the complaint that the debit card usage guide was not enclosed to the forwarding letter. This finding proceeds on a misreading of the averments in the complaint. The NCDRC also held that the forwarding letter referred to the usage guide and if the guide had not been furnished, the deceased account holder would in the ordinary course of human conduct have written to the bank complaining that usage guide had not been made available. The specific averment of the appellant in the consumer complaint was that save and except for the covering letter, neither the insurance policy nor its terms and conditions were furnished to the account holder or the appellant. It was also averred that no document relating to the insurance cover was issued to the account holder or the appellant by the insurer or the banker.12. The insurance cover was governed by a policy between the first and the second respondents. The terms of the insurance cover had to be specifically communicated to the account holder. The account holder had to be put on notice that the insurance cover would become available only after a transaction took place of the nature spelt out in the special conditions of the insurance policy. Insistence on communication to the account holder is necessary because the policy was issued to the bank by the insurer. The account holders are beneficiaries of the policy. In the present case, the bank did not choose to defend the proceedings at all. The insurer who also belongs to the HDFC group could well have applied for a summons to be issued to the bank for production of its records in the course of the evidence which would establish as to whether the debit card usage guide had been made available to the account holder. In this backdrop, and in the absence of such a course of action being adopted, the case of the appellant as set out in the complaint remained uncontroverted. Consequently, unless the respondents were able to establish on a cogent basis that the special conditions of the policy which was issued by the first respondent to the second respondent were drawn to the notice of the account holder for whose benefit the insurance cover extended, the claim ought not to have been rejected.We are unable to subscribe to this contention since, as a matter of fact, the case of the appellant was that save and except for the covering letter no further documentation had been furnished to the account holder. Learned counsel for the insurer has submitted in the alternate that the deficiency of service, if any, would be on the part of the bank and that there was no deficiency on the part of the insurer. We are not inclined to go into this aspect of whether or not there was deficiency of service on the part of the bank. The deficiency of service on the part of the insurer lies in the wrongful repudiation of the claim under the policy. The insurer would however be at liberty to work out its remedy against the second respondent – bank.14. For the reasons which we have indicated, we find that the case which was set up by the appellant has not been displaced. Hence, the appellant was validly entitled to the award of the basic claim in the amount of Rs 5 lakhs together with interest as directed by the District Forum. The appellant would not be entitled to the claim under the enhanced cover since it was linked to purchases made against the debit card.
|
Association of Unified Tele Services Providers and Ors Vs. Union of India | not expected to record any reasons and that they can summon books of accounts in respect of the business at any time, from the UAS Licence holders. 65. Let us now examine the communication dated 10.5.2010 issued by the Director General of Audit, Post & Telecommunications to the UAS service providers, which specifically refers to the communication dated 16.3.2010, which is extracted below, once again, for an easy reference: "D.O. No. Report-PSP/F-4/Vol-II/2009-10/4OFFICE OF THEDirector General of Audit, Post & TelecommunicationsSham Nath Marg, (Near Old Secretariat), Delhi -110002R. P. SinghDirector GeneralDated 10-5-2010Sub: Audit of Telecom Service Providers by C&AG-Reg.Ref: 1) DoT letter No. 842-1086/2010/AS-IV dt. 16.03.20102) Your office letter No. TTSL/DoT/ Audit/2010 dt. 1.04.2010Dear Sh. DalalKindly refer to your office letter cited on the above subject extending cooperation in conduct of the audit of revenue share by C&AG. Certain difficulty has been expressed by your Company in providing the books of accounts in physical form as they are being maintained in electronic form in SAP ERP System. Further, it has been stated that the audit could be carried out by access to your systems at Noida Office. In this connection, it is requested that on 21st May 2010 a presentation may be given covering your business activities, accounting policies, accounting, billing and financial systems and all other issues relating to revenue shares, followed by brief interface meeting with my Audit term which would start the process of audit. The time and venue of the presentation is given in Annexure-I. Shri Subu R. Director (Report) of my office has been nominated as Nodal Officer who would be overseeing and coordinating the audit.RegardsYours sincerely,Sd/-R.P. Singh" 66. Both the communications dated 16.3.2010 and 10.5.2010, referred to above, clearly indicate that CAG intends to conduct the Audit, since there is "revenue sharing"between the Union of India and the UAS licence holders and the revenue generated will have to be credited to the Consolidated Fund of India. 67. The Tribunal, in our view, has committed a fundamental error in taking the view that the above mentioned communications were issued by the DoT in exercise of the powers conferred under Clauses 22.3 to 22.6, in fact, the communications specifically refer to only Clause 22.3, and not to any other clauses. On the other hand, the Tribunal made specific reference to Clause 22.5 which, in our view, is inapplicable in a case where the audit is sought to be conducted by CAG. The Tribunal has also not properly appreciated the scope of clauses 20.4, 22.5 and 22.6. There are three stages of audit. First, audit is to be conducted by the Licencee under Clause 20.4 through an auditor appointed under Section 224 of the Companies Act. Clause 22.5 empowers the licensor to conduct an audit, if it is found that statements or accounts submitted are inaccurate and misleading. In our view, the opinion to be formed is purely subjective, it need not establish to the satisfaction of the licencee that the statements or accounts are inaccurate and misleading. Further, Clause 22.6 is an independent Clause which has no relationship with Clause 22.5. This is an additional power conferred on the Licensor to conduct special audit. In other words, audit conducted by the licensor or the licencee, has nothing to do with the audit conducted by CAG. If the reasoning of the Tribunal is accepted, then the DOT can always stall an Audit sought to be conducted not only by CAG in exercise of powers conferred under Article 149 of the Constitution read with the 1971 Act and TRAI Rules 2002, but also an audit under clause 22.5 as well as special audit under clause 22.6. Consequently, an audit to be conducted by CAG would not depend upon the "formation of opinion"by the DoT that the statements or accounts submitted to it were inaccurate or misleading, which, in our view, would deprive the statutory and constitutional powers conferred on the CAG to conduct the audit or enquiry or inspection. Tribunals order, in our view, is an encroachment upon the constitutional and statutory power conferred on CAG under Articles 148, 149 of the Constitution as well as Section 16 of the 1971 Act read with Rule 5 of the TRAI Rules 2002 and the licensing provisions. 68. We may, in this connection, refer to Clauses 22.5 and 22.6 for an easy reference: "22.5 The LICENSOR may, on forming an opinion that the statements or accounts submitted are inaccurate or misleading, order Audit of the accounts of the LICENSEE by appointing auditor at the cost of the LICENSEE and such auditor(s) shall have the same powers which the statutory auditors of the company enjoy under Section 227 of the Companies Act, 1956. The remuneration of the Auditors, as fixed by the LICENSOR, shall be borne by the LICENSEE.22.6 The LICENSOR may also get conducted a Special Audit of the LICENSEE companys accounts/records by "Special Auditors", the payment for which at a rate as fixed by the LICENSOR, shall be borne by the LICENSEE. This will be in thenature of auditing the audit described in para 22.5 above. The Special Auditors shall also be provided the same facility and have the same powers as of the companies auditors as envisaged in the Companies Act, 1956." 69. Clauses 22.5 and 22.6 are not meant for an audit to be conducted by CAG or TRAI, but meant for an audit by the DoT. The Tribunal also committed an error in holding that the "formation of opinion"under clause 22.5, that the statements or accounts submitted by the Licensee are inaccurateor misleading, is jurisdictional fact, referring to the jurisdiction of DoT/CAG to conduct audit under clause 22.5 or a special audit under clause 22.6. Formation of opinion under clause 22.5 is a subjective opinion of Licensor or else the power to conduct any form of audit under clause 22.5 and 22.6 would be lost and Licensor has to go on convincing the licensee that the statements or accounts submitted by the Licensee are inaccurate and misleading. | 0[ds]37. We are of the considered view that when the executive deals with the natural resources, like spectrum, which belongs to the people of this country, Parliament should know how the nations wealth has been dealt with by the executive and even by the UAS Licence holders and the quantum of the Revenue generated out of the use of the spectrum and whether the same has been properly assessed, collected and accounted for by the Union and the UAS Licence holders. When nations wealth, like spectrum, is being dealt with either by the Union, State or its instrumentalities or even the private parties, like service providers, they are accountable to the people and to the Parliament. Parliamentary democracy also envisages, inter alia, the accountability of the Council of Ministers to the Legislature. In this connection reference may be made to the Judgment of this Court in S.R. Chaudhuri (supra) and Kihoto Hollohan (supra).We have to read Section 13, 16 and 18 of the 1971 Act along with Article 149 of the Constitution and Sections 3 and 5 of the TRAI Act, 1997 and, if so read, in our view, CAG is entitled to seek the records in terms of Rule 3 of TRAI Rules 2002 read with Clause 22 of the Licence Agreement. CAG, in that process, is not actually auditing the accounts of the UAS Service providers as such, but examining all the receipts to ascertain whether the Union is getting its due share by way of licence fee and spectrum charges, which it is legitimately entitled to, by way of Revenue Sharing. By adopting that process, CAG is not carrying out any statutory audit of the accounts of the service providers, but for the limited purpose of ascertaining whether the Union is getting its legitimate share by way of "Revenue Sharing". Service providers are, therefore, bound to provide all the records and documents called for by the CAG.51. CAG has, therefore, a duty to examine and satisfy himself that all the rules and procedures in that behalf are being met not only by the Union but also the service providers as a whole, since both, the Union, as well as the service providers, are dealing with the natural resources. CAGs function is, therefore, separate and independent, which is not similar to the audit conducted by the DoT under Clause 22.5 or special audit under Clause 22.6. CAGs function is only to ascertain whether the Union of India is getting its due share, while parting with the right to deal with its exclusive privilege to the Service Providers, who are dealing with a national wealth, to that extent, Rule 5(1)(ii) has to be read down, but the service providers are bound to make available all the books of accounts and other documents maintained by them under Rule 3, so as to ascertain whether the Union of India is getting its full share of revenue.We are of the view that there has been a complete misreading of the various clauses of the licensing agreement as well as understanding of law on the point. Let us first examine the background under which the communications dated 16.3.2010 and 10.5.2010 were issued by DoT and the Director General of Audit, Post & Telecommunications respectively, to the UAS license holders. Both the communications would indicate that they were sent for seeking cooperation for the Audit of Telecom service providers by the CAG, which is neither an audit by the department within the meaning of Clause 22.5, nor a special audit under Clause 22.6.The Tribunal, in our view, has committed a fundamental error in taking the view that the above mentioned communications were issued by the DoT in exercise of the powers conferred under Clauses 22.3 to 22.6, in fact, the communications specifically refer to only Clause 22.3, and not to any other clauses. On the other hand, the Tribunal made specific reference to Clause 22.5 which, in our view, is inapplicable in a case where the audit is sought to be conducted by CAG. The Tribunal has also not properly appreciated the scope of clauses 20.4, 22.5 and 22.6. There are three stages of audit. First, audit is to be conducted by the Licencee under Clause 20.4 through an auditor appointed under Section 224 of the Companies Act. Clause 22.5 empowers the licensor to conduct an audit, if it is found that statements or accounts submitted are inaccurate and misleading. In our view, the opinion to be formed is purely subjective, it need not establish to the satisfaction of the licencee that the statements or accounts are inaccurate and misleading. Further, Clause 22.6 is an independent Clause which has no relationship with Clause 22.5. This is an additional power conferred on the Licensor to conduct special audit. In other words, audit conducted by the licensor or the licencee, has nothing to do with the audit conducted by CAG. If the reasoning of the Tribunal is accepted, then the DOT can always stall an Audit sought to be conducted not only by CAG in exercise of powers conferred under Article 149 of the Constitution read with the 1971 Act and TRAI Rules 2002, but also an audit under clause 22.5 as well as special audit under clause 22.6. Consequently, an audit to be conducted by CAG would not depend upon the "formation of opinion"by the DoT that the statements or accounts submitted to it were inaccurate or misleading, which, in our view, would deprive the statutory and constitutional powers conferred on the CAG to conduct the audit or enquiry or inspection. Tribunals order, in our view, is an encroachment upon the constitutional and statutory power conferred on CAG under Articles 148, 149 of the Constitution as well as Section 16 of the 1971 Act read with Rule 5 of the TRAI Rules 2002 and the licensing provisions.Clauses 22.5 and 22.6 are not meant for an audit to be conducted by CAG or TRAI, but meant for an audit by the DoT. The Tribunal also committed an error in holding that the "formation of opinion"under clause 22.5, that the statements or accounts submitted by the Licensee are inaccurateor misleading, is jurisdictional fact, referring to the jurisdiction of DoT/CAG to conduct audit under clause 22.5 or a special audit under clause 22.6. Formation of opinion under clause 22.5 is a subjective opinion of Licensor or else the power to conduct any form of audit under clause 22.5 and 22.6 would be lost and Licensor has to go on convincing the licensee that the statements or accounts submitted by the Licensee are inaccurate and misleading. | 0 | 15,661 | 1,221 | ### Instruction:
Assess the case to predict the court's ruling (favorably (1) or unfavorably (0)), and then expound on this prediction by highlighting and analyzing key textual elements from the proceeding.
### Input:
not expected to record any reasons and that they can summon books of accounts in respect of the business at any time, from the UAS Licence holders. 65. Let us now examine the communication dated 10.5.2010 issued by the Director General of Audit, Post & Telecommunications to the UAS service providers, which specifically refers to the communication dated 16.3.2010, which is extracted below, once again, for an easy reference: "D.O. No. Report-PSP/F-4/Vol-II/2009-10/4OFFICE OF THEDirector General of Audit, Post & TelecommunicationsSham Nath Marg, (Near Old Secretariat), Delhi -110002R. P. SinghDirector GeneralDated 10-5-2010Sub: Audit of Telecom Service Providers by C&AG-Reg.Ref: 1) DoT letter No. 842-1086/2010/AS-IV dt. 16.03.20102) Your office letter No. TTSL/DoT/ Audit/2010 dt. 1.04.2010Dear Sh. DalalKindly refer to your office letter cited on the above subject extending cooperation in conduct of the audit of revenue share by C&AG. Certain difficulty has been expressed by your Company in providing the books of accounts in physical form as they are being maintained in electronic form in SAP ERP System. Further, it has been stated that the audit could be carried out by access to your systems at Noida Office. In this connection, it is requested that on 21st May 2010 a presentation may be given covering your business activities, accounting policies, accounting, billing and financial systems and all other issues relating to revenue shares, followed by brief interface meeting with my Audit term which would start the process of audit. The time and venue of the presentation is given in Annexure-I. Shri Subu R. Director (Report) of my office has been nominated as Nodal Officer who would be overseeing and coordinating the audit.RegardsYours sincerely,Sd/-R.P. Singh" 66. Both the communications dated 16.3.2010 and 10.5.2010, referred to above, clearly indicate that CAG intends to conduct the Audit, since there is "revenue sharing"between the Union of India and the UAS licence holders and the revenue generated will have to be credited to the Consolidated Fund of India. 67. The Tribunal, in our view, has committed a fundamental error in taking the view that the above mentioned communications were issued by the DoT in exercise of the powers conferred under Clauses 22.3 to 22.6, in fact, the communications specifically refer to only Clause 22.3, and not to any other clauses. On the other hand, the Tribunal made specific reference to Clause 22.5 which, in our view, is inapplicable in a case where the audit is sought to be conducted by CAG. The Tribunal has also not properly appreciated the scope of clauses 20.4, 22.5 and 22.6. There are three stages of audit. First, audit is to be conducted by the Licencee under Clause 20.4 through an auditor appointed under Section 224 of the Companies Act. Clause 22.5 empowers the licensor to conduct an audit, if it is found that statements or accounts submitted are inaccurate and misleading. In our view, the opinion to be formed is purely subjective, it need not establish to the satisfaction of the licencee that the statements or accounts are inaccurate and misleading. Further, Clause 22.6 is an independent Clause which has no relationship with Clause 22.5. This is an additional power conferred on the Licensor to conduct special audit. In other words, audit conducted by the licensor or the licencee, has nothing to do with the audit conducted by CAG. If the reasoning of the Tribunal is accepted, then the DOT can always stall an Audit sought to be conducted not only by CAG in exercise of powers conferred under Article 149 of the Constitution read with the 1971 Act and TRAI Rules 2002, but also an audit under clause 22.5 as well as special audit under clause 22.6. Consequently, an audit to be conducted by CAG would not depend upon the "formation of opinion"by the DoT that the statements or accounts submitted to it were inaccurate or misleading, which, in our view, would deprive the statutory and constitutional powers conferred on the CAG to conduct the audit or enquiry or inspection. Tribunals order, in our view, is an encroachment upon the constitutional and statutory power conferred on CAG under Articles 148, 149 of the Constitution as well as Section 16 of the 1971 Act read with Rule 5 of the TRAI Rules 2002 and the licensing provisions. 68. We may, in this connection, refer to Clauses 22.5 and 22.6 for an easy reference: "22.5 The LICENSOR may, on forming an opinion that the statements or accounts submitted are inaccurate or misleading, order Audit of the accounts of the LICENSEE by appointing auditor at the cost of the LICENSEE and such auditor(s) shall have the same powers which the statutory auditors of the company enjoy under Section 227 of the Companies Act, 1956. The remuneration of the Auditors, as fixed by the LICENSOR, shall be borne by the LICENSEE.22.6 The LICENSOR may also get conducted a Special Audit of the LICENSEE companys accounts/records by "Special Auditors", the payment for which at a rate as fixed by the LICENSOR, shall be borne by the LICENSEE. This will be in thenature of auditing the audit described in para 22.5 above. The Special Auditors shall also be provided the same facility and have the same powers as of the companies auditors as envisaged in the Companies Act, 1956." 69. Clauses 22.5 and 22.6 are not meant for an audit to be conducted by CAG or TRAI, but meant for an audit by the DoT. The Tribunal also committed an error in holding that the "formation of opinion"under clause 22.5, that the statements or accounts submitted by the Licensee are inaccurateor misleading, is jurisdictional fact, referring to the jurisdiction of DoT/CAG to conduct audit under clause 22.5 or a special audit under clause 22.6. Formation of opinion under clause 22.5 is a subjective opinion of Licensor or else the power to conduct any form of audit under clause 22.5 and 22.6 would be lost and Licensor has to go on convincing the licensee that the statements or accounts submitted by the Licensee are inaccurate and misleading.
### Response:
0
### Explanation:
instrumentalities or even the private parties, like service providers, they are accountable to the people and to the Parliament. Parliamentary democracy also envisages, inter alia, the accountability of the Council of Ministers to the Legislature. In this connection reference may be made to the Judgment of this Court in S.R. Chaudhuri (supra) and Kihoto Hollohan (supra).We have to read Section 13, 16 and 18 of the 1971 Act along with Article 149 of the Constitution and Sections 3 and 5 of the TRAI Act, 1997 and, if so read, in our view, CAG is entitled to seek the records in terms of Rule 3 of TRAI Rules 2002 read with Clause 22 of the Licence Agreement. CAG, in that process, is not actually auditing the accounts of the UAS Service providers as such, but examining all the receipts to ascertain whether the Union is getting its due share by way of licence fee and spectrum charges, which it is legitimately entitled to, by way of Revenue Sharing. By adopting that process, CAG is not carrying out any statutory audit of the accounts of the service providers, but for the limited purpose of ascertaining whether the Union is getting its legitimate share by way of "Revenue Sharing". Service providers are, therefore, bound to provide all the records and documents called for by the CAG.51. CAG has, therefore, a duty to examine and satisfy himself that all the rules and procedures in that behalf are being met not only by the Union but also the service providers as a whole, since both, the Union, as well as the service providers, are dealing with the natural resources. CAGs function is, therefore, separate and independent, which is not similar to the audit conducted by the DoT under Clause 22.5 or special audit under Clause 22.6. CAGs function is only to ascertain whether the Union of India is getting its due share, while parting with the right to deal with its exclusive privilege to the Service Providers, who are dealing with a national wealth, to that extent, Rule 5(1)(ii) has to be read down, but the service providers are bound to make available all the books of accounts and other documents maintained by them under Rule 3, so as to ascertain whether the Union of India is getting its full share of revenue.We are of the view that there has been a complete misreading of the various clauses of the licensing agreement as well as understanding of law on the point. Let us first examine the background under which the communications dated 16.3.2010 and 10.5.2010 were issued by DoT and the Director General of Audit, Post & Telecommunications respectively, to the UAS license holders. Both the communications would indicate that they were sent for seeking cooperation for the Audit of Telecom service providers by the CAG, which is neither an audit by the department within the meaning of Clause 22.5, nor a special audit under Clause 22.6.The Tribunal, in our view, has committed a fundamental error in taking the view that the above mentioned communications were issued by the DoT in exercise of the powers conferred under Clauses 22.3 to 22.6, in fact, the communications specifically refer to only Clause 22.3, and not to any other clauses. On the other hand, the Tribunal made specific reference to Clause 22.5 which, in our view, is inapplicable in a case where the audit is sought to be conducted by CAG. The Tribunal has also not properly appreciated the scope of clauses 20.4, 22.5 and 22.6. There are three stages of audit. First, audit is to be conducted by the Licencee under Clause 20.4 through an auditor appointed under Section 224 of the Companies Act. Clause 22.5 empowers the licensor to conduct an audit, if it is found that statements or accounts submitted are inaccurate and misleading. In our view, the opinion to be formed is purely subjective, it need not establish to the satisfaction of the licencee that the statements or accounts are inaccurate and misleading. Further, Clause 22.6 is an independent Clause which has no relationship with Clause 22.5. This is an additional power conferred on the Licensor to conduct special audit. In other words, audit conducted by the licensor or the licencee, has nothing to do with the audit conducted by CAG. If the reasoning of the Tribunal is accepted, then the DOT can always stall an Audit sought to be conducted not only by CAG in exercise of powers conferred under Article 149 of the Constitution read with the 1971 Act and TRAI Rules 2002, but also an audit under clause 22.5 as well as special audit under clause 22.6. Consequently, an audit to be conducted by CAG would not depend upon the "formation of opinion"by the DoT that the statements or accounts submitted to it were inaccurate or misleading, which, in our view, would deprive the statutory and constitutional powers conferred on the CAG to conduct the audit or enquiry or inspection. Tribunals order, in our view, is an encroachment upon the constitutional and statutory power conferred on CAG under Articles 148, 149 of the Constitution as well as Section 16 of the 1971 Act read with Rule 5 of the TRAI Rules 2002 and the licensing provisions.Clauses 22.5 and 22.6 are not meant for an audit to be conducted by CAG or TRAI, but meant for an audit by the DoT. The Tribunal also committed an error in holding that the "formation of opinion"under clause 22.5, that the statements or accounts submitted by the Licensee are inaccurateor misleading, is jurisdictional fact, referring to the jurisdiction of DoT/CAG to conduct audit under clause 22.5 or a special audit under clause 22.6. Formation of opinion under clause 22.5 is a subjective opinion of Licensor or else the power to conduct any form of audit under clause 22.5 and 22.6 would be lost and Licensor has to go on convincing the licensee that the statements or accounts submitted by the Licensee are inaccurate and misleading.
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Shiromani & Ors Vs. Hem Kumar & Ors | of the exceptions was in favour of the eldest son, who was originally entitled to a special share on partition, either a tenth or a twentieth in excess of the others, or some special chattel, or an extra portion of the flocks (Apastamba, II, 6, 14, 10-13; Baudh., II, 2, 2-5; Gaut., XXVIII, 11, 12; Vas., XVII, 42-45; Manu IX, 112, 114, 156). But unequal partition of ancestral or joint property was from early times condemned. The Smritichandrika, the Vyavahara Mayukha and the Viramitrodaya declare that unequal partition is forbidden in the Kali age (Smritichandrika, III, 16, V. May, IV, iv, 11, Viramit., III, 16 (Setlurs ed., 319) The Commentary of Mitakshara on Yajnavalkya, II, 117 is briefly as follows:"Unequal division though found in the sastras (e. g., Manu IX, 105, 112, 116, 117, Yaj. II, 114) should not be practiced because it has come to be condemned (or has become hateful to) by the people, since there is the prohibition (in Yaj. 1. 156) that an action, though prescribed in the sastras, should not be performed when it has come to be condemned by the people, since such an action does not lead to the attainment of Heaven. For example, though Yaj. I, 109 prescribes the offering of a big ox or a goat to a learned brahmana guest it is not now practiced because people have come to hate it, or just as, although there is a Vedic text laying down the sacrificing of a cow one should sacrifice a barren cow called anubandhya for Mitra and Varuna still it is not done because people condemn it And it has been said just as the practice of niyoga or the killing of the anubandhya cow is not now in vogue, so also division after giving a special share (to the eldest son) does not now exist."As between brothers or other relations, absolute equality is now the invariable rule in all the States, unless perhaps, where some special family custom to the contrary is made out (For example, see the decision of the Madras High Court in Nachiappa Chettiar v. Muthu Karuppan Chettiar, AIR 1946 Mad 398 ).7. On behalf of the respondents, however, reliance was placed upon the special custom of "Jethansi" said to be prevalent in the caste of Agharias to which the parties belong. Reference was made to the evidence of D.W. 4, Baratram, D. W. 5, Sitaram, D. W. 6, Yalobra and D. W. 7, Khewlal to show that there was such a custom in the caste whereby the eldest son was given a greater share in the property of the father. Mr. Sarjoo Prasad took us through the evidence of these witnesses but we are not satisfied on their evidence that the custom pleaded for has been established. It is well established that a custom must be proved to he ancient, certain and reasonable if it is to be recognised and acted upon by Courts of law; and being in derogation of the general rules of law the custom must be construed strictly: See Hur Purshad v. Sheo Dyal, (1876-77) 3 Ind App 259 at p. 295 (PC). In the present case, the evidence adduced on behalf of the respondents to prove the alleged custom is unsatisfactory and conflicting. D. W. 4, Baratram stated that the custom of "Jethansi" was prevalent in Agharias community but he admitted when cross-examined, that he was not present at any partition. He further said that there was "no fixed custom about Jethansi and the eldest brother could be given more or less". D. W. 5, Sitaram said that "I got 16 acres of Jethansi land in a partition between my own brother". The total area of land was 100 acres. He admitted that there was no written document about the custom. D. W. 6, Yalobra said that his brother Sita Ram got Jethansi land of 16 acres out of a total area of 100 acres. When cross-examined, he said that no more than Dashanshi was given "and the people who divided did not tell any account of it". The evidence of Khewlal, D. W. 7 is that there was partition among his brothers and the eldest brother Din Dayal was given 5-6 acres of land as Jethansi. The total area of the land to be divided was 100 acres. No documentary evidence of partition has been adduced on behalf of the respondents and the oral evidence is vague and uncertain.We are accordingly of the opinion that the custom of Jethansi alleged on behalf of the respondents has not been established by proper evidence and the finding of the High Court is vitated because it is not supported by proper evidence. We accordingly reject the argument of the respondents that Hemkumar was entitled to a larger share of the joint family properties on the basis of the alleged custom of Jethansi in his caste.8. On behalf of the respondents reference was made to the evidence of D. W. 1 Dinamoni and D. W. 2 Dindayal that there was an actual partition of joint family properties not on December 27, 1943 when Ex. D-4 was executed but about two months later and specific allotments were made to each of the coparceners. There is, however, no pleading in the written statement on behalf of the respondents that apart from the document, Ex. D-4 there was a partition of the joint family properties. We are satisfied in this case, upon examination of the evidence that the intention of the parties was that document Ex. D-4 should he the sole evidence of partition and since we have held that Ex. D-4 is not admissible in evidence on account of non-registration to establish when the property was so partitioned, it is manifest that no oral evidence is admissible to prove any subsequent partition having regard to the provisions of Section 91 of the Evidence Act. It is clear therefore that the appellants are entitled to a preliminary decree for partition of joint family properties. | 1[ds]In our opinion, the argument put forward on behalf of the appellants is well founded and must be accepted as correct. It was contended on behalf of the respondents that the document was not necessary to be registered because there was only severance of joint status of the members of the coparcenery and there was no partition of the properties by metes and bounds.We proceed to consider the next question arising in this appeal namely, whether Mst. Subhagwati was entitled to a share in the joint family properties equal to that of a son and whether properties equal to that of a son and whether the alleged partition effected by Ex. D-4 was invalid because no such share was allotted to her. It is not disputed on behalf of the respondents that according to the Mitashara Law of the Benares School a wife is entitled, on partition between her sons, to a share equal to that of a son. But the contention put forward on behalf of the respondents is that by signing the document, Ex. D-4 Mst, Subhagwati acquiesced in the division of the properties between her sons without claiming any share for herself and it must counsequently be taken that Mst. Subhagwati relinquished her share. It was pointed out that Ex. D-4 was executed on December 27, 1943 and for a period of 11 years Mst. Subhagwati did not take any action to impeach that document. We are unable to accept the argument put forward on behalf of the respondents as correct. There is no issue in the trial court regarding the alleged acquiescence of Mst. Subhagwati nor was it pleaded on behalf of the respondents that there was an agreement by which Mst. Subhagwati gave up her share in favour of the other coparceners. On the contrary, it is alleged in Para 9 of the written statement that Subhagwati was not entitled to any be effected by Ex. D-4 was not prejudicial to the interest of plaintiff No. 1. To put it differently, there is not pleading on the part of respondents of acquiescence by Mst. Subhagwati and there is no issue on the question of acquiescence. We are accordingly unable to accept the argument of the respondents that there was acquiescence on the part of Mst. Subhagwati or that she relinquished her share in favour of the other coparceners and the finding of the High Court on this point is erroneous.On behalf of the respondents, however, reliance was placed upon the special custom of "Jethansi" said to be prevalent in the caste of Agharias to which the parties belong. Reference was made to the evidence of D.W. 4, Baratram, D. W. 5, Sitaram, D. W. 6, Yalobra and D. W. 7, Khewlal to show that there was such a custom in the caste whereby the eldest son was given a greater share in the property of the father. Mr. Sarjoo Prasad took us through the evidence of these witnesses but we are not satisfied on their evidence that the custom pleaded for has been established. It is well established that a custom must be proved to he ancient, certain and reasonable if it is to be recognised and acted upon by Courts of law; and being in derogation of the general rules of law the custom must be construedare accordingly of the opinion that the custom of Jethansi alleged on behalf of the respondents has not been established by proper evidence and the finding of the High Court is vitated because it is not supported by proper evidence. We accordingly reject the argument of the respondents that Hemkumar was entitled to a larger share of the joint family properties on the basis of the alleged custom of Jethansi in his caste.8. On behalf of the respondents reference was made to the evidence of D. W. 1 Dinamoni and D. W. 2 Dindayal that there was an actual partition of joint family properties not on December 27, 1943 when Ex. D-4 was executed but about two months later and specific allotments were made to each of the coparceners. There is, however, no pleading in the written statement on behalf of the respondents that apart from the document, Ex. D-4 there was a partition of the joint family properties. We are satisfied in this case, upon examination of the evidence that the intention of the parties was that document Ex. D-4 should he the sole evidence of partition and since we have held that Ex. D-4 is not admissible in evidence on account of non-registration to establish when the property was so partitioned, it is manifest that no oral evidence is admissible to prove any subsequent partition having regard to the provisions of Section 91 of the Evidence Act. It is clear therefore that the appellants are entitled to a preliminary decree for partition of joint family properties. | 1 | 3,117 | 875 | ### Instruction:
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of the exceptions was in favour of the eldest son, who was originally entitled to a special share on partition, either a tenth or a twentieth in excess of the others, or some special chattel, or an extra portion of the flocks (Apastamba, II, 6, 14, 10-13; Baudh., II, 2, 2-5; Gaut., XXVIII, 11, 12; Vas., XVII, 42-45; Manu IX, 112, 114, 156). But unequal partition of ancestral or joint property was from early times condemned. The Smritichandrika, the Vyavahara Mayukha and the Viramitrodaya declare that unequal partition is forbidden in the Kali age (Smritichandrika, III, 16, V. May, IV, iv, 11, Viramit., III, 16 (Setlurs ed., 319) The Commentary of Mitakshara on Yajnavalkya, II, 117 is briefly as follows:"Unequal division though found in the sastras (e. g., Manu IX, 105, 112, 116, 117, Yaj. II, 114) should not be practiced because it has come to be condemned (or has become hateful to) by the people, since there is the prohibition (in Yaj. 1. 156) that an action, though prescribed in the sastras, should not be performed when it has come to be condemned by the people, since such an action does not lead to the attainment of Heaven. For example, though Yaj. I, 109 prescribes the offering of a big ox or a goat to a learned brahmana guest it is not now practiced because people have come to hate it, or just as, although there is a Vedic text laying down the sacrificing of a cow one should sacrifice a barren cow called anubandhya for Mitra and Varuna still it is not done because people condemn it And it has been said just as the practice of niyoga or the killing of the anubandhya cow is not now in vogue, so also division after giving a special share (to the eldest son) does not now exist."As between brothers or other relations, absolute equality is now the invariable rule in all the States, unless perhaps, where some special family custom to the contrary is made out (For example, see the decision of the Madras High Court in Nachiappa Chettiar v. Muthu Karuppan Chettiar, AIR 1946 Mad 398 ).7. On behalf of the respondents, however, reliance was placed upon the special custom of "Jethansi" said to be prevalent in the caste of Agharias to which the parties belong. Reference was made to the evidence of D.W. 4, Baratram, D. W. 5, Sitaram, D. W. 6, Yalobra and D. W. 7, Khewlal to show that there was such a custom in the caste whereby the eldest son was given a greater share in the property of the father. Mr. Sarjoo Prasad took us through the evidence of these witnesses but we are not satisfied on their evidence that the custom pleaded for has been established. It is well established that a custom must be proved to he ancient, certain and reasonable if it is to be recognised and acted upon by Courts of law; and being in derogation of the general rules of law the custom must be construed strictly: See Hur Purshad v. Sheo Dyal, (1876-77) 3 Ind App 259 at p. 295 (PC). In the present case, the evidence adduced on behalf of the respondents to prove the alleged custom is unsatisfactory and conflicting. D. W. 4, Baratram stated that the custom of "Jethansi" was prevalent in Agharias community but he admitted when cross-examined, that he was not present at any partition. He further said that there was "no fixed custom about Jethansi and the eldest brother could be given more or less". D. W. 5, Sitaram said that "I got 16 acres of Jethansi land in a partition between my own brother". The total area of land was 100 acres. He admitted that there was no written document about the custom. D. W. 6, Yalobra said that his brother Sita Ram got Jethansi land of 16 acres out of a total area of 100 acres. When cross-examined, he said that no more than Dashanshi was given "and the people who divided did not tell any account of it". The evidence of Khewlal, D. W. 7 is that there was partition among his brothers and the eldest brother Din Dayal was given 5-6 acres of land as Jethansi. The total area of the land to be divided was 100 acres. No documentary evidence of partition has been adduced on behalf of the respondents and the oral evidence is vague and uncertain.We are accordingly of the opinion that the custom of Jethansi alleged on behalf of the respondents has not been established by proper evidence and the finding of the High Court is vitated because it is not supported by proper evidence. We accordingly reject the argument of the respondents that Hemkumar was entitled to a larger share of the joint family properties on the basis of the alleged custom of Jethansi in his caste.8. On behalf of the respondents reference was made to the evidence of D. W. 1 Dinamoni and D. W. 2 Dindayal that there was an actual partition of joint family properties not on December 27, 1943 when Ex. D-4 was executed but about two months later and specific allotments were made to each of the coparceners. There is, however, no pleading in the written statement on behalf of the respondents that apart from the document, Ex. D-4 there was a partition of the joint family properties. We are satisfied in this case, upon examination of the evidence that the intention of the parties was that document Ex. D-4 should he the sole evidence of partition and since we have held that Ex. D-4 is not admissible in evidence on account of non-registration to establish when the property was so partitioned, it is manifest that no oral evidence is admissible to prove any subsequent partition having regard to the provisions of Section 91 of the Evidence Act. It is clear therefore that the appellants are entitled to a preliminary decree for partition of joint family properties.
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In our opinion, the argument put forward on behalf of the appellants is well founded and must be accepted as correct. It was contended on behalf of the respondents that the document was not necessary to be registered because there was only severance of joint status of the members of the coparcenery and there was no partition of the properties by metes and bounds.We proceed to consider the next question arising in this appeal namely, whether Mst. Subhagwati was entitled to a share in the joint family properties equal to that of a son and whether properties equal to that of a son and whether the alleged partition effected by Ex. D-4 was invalid because no such share was allotted to her. It is not disputed on behalf of the respondents that according to the Mitashara Law of the Benares School a wife is entitled, on partition between her sons, to a share equal to that of a son. But the contention put forward on behalf of the respondents is that by signing the document, Ex. D-4 Mst, Subhagwati acquiesced in the division of the properties between her sons without claiming any share for herself and it must counsequently be taken that Mst. Subhagwati relinquished her share. It was pointed out that Ex. D-4 was executed on December 27, 1943 and for a period of 11 years Mst. Subhagwati did not take any action to impeach that document. We are unable to accept the argument put forward on behalf of the respondents as correct. There is no issue in the trial court regarding the alleged acquiescence of Mst. Subhagwati nor was it pleaded on behalf of the respondents that there was an agreement by which Mst. Subhagwati gave up her share in favour of the other coparceners. On the contrary, it is alleged in Para 9 of the written statement that Subhagwati was not entitled to any be effected by Ex. D-4 was not prejudicial to the interest of plaintiff No. 1. To put it differently, there is not pleading on the part of respondents of acquiescence by Mst. Subhagwati and there is no issue on the question of acquiescence. We are accordingly unable to accept the argument of the respondents that there was acquiescence on the part of Mst. Subhagwati or that she relinquished her share in favour of the other coparceners and the finding of the High Court on this point is erroneous.On behalf of the respondents, however, reliance was placed upon the special custom of "Jethansi" said to be prevalent in the caste of Agharias to which the parties belong. Reference was made to the evidence of D.W. 4, Baratram, D. W. 5, Sitaram, D. W. 6, Yalobra and D. W. 7, Khewlal to show that there was such a custom in the caste whereby the eldest son was given a greater share in the property of the father. Mr. Sarjoo Prasad took us through the evidence of these witnesses but we are not satisfied on their evidence that the custom pleaded for has been established. It is well established that a custom must be proved to he ancient, certain and reasonable if it is to be recognised and acted upon by Courts of law; and being in derogation of the general rules of law the custom must be construedare accordingly of the opinion that the custom of Jethansi alleged on behalf of the respondents has not been established by proper evidence and the finding of the High Court is vitated because it is not supported by proper evidence. We accordingly reject the argument of the respondents that Hemkumar was entitled to a larger share of the joint family properties on the basis of the alleged custom of Jethansi in his caste.8. On behalf of the respondents reference was made to the evidence of D. W. 1 Dinamoni and D. W. 2 Dindayal that there was an actual partition of joint family properties not on December 27, 1943 when Ex. D-4 was executed but about two months later and specific allotments were made to each of the coparceners. There is, however, no pleading in the written statement on behalf of the respondents that apart from the document, Ex. D-4 there was a partition of the joint family properties. We are satisfied in this case, upon examination of the evidence that the intention of the parties was that document Ex. D-4 should he the sole evidence of partition and since we have held that Ex. D-4 is not admissible in evidence on account of non-registration to establish when the property was so partitioned, it is manifest that no oral evidence is admissible to prove any subsequent partition having regard to the provisions of Section 91 of the Evidence Act. It is clear therefore that the appellants are entitled to a preliminary decree for partition of joint family properties.
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Abdul Wahid Abdul Gaffor Khatri Director & Others Vs. M/S. Safe Heights Developers Private Limited & Others | to obtain an RTI for a meeting held in 2011. Be that as it may, the Appellants have been removed by resolutions and with appropriate Form 32s filed, to the satisfaction of the ROC. It is nobodys case that the ROC has thereafter raised any objections to the filing of the Forms or indeed to the manner of removal of the Appellants.37. As held by the Honble Supreme Court in Hanuman Prasad Bagri v. Bagress Cereals Private Limited (supra) directorial disputes are beyond the jurisdiction of the CLB under Sections 397 and 398. Thus, the same cannot be raised before the CLB as rightly held by the CLB in paragraph 35 of the judgment.38. Further the Company is not under any circumstances either a family company or a closely held quasi partnership, in which circumstances potentially directorial disputes may be raised. The judgments relied upon by the Appellants in this regard will have no application to a company such as Respondent No.1. Further, it does not appear that this issue of quasi-partnership was pressed before the CLB, and was not pressed in arguments before this Court.39. The judgments placed in the Written Submissions, are, to a substantial extent, on points not raised before the CLB or before this Court in the arguments canvassed by the Appellants. The said judgments pertain to several aspects which were neither pressed before the CLB or before this Court, and to the extent that the same are placed in reliance of a case not pressed before the CLB or this Honble Court, the judgments ought to be disregarded. Nevertheless, the said judgments are broadly dealt with hereinbelow:40. As regards 2001 (1) Mah. L.J. 701 Dushyant D.Anjaria v. M/s. Wall Street Finance Ltd. ; 2011 SCC Online Gau 143 Yogendra Kumar Maheshwari v. Registrar of Companies; and (2004) 1 CTC 340 P.Natarajan v. Central Government, of the Compilation are in cases which were not under Section 397/398.41. As regards Dushyant D.Anjaria (supra), Yogendra Kumar (supra); P.Natarajan (supra) ; (1983) 53 Comp Cas 883 Sishu Ranjan Dutta v. Bhola Nath Paper House Ltd.,; (1999) 19 SCL 391 (Mad)Harikumar Rajah v. Sovereign Dairy Ltd. (Mad) ; (1961) 31 Comp Cas 193 (Cal) Hindusthan Cooperative Insurance Society Ltd. In re ; (2010) 156 Comp Cas 367 Sintex Industries Ltd., In re, pertain to appointment of (Additional) Directors and the tenure thereof. The appointment and duration of Directors is a matter beyond the scope of jurisdiction of the CLB, and in any case is not the grievance urged before this Court.42. As regards (2009) 149 Comp Cas 328 (P&H) Zora Singh v. Amrik Singh Hayer; (2010) 153 Comp Cas 370 (CLB) Rajiv Kumar Singh v. Shree Narayan Developers P. Ltd. and Ors.; (2010) 153 Comp Cas 222 Ashok Kumar and Ors. v. Shree Janki Cold Storage P. Ltd. and Ors.; (1988) 64 Comp Cas 562 (Cal) Swapan Dasgupta v. Navin Chand Suchanti, pertain to notices for meetings and the issue of UPC. This issue has been dealt with above. The judgments turn purely on the facts of their respective cases. In the present case, the CLB has arrived at a conclusion that the notices appear to have been served on the Appellants, and even in respect of the Board Meetings, it cannot be disputed that there are UPC proofs of the notices.43. As regards Needle Industries India Ltd. (supra) ; (1996) 87 Comp Cas 290 CLB Mrs. Farhat Sheikh v. Esemen Metalo Chemicals Pvt. Ltd. ; (1995) 82 Comp Cas 563 (CLB) Rashmi Seth v. Chemon India Pvt. Ltd. ; (2009) 151 Comp Cas 71 (CLB) Ram Babu v. Target Constructions Pvt. Ltd. and Ors. ; and (2010) 158 Comp Cas 195 (CLB) Mrs. Gurpreet Gill v. Pumpkin Studio P. Ltd. & Ors., the same pertain to issue of shares. As set out earlier, the impending Rights Issue was to the knowledge of the Appellants; even otherwise, at no point had they sought to exercise their purported right of preemption as is now sought to be contended in the Appellants Written Submissions. The Appellants in fact had accepted repayment of their loan by March 2007 and were clearly not interested in the functioning of the company. Pertinently, even after having full knowledge, as per their own case, in November 2007, the Appellants did not take steps to challenge the Rights Issue or to seek allotment of shares to them in the ensuing several years. In any event, the judgments relied upon take the position that if the Rights Issue is not bona fide but is only for the purpose of enabling a party to obtain a majority, then such action will constitute oppression; this is not so in the present case. The CLB has concluded that funds were required for which the Rights Issue was carried out, and therefore it cannot be said that the same was not bona fide.44. As regards (2008) 141 Comp Cas 270 (CLB) Sanjay Paliwal and Anr. v. Paliwal Hotels Pvt. Ltd., ; (2008) 141 Comp Cas 482 (CLB) Rajesh Patil v. Moonshine Films Pvt. Ltd. ; (2008) 142 Comp Cas 320 (CLB) M.L. Arora v. Green Valley Frozen Food Ltd. & Ors. ; and (2004) 119 Comp Cas 974 (CLB) A. Kalyani v. Vale Exports P. Ltd., the same pertain to the allegation of continuous oppression and mismanagement, to justify the delay in filing of the Company Petition. As set out above, the contention of continuous oppression and mismanagement culminating in the removal of the Appellants as Directors in 2011, was not the ground urged before the CLB to justify the delay. The ground urged was as to the pendency of proceedings before the ROC, and it is in that context that the CLB has rightly held that the explanation for the delay is unjustifiable. Even otherwise, the explanation given by the Appellants cannot be countenanced, as the events of which they complained, had to a material extent, culminated in 2007 itself, and there is no justification for the delay in approaching the CLB. | 0[ds]In the present case, under no circumstances can it be said that the judgment of the CLB is either perverse or cursory or based on no evidence. The Appellants are attempting to treat the present proceedings as a First Appeal and are in effect seeking that this Court delve deeply into the facts and exercise its discretion to replace the discretionary judgment of the CLB. This is impermissible in law and is contrary to the judgments of the Honble Supreme Court and High Courts which were cited on behalf of the Respondents.9. In my view, the order of the CLB in the present case can in no circumstances be said to be either perverse, based on no evidence or arbitrary. The CLB has analysed the factual and legal position in depth and has arrived at a conclusion on facts that no case of oppression and/of mismanagement has been made out by the Appellants.The CLB has, after a detailed consideration of the Appellants conduct, arrived at a finding of fact that the Appellants had suppressed material facts and had not come with clean hands, having indulged in various acts of misconduct as set out in the order, including running a parallel Board of Directors, holding meetings without any notice (as opposed to the Respondents having shown UPC records for service of notice for their meetings) and appointing/removing directors at their whim. The CLB has rightly noted that a party seeking relief in an equitable jurisdiction must itself act equitably (i.e., a person who wants equity must do equity), and has arrived at a conclusion that the Appellants have not acted equitably.17. In their submissions, the Appellants have sought to deflect attention from their own defaults by alleging defaults on the part of the Respondents. The Appellants have not been able to deny the illegalities committed by them, but have simply alleged that the same yardstick was not applied to the Respondents. This stand is factually incorrect in as much as the Appellants did not give any notice for their meeting, whereas the Respondents had given notice by UPC. Even otherwise, it is the Appellants who have approached the CLB in the exercise of its equitable jurisdiction, and it is the Appellants who must show that they have acted equitably and with clean hands. It is no answer to contend that their illegalities are justified by alleged illegalities on the part of the Respondents, which in themselves have been denied.In these circumstances, on this ground also, I see no reason to interfere in factual findings of theA grievance was raised by the appellants that the UPC proofs at pgs. 351 and 354 appear to be identical. While this is purely a factual matter which ought not to detain this Court, the Appellants ought to have pointed out that the UPCs at pgs. 351 and 354 pertain to communications both dated 19th February 2007, and therefore potentially the same UPC proof would be sufficient if both communications were forwarded under the same UPC certificate and/or in the same packet. These are factual matters, which if had been pressed before the CLB would duly have been answered by the CLB after hearing both sides, but this aspect was not urged, as is apparent from the judgment of the CLB.21. In this context, the CLB has rightly held on the basis of Section 53 of Companies Act, 1956, that there arises a rebuttable presumption that the documents were served on the Appellants under certificate of posting. As held by the Honble Supreme Court in the case of V.S. Krishnan (supra) relying on the judgment of the Honble Supreme Court in (2004) 9 SCC 204 M. S. Madhusoodhanan v. Kerala Kaumudi Private Limited, the burden was on the addressee, i.e., the Appellants herein, to rebut the statutory presumption and show that the notice had not been received by them. Admittedly in the present case no such attempt has been made by the Appellants to show that the notice was in fact not received by them. In the circumstances, it cannot be said that the CLB judgment is perverse or unreasonable or arbitrary on this score.22. The Appellants have sought to rely upon certain judgments on the aspect of service of notice for meetings. Broadly stated, the said judgments only lay down the accepted proposition that notice of a meeting ought to be given to the shareholder/director. The said judgments have no application in the present case, as it is not the case of the Respondents that no notice was given, but in fact notices were sent by post under certificate of posting (UPC). As aforesaid, the rebuttable presumption under Section 53 having arisen, and having not been rebutted by the Appellants, the CLB has rightly held in favour of the Respondents in thisis pertinent to note that in the present case, after the meeting of 14th March 2007 as set out later, in which the Appellants have participated in raising the share capital, and until the issuance of the show cause notice on 5th November 2007, (during which time the notices were sent by UPC) there is no record whatsoever to show that the relationships between the parties was in any manner embittered. During this period between March 2007 and November 2007 there was no embitterment whatsoever and it was during this period that the rights issue took place culminating on 22nd September 2007, as also the shifting of the registered office in April 2007 and2007. Hence, the notices sent for these meetings under UPC during this period, cannot possibly be required to be viewed with any suspicion on the ground of purported embitterment, or otherwise.23. Before the CLB, the case of the Appellants was that the UPC notices were infirm and should not be relied upon because relations between the parties were embittered. Before this Court, it was urged that the UPCs could not be relied upon in respect of Board Meetings and that the presumption under Section 53 applied to general meetings of the company. This contention is misleading. While Section 53 does raise a presumption in respect of notices for meetings of members of the company, under Section 286 of the Companies Act, 1956, there is no format provided for service of notices to Directors. The CLB has dealt with the argument which was urged, namely that the notice through UPC should not be presumed as sufficient proof of service; this argument of UPC notice for Board Meeting does not appear to have been urged before the CLB. Even otherwise, under Section 286 of the Companies Act, 1956 no specific mode of service is provided for. The UPC proofs were duly produced before the CLB even for meetings of the Board of Directors, and there was nothing placed on record by the Appellants to show that they were either not available at the time when the notices were served or that they could not or were not in a position to receive the same. Even otherwise, the CLB has rightly held that after knowledge of those resolutions being passed by November 2007January 2008, no steps were taken by the Appellants to approach the CLB for redressal of their grievances for close to four years. On the contrary, the Appellants held their own meetings without even attempting to send notices thereof to the Respondents; what has weighed with the CLB therefore is the inequitable conduct on the part of the Appellants and this factual finding cannot to be interfered with.24. Even otherwise, the rights issue having been done in the interest of the Company with a view to infuse funds into the Company, can under no circumstances be said to be an act of oppression. The Honble Supreme Court in the case of AIR 1981 SC 1298 Needle Industries (India) Limited v. Needle Industries Newey India Holdings Limitedrelied upon in V. S. Krishnan (supra), has held that if the shares are issued in the larger interest of the Company and bona fide with a view to enable capital to be raised, the rights issue cannot be termed as oppressive.25. In the present case, in the meeting of the Board of Directors held on 14th February 2007 and confirmed in an EGM held on 14th March 2007 it was decided to raise the authorised share capital of the Company from Rs. 5,00,000/The explanatory statement for the meeting held on 14th March 2007, placed on record by the Appellants themselves, bearing Appellant No.1s digital signature, expressly records that the shareholding was being increased as the Company "wishes to enhance its current business greatly", and that the present authorised capital of the Company was "very small and would be a constraint to the growth of the Company". Admittedly, validity of these meetings which were referred to in paragraphs ii(a) and (b) of the Respondents Reply, and the Appellant Nos. 1 and 2s presence have been accepted in paragraph 6 of the Appellants Rejoinder.26. The rights issue was thus obviously contemplated as being the avenue for increasing the funds of the Company and for the growth of the Company. The CLB has recorded a finding of fact (in paragraph 28) that the rights issue was necessary for the growth of the Company and therefore the action of issuing the shares could not be termed as oppressive to the Appellants and/or mismanagement of the affairs of the Company.27. Pertinently, despite being party to the above meetings, at no point did the Appellants seek to subscribe to the rights issue, and did not even make such enquiries for several years prior to filing the present Petition. The reason for this was clearly because the rights issue which commenced from April 2007, was not of interest to the Appellants, as the Appellants had received back the sum loaned by them to the Company to the tune of Rs.The Appellants had accepted back the loan as they did not desire to partake in the functioning of the Company.28. The Appellants have no explanation for their having taken back their loan, save and except to contend that this was not reflective of their disinterest in the company. In this regard, the CLB has arrived at a finding of fact, based on the conduct of the Appellants and this finding ought not to be interfered with in exercise of jurisdiction under SectionAs a matter of fact, after accepting their loan amounts back in or about March 2007, at no point did the Appellants write a single letter or demand to participate or show any interest in participating in the company until issuance of the show cause notice on 5th November 2007. If the Appellants truly desired to partake in the management of the company and felt that they had been wrongly prevented from doing so, any reasonable person would have approached the appropriate forum, i.e., the CLB in 2007 itself. However, no such steps were taken by the Appellants until July 2011.29. In the circumstances, even on merits it cannot be said that the rights issue was either oppressive or done behind the back of the Appellants.Shifting of registered office:30. The Appellants have sought to raise certain factual contentions as to where the notices for the Registered Office shifting were posted from. These are all factual matters, which would turn on evidence as to where Respondent No.2 resided and where he posted the notices from. It is not necessary that the notices be posted only from the Post Office adjacent to the Registered Office of the Company. Be that as it may, this factual analysis is beyond the scope of this Courts jurisdiction under Section10F of the Companies Act, 1956.1956.31. The Appellants raised a grievance that the registered office of the Company was shifted from Jogeshwari to Sir P. M. Road in April 2007 and thereafter from Mumbai to Nashik in JulyAugust 2007.32. It has to be noted that the jurisdiction of the ROC was not changed, and there was no prejudice whatsoever caused to the Company by virtue of the change of the registered office. The sequence of events relating to the shifting of the registered office have been set out in paragraphs (i) to (iii) of the Reply filed by the Respondents in the CLB.33. As laid down by the Honble Supreme Court in [2001] 33 SCL 78 (SC) Hanuman Prasad Bagri v. Bagress Cereals Private Limited, shifting of the registered office by itself may not be a reason or a ground to be raised in a Petition under Sections 397/398 as long as the Company did not suffer much loss on account of the shifting and no case was made out to show that such exercise was undertaken to put oppressive pressure or pain upon the Petitioners. As in the case that was before the Honble Supreme Court, there is nothing in the present case to show that any prejudice was/is caused to the Appellants or that any wasteful expenditure amounting to mismanagement was incurred on behalf of the Company by shifting of the registered office.34. Pertinently, it is the admitted position that the UPC amount paid was Rs.It is more than sufficient for service on Appellant Nos. 1 and 2; the other Directors and Shareholders being part of the Respondent Group, may well have been served by other meansthey have raised no objection as to service or receipt of the notices. Once again this aspect is purely factual and is being dealt with only in light of the contentions raised by the Appellants. The crucial factor remains that shifting of the Registered Office has caused no prejudice to the Company, and is not oppressive in the least. There is nothing to show that the shifting was done to prejudice the Appellants.35. Thus this contention does not constitute oppression or mismanagement.Directorial disputes36. The Appellants have relied upon an RTI Application of 2012 to contend that no notice was received of the meeting for removal of the Appellants as Directors. It appears from the impugned judgment that this issue of the RTI Reply was not pressed before the CLB. Even otherwise, it is pertinent to note that in all the various allegations of not having received notice for various meetings, the Appellants have not sought to obtain any RTI on the delivery of notices for all the meetings which are the subject matter of dispute between 2007 and 2010, but have only purported to obtain an RTI for a meeting held in 2011. Be that as it may, the Appellants have been removed by resolutions and with appropriate Form 32s filed, to the satisfaction of the ROC. It is nobodys case that the ROC has thereafter raised any objections to the filing of the Forms or indeed to the manner of removal of the Appellants.37. As held by the Honble Supreme Court in Hanuman Prasad Bagri v. Bagress Cereals Private Limited (supra) directorial disputes are beyond the jurisdiction of the CLB under Sections 397 and 398. Thus, the same cannot be raised before the CLB as rightly held by the CLB in paragraph 35 of the judgment.38. Further the Company is not under any circumstances either a family company or a closely held quasi partnership, in which circumstances potentially directorial disputes may be raised. The judgments relied upon by the Appellants in this regard will have no application to a company such as Respondent No.1. Further, it does not appear that this issue ofwas pressed before the CLB, and was not pressed in arguments before this Court.39. The judgments placed in the Written Submissions, are, to a substantial extent, on points not raised before the CLB or before this Court in the arguments canvassed by the Appellants. The said judgments pertain to several aspects which were neither pressed before the CLB or before this Court, and to the extent that the same are placed in reliance of a case not pressed before the CLB or this Honble Court, the judgments ought to be disregarded. Nevertheless, the said judgments are broadly dealt with hereinbelow:40. As regards 2001 (1) Mah. L.J. 701 Dushyant D.Anjaria v. M/s. Wall Street Finance Ltd. ; 2011 SCC Online Gau 143 Yogendra Kumar Maheshwari v. Registrar of Companies; and (2004) 1 CTC 340 P.Natarajan v. Central Government, of the Compilation are in cases which were not under Section 397/398.41. As regards Dushyant D.Anjaria (supra), Yogendra Kumar (supra); P.Natarajan (supra) ; (1983) 53 Comp Cas 883 Sishu Ranjan Dutta v. Bhola Nath Paper House Ltd.,; (1999) 19 SCL 391 (Mad)Harikumar Rajah v. Sovereign Dairy Ltd. (Mad) ; (1961) 31 Comp Cas 193 (Cal) Hindusthan Cooperative Insurance Society Ltd. In re ; (2010) 156 Comp Cas 367 Sintex Industries Ltd., In re, pertain to appointment of (Additional) Directors and the tenure thereof. The appointment and duration of Directors is a matter beyond the scope of jurisdiction of the CLB, and in any case is not the grievance urged before this Court.42. As regards (2009) 149 Comp Cas 328Zora Singh v. Amrik Singh Hayer; (2010) 153 Comp Cas 370 (CLB) Rajiv Kumar Singh v. Shree Narayan Developers P. Ltd. and Ors.; (2010) 153 Comp Cas 222 Ashok Kumar and Ors. v. Shree Janki Cold Storage P. Ltd. and Ors.; (1988) 64 Comp Cas 562 (Cal) Swapan Dasgupta v. Navin Chand Suchanti, pertain to notices for meetings and the issue of UPC. This issue has been dealt with above. The judgments turn purely on the facts of their respective cases. In the present case, the CLB has arrived at a conclusion that the notices appear to have been served on the Appellants, and even in respect of the Board Meetings, it cannot be disputed that there are UPC proofs of the notices.43. As regards Needle Industries India Ltd. (supra) ; (1996) 87 Comp Cas 290 CLB Mrs. Farhat Sheikh v. Esemen Metalo Chemicals Pvt. Ltd. ; (1995) 82 Comp Cas 563 (CLB) Rashmi Seth v. Chemon India Pvt. Ltd. ; (2009) 151 Comp Cas 71 (CLB) Ram Babu v. Target Constructions Pvt. Ltd. and Ors. ; and (2010) 158 Comp Cas 195 (CLB) Mrs. Gurpreet Gill v. Pumpkin Studio P. Ltd.Ors., the same pertain to issue of shares. As set out earlier, the impending Rights Issue was to the knowledge of the Appellants; even otherwise, at no point had they sought to exercise their purported right of preemption as is now sought to be contended in the Appellants Written Submissions. The Appellants in fact had accepted repayment of their loan by March 2007 and were clearly not interested in the functioning of the company. Pertinently, even after having full knowledge, as per their own case, in November 2007, the Appellants did not take steps to challenge the Rights Issue or to seek allotment of shares to them in the ensuing several years. In any event, the judgments relied upon take the position that if the Rights Issue is not bona fide but is only for the purpose of enabling a party to obtain a majority, then such action will constitute oppression; this is not so in the present case. The CLB has concluded that funds were required for which the Rights Issue was carried out, and therefore it cannot be said that the same was not bona fide.44. As regards (2008) 141 Comp Cas 270 (CLB) Sanjay Paliwal and Anr. v. Paliwal Hotels Pvt. Ltd., ; (2008) 141 Comp Cas 482 (CLB) Rajesh Patil v. Moonshine Films Pvt. Ltd. ; (2008) 142 Comp Cas 320 (CLB) M.L. Arora v. Green Valley Frozen Food Ltd.Ors. ; and (2004) 119 Comp Cas 974 (CLB) A. Kalyani v. Vale Exports P. Ltd., the same pertain to the allegation of continuous oppression and mismanagement, to justify the delay in filing of the Company Petition. As set out above, the contention of continuous oppression and mismanagement culminating in the removal of the Appellants as Directors in 2011, was not the ground urged before the CLB to justify the delay. The ground urged was as to the pendency of proceedings before the ROC, and it is in that context that the CLB has rightly held that the explanation for the delay is unjustifiable. Even otherwise, the explanation given by the Appellants cannot be countenanced, as the events of which they complained, had to a material extent, culminated in 2007 itself, and there is no justification for the delay in approaching the CLB. | 0 | 7,107 | 3,765 | ### Instruction:
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to obtain an RTI for a meeting held in 2011. Be that as it may, the Appellants have been removed by resolutions and with appropriate Form 32s filed, to the satisfaction of the ROC. It is nobodys case that the ROC has thereafter raised any objections to the filing of the Forms or indeed to the manner of removal of the Appellants.37. As held by the Honble Supreme Court in Hanuman Prasad Bagri v. Bagress Cereals Private Limited (supra) directorial disputes are beyond the jurisdiction of the CLB under Sections 397 and 398. Thus, the same cannot be raised before the CLB as rightly held by the CLB in paragraph 35 of the judgment.38. Further the Company is not under any circumstances either a family company or a closely held quasi partnership, in which circumstances potentially directorial disputes may be raised. The judgments relied upon by the Appellants in this regard will have no application to a company such as Respondent No.1. Further, it does not appear that this issue of quasi-partnership was pressed before the CLB, and was not pressed in arguments before this Court.39. The judgments placed in the Written Submissions, are, to a substantial extent, on points not raised before the CLB or before this Court in the arguments canvassed by the Appellants. The said judgments pertain to several aspects which were neither pressed before the CLB or before this Court, and to the extent that the same are placed in reliance of a case not pressed before the CLB or this Honble Court, the judgments ought to be disregarded. Nevertheless, the said judgments are broadly dealt with hereinbelow:40. As regards 2001 (1) Mah. L.J. 701 Dushyant D.Anjaria v. M/s. Wall Street Finance Ltd. ; 2011 SCC Online Gau 143 Yogendra Kumar Maheshwari v. Registrar of Companies; and (2004) 1 CTC 340 P.Natarajan v. Central Government, of the Compilation are in cases which were not under Section 397/398.41. As regards Dushyant D.Anjaria (supra), Yogendra Kumar (supra); P.Natarajan (supra) ; (1983) 53 Comp Cas 883 Sishu Ranjan Dutta v. Bhola Nath Paper House Ltd.,; (1999) 19 SCL 391 (Mad)Harikumar Rajah v. Sovereign Dairy Ltd. (Mad) ; (1961) 31 Comp Cas 193 (Cal) Hindusthan Cooperative Insurance Society Ltd. In re ; (2010) 156 Comp Cas 367 Sintex Industries Ltd., In re, pertain to appointment of (Additional) Directors and the tenure thereof. The appointment and duration of Directors is a matter beyond the scope of jurisdiction of the CLB, and in any case is not the grievance urged before this Court.42. As regards (2009) 149 Comp Cas 328 (P&H) Zora Singh v. Amrik Singh Hayer; (2010) 153 Comp Cas 370 (CLB) Rajiv Kumar Singh v. Shree Narayan Developers P. Ltd. and Ors.; (2010) 153 Comp Cas 222 Ashok Kumar and Ors. v. Shree Janki Cold Storage P. Ltd. and Ors.; (1988) 64 Comp Cas 562 (Cal) Swapan Dasgupta v. Navin Chand Suchanti, pertain to notices for meetings and the issue of UPC. This issue has been dealt with above. The judgments turn purely on the facts of their respective cases. In the present case, the CLB has arrived at a conclusion that the notices appear to have been served on the Appellants, and even in respect of the Board Meetings, it cannot be disputed that there are UPC proofs of the notices.43. As regards Needle Industries India Ltd. (supra) ; (1996) 87 Comp Cas 290 CLB Mrs. Farhat Sheikh v. Esemen Metalo Chemicals Pvt. Ltd. ; (1995) 82 Comp Cas 563 (CLB) Rashmi Seth v. Chemon India Pvt. Ltd. ; (2009) 151 Comp Cas 71 (CLB) Ram Babu v. Target Constructions Pvt. Ltd. and Ors. ; and (2010) 158 Comp Cas 195 (CLB) Mrs. Gurpreet Gill v. Pumpkin Studio P. Ltd. & Ors., the same pertain to issue of shares. As set out earlier, the impending Rights Issue was to the knowledge of the Appellants; even otherwise, at no point had they sought to exercise their purported right of preemption as is now sought to be contended in the Appellants Written Submissions. The Appellants in fact had accepted repayment of their loan by March 2007 and were clearly not interested in the functioning of the company. Pertinently, even after having full knowledge, as per their own case, in November 2007, the Appellants did not take steps to challenge the Rights Issue or to seek allotment of shares to them in the ensuing several years. In any event, the judgments relied upon take the position that if the Rights Issue is not bona fide but is only for the purpose of enabling a party to obtain a majority, then such action will constitute oppression; this is not so in the present case. The CLB has concluded that funds were required for which the Rights Issue was carried out, and therefore it cannot be said that the same was not bona fide.44. As regards (2008) 141 Comp Cas 270 (CLB) Sanjay Paliwal and Anr. v. Paliwal Hotels Pvt. Ltd., ; (2008) 141 Comp Cas 482 (CLB) Rajesh Patil v. Moonshine Films Pvt. Ltd. ; (2008) 142 Comp Cas 320 (CLB) M.L. Arora v. Green Valley Frozen Food Ltd. & Ors. ; and (2004) 119 Comp Cas 974 (CLB) A. Kalyani v. Vale Exports P. Ltd., the same pertain to the allegation of continuous oppression and mismanagement, to justify the delay in filing of the Company Petition. As set out above, the contention of continuous oppression and mismanagement culminating in the removal of the Appellants as Directors in 2011, was not the ground urged before the CLB to justify the delay. The ground urged was as to the pendency of proceedings before the ROC, and it is in that context that the CLB has rightly held that the explanation for the delay is unjustifiable. Even otherwise, the explanation given by the Appellants cannot be countenanced, as the events of which they complained, had to a material extent, culminated in 2007 itself, and there is no justification for the delay in approaching the CLB.
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between 2007 and 2010, but have only purported to obtain an RTI for a meeting held in 2011. Be that as it may, the Appellants have been removed by resolutions and with appropriate Form 32s filed, to the satisfaction of the ROC. It is nobodys case that the ROC has thereafter raised any objections to the filing of the Forms or indeed to the manner of removal of the Appellants.37. As held by the Honble Supreme Court in Hanuman Prasad Bagri v. Bagress Cereals Private Limited (supra) directorial disputes are beyond the jurisdiction of the CLB under Sections 397 and 398. Thus, the same cannot be raised before the CLB as rightly held by the CLB in paragraph 35 of the judgment.38. Further the Company is not under any circumstances either a family company or a closely held quasi partnership, in which circumstances potentially directorial disputes may be raised. The judgments relied upon by the Appellants in this regard will have no application to a company such as Respondent No.1. Further, it does not appear that this issue ofwas pressed before the CLB, and was not pressed in arguments before this Court.39. The judgments placed in the Written Submissions, are, to a substantial extent, on points not raised before the CLB or before this Court in the arguments canvassed by the Appellants. The said judgments pertain to several aspects which were neither pressed before the CLB or before this Court, and to the extent that the same are placed in reliance of a case not pressed before the CLB or this Honble Court, the judgments ought to be disregarded. Nevertheless, the said judgments are broadly dealt with hereinbelow:40. As regards 2001 (1) Mah. L.J. 701 Dushyant D.Anjaria v. M/s. Wall Street Finance Ltd. ; 2011 SCC Online Gau 143 Yogendra Kumar Maheshwari v. Registrar of Companies; and (2004) 1 CTC 340 P.Natarajan v. Central Government, of the Compilation are in cases which were not under Section 397/398.41. As regards Dushyant D.Anjaria (supra), Yogendra Kumar (supra); P.Natarajan (supra) ; (1983) 53 Comp Cas 883 Sishu Ranjan Dutta v. Bhola Nath Paper House Ltd.,; (1999) 19 SCL 391 (Mad)Harikumar Rajah v. Sovereign Dairy Ltd. (Mad) ; (1961) 31 Comp Cas 193 (Cal) Hindusthan Cooperative Insurance Society Ltd. In re ; (2010) 156 Comp Cas 367 Sintex Industries Ltd., In re, pertain to appointment of (Additional) Directors and the tenure thereof. The appointment and duration of Directors is a matter beyond the scope of jurisdiction of the CLB, and in any case is not the grievance urged before this Court.42. As regards (2009) 149 Comp Cas 328Zora Singh v. Amrik Singh Hayer; (2010) 153 Comp Cas 370 (CLB) Rajiv Kumar Singh v. Shree Narayan Developers P. Ltd. and Ors.; (2010) 153 Comp Cas 222 Ashok Kumar and Ors. v. Shree Janki Cold Storage P. Ltd. and Ors.; (1988) 64 Comp Cas 562 (Cal) Swapan Dasgupta v. Navin Chand Suchanti, pertain to notices for meetings and the issue of UPC. This issue has been dealt with above. The judgments turn purely on the facts of their respective cases. In the present case, the CLB has arrived at a conclusion that the notices appear to have been served on the Appellants, and even in respect of the Board Meetings, it cannot be disputed that there are UPC proofs of the notices.43. As regards Needle Industries India Ltd. (supra) ; (1996) 87 Comp Cas 290 CLB Mrs. Farhat Sheikh v. Esemen Metalo Chemicals Pvt. Ltd. ; (1995) 82 Comp Cas 563 (CLB) Rashmi Seth v. Chemon India Pvt. Ltd. ; (2009) 151 Comp Cas 71 (CLB) Ram Babu v. Target Constructions Pvt. Ltd. and Ors. ; and (2010) 158 Comp Cas 195 (CLB) Mrs. Gurpreet Gill v. Pumpkin Studio P. Ltd.Ors., the same pertain to issue of shares. As set out earlier, the impending Rights Issue was to the knowledge of the Appellants; even otherwise, at no point had they sought to exercise their purported right of preemption as is now sought to be contended in the Appellants Written Submissions. The Appellants in fact had accepted repayment of their loan by March 2007 and were clearly not interested in the functioning of the company. Pertinently, even after having full knowledge, as per their own case, in November 2007, the Appellants did not take steps to challenge the Rights Issue or to seek allotment of shares to them in the ensuing several years. In any event, the judgments relied upon take the position that if the Rights Issue is not bona fide but is only for the purpose of enabling a party to obtain a majority, then such action will constitute oppression; this is not so in the present case. The CLB has concluded that funds were required for which the Rights Issue was carried out, and therefore it cannot be said that the same was not bona fide.44. As regards (2008) 141 Comp Cas 270 (CLB) Sanjay Paliwal and Anr. v. Paliwal Hotels Pvt. Ltd., ; (2008) 141 Comp Cas 482 (CLB) Rajesh Patil v. Moonshine Films Pvt. Ltd. ; (2008) 142 Comp Cas 320 (CLB) M.L. Arora v. Green Valley Frozen Food Ltd.Ors. ; and (2004) 119 Comp Cas 974 (CLB) A. Kalyani v. Vale Exports P. Ltd., the same pertain to the allegation of continuous oppression and mismanagement, to justify the delay in filing of the Company Petition. As set out above, the contention of continuous oppression and mismanagement culminating in the removal of the Appellants as Directors in 2011, was not the ground urged before the CLB to justify the delay. The ground urged was as to the pendency of proceedings before the ROC, and it is in that context that the CLB has rightly held that the explanation for the delay is unjustifiable. Even otherwise, the explanation given by the Appellants cannot be countenanced, as the events of which they complained, had to a material extent, culminated in 2007 itself, and there is no justification for the delay in approaching the CLB.
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Krishan Bhimrao Deshpande Vs. Land Tribunal Dharwad and Others | when an area is notified as an urban agglomeration under Section 2(n)(A)(ii), the Central Act would apply to land situate in such area and the Andhra Pradesh Act would cease to have application, but by that time the Andhra Pradesh Act would have already operated to determine the ceiling on holding of land falling within the definition of Section 3(j) and situate within such area. It is therefore not possible to uphold the contention of the landholders that the Andhra Pradesh Act is ultra vires and void as being outside the legislative competence of the Andhra Pradesh Legislature." The above observations throw a flood of light on the question involved before us. It can be seen that entire power to legislate in respect of several matters falling under wide scope of Entry 18 List II is not transferred. The power transferred is only in respect of imposition of ceiling on urban immovable property. There can be several topics in respect of the subject matters of regulatory legislations governing the lands or other immovable properties. The imposition of ceiling on owning property is one such topic and there can be laws regulating ceiling on owning the property, relationship of lessor and lessee, payment of rent, manner of granting the lease, conferment of ownership on the lessee ect. It is the concept of a welfare State which is the underlying object in such welfare legislations. When viewed rom that angle it is axiomatic that imposition of ceiling on urban land is a distinct and independent subject as compared to imposition of ceiling on owning or holding agricultural land or any other kind of property which do not attract the Urban Ceiling Act. Likewise it cannot be said that the pith and substance of the law governing the conferment of ownership of land on the tenant is a law regulating the imposition of ceiling on land holding. Equally it cannot be said that the pith and substance of the law imposing the ceiling on land holding covers the subject of conferring ownership of land on the tenant. These are two distinct powers and therefore the law-making competence can be in two different legislative bodies. Consequently it is difficult to hold that the provisions of Chapter III of the Karnataka Land Reforms Act are outside the legislative competence of the State Legislature. In Calcutta Gas Company (Proprietory) Ltd., v. State of West Bengal 1962 AIR(SC) 1044) this Court observed as under. "The entries in the three Lists are only legislative heads or fields of legislation: they demarcate the area over which the appropriate Legislatures can operate. It is also well settled that widest amplitude should be given to the language of the entries. But some of the entire in the different Lists or in the same Lists may overlap and sometimes may also appear to be in direct conflict with each other. It is then the duty of this Court to reconcile the entire and bring about harmony between them." * 8. It is well settled that the legislative power of the State has to be reconciled with that of the Parliament and that in their respective fields each is supreme. Even assuming that the State enactment has same effect on the subject-matter falling within the Parliaments legislative competence, that by itself will not render such law invalid or inoperative. In Kannan Devan Hills Produce Company Ltd. v. State of Kerala ( 1972 (2) SCC 218 : 1972 AIR(SC) 2301) this Court held as under: (SCC p. 229, para 28). "It seems to; us clear that the State has legislative competence to legislate on Entry 18, List II and Entry 42, List III. This power cannot be denied on the ground that it; has some effect on an industry controlled under Entry 52, List I. Effect is not the same thing as subject-matter. If a State Act, otherwise valid, has effect on a matter in List I it does not cease to be a legislation with respect to an entry in List II or List III" * However, in the instant case, we are clearly of the view that there is no conflict. The imposition of ceiling on urban immovable property is an independent topic and cannot be construed as to nullify the other subject left in the domain of the State Legislature under Entry 18; inasmuch as imposition of ceiling as a distinct and separately identifiable subject and does not cover the other measures such as regulation of landlord and tenant in respect of which the State Legislature has competence to legislate. Thus the one topic that is transferred in the resolution passed under Article 252 is distinct and separately identifiable and does not include the remaining topics under Entry 18 in respect of which the State alone has the power to legislate. An examination of the various provisions of the State Act makes this aspect clear. The object underlying the Act is to make a uniform law in the State of Karnataka relating to agrarian relations, conferment of ownership on tenants, ceiling on land holdings etc. Chapter II of the Act contains general provisions regarding tenancy, deemed tenancy, regulation of relationship between landlord and tenant etc. Sections 44 to 62 of Chapter III provide for vesting of tenanted lands in the State Government with effect from March 1, 1974 and conferment of occupancy rights on the tenants. Chapter V controls the eligibility to purchase or possess agricultural lands. Chapter VI to XI have many other provisions regarding agrarian reforms. We, however, find a a ceiling provision under Section 45(2) providing for computation of the area in respect of which the tenant may; be granted occupancy rights. But it is clear that ceiling on the area in this context is only for the purpose of Section 45. These are all topics regarding the conferment of occupancy rights on the respective tenants and they do not in any way conflict with the subject-matter transferred to the Parliament by the resolution passed under Section 252. | 0[ds]5. A plain reading of the above provisions in the background of the objects underlying these two enactments clearly shows that the two Acts operate in two different fields to a large extent8. It is well settled that the legislative power of the State has to be reconciled with that of the Parliament and that in their respective fields each is supreme. Even assuming that the State enactment has same effect on the subject-matter falling within the Parliaments legislative competence, that by itself will not render such law invalid or inoperativeHowever, in the instant case, we are clearly of the view that there is no conflict. The imposition of ceiling on urban immovable property is an independent topic and cannot be construed as to nullify the other subject left in the domain of the State Legislature under Entry 18; inasmuch as imposition of ceiling as a distinct and separately identifiable subject and does not cover the other measures such as regulation of landlord and tenant in respect of which the State Legislature has competence to legislate. Thus the one topic that is transferred in the resolution passed under Article 252 is distinct and separately identifiable and does not include the remaining topics under Entry 18 in respect of which the State alone has the power to legislate. An examination of the various provisions of the State Act makes this aspect clear. The object underlying the Act is to make a uniform law in the State of Karnataka relating to agrarian relations, conferment of ownership on tenants, ceiling on land holdings etc. Chapter II of the Act contains general provisions regarding tenancy, deemed tenancy, regulation of relationship between landlord and tenant etc. Sections 44 to 62 of Chapter III provide for vesting of tenanted lands in the State Government with effect from March 1, 1974 and conferment of occupancy rights on the tenants. Chapter V controls the eligibility to purchase or possess agricultural lands. Chapter VI to XI have many other provisions regarding agrarian reforms. We, however, find a a ceiling provision under Section 45(2) providing for computation of the area in respect of which the tenant may; be granted occupancy rights. But it is clear that ceiling on the area in this context is only for the purpose of Section 45. These are all topics regarding the conferment of occupancy rights on the respective tenants and they do not in any way conflict with the subject-matter transferred to the Parliament by the resolution passed under Section 252 | 0 | 6,479 | 451 | ### Instruction:
Conjecture the end result of the case (acceptance (1) or non-acceptance (0) of the appeal), followed by a detailed explanation using crucial sentences from the case proceeding.
### Input:
when an area is notified as an urban agglomeration under Section 2(n)(A)(ii), the Central Act would apply to land situate in such area and the Andhra Pradesh Act would cease to have application, but by that time the Andhra Pradesh Act would have already operated to determine the ceiling on holding of land falling within the definition of Section 3(j) and situate within such area. It is therefore not possible to uphold the contention of the landholders that the Andhra Pradesh Act is ultra vires and void as being outside the legislative competence of the Andhra Pradesh Legislature." The above observations throw a flood of light on the question involved before us. It can be seen that entire power to legislate in respect of several matters falling under wide scope of Entry 18 List II is not transferred. The power transferred is only in respect of imposition of ceiling on urban immovable property. There can be several topics in respect of the subject matters of regulatory legislations governing the lands or other immovable properties. The imposition of ceiling on owning property is one such topic and there can be laws regulating ceiling on owning the property, relationship of lessor and lessee, payment of rent, manner of granting the lease, conferment of ownership on the lessee ect. It is the concept of a welfare State which is the underlying object in such welfare legislations. When viewed rom that angle it is axiomatic that imposition of ceiling on urban land is a distinct and independent subject as compared to imposition of ceiling on owning or holding agricultural land or any other kind of property which do not attract the Urban Ceiling Act. Likewise it cannot be said that the pith and substance of the law governing the conferment of ownership of land on the tenant is a law regulating the imposition of ceiling on land holding. Equally it cannot be said that the pith and substance of the law imposing the ceiling on land holding covers the subject of conferring ownership of land on the tenant. These are two distinct powers and therefore the law-making competence can be in two different legislative bodies. Consequently it is difficult to hold that the provisions of Chapter III of the Karnataka Land Reforms Act are outside the legislative competence of the State Legislature. In Calcutta Gas Company (Proprietory) Ltd., v. State of West Bengal 1962 AIR(SC) 1044) this Court observed as under. "The entries in the three Lists are only legislative heads or fields of legislation: they demarcate the area over which the appropriate Legislatures can operate. It is also well settled that widest amplitude should be given to the language of the entries. But some of the entire in the different Lists or in the same Lists may overlap and sometimes may also appear to be in direct conflict with each other. It is then the duty of this Court to reconcile the entire and bring about harmony between them." * 8. It is well settled that the legislative power of the State has to be reconciled with that of the Parliament and that in their respective fields each is supreme. Even assuming that the State enactment has same effect on the subject-matter falling within the Parliaments legislative competence, that by itself will not render such law invalid or inoperative. In Kannan Devan Hills Produce Company Ltd. v. State of Kerala ( 1972 (2) SCC 218 : 1972 AIR(SC) 2301) this Court held as under: (SCC p. 229, para 28). "It seems to; us clear that the State has legislative competence to legislate on Entry 18, List II and Entry 42, List III. This power cannot be denied on the ground that it; has some effect on an industry controlled under Entry 52, List I. Effect is not the same thing as subject-matter. If a State Act, otherwise valid, has effect on a matter in List I it does not cease to be a legislation with respect to an entry in List II or List III" * However, in the instant case, we are clearly of the view that there is no conflict. The imposition of ceiling on urban immovable property is an independent topic and cannot be construed as to nullify the other subject left in the domain of the State Legislature under Entry 18; inasmuch as imposition of ceiling as a distinct and separately identifiable subject and does not cover the other measures such as regulation of landlord and tenant in respect of which the State Legislature has competence to legislate. Thus the one topic that is transferred in the resolution passed under Article 252 is distinct and separately identifiable and does not include the remaining topics under Entry 18 in respect of which the State alone has the power to legislate. An examination of the various provisions of the State Act makes this aspect clear. The object underlying the Act is to make a uniform law in the State of Karnataka relating to agrarian relations, conferment of ownership on tenants, ceiling on land holdings etc. Chapter II of the Act contains general provisions regarding tenancy, deemed tenancy, regulation of relationship between landlord and tenant etc. Sections 44 to 62 of Chapter III provide for vesting of tenanted lands in the State Government with effect from March 1, 1974 and conferment of occupancy rights on the tenants. Chapter V controls the eligibility to purchase or possess agricultural lands. Chapter VI to XI have many other provisions regarding agrarian reforms. We, however, find a a ceiling provision under Section 45(2) providing for computation of the area in respect of which the tenant may; be granted occupancy rights. But it is clear that ceiling on the area in this context is only for the purpose of Section 45. These are all topics regarding the conferment of occupancy rights on the respective tenants and they do not in any way conflict with the subject-matter transferred to the Parliament by the resolution passed under Section 252.
### Response:
0
### Explanation:
5. A plain reading of the above provisions in the background of the objects underlying these two enactments clearly shows that the two Acts operate in two different fields to a large extent8. It is well settled that the legislative power of the State has to be reconciled with that of the Parliament and that in their respective fields each is supreme. Even assuming that the State enactment has same effect on the subject-matter falling within the Parliaments legislative competence, that by itself will not render such law invalid or inoperativeHowever, in the instant case, we are clearly of the view that there is no conflict. The imposition of ceiling on urban immovable property is an independent topic and cannot be construed as to nullify the other subject left in the domain of the State Legislature under Entry 18; inasmuch as imposition of ceiling as a distinct and separately identifiable subject and does not cover the other measures such as regulation of landlord and tenant in respect of which the State Legislature has competence to legislate. Thus the one topic that is transferred in the resolution passed under Article 252 is distinct and separately identifiable and does not include the remaining topics under Entry 18 in respect of which the State alone has the power to legislate. An examination of the various provisions of the State Act makes this aspect clear. The object underlying the Act is to make a uniform law in the State of Karnataka relating to agrarian relations, conferment of ownership on tenants, ceiling on land holdings etc. Chapter II of the Act contains general provisions regarding tenancy, deemed tenancy, regulation of relationship between landlord and tenant etc. Sections 44 to 62 of Chapter III provide for vesting of tenanted lands in the State Government with effect from March 1, 1974 and conferment of occupancy rights on the tenants. Chapter V controls the eligibility to purchase or possess agricultural lands. Chapter VI to XI have many other provisions regarding agrarian reforms. We, however, find a a ceiling provision under Section 45(2) providing for computation of the area in respect of which the tenant may; be granted occupancy rights. But it is clear that ceiling on the area in this context is only for the purpose of Section 45. These are all topics regarding the conferment of occupancy rights on the respective tenants and they do not in any way conflict with the subject-matter transferred to the Parliament by the resolution passed under Section 252
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Kanhsingh Vs. Tukaram | V. Gopala Gowda, J. 1. Leave granted. 2. This appeal has been filed by the appellants against the impugned Judgment and order dated 23.07.2012 passed by the High Court of Madhya Pradesh Bench at Indore wherein the High Court partly allowed and disposed of the Miscellaneous Appeal No.2918 of 2009 filed by the appellants. 3. The necessary relevant facts are stated hereunder to appreciate the case with a view to determine whether the appellants are entitled for relief as prayed in this appeal. 4. On 02.07.2006, Deependra Singh Chouhan, son of the appellants herein, aged 27 years, was driving the motor cycle No. MP-09-LM-8244 along with his friend Ashok Sharma. The aforesaid motor cycle which was being ridden by Deependra met with an accident when it was hit by tanker No. MP-14-B-6645 driven by Tukaram, respondent No. 1 herein. Deependra Singh succumbed to his injuries during the course of treatment. 5. The claimant-appellants, parents of the deceased filed a claim petition before the Motor Accidents Claims Tribunal, Jawra, District Ratlam (M.P.) (in short the Tribunal) under Section 166 of the M.V. Act, 1988, for a compensation of Rs.27,85,000/-. The Tribunal by its judgment and award partly allowed the Claim Petition by awarding a total sum of Rs.12,10,014/-. 6. Being aggrieved by the judgment and award passed by the Tribunal, the appellants filed Miscellaneous Appeal No. 2918 of 2009 before the High Court of Madhya Pradesh at Indore. The High Court by its judgment and award dated 23.07.2012 partly allowed the said appeal and disposed of the same with an enhancement of Rs.2,00,000/-. Hence, this appeal. 7. It has been contended by the learned counsel for the appellants that the courts below failed to notice that the deceased was 27 years of age and was posted as the Manager at HDFC Bank at the time of the accident. He would have served for another 35 years if he would have been alive and during that period his salary would have certainly doubled. The learned counsel placed reliance on the decision of this Court in Vimal Kanwar & Ors. v. Kishore Dan & Ors. [(2013) 7 SCC 476] , wherein it was held thus:- "31. In New India Assurance Co. Ltd. (2012) 12 SCC 198 this Court noticed that the High Court determined the compensation by granting 100% increase in the income of the deceased. Taking into consideration the fact that in the normal course, the deceased would have served for 22 years and during that period his salary would have certainly doubled, upheld the judgment of the High Court...." 8. It is further contended that the courts below have erred in the computation of income of the deceased as Rs. 11,146/- p.m. In the case of Raghuvir Singh Matolya & Ors. v. Hari Singh Malviya & Ors. [(2009) 15 SCC 363] and in Sarla Verma and Others v. Delhi Transport Corporation & Another [(2009) 6 SCC 121] , this Court observed that the deductions made by the Tribunal on account of HRA, CCA and medical allowance are done on incorrect basis and should have been taken into consideration the calculation of the income of the deceased. Therefore, the monthly income of the deceased should have been taken as Rs.15,155/- p.m. 9. On the other hand, the learned Counsel for the respondents contended that the High Court concurred with the findings of the Tribunal on all material issues of fact but observed that the quantum of compensation in respect of loss due to death deserved to be enhanced by Rs.2,00,000/-. Therefore, the High Court has already enhanced the compensation sufficiently, which does not call for interference of this Court with the impugned judgment. 10. We have heard the learned counsel for the parties. In our considered view, the courts below have erred in taking the monthly income of the deceased at Rs.11,146/- p.m. From the facts, circumstances and evidence on record, it is clear that the deceased was 27 years of age, working with HDFC as the Manager earning Rs.1,81,860/- per annum (i.e. Rs.15,155/- p.m.) and there were definite chances of his further promotion and consequent increase in salary by way of periodical revision of the salary on the basis of cost of living Index prevalent in the area if he would alive and worked in the bank. Therefore, adding 50% under the head of future prospects to the annual income of the deceased according to the principle laid down in the case of Vimal Kanwar & Ors. (supra), the total loss of income comes to Rs.2,72,790/- per annum [Rs. 1,81,860 + (1/2 * Rs.1,81,860)].Deducting 10% tax (Rs.27,279/-), net annual income comes to Rs.2,45,511/-.Deducting 1/3rd [Rs.81,837] towards personal expenses since the claimants are the parents of the deceased, loss of dependency comes to 1,63,674 X 11(appropriate multiplier as per the age of the parent) Rs. 18,00,414/-. 11. The Tribunal and the High Court have further erred in law in awarding only Rs.2,000/- towards funeral expenses instead of Rs.25,000/- according to the principles laid down by this Court in Rajesh & Ors. v. Rajbir Singh & Ors. [(2013) 9 SCC 54] . Hence, we award Rs.25,000/- towards the same. 12. Further, the Tribunal and the High Court have erred in not following the principles laid down by this Court in M. Mansoor & Anr v. United India Insurance Co. Ltd. [2013 (12) SCALE 324] in awarding a meagre sum of just Rs.30,000/- under the heads of loss of love and affection. Accordingly, we award Rs.1,00,000/- to the appellants towards the same. 13. Further, we award Rs.5,00,190/- towards medical expenses incurred towards medical treatment. In the result, the appellants shall be entitled to compensation under the following heads: "TABLE" 14. | 1[ds]p.m. From the facts, circumstances and evidence on record, it is clear that the deceased was 27 years of age, working with HDFC as the Manager earning Rs.1,81,860/per annum (i.e. Rs.15,155/p.m.) and there were definite chances of his further promotion and consequent increase in salary by way of periodical revision of the salary on the basis of cost of living Index prevalent in the area if he would alive and worked in the bank. Therefore, adding 50% under the head of future prospects to the annual income of the deceased according to the principle laid down in the case of Vimal Kanwar & Ors. (supra), the total loss of income comes to Rs.2,72,790/per annum [Rs. 1,81,860 + (1/2 * Rs.1,81,860)]Deducting 10% tax, net annual income comes to Rs.2,45,511/Deducting 1/3rd [Rs.81,837] towards personal expenses since the claimants are the parents of the deceased, loss of dependency comes to 1,63,674 X 11(appropriate multiplier as per the age of the parent) Rs. 18,00,414/The Tribunal and the High Court have further erred in law in awarding only Rs.2,000/towards funeral expenses instead of Rs.25,000/according to the principles laid down by this Court in Rajesh & Ors. v. Rajbir Singh & Ors. [(2013) 9 SCC 54] . Hence, we award Rs.25,000/towards the sameFurther, the Tribunal and the High Court have erred in not following the principles laid down by this Court in M. Mansoor & Anr v. United India Insurance Co. Ltd. [2013 (12) SCALE 324] in awarding a meagre sum of just Rs.30,000/under the heads of loss of love and affectionThe Courts below have erred in not granting the interest on compensation at the rate of 9% p.a. as per the principles laid down in the case of Municipal Corporation of Delhi v. Association of Victims of Uphaar Tragedy [(2011)14 SCC 481] . The total compensation payable to the appellants by thee Company will be Rs. 24,25,604/with interest at the rate of 9% p.a. from the date of filing of the application till the date of payment to the appellants. | 1 | 1,090 | 391 | ### Instruction:
Decide if the appeal in the case proceeding is more likely to be successful (1) or unsuccessful (0), and then justify your decision by focusing on essential sentences in the document.
### Input:
V. Gopala Gowda, J. 1. Leave granted. 2. This appeal has been filed by the appellants against the impugned Judgment and order dated 23.07.2012 passed by the High Court of Madhya Pradesh Bench at Indore wherein the High Court partly allowed and disposed of the Miscellaneous Appeal No.2918 of 2009 filed by the appellants. 3. The necessary relevant facts are stated hereunder to appreciate the case with a view to determine whether the appellants are entitled for relief as prayed in this appeal. 4. On 02.07.2006, Deependra Singh Chouhan, son of the appellants herein, aged 27 years, was driving the motor cycle No. MP-09-LM-8244 along with his friend Ashok Sharma. The aforesaid motor cycle which was being ridden by Deependra met with an accident when it was hit by tanker No. MP-14-B-6645 driven by Tukaram, respondent No. 1 herein. Deependra Singh succumbed to his injuries during the course of treatment. 5. The claimant-appellants, parents of the deceased filed a claim petition before the Motor Accidents Claims Tribunal, Jawra, District Ratlam (M.P.) (in short the Tribunal) under Section 166 of the M.V. Act, 1988, for a compensation of Rs.27,85,000/-. The Tribunal by its judgment and award partly allowed the Claim Petition by awarding a total sum of Rs.12,10,014/-. 6. Being aggrieved by the judgment and award passed by the Tribunal, the appellants filed Miscellaneous Appeal No. 2918 of 2009 before the High Court of Madhya Pradesh at Indore. The High Court by its judgment and award dated 23.07.2012 partly allowed the said appeal and disposed of the same with an enhancement of Rs.2,00,000/-. Hence, this appeal. 7. It has been contended by the learned counsel for the appellants that the courts below failed to notice that the deceased was 27 years of age and was posted as the Manager at HDFC Bank at the time of the accident. He would have served for another 35 years if he would have been alive and during that period his salary would have certainly doubled. The learned counsel placed reliance on the decision of this Court in Vimal Kanwar & Ors. v. Kishore Dan & Ors. [(2013) 7 SCC 476] , wherein it was held thus:- "31. In New India Assurance Co. Ltd. (2012) 12 SCC 198 this Court noticed that the High Court determined the compensation by granting 100% increase in the income of the deceased. Taking into consideration the fact that in the normal course, the deceased would have served for 22 years and during that period his salary would have certainly doubled, upheld the judgment of the High Court...." 8. It is further contended that the courts below have erred in the computation of income of the deceased as Rs. 11,146/- p.m. In the case of Raghuvir Singh Matolya & Ors. v. Hari Singh Malviya & Ors. [(2009) 15 SCC 363] and in Sarla Verma and Others v. Delhi Transport Corporation & Another [(2009) 6 SCC 121] , this Court observed that the deductions made by the Tribunal on account of HRA, CCA and medical allowance are done on incorrect basis and should have been taken into consideration the calculation of the income of the deceased. Therefore, the monthly income of the deceased should have been taken as Rs.15,155/- p.m. 9. On the other hand, the learned Counsel for the respondents contended that the High Court concurred with the findings of the Tribunal on all material issues of fact but observed that the quantum of compensation in respect of loss due to death deserved to be enhanced by Rs.2,00,000/-. Therefore, the High Court has already enhanced the compensation sufficiently, which does not call for interference of this Court with the impugned judgment. 10. We have heard the learned counsel for the parties. In our considered view, the courts below have erred in taking the monthly income of the deceased at Rs.11,146/- p.m. From the facts, circumstances and evidence on record, it is clear that the deceased was 27 years of age, working with HDFC as the Manager earning Rs.1,81,860/- per annum (i.e. Rs.15,155/- p.m.) and there were definite chances of his further promotion and consequent increase in salary by way of periodical revision of the salary on the basis of cost of living Index prevalent in the area if he would alive and worked in the bank. Therefore, adding 50% under the head of future prospects to the annual income of the deceased according to the principle laid down in the case of Vimal Kanwar & Ors. (supra), the total loss of income comes to Rs.2,72,790/- per annum [Rs. 1,81,860 + (1/2 * Rs.1,81,860)].Deducting 10% tax (Rs.27,279/-), net annual income comes to Rs.2,45,511/-.Deducting 1/3rd [Rs.81,837] towards personal expenses since the claimants are the parents of the deceased, loss of dependency comes to 1,63,674 X 11(appropriate multiplier as per the age of the parent) Rs. 18,00,414/-. 11. The Tribunal and the High Court have further erred in law in awarding only Rs.2,000/- towards funeral expenses instead of Rs.25,000/- according to the principles laid down by this Court in Rajesh & Ors. v. Rajbir Singh & Ors. [(2013) 9 SCC 54] . Hence, we award Rs.25,000/- towards the same. 12. Further, the Tribunal and the High Court have erred in not following the principles laid down by this Court in M. Mansoor & Anr v. United India Insurance Co. Ltd. [2013 (12) SCALE 324] in awarding a meagre sum of just Rs.30,000/- under the heads of loss of love and affection. Accordingly, we award Rs.1,00,000/- to the appellants towards the same. 13. Further, we award Rs.5,00,190/- towards medical expenses incurred towards medical treatment. In the result, the appellants shall be entitled to compensation under the following heads: "TABLE" 14.
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1
### Explanation:
p.m. From the facts, circumstances and evidence on record, it is clear that the deceased was 27 years of age, working with HDFC as the Manager earning Rs.1,81,860/per annum (i.e. Rs.15,155/p.m.) and there were definite chances of his further promotion and consequent increase in salary by way of periodical revision of the salary on the basis of cost of living Index prevalent in the area if he would alive and worked in the bank. Therefore, adding 50% under the head of future prospects to the annual income of the deceased according to the principle laid down in the case of Vimal Kanwar & Ors. (supra), the total loss of income comes to Rs.2,72,790/per annum [Rs. 1,81,860 + (1/2 * Rs.1,81,860)]Deducting 10% tax, net annual income comes to Rs.2,45,511/Deducting 1/3rd [Rs.81,837] towards personal expenses since the claimants are the parents of the deceased, loss of dependency comes to 1,63,674 X 11(appropriate multiplier as per the age of the parent) Rs. 18,00,414/The Tribunal and the High Court have further erred in law in awarding only Rs.2,000/towards funeral expenses instead of Rs.25,000/according to the principles laid down by this Court in Rajesh & Ors. v. Rajbir Singh & Ors. [(2013) 9 SCC 54] . Hence, we award Rs.25,000/towards the sameFurther, the Tribunal and the High Court have erred in not following the principles laid down by this Court in M. Mansoor & Anr v. United India Insurance Co. Ltd. [2013 (12) SCALE 324] in awarding a meagre sum of just Rs.30,000/under the heads of loss of love and affectionThe Courts below have erred in not granting the interest on compensation at the rate of 9% p.a. as per the principles laid down in the case of Municipal Corporation of Delhi v. Association of Victims of Uphaar Tragedy [(2011)14 SCC 481] . The total compensation payable to the appellants by thee Company will be Rs. 24,25,604/with interest at the rate of 9% p.a. from the date of filing of the application till the date of payment to the appellants.
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B.E. Simoes Von Staraburg Niedenthal & Another Vs. M/s. Chhattisgarh Investment Ltd | Judge, Raipur, the District Judge, Raipur must be allowed to decide the question of its own jurisdiction. In support of his arguments, learned counsel for CIL relies upon decisions of this Court in Michael Golodetz and others v. Serajuddin and Co., AIR 1963 SC 1044 and Bhatia Co-operative Housing Society Ltd. v. D.C. Patel, (1953) SCR 185. 8. On the other hand, Mr. Rafiq A. Dada, learned senior counsel for SIMOES, submits that the parties have agreed that Goa courts shall have exclusive jurisdiction and, thus, by their agreement the jurisdiction of the Raipur court has been ousted. He submits that in view of the jurisdiction clause in the agreement, now the Raipur court has no jurisdiction at all. In support of his arguments, learned senior counsel for the appellants, relies upon two judgments of this Court - (one), Swastik Gases Private Limited v. Indian Oil Corporation Limited, (2013) 9 SCC 32 and (two), State of West Bengal & Ors. v. Associated Contractors, (Civil Appeal No. 6691 of 2005) and other connected matter (Civil Appeal No. 4808 of 2013) decided on 10.09.2014. 9. In Swastik Gases Private Limited, the 3-Judge Bench of this Court had an occasion to consider the issue as to whether in a contract that specifies the jurisdiction of particular courts at a particular place and such courts have jurisdiction to deal with the matter, whether the parties had intended to exclude the other courts? In Swastik Gases Private Limited, (2013) 9 SCC 32 , in the lead judgment, one of us (R.M. Lodha, J., as he then was) referred to the earlier decisions of this Court in Hakam Singh v. M/s Gammon (India) Ltd., (1971) 1 SCC 286 ; Globe Transport Corporation v. Triveni Engineering Works and Another, (1983) 4 SCC 707; Angile Insulations v. Davy Ashmore India Ltd. and Another, (1995) 4 SCC 153 ; New Moga Transport Co., through its Proprietor Krishanlal Jhanwar v. United India Insurance Co. Ltd. and others, (2004) 4 SCC 677 ; Shree Subhlaxmi Fabrics (P) Ltd. v. Chand Mal Baradia and Others, (2005) 10 SCC 704 ; Rajasthan State Electricity Board v. Universal Petrol Chemicals Limited, (2009) 3 SCC 107 ; Balaji Coke Industry Private Limited v. Maa Bhagwati Coke Gujarat Private Limited, (2009) 9 SCC 403 ; A.V.M. Sales Corporation v. Anuradha Chemicals Private Limited, (2012) 2 SCC 315 , and culled out the legal position in para 32 of the report as under:- "32. ... It is a fact that whilst providing for jurisdiction clause in the agreement the words like "alone", "only", "exclusive" or "exclusive jurisdiction" have not been used but this, in our view, is not decisive and does not make any material difference. The intention of the parties - by having Clause 18 in the agreement - is clear and unambiguous that the courts at Kolkata shall have jurisdiction which means that the courts at Kolkata alone shall have jurisdiction. It is so because for construction of jurisdiction clause, like Clause 18 in the agreement, the maxim expressio unius est exclusio alterius comes into play as there is nothing to indicate to the contrary. This legal maxim means that expression of one is the exclusion of another. By making a provision that the agreement is subject to the jurisdiction of the courts at Kolkata, the parties have impliedly excluded the jurisdiction of other courts. Where the contract specifies the jurisdiction of the courts at a particular place and such courts have jurisdiction to deal with the matter, we think that an inference may be drawn that parties intended to exclude all other courts. A clause like this is not hit by Section 23 of the Contract Act at all. Such clause is neither forbidden by law nor it is against the public policy. It does not offend Section 28 of the Contract Act in any manner." Madan B. Lokur, J., while writing separate judgment, concurred with the above legal position. 10. In a very recent judgment delivered on 10.09.2014 in Civil Appeal No. 6691 of 2005, State of West Bengal & Ors. v. Associated Contractors, the 3-Judge Bench (speaking through one of us, Rohinton Fali Nariman, J.), noticing the decisions of this Court in FCI represented by Managing Director & Anr. v. A.M. Ahmed & Co. through MD & Anr., (2001) 10 SCC 532 ( para 6); Neycer India Ltd. v. GNB Ceramics Ltd., (2002) 9 SCC 489 ( para 3) with reference to Section 31(4) of the Arbitration Act, 1940 and the decisions of this Court in Jatinder Nath v. Chopra Land Developers Pvt. Ltd., (2007) 11 SCC 453 ( para 9); Rajasthan State Electrical Board v. Universal Petrol Chemical Limited, (2009) 3 SCC 107 (paras 33 to 36) and Swastik Gases (P) Ltd. v. Indian Oil Corporation, 2013 (9) SCC 32 ( para 32), held that where the agreement between the parties restricted jurisdiction to only one particular court, that court alone would have jurisdiction as neither Section 31(4) nor Section 42 (of the 1996 Act) contains a non-obstante clause wiping out a contrary agreement between the parties. On the basis of the above decisions, it was further held that applications preferred to courts outside the exclusive court agreed to by parties would also be without jurisdiction. 11. In light of the legal position exposited in Swastik Gases Private Limited and Associated Contractors (supra) and having regard to Clause 13 of the agreement, as noted above, the jurisdiction of the District Judge, Raipur is ousted and, therefore, he cannot be said to have any jurisdiction in dealing with the matter. The only competent court of jurisdiction is the court at Goa.12. In what we have discussed above, we do not think that it is necessary to send the matter back to the District Judge, Raipur for determination of the jurisdiction as contended by the learned counsel for the respondent. In our view, relegating the parties to the District Judge, Raipur to determine the question of jurisdiction will be unnecessary and futile exercise. | 1[ds]11. In light of the legal position exposited in Swastik Gases Private Limited and Associated Contractors (supra) and having regard to Clause 13 of the agreement, as noted above, the jurisdiction of the District Judge, Raipur is ousted and, therefore, he cannot be said to have any jurisdiction in dealing with the matter. The only competent court of jurisdiction is the court at Goa.12. In what we have discussed above, we do not think that it is necessary to send the matter back to the District Judge, Raipur for determination of the jurisdiction as contended by the learned counsel for the respondent. In our view, relegating the parties to the District Judge, Raipur to determine the question of jurisdiction will be unnecessary and futile exercise. | 1 | 1,730 | 146 | ### Instruction:
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Judge, Raipur, the District Judge, Raipur must be allowed to decide the question of its own jurisdiction. In support of his arguments, learned counsel for CIL relies upon decisions of this Court in Michael Golodetz and others v. Serajuddin and Co., AIR 1963 SC 1044 and Bhatia Co-operative Housing Society Ltd. v. D.C. Patel, (1953) SCR 185. 8. On the other hand, Mr. Rafiq A. Dada, learned senior counsel for SIMOES, submits that the parties have agreed that Goa courts shall have exclusive jurisdiction and, thus, by their agreement the jurisdiction of the Raipur court has been ousted. He submits that in view of the jurisdiction clause in the agreement, now the Raipur court has no jurisdiction at all. In support of his arguments, learned senior counsel for the appellants, relies upon two judgments of this Court - (one), Swastik Gases Private Limited v. Indian Oil Corporation Limited, (2013) 9 SCC 32 and (two), State of West Bengal & Ors. v. Associated Contractors, (Civil Appeal No. 6691 of 2005) and other connected matter (Civil Appeal No. 4808 of 2013) decided on 10.09.2014. 9. In Swastik Gases Private Limited, the 3-Judge Bench of this Court had an occasion to consider the issue as to whether in a contract that specifies the jurisdiction of particular courts at a particular place and such courts have jurisdiction to deal with the matter, whether the parties had intended to exclude the other courts? In Swastik Gases Private Limited, (2013) 9 SCC 32 , in the lead judgment, one of us (R.M. Lodha, J., as he then was) referred to the earlier decisions of this Court in Hakam Singh v. M/s Gammon (India) Ltd., (1971) 1 SCC 286 ; Globe Transport Corporation v. Triveni Engineering Works and Another, (1983) 4 SCC 707; Angile Insulations v. Davy Ashmore India Ltd. and Another, (1995) 4 SCC 153 ; New Moga Transport Co., through its Proprietor Krishanlal Jhanwar v. United India Insurance Co. Ltd. and others, (2004) 4 SCC 677 ; Shree Subhlaxmi Fabrics (P) Ltd. v. Chand Mal Baradia and Others, (2005) 10 SCC 704 ; Rajasthan State Electricity Board v. Universal Petrol Chemicals Limited, (2009) 3 SCC 107 ; Balaji Coke Industry Private Limited v. Maa Bhagwati Coke Gujarat Private Limited, (2009) 9 SCC 403 ; A.V.M. Sales Corporation v. Anuradha Chemicals Private Limited, (2012) 2 SCC 315 , and culled out the legal position in para 32 of the report as under:- "32. ... It is a fact that whilst providing for jurisdiction clause in the agreement the words like "alone", "only", "exclusive" or "exclusive jurisdiction" have not been used but this, in our view, is not decisive and does not make any material difference. The intention of the parties - by having Clause 18 in the agreement - is clear and unambiguous that the courts at Kolkata shall have jurisdiction which means that the courts at Kolkata alone shall have jurisdiction. It is so because for construction of jurisdiction clause, like Clause 18 in the agreement, the maxim expressio unius est exclusio alterius comes into play as there is nothing to indicate to the contrary. This legal maxim means that expression of one is the exclusion of another. By making a provision that the agreement is subject to the jurisdiction of the courts at Kolkata, the parties have impliedly excluded the jurisdiction of other courts. Where the contract specifies the jurisdiction of the courts at a particular place and such courts have jurisdiction to deal with the matter, we think that an inference may be drawn that parties intended to exclude all other courts. A clause like this is not hit by Section 23 of the Contract Act at all. Such clause is neither forbidden by law nor it is against the public policy. It does not offend Section 28 of the Contract Act in any manner." Madan B. Lokur, J., while writing separate judgment, concurred with the above legal position. 10. In a very recent judgment delivered on 10.09.2014 in Civil Appeal No. 6691 of 2005, State of West Bengal & Ors. v. Associated Contractors, the 3-Judge Bench (speaking through one of us, Rohinton Fali Nariman, J.), noticing the decisions of this Court in FCI represented by Managing Director & Anr. v. A.M. Ahmed & Co. through MD & Anr., (2001) 10 SCC 532 ( para 6); Neycer India Ltd. v. GNB Ceramics Ltd., (2002) 9 SCC 489 ( para 3) with reference to Section 31(4) of the Arbitration Act, 1940 and the decisions of this Court in Jatinder Nath v. Chopra Land Developers Pvt. Ltd., (2007) 11 SCC 453 ( para 9); Rajasthan State Electrical Board v. Universal Petrol Chemical Limited, (2009) 3 SCC 107 (paras 33 to 36) and Swastik Gases (P) Ltd. v. Indian Oil Corporation, 2013 (9) SCC 32 ( para 32), held that where the agreement between the parties restricted jurisdiction to only one particular court, that court alone would have jurisdiction as neither Section 31(4) nor Section 42 (of the 1996 Act) contains a non-obstante clause wiping out a contrary agreement between the parties. On the basis of the above decisions, it was further held that applications preferred to courts outside the exclusive court agreed to by parties would also be without jurisdiction. 11. In light of the legal position exposited in Swastik Gases Private Limited and Associated Contractors (supra) and having regard to Clause 13 of the agreement, as noted above, the jurisdiction of the District Judge, Raipur is ousted and, therefore, he cannot be said to have any jurisdiction in dealing with the matter. The only competent court of jurisdiction is the court at Goa.12. In what we have discussed above, we do not think that it is necessary to send the matter back to the District Judge, Raipur for determination of the jurisdiction as contended by the learned counsel for the respondent. In our view, relegating the parties to the District Judge, Raipur to determine the question of jurisdiction will be unnecessary and futile exercise.
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1
### Explanation:
11. In light of the legal position exposited in Swastik Gases Private Limited and Associated Contractors (supra) and having regard to Clause 13 of the agreement, as noted above, the jurisdiction of the District Judge, Raipur is ousted and, therefore, he cannot be said to have any jurisdiction in dealing with the matter. The only competent court of jurisdiction is the court at Goa.12. In what we have discussed above, we do not think that it is necessary to send the matter back to the District Judge, Raipur for determination of the jurisdiction as contended by the learned counsel for the respondent. In our view, relegating the parties to the District Judge, Raipur to determine the question of jurisdiction will be unnecessary and futile exercise.
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Bharat Barrel And Drum Mfg. Co.Private Ltd Vs. Govind Gopal Waghmare And Another | but it opposed the grant of the increased scale retrospectively and also wanted that the increased wages should be linked to some guaranteed production. The reason for this was that the appellant felt that there had been deliberate slowing down of production by the workmen in the previous years. The tribunal was of opinion that there was some justification in the appellants contention that there had been considerable go-slow which had affected production. Taking that into account it ordered that retrospective effect should be given to its order which was passed on May 13, 1957 from June 1, 1956. As to the linking of the increased wages to a certain guaranteed production it found it difficult to lay down any norm itself; but it made it clear that the increase in wages was made by it on the basis that the workers would give a certain reasonable production and noted that the workers were agreeable to do that. It, however, recommended that immediately after the award had been given, an expert should be appointed by agreement, if possible, to go into this question. It also said that in case it was not possible to appoint an expert by agreement it would be open to the appellant to appoint one.3. The appellants contention before us is that the tribunal having found some justification in its contention that there had been considerable go-slow should not have given retrospective effect at all to the order relating to the increase in wages.This matter has been considered fully by the tribunal and it came to the conclusion that increase in wages should be granted from June 1, 1956. This could hardly be called retrospective considering that the reference was made in November 1955; in any case the tribunal rejected the claim of the workmen for retrospective operation for the period of over four years from march 1952 to May 1956 and a good deal of go-slow was practised during this period.In the circumstances we see no reason for interference with the order of the tribunal fixing the date as June 1, 1956, from which the increased wages should come into force.4. This brings us to the next question relating to bonus. The tribunal has awarded five months basic wages by way of bonus.The first contention in this connection is that the workmen had only claimed four months basic wages and the tribunal could not have awarded anything more than what the workmen claimed. This in our opinion in incorrect. The workmen had claimed four months wages including dearness allowance as bonus. Five months basic wages which the tribunal has allowed are admittedly less than the claim put forward (namely, four months wages including dearness allowance). In the circumstances the tribunal certainly had jurisdiction to award what it has awarded to the workmen.5. Next question is whether the tribunal was justified in awarding as much as five months basic wages on the basis of the Full Bench formula, which is generally applied to these matters. The gross profit found by the tribunal is not challenged, namely, Rs. 5.05 lacs. The tribunal has than allowed Rs. 1.36 lacs as depreciation, leaving a balance of Rs. 3.69 lacs. Deducting income-tax from this at seven annas in a rupee (i.e. Rs. 1.61 lacs), we are left with a balance of Rs. 2.08 lacs. Six per cent per annum interest on the paid-up capital along with four per cent interest on the working capital comes to Rs. 16,000, leaving an available surplus of Rs. 1.92 lacs. Out of this, the tribunal has allowed five months basic wages as bonus which according to its calculations comes to Rs. 91,000, leaving Rs. 1.01 lacs. There will be a rebate of Rs. 40,000 on this sum, leaving a total of Rs. 1.41 lacs with the appellant. On these figures, the bonus awarded by the tribunal cannot be interfered with.6. The appellant however, draws our attention to two circumstances in this connection. In the first place it urges that the tribunal has not taken into account anything for rehabilitation. But it may be mentioned that the appellant had proved no rehabilitation amount as such. What it had done was to appropriate Rs. 3.16 lacs towards depreciation, which of course was not the proper amount of notional normal depreciation, which is allowable under the formula. Our attention is drawn, however, to the figures filed by the workmen in Ex. U-4 in which Rs. 40,000 has been allowed towards rehabilitation. Even accepting this concession by the workmen and deducting it from the figures given by us above, the appellant would still be left with Rs. 1.01 lacs after paying five months basic wages as bonus. There is thus no reason to interfere with the award of bonus on this ground.7. Lastly it is urged that accordingly to the income-tax assessment which was actually made in this case sometime after the order of the tribunal, the appellant has been assessed to income-tax amounting to Rs. 2.35 lacs. The appellant claims that it should be allowed this entire amount and not the notional figure calculated by us, namely Rs. 1.61 lacs as income-tax.We are of opinion that for the purpose of the Full Bench formula, the income-tax payable has to be deducted on the figures worked out according to the formula and it is immaterial what the actual income-tax paid is - whether more or less.In this particular case, the income-tax appears to be more because certain items which were challenged by the workmen but were allowed as proper expense by the tribunal have apparently not been allowed as proper expense by the income-tax department.The industrial tribunal, however, is not concerned directly with what the income-tax authorities assess as actual income-tax in a particular year ; it is concerned with working out the Full Bench formula in accordance with its notional calculations and this is what has been done in this case. There is no ground therefore for interference with the award of bonus for this reason either. | 0[ds]2. So far as the increase in wages is concerned, the appellant agreed to the scale suggested by the tribunal but it opposed the grant of the increased scale retrospectively and also wanted that the increased wages should be linked to some guaranteed production. The reason for this was that the appellant felt that there had been deliberate slowing down of production by the workmen in the previous years. The tribunal was of opinion that there was some justification in the appellants contention that there had been considerable go-slow which had affected production. Taking that into account it ordered that retrospective effect should be given to its order which was passed on May 13, 1957 from June 1, 1956. As to the linking of the increased wages to a certain guaranteed production it found it difficult to lay down any norm itself; but it made it clear that the increase in wages was made by it on the basis that the workers would give a certain reasonable production and noted that the workers were agreeable to do that. It, however, recommended that immediately after the award had been given, an expert should be appointed by agreement, if possible, to go into this question. It also said that in case it was not possible to appoint an expert by agreement it would be open to the appellant to appoint one.This could hardly be called retrospective considering that the reference was made in November 1955; in any case the tribunal rejected the claim of the workmen for retrospective operation for the period of over four years from march 1952 to May 1956 and a good deal of go-slow was practised during this period.In the circumstances we see no reason for interference with the order of the tribunal fixing the date as June 1, 1956, from which the increased wages should come intotribunal has awarded five months basic wages by way of bonus.The first contention in this connection is that the workmen had only claimed four months basic wages and the tribunal could not have awarded anything more than what the workmen claimed. This in our opinion in incorrect. The workmen had claimed four months wages including dearness allowance as bonus. Five months basic wages which the tribunal has allowed are admittedly less than the claim put forward (namely, four months wages including dearness allowance). In the circumstances the tribunal certainly had jurisdiction to award what it has awarded to thegross profit found by the tribunal is not challenged, namely, Rs. 5.05 lacs. The tribunal has than allowed Rs. 1.36 lacs as depreciation, leaving a balance of Rs. 3.69 lacs. Deducting income-tax from this at seven annas in a rupee (i.e. Rs. 1.61 lacs), we are left with a balance of Rs. 2.08 lacs. Six per cent per annum interest on the paid-up capital along with four per cent interest on the working capital comes to Rs. 16,000, leaving an available surplus of Rs. 1.92 lacs. Out of this, the tribunal has allowed five months basic wages as bonus which according to its calculations comes to Rs. 91,000, leaving Rs. 1.01 lacs. There will be a rebate of Rs. 40,000 on this sum, leaving a total of Rs. 1.41 lacs with the appellant. On these figures, the bonus awarded by the tribunal cannot be interfered with.6. The appellant however, draws our attention to two circumstances in this connection. In the first place it urges that the tribunal has not taken into account anything for rehabilitation. But it may be mentioned that the appellant had proved no rehabilitation amount as such. What it had done was to appropriate Rs. 3.16 lacs towards depreciation, which of course was not the proper amount of notional normal depreciation, which is allowable under the formula. Our attention is drawn, however, to the figures filed by the workmen in Ex. U-4 in which Rs. 40,000 has been allowed towards rehabilitation. Even accepting this concession by the workmen and deducting it from the figures given by us above, the appellant would still be left with Rs. 1.01 lacs after paying five months basic wages as bonus. There is thus no reason to interfere with the award of bonus on this ground.7. Lastly it is urged that accordingly to the income-tax assessment which was actually made in this case sometime after the order of the tribunal, the appellant has been assessed to income-tax amounting to Rs. 2.35 lacs. The appellant claims that it should be allowed this entire amount and not the notional figure calculated by us, namely Rs. 1.61 lacs as income-tax.We are of opinion that for the purpose of the Full Bench formula, the income-tax payable has to be deducted on the figures worked out according to the formula and it is immaterial what the actual income-tax paid is - whether more or less.In this particular case, the income-tax appears to be more because certain items which were challenged by the workmen but were allowed as proper expense by the tribunal have apparently not been allowed as proper expense by the income-tax department.The industrial tribunal, however, is not concerned directly with what the income-tax authorities assess as actual income-tax in a particular year ; it is concerned with working out the Full Bench formula in accordance with its notional calculations and this is what has been done in this case. There is no ground therefore for interference with the award of bonus for this reason either. | 0 | 1,249 | 996 | ### Instruction:
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but it opposed the grant of the increased scale retrospectively and also wanted that the increased wages should be linked to some guaranteed production. The reason for this was that the appellant felt that there had been deliberate slowing down of production by the workmen in the previous years. The tribunal was of opinion that there was some justification in the appellants contention that there had been considerable go-slow which had affected production. Taking that into account it ordered that retrospective effect should be given to its order which was passed on May 13, 1957 from June 1, 1956. As to the linking of the increased wages to a certain guaranteed production it found it difficult to lay down any norm itself; but it made it clear that the increase in wages was made by it on the basis that the workers would give a certain reasonable production and noted that the workers were agreeable to do that. It, however, recommended that immediately after the award had been given, an expert should be appointed by agreement, if possible, to go into this question. It also said that in case it was not possible to appoint an expert by agreement it would be open to the appellant to appoint one.3. The appellants contention before us is that the tribunal having found some justification in its contention that there had been considerable go-slow should not have given retrospective effect at all to the order relating to the increase in wages.This matter has been considered fully by the tribunal and it came to the conclusion that increase in wages should be granted from June 1, 1956. This could hardly be called retrospective considering that the reference was made in November 1955; in any case the tribunal rejected the claim of the workmen for retrospective operation for the period of over four years from march 1952 to May 1956 and a good deal of go-slow was practised during this period.In the circumstances we see no reason for interference with the order of the tribunal fixing the date as June 1, 1956, from which the increased wages should come into force.4. This brings us to the next question relating to bonus. The tribunal has awarded five months basic wages by way of bonus.The first contention in this connection is that the workmen had only claimed four months basic wages and the tribunal could not have awarded anything more than what the workmen claimed. This in our opinion in incorrect. The workmen had claimed four months wages including dearness allowance as bonus. Five months basic wages which the tribunal has allowed are admittedly less than the claim put forward (namely, four months wages including dearness allowance). In the circumstances the tribunal certainly had jurisdiction to award what it has awarded to the workmen.5. Next question is whether the tribunal was justified in awarding as much as five months basic wages on the basis of the Full Bench formula, which is generally applied to these matters. The gross profit found by the tribunal is not challenged, namely, Rs. 5.05 lacs. The tribunal has than allowed Rs. 1.36 lacs as depreciation, leaving a balance of Rs. 3.69 lacs. Deducting income-tax from this at seven annas in a rupee (i.e. Rs. 1.61 lacs), we are left with a balance of Rs. 2.08 lacs. Six per cent per annum interest on the paid-up capital along with four per cent interest on the working capital comes to Rs. 16,000, leaving an available surplus of Rs. 1.92 lacs. Out of this, the tribunal has allowed five months basic wages as bonus which according to its calculations comes to Rs. 91,000, leaving Rs. 1.01 lacs. There will be a rebate of Rs. 40,000 on this sum, leaving a total of Rs. 1.41 lacs with the appellant. On these figures, the bonus awarded by the tribunal cannot be interfered with.6. The appellant however, draws our attention to two circumstances in this connection. In the first place it urges that the tribunal has not taken into account anything for rehabilitation. But it may be mentioned that the appellant had proved no rehabilitation amount as such. What it had done was to appropriate Rs. 3.16 lacs towards depreciation, which of course was not the proper amount of notional normal depreciation, which is allowable under the formula. Our attention is drawn, however, to the figures filed by the workmen in Ex. U-4 in which Rs. 40,000 has been allowed towards rehabilitation. Even accepting this concession by the workmen and deducting it from the figures given by us above, the appellant would still be left with Rs. 1.01 lacs after paying five months basic wages as bonus. There is thus no reason to interfere with the award of bonus on this ground.7. Lastly it is urged that accordingly to the income-tax assessment which was actually made in this case sometime after the order of the tribunal, the appellant has been assessed to income-tax amounting to Rs. 2.35 lacs. The appellant claims that it should be allowed this entire amount and not the notional figure calculated by us, namely Rs. 1.61 lacs as income-tax.We are of opinion that for the purpose of the Full Bench formula, the income-tax payable has to be deducted on the figures worked out according to the formula and it is immaterial what the actual income-tax paid is - whether more or less.In this particular case, the income-tax appears to be more because certain items which were challenged by the workmen but were allowed as proper expense by the tribunal have apparently not been allowed as proper expense by the income-tax department.The industrial tribunal, however, is not concerned directly with what the income-tax authorities assess as actual income-tax in a particular year ; it is concerned with working out the Full Bench formula in accordance with its notional calculations and this is what has been done in this case. There is no ground therefore for interference with the award of bonus for this reason either.
### Response:
0
### Explanation:
2. So far as the increase in wages is concerned, the appellant agreed to the scale suggested by the tribunal but it opposed the grant of the increased scale retrospectively and also wanted that the increased wages should be linked to some guaranteed production. The reason for this was that the appellant felt that there had been deliberate slowing down of production by the workmen in the previous years. The tribunal was of opinion that there was some justification in the appellants contention that there had been considerable go-slow which had affected production. Taking that into account it ordered that retrospective effect should be given to its order which was passed on May 13, 1957 from June 1, 1956. As to the linking of the increased wages to a certain guaranteed production it found it difficult to lay down any norm itself; but it made it clear that the increase in wages was made by it on the basis that the workers would give a certain reasonable production and noted that the workers were agreeable to do that. It, however, recommended that immediately after the award had been given, an expert should be appointed by agreement, if possible, to go into this question. It also said that in case it was not possible to appoint an expert by agreement it would be open to the appellant to appoint one.This could hardly be called retrospective considering that the reference was made in November 1955; in any case the tribunal rejected the claim of the workmen for retrospective operation for the period of over four years from march 1952 to May 1956 and a good deal of go-slow was practised during this period.In the circumstances we see no reason for interference with the order of the tribunal fixing the date as June 1, 1956, from which the increased wages should come intotribunal has awarded five months basic wages by way of bonus.The first contention in this connection is that the workmen had only claimed four months basic wages and the tribunal could not have awarded anything more than what the workmen claimed. This in our opinion in incorrect. The workmen had claimed four months wages including dearness allowance as bonus. Five months basic wages which the tribunal has allowed are admittedly less than the claim put forward (namely, four months wages including dearness allowance). In the circumstances the tribunal certainly had jurisdiction to award what it has awarded to thegross profit found by the tribunal is not challenged, namely, Rs. 5.05 lacs. The tribunal has than allowed Rs. 1.36 lacs as depreciation, leaving a balance of Rs. 3.69 lacs. Deducting income-tax from this at seven annas in a rupee (i.e. Rs. 1.61 lacs), we are left with a balance of Rs. 2.08 lacs. Six per cent per annum interest on the paid-up capital along with four per cent interest on the working capital comes to Rs. 16,000, leaving an available surplus of Rs. 1.92 lacs. Out of this, the tribunal has allowed five months basic wages as bonus which according to its calculations comes to Rs. 91,000, leaving Rs. 1.01 lacs. There will be a rebate of Rs. 40,000 on this sum, leaving a total of Rs. 1.41 lacs with the appellant. On these figures, the bonus awarded by the tribunal cannot be interfered with.6. The appellant however, draws our attention to two circumstances in this connection. In the first place it urges that the tribunal has not taken into account anything for rehabilitation. But it may be mentioned that the appellant had proved no rehabilitation amount as such. What it had done was to appropriate Rs. 3.16 lacs towards depreciation, which of course was not the proper amount of notional normal depreciation, which is allowable under the formula. Our attention is drawn, however, to the figures filed by the workmen in Ex. U-4 in which Rs. 40,000 has been allowed towards rehabilitation. Even accepting this concession by the workmen and deducting it from the figures given by us above, the appellant would still be left with Rs. 1.01 lacs after paying five months basic wages as bonus. There is thus no reason to interfere with the award of bonus on this ground.7. Lastly it is urged that accordingly to the income-tax assessment which was actually made in this case sometime after the order of the tribunal, the appellant has been assessed to income-tax amounting to Rs. 2.35 lacs. The appellant claims that it should be allowed this entire amount and not the notional figure calculated by us, namely Rs. 1.61 lacs as income-tax.We are of opinion that for the purpose of the Full Bench formula, the income-tax payable has to be deducted on the figures worked out according to the formula and it is immaterial what the actual income-tax paid is - whether more or less.In this particular case, the income-tax appears to be more because certain items which were challenged by the workmen but were allowed as proper expense by the tribunal have apparently not been allowed as proper expense by the income-tax department.The industrial tribunal, however, is not concerned directly with what the income-tax authorities assess as actual income-tax in a particular year ; it is concerned with working out the Full Bench formula in accordance with its notional calculations and this is what has been done in this case. There is no ground therefore for interference with the award of bonus for this reason either.
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Shriram Chits and Investment (P.) Ltd. Vs. Union of India (UOI) and Ors. | be signed by the foreman, the prized subscribers, if present, or their authorised agents, or their authorised agents, and at least two other subscribers who are present, and where a direction has been made under Sub-section (3) of Section 16, also by the Registrar or the person deputed by him under that Sub-section. 35. These provisions are again regulatory and are with a view to avoid fraud on the subscribers by delaying their payments. SECTION 20 36. It was contended that there is no provision in Section 20 of the Act to pay interest to the Foreman on the bank deposits/Government or approved securities that he is required to keep in the name of the Registrar of Chits. In law, the beneficial owner would be entitled to the refund of the securities/cash deposited with the Registrar or with the Bank as also the accrued interest thereon, if any, and undrawn on the Registrar being satisfied that there is no outstanding amount payable to the subscribers. It was submitted that when there is no liability to the subscribers, the Registrar is not entitled to retain the accrued interest or benefits accrued to the securities. 37. It was submitted on behalf of the Union of India that the Reserve bank of India has advised the State Governments to amend their Chit Rules stipulating payment of interest accrued on the remaining unpaid to the foreman while releasing the securities. The circular dated 28th February, 1990 issued by the Reserve Bank India is extracted below:- RESERVE BANK OF INDIA DEPARTMENT OF FINANCIAL COMPANIES CENTRAL OFFICE CELL BOMBAY 400 023 DFO(COC) No. 352/50(1)/89-90 February 28, 1990 Phalguna 9, 1991 (saka) To, All State Governments/Union Territories. Dear Sir, Chit Funds Act, 1982 (Central Act 40 of 1982) Rules to be made thereunder. _____________________________________ The State Government are aware that a batch of writ petitions challenging the validity of the provisions of Chit Funds Act before the Karnataka High Court. Bangalore was dismissed by the Division Bench of that Court in April, 1988. The Division Bench has inter alia observed that with the view of providing relief to a foreman Section 20 of the Act dealing with the security to be obtained from a foreman may he amended so as to provide for payment of interest on the securities lodged by a foreman. (This judgments reported in AIR (1989) Kar page 125 - (1990) 67 Comp Cas p.203). The matter was examined in consultation with the Central Government and it has been decided not to amend Section 20 of the Chit Funds Act, 1982 but only to amend the rules framed thereunder (which deal with the release of securities) to comply with the directions of Karnataka High Court. A copy of the draft amendment to Rule 24 of the Model Rules dealing with the release of security is enclosed (Draft) for your consideration. It is requested that the State Government may please arrange to incorporate the same in Rule 24 ibid if the Rules have been framed on the lines of the Model Rules furnished by the Reserve Bank of India; otherwise a suitable amendment may be made to reflect compliances of the directives of the Karnataka High Court. For your information an extract of Rule 16 as it is at present and the new Rule 16 of the Chit Funds (Karnataka) Rules, 1983 as proposed to be amended is enclosed for reference and notify the same in the Gazette. Six copies of the notification may please be furnished to us for our records in due course. Your faithfully, Sd/- (B. Subramanian) Joint Chef Officer 38. In view of this submission on behalf of the Union of India no further discussion is required in regard to the objection of the appellants/petitioners on non-payment of interest. SECTIONS 21(1)(a), (1)(b) and (1)(c) Sections 21(1)(a), (1)(b) and (1)(c) read thus:- 21. Rights of foreman - (1) The foreman shall be entitled. - (a) in the absence of any provision in the chit agreement to the contrary, to obtain the chit amount at the first installment without deduction of the discount specified in the chit agree-merit, subject to the condition that he shall subscribe to a ticket in the chit: Provided that in a case where the foreman has subscribed to more than one ticket, he shall not be eligible to obtain more than one chit amount in a chit without discount; (b) to such amount not exceeding five per cent of the chit amount as may be fixed in the chit agreement, by way of commission, remuneration or for meeting the expenses of running the chit: (c) to interest and penalty, if any, payable on any default in the payment of installments and to such other amounts as may be payable to him under the provisions of the chit agreement; 39. We find no reason for the appellants/petitioners to have any objection to Clause (a) or (c) of Section 21. As regards maximum commission of 5% of the chit amount, the objection does not appear to be legitimate because any foreman is not debarred from doing any other business and he is not supposed to incur the expenditure at the cost of the subscribers and then claim higher commission. Expert Bodies have only recommendation two per cent commission whereas the Act provided for 5 per cent commission. We do not find any thing unreasonable in respect of the commission. 40. Again objection to Section 25 is meaningless. This is a normal duty of the foreman which has been converted into a statutory duty. We do not find anything unreasonable. The provision is in subscribers interest. SECTION 48 41. The objection to the vires of Section 48 as to the circumstances in which chits are to be wound up is merely staled to be rejected. 42. All the provisions are in the interest of the subscribers and are very material. In any case if the order is unreasonable a party has a right of appeal under Section 59 of the Act. | 0[ds]13. Section 6 provides that the agreement shall be signed by each of the subscribers or by any person authorised by him in writing and the foreman and attested by at least two witnesses and the particulars that has to be stated in the said agreement have also been provided in Section 6 of the Act. This clearly shows that a contract has to be entered into between the subscribers and the foreman and in view of the definitions provided in Sections 2(b), 2(c), 2(d), 2(e) and 2(j) enforceable contract comes into existence and the Act provides how the contract has to be implemented and acted upon by the parties to the contract. Therefore, it is a special form of contract contemplated by Entry 7 of List III of VIIth Schedule of the Constitution of India and it cannot be termed as money lending business. It is clear that the foreman does not lend his money to any of the subscribers. The foreman acts only as person to bring together the subscribers and certain obligations are cast upon him with a view to protect the subscribers from the mischief and fraud committed by the foreman in view of his position. The amounts are paid to the subscribers as per the chit and in accordance with the provisions of Act. It will not be correct to state that each subscriber lends money to the person who gets chit earlier. It cannot also be construed that the person who gets chit later should be treated as the money lender. The agreement between the parties that is entered as per Section 6 of the Act, only provides for distribution of the chit amount. This agreement has to be treated as contract between the subscribers and the foreman and it is the foreman who brings the subscribers together and therefore the Act provided for payment of commission for the services rendered by the foreman as he does not lend money belonging to him. The dominant purpose of the Act is to regulate the chit and control the activity of the foreman and protect the interests of the subscribers. The pith and substance of the Act is that it provides for a special contract. The legislation provides for a special kind of contract and thus squarely falls within Entry 7 of List III of Schedule VII. If any support thereof is required the reference may be made to the decision of this Court in Srinivasa Enterprises case (supra). That decision was involved with the power of the Parliament to enact the Prize Chits and Money Circulation Schemes (Baning) Act, 1978 and this Court held that the legislation fell within Entry 7 of List III of the VIIth Schedule as opposed to the claim of the petitioners therein that the legislation fell within State List Entry 34 of List II. That was a case which dealt with prohibition of dealing in private prized chits and the Court fund that the pith and substance of the legislation therein was not one against lotteries and it dealt with a special species of contracts. Similar view was taken by the Madras High Court while dealing with the Pondicherry Chit Funds Act, 1966 and held that the legislation fell within Entry 7 of List III of the VIIth Schedule and not under Entry 45 of List I or Entry 30 of List II (see) Chock Nathan Chit Fund and Finance (P) Ltd., Pondicherry and Ors. v. Union Territory of Pondicherry and Ors. AIR1972Mad99 .15. We were referred to the decision of this Court in K.P. Subbarama Sastri and Ors. v. K.S. Raghavan and Ors. : [1987]2SCR767 wherein a contract providing for payment of money in installments and stipulating that on default in payment of any of the installments all the future installments shall be payable at a time with interest was held not penal in nature in the case of kuri transaction under the Kerala Chitties Act, 1975. While upholding the transaction a Bench of this Court approved the decision of the earlier Full Bench decision of the Kerala High Court in the case P.K. Achuthan (supra) wherein the Kerala High Court had upheld such a transaction and held it, to be of not a penal nature. In this context Eradi, J. (as His Lordship then was) speaking for the Full Bench observed that a subscriber truly and really becomes a debtor for the prized amount paid to him. It will be noticed that the later Full Bench decision of the Kerala High Court in Janardhana Mallan and Ors. (supra) was not brought to the notice of this Court and the Court was referred to the over-ruled decision of the Kerala High Court. The fact remains that the question involved before us as to the true nature of transaction for the purpose of finding out the relevant entry in the Constitution into which it may fall, was not involved in that case.16. It appear to us, but for the discordant note struck by the other Full Bench of the Kerala High Court in the aforesaid case of P.K. Achuthan (Supra), the consistent view of all the High Courts has been that it is not a moneylending transaction and that there is no relationship of debtor and creditor for the purpose of it being treated as a money lending transaction.19. The judgment of this Court in Srinivasa Enterprises (supra) fairly covers the present Act as well. The prized chit is covered by entry 7 of List III as observed by the Court in that case. Conventional chits are also matter of contract with an added element of chance of draw of lot to choose the successful bidder. The prized chits are chits with an element of draw of luck. Otherwise prized chits and conventional chits are forms of contract and arise out of contracts only. They are not money lending business. Applying the ratio laid down in the case of Srinivasa Enterprises (supra) it has to be held that the Chit Funds Act, in pith and substance, deals with special contract and consequently falls within Entry 7 of List III of the Third Schedule. It must, therefore, be held that the Chit Funds Act is within the legislative competence of the parliament.22. The Report 01 me Select Committee was brought to our notice and we thought it fit to look into it and the reports of the expert bodies with a view to satisfy ourselves that when Parliament enacted the Act, it had given its careful consideration to the various suggestions made by the State Governments, by the financial institutions, by the Companies, by the Cooperative Societies and by individuals; to the interests of the subscribers; to the risks of the foreman and to his difficulties in complying with certain regulatory measures, as found in the Bill; and passed the impugned Act. Almost all the recommendation of the Select Committee were incorporated in the impugned Act. Most of the appellants/petitioners had to opportunity of presenting their views before the Select Committee as could be seen from its report.This appears to be the main contention of the appellants/petitioners in all these matters. According to some of them their Companies are registered under the Companies Act and the Companies Act provides sufficient regulatory measures over their business by prescribing provisions for running the day-to-day business through Board of Directors who are responsible to the shareholders, maintenance of various statutory returns which have to be submitted to the Registrar of Companies from time to time for enabling the Registrar of Companies to have an effective control over the business of the appellants/petitioners and annual statutory audit proceeded by internal audits.They have complained that the provisions of Section 3 of the Act has an over-riding effect. It imposed unreasonable restrictions on the existing rights of the appellants/petitioners to carry on chit fund business. It will be noticed that Section 3 of the Act which overrides other laws, memorandum or articles of association or bye-laws, or any agreement concerning the chit fund business, s a result, to the extent to which it is repugnant to the provisions of this Act, become void. The Act itself is one of the socio-economic legislations which had been enacted primarily and predominantly to safeguard the interests of the chit subscribers who are gullible and unwary public and who have been subjected to exploitation by chit foremen. The Act is intended to regulate and to bring in financial discipline in the chit business, as the foremen deal in and dabble with the funds of the subscribing public. In this context it will be noticed that the banks, financial institutions and non-banking financial institutions, who accept deposits or deal with moneys of the public are disciplined and regulated by the various legislations. Banking Regulations Act, 1949 is applicable to commercial banks, both in the public sector and private sector registered under the Companies Act, 1956. Banking activities of the Regional Rural Banks (Banks in rural sector) are regulated under the regulatory mechanism of Regional Rural Banks Act, Non-Banking Financial Companies (Reserve Bank) Directions, 1977 apply to the deposit-taking activities of non-banking financial companies like loan, investment, hire purchase finance and equipment leasing companies. Misc. Non-Banking Companies (Reserve Bank) Directions, 1977 apply to deposit acceptance by conventional chit companies but do not cover their chit subscription activities. The deposit acceptance activities by the remaining financial companies are regulated by the Residuary Non-Banking Companies (Reserve Bank) Directions, 1987. These directions have been issued under the provisions of Chapter III B of the Reserve Bank of India Act, 1934, as amended. Section 45S of Chapter III C of the Reserve Bank of India Act deals with acceptance of deposits from the public by unincorporated bodies such as individuals, firms and associations of persons. Acceptance of deposits by non-banking non financial companies, like trading and manufacturing companies, are regulated by the Companies (Acceptance of Deposits) Rules, 1975 framed under Section 58A of the Companies Act, 1956.24. The Chit Fund Companies are financial intermediaries and the State Acts (which were enacted in some of the States) were not uniformly observed and were not found to be adequate to meet the nefarious activities of the foremen. In order to protect the interests of chit subscribers and having regard to volatile and vulnerable nature of chit transactions, authorities sought expert opinions and Expert Committees went into the matter and submitted the various reports, which we have noticed earlier. The report of the Banking Committee, which considered the types of chit funds, had indicated that conventional chit funds might be permitted to be conducted by public limited companies. The Commission opined that the individuals should not be allowed to conduct chits. The recommendations of the Banking Commission and Dutta Committee were examined and a model Bill was prepared by the Reserved Bank of India. At that stage Raj Committee was appointed. The Model Bill was also referred to Raj Committee for opinion. Raj Committee discussed Chit Funds in Chapter 6 of its report and recommended a uniform Central Legislation for regulating the conventional chit funds. The Committee also considered the model Bill and suggested some modifications. The Bill duly amended was introduced in the Lok Sabha on 23.2.1979 (Bill No. 5 of 1979) but lapsed. The Bill was re-introduced in the Lok Sabha on 20.11.1980 as Bill No. 186 of 1980. Bill No. 186 of 1980 was referred to the Select Committee of the Lok Sabha. The Select Committee gave wide publicity to the Bill, invited suggestions, received as many as 529 representations/memoranda from chit companies, Associations, Federations, State Governments, Co-operative Banks, individuals etc., examined 101 witnesses and had 25 sittings at important centers. The Select Committee submitted its report on 24.11.1981 and in the light of the representations suggested certain modifications in the Bill. The amendments, as suggested by the Select Committee, were incorporated in the Bill and the Bill was passed by the Lok Sabha on 19.7.1982. The Bill as passed by the Lok Sabha was introduced in the Rajya Sabha on 2.8.1982 and was referred to a Select Committee of the Rajya Sabha. The Select Committee of the Rajya Sabha submitted its report on 5.8.1982 and suggested some amendments. The amendments were incorporated in the Act.25. It will thus be seen that it is not a hasty legislation. It was conceived and legislated after a lot of deliberations and discussions and is the outcome of the views of the Expert Committees and Select Committees and prevalent State legislations on chits were also taken into account.26. In its sitting at Ahmedabad on 2.7.1981 the Select Committee of the Lok Sabha was informed that the subscribers in various States had been cheated of their hard-earned money by Chit Fund Companies by adopting dubious means and the subscribers were not being paid their prize money or dues back. The subscribers requested the Committee to do something to enable them to get their money back (page 55 of the Lok Sabha Select Committees Report).28. Section 4(1) contemplates that no chit shall be commenced without the previous sanction of the State Government. Sub-section (3) gives guidance to the State Government for granting and/or refusing to grant previous sanction. Clause (b) like Clause (a) gives guidance to the State authorities conferred on them discretion to grant or refuse to grant the sanction. We notice that the provisions is discretionary and merely gives guidelines to grant or refuse to grant sanction as per various clauses and is regulatory in nature and not violative of Article 19(1)(g) of the Constitution.It appears to us that the ceiling of discount is on the higher side and the subscribers, who are in need of money, per force, have to give the discount to that extent and cannot be expected to take care of their own interest when they bid at the tie of chit auction. The restriction is neither arbitrary nor unreasonable.30. Section 9(1) of the Act provides for commencement of chit. It contemplates that the foreman shall, after all the tickets specified in the chit agreement are fully subscribed, file a declaration to that effect with the Registrar. It will be noticed that this provision too is merely regulatory and is in the interest of the subscribers and cannot seriously be challenged under the provisions of Article 19(1)(g) of the Constitution of India.31. This Section creates a bar for a Company carrying on chit to desists from carrying on any other business. Similar provisions in regard to the ban are contained in Section 8 of the Banking Regulation Act, 1949 which restrain the banks from carrying on any other business. Sub-section (1) of Section 12 of the Act, however, provides that with the general or special permission of the State Government the chit company can carry on any business other than the chit business. This section is intended to leave discretion with the State Government to decide whether or not to allow the chit company to do any other business. It was pointed out that certain State Enterprises like Kerala State Financial Enterprises Ltd., were, in addition to chit business, engaged in other types of activities. The Datta Committee and banking Commission had suggested that the public section enterprises may be encouraged to do chit fund business.Many of those advances had become irrecoverable which in turn affected the liquidity of the chit fund companies and as a result the chit fund companies failed to pay the dues to the subscribers. Some of the companies had utilised the funds for shipping business, producing cinemas and also utilised the funds for venturing into fields with high degree of risk. Some of those ventures had flopped, the chit fund companies, had come to grief and consequently defaulted in the payment of dues to the subscribers i.e. subscribers were left high and dry to suffer in silence in view of the prohibitive cost and time consuming nature of litigations. In regard to policy guidelines for exemption i.e. permission to carry on other business the highest authority in Administration has been given the power to determine and the guidelines, of course, are public interest and the interest of the subscribers to the chit. The provisions of the Act gives sufficient guidelines to ensure subscribers interest. This Section, therefore, is again regulatory and is not hit by Article 19(1)(g) of the Constitution.33. The main challenge to Section 13 is in regard to the criteria fixed for chit business for individual firms on the one hand and co-operative societies and companies on the other. Whereas in the case of individuals the maximum permissible chit business is Rs. 25,000, in the case of firms for each partner Rs. 25,000 subject to the limit of rupees one lakh; in the case of companies the maximum business is linked with its net owned funds which has been defined in the explanation thereto. At the outset it may be noticed that the main purpose for laying down the ceiling on the limited amounts of chits, that may be conducted by the foreman, is to ensure that the foreman does not overtrade to the detriment of the chit subscribers and at the same time to see that the foreman has a sufficient stake in the chit business. It is in the context of these factors that the aggregate chit fund which could be considered as reasonable in respect of the chit conducted by individual or partnership concerns and as a multiple of net owned funds in the case of limited companies, came to be fixed. In the case of individuals and partnership concerns or association of individuals, it is not unlikely that the individuals/partnership firms etc., may do other types of business and divert portion of chit business funds for such business. Moreover, it is also not feasible to lay down the aggregate chit amount of chits to be conducted by such bodies with reference to their net means or individuals worth since it would be very difficult to assess and monitor such net worth and even if such assessment could be made, the position could change rapidly. On the other hand in the case of companies it is not difficult to arrive at the net worth having regard to the balance sheet position of the company. Hence it was thought desirable to fix the aggregate chit amount of chits which may be conducted by the limited companies with reference to their net owned funds while in the case of individuals, partnership firms etc., the amounts were fixed in absolute terms. As regards the fixing of limit of Rs. 25,000 in the case of individual and Rs. 1 lakh in the case of a firm having not less than four partners, we have already noticed that the Dutta Committee and the Banking Commission had recommended that only public limited companies should be allowed to do chit business (para 17.49). The Raj Committee, however, suggested (para 6.18(c) ) that individuals/sole proprietorship concerns/partnership firms may be allowed to conduct chit business on a limited scale. In the light of the above it was thought fit to allow individuals/partnership firms to do chit business in a limited way. Unlike companies, the individuals and partners are not precluded from carrying on other business which will supplement their income. Again the risk in the case of partnership firms and individuals is in a way minimised as the chit fund business in these cases can be set out in absolute term. The risk factor related to the amounts involved and the vulnerability of individuals/partners disappearing from the mid-stream of the business would be to the detriment of the subscribers, more the quantum of amount, greater the sufferance of the subscribers in case there were to be a collapse of chit fund business of the individuals and partnership firms. The offences under the Act, in terms of Section 81, are compoundable. The various rules relating to compounding are set out in Rule 62 of the Tamil Nadu Chit Funds Rules, 1984; Rule 63 of the Chit Fund (Pondicherry) Rules, 1906. In the Lok Sabha Select Committee tenth sitting at Ahmedabad held on 2nd July, 1981 it was stated as under :-3. During the course of evidence, the Committee was informed that the subscribers in various States had been cheated of their hard earned money of Chit Fund Companies by adopting dubious means and the subscribers were not being paid their prize money or dues back. The subscribers requested the Committee to do something to enable them to get their money back.34. We do not find that the limits put are violative of Article 19(1)(g) of the Constitution. In any case they are in the interests of the subscribers. However, we have no doubt that in view of the inflation in the country, the appropriate authorities, in case a demand is so raised, from time to time increase the limits. However, we do not find it necessary to give any direction in this behalf.35. These provisions are again regulatory and are with a view to avoid fraud on the subscribers by delaying their payments.SECTION 2038. In view of this submission on behalf of the Union of India no further discussion is required in regard to the objection of the appellants/petitioners on non-payment of interest.39. We find no reason for the appellants/petitioners to have any objection to Clause (a) or (c) of Section 21. As regards maximum commission of 5% of the chit amount, the objection does not appear to be legitimate because any foreman is not debarred from doing any other business and he is not supposed to incur the expenditure at the cost of the subscribers and then claim higher commission. Expert Bodies have only recommendation two per cent commission whereas the Act provided for 5 per cent commission. We do not find any thing unreasonable in respect of the commission.40. Again objection to Section 25 is meaningless. This is a normal duty of the foreman which has been converted into a statutory duty. We do not find anything unreasonable. The provision is in subscribers interest.SECTION 4841. The objection to the vires of Section 48 as to the circumstances in which chits are to be wound up is merely staled to be rejected.42. All the provisions are in the interest of the subscribers and are very material. In any case if the order is unreasonable a party has a right of appeal under Section 59 of the Act. | 0 | 16,079 | 4,105 | ### Instruction:
Predict whether the case will result in an affirmative (1) or negative (0) decision for the appeal, and then provide a thorough explanation using key sentences to support your prediction.
### Input:
be signed by the foreman, the prized subscribers, if present, or their authorised agents, or their authorised agents, and at least two other subscribers who are present, and where a direction has been made under Sub-section (3) of Section 16, also by the Registrar or the person deputed by him under that Sub-section. 35. These provisions are again regulatory and are with a view to avoid fraud on the subscribers by delaying their payments. SECTION 20 36. It was contended that there is no provision in Section 20 of the Act to pay interest to the Foreman on the bank deposits/Government or approved securities that he is required to keep in the name of the Registrar of Chits. In law, the beneficial owner would be entitled to the refund of the securities/cash deposited with the Registrar or with the Bank as also the accrued interest thereon, if any, and undrawn on the Registrar being satisfied that there is no outstanding amount payable to the subscribers. It was submitted that when there is no liability to the subscribers, the Registrar is not entitled to retain the accrued interest or benefits accrued to the securities. 37. It was submitted on behalf of the Union of India that the Reserve bank of India has advised the State Governments to amend their Chit Rules stipulating payment of interest accrued on the remaining unpaid to the foreman while releasing the securities. The circular dated 28th February, 1990 issued by the Reserve Bank India is extracted below:- RESERVE BANK OF INDIA DEPARTMENT OF FINANCIAL COMPANIES CENTRAL OFFICE CELL BOMBAY 400 023 DFO(COC) No. 352/50(1)/89-90 February 28, 1990 Phalguna 9, 1991 (saka) To, All State Governments/Union Territories. Dear Sir, Chit Funds Act, 1982 (Central Act 40 of 1982) Rules to be made thereunder. _____________________________________ The State Government are aware that a batch of writ petitions challenging the validity of the provisions of Chit Funds Act before the Karnataka High Court. Bangalore was dismissed by the Division Bench of that Court in April, 1988. The Division Bench has inter alia observed that with the view of providing relief to a foreman Section 20 of the Act dealing with the security to be obtained from a foreman may he amended so as to provide for payment of interest on the securities lodged by a foreman. (This judgments reported in AIR (1989) Kar page 125 - (1990) 67 Comp Cas p.203). The matter was examined in consultation with the Central Government and it has been decided not to amend Section 20 of the Chit Funds Act, 1982 but only to amend the rules framed thereunder (which deal with the release of securities) to comply with the directions of Karnataka High Court. A copy of the draft amendment to Rule 24 of the Model Rules dealing with the release of security is enclosed (Draft) for your consideration. It is requested that the State Government may please arrange to incorporate the same in Rule 24 ibid if the Rules have been framed on the lines of the Model Rules furnished by the Reserve Bank of India; otherwise a suitable amendment may be made to reflect compliances of the directives of the Karnataka High Court. For your information an extract of Rule 16 as it is at present and the new Rule 16 of the Chit Funds (Karnataka) Rules, 1983 as proposed to be amended is enclosed for reference and notify the same in the Gazette. Six copies of the notification may please be furnished to us for our records in due course. Your faithfully, Sd/- (B. Subramanian) Joint Chef Officer 38. In view of this submission on behalf of the Union of India no further discussion is required in regard to the objection of the appellants/petitioners on non-payment of interest. SECTIONS 21(1)(a), (1)(b) and (1)(c) Sections 21(1)(a), (1)(b) and (1)(c) read thus:- 21. Rights of foreman - (1) The foreman shall be entitled. - (a) in the absence of any provision in the chit agreement to the contrary, to obtain the chit amount at the first installment without deduction of the discount specified in the chit agree-merit, subject to the condition that he shall subscribe to a ticket in the chit: Provided that in a case where the foreman has subscribed to more than one ticket, he shall not be eligible to obtain more than one chit amount in a chit without discount; (b) to such amount not exceeding five per cent of the chit amount as may be fixed in the chit agreement, by way of commission, remuneration or for meeting the expenses of running the chit: (c) to interest and penalty, if any, payable on any default in the payment of installments and to such other amounts as may be payable to him under the provisions of the chit agreement; 39. We find no reason for the appellants/petitioners to have any objection to Clause (a) or (c) of Section 21. As regards maximum commission of 5% of the chit amount, the objection does not appear to be legitimate because any foreman is not debarred from doing any other business and he is not supposed to incur the expenditure at the cost of the subscribers and then claim higher commission. Expert Bodies have only recommendation two per cent commission whereas the Act provided for 5 per cent commission. We do not find any thing unreasonable in respect of the commission. 40. Again objection to Section 25 is meaningless. This is a normal duty of the foreman which has been converted into a statutory duty. We do not find anything unreasonable. The provision is in subscribers interest. SECTION 48 41. The objection to the vires of Section 48 as to the circumstances in which chits are to be wound up is merely staled to be rejected. 42. All the provisions are in the interest of the subscribers and are very material. In any case if the order is unreasonable a party has a right of appeal under Section 59 of the Act.
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for chit business for individual firms on the one hand and co-operative societies and companies on the other. Whereas in the case of individuals the maximum permissible chit business is Rs. 25,000, in the case of firms for each partner Rs. 25,000 subject to the limit of rupees one lakh; in the case of companies the maximum business is linked with its net owned funds which has been defined in the explanation thereto. At the outset it may be noticed that the main purpose for laying down the ceiling on the limited amounts of chits, that may be conducted by the foreman, is to ensure that the foreman does not overtrade to the detriment of the chit subscribers and at the same time to see that the foreman has a sufficient stake in the chit business. It is in the context of these factors that the aggregate chit fund which could be considered as reasonable in respect of the chit conducted by individual or partnership concerns and as a multiple of net owned funds in the case of limited companies, came to be fixed. In the case of individuals and partnership concerns or association of individuals, it is not unlikely that the individuals/partnership firms etc., may do other types of business and divert portion of chit business funds for such business. Moreover, it is also not feasible to lay down the aggregate chit amount of chits to be conducted by such bodies with reference to their net means or individuals worth since it would be very difficult to assess and monitor such net worth and even if such assessment could be made, the position could change rapidly. On the other hand in the case of companies it is not difficult to arrive at the net worth having regard to the balance sheet position of the company. Hence it was thought desirable to fix the aggregate chit amount of chits which may be conducted by the limited companies with reference to their net owned funds while in the case of individuals, partnership firms etc., the amounts were fixed in absolute terms. As regards the fixing of limit of Rs. 25,000 in the case of individual and Rs. 1 lakh in the case of a firm having not less than four partners, we have already noticed that the Dutta Committee and the Banking Commission had recommended that only public limited companies should be allowed to do chit business (para 17.49). The Raj Committee, however, suggested (para 6.18(c) ) that individuals/sole proprietorship concerns/partnership firms may be allowed to conduct chit business on a limited scale. In the light of the above it was thought fit to allow individuals/partnership firms to do chit business in a limited way. Unlike companies, the individuals and partners are not precluded from carrying on other business which will supplement their income. Again the risk in the case of partnership firms and individuals is in a way minimised as the chit fund business in these cases can be set out in absolute term. The risk factor related to the amounts involved and the vulnerability of individuals/partners disappearing from the mid-stream of the business would be to the detriment of the subscribers, more the quantum of amount, greater the sufferance of the subscribers in case there were to be a collapse of chit fund business of the individuals and partnership firms. The offences under the Act, in terms of Section 81, are compoundable. The various rules relating to compounding are set out in Rule 62 of the Tamil Nadu Chit Funds Rules, 1984; Rule 63 of the Chit Fund (Pondicherry) Rules, 1906. In the Lok Sabha Select Committee tenth sitting at Ahmedabad held on 2nd July, 1981 it was stated as under :-3. During the course of evidence, the Committee was informed that the subscribers in various States had been cheated of their hard earned money of Chit Fund Companies by adopting dubious means and the subscribers were not being paid their prize money or dues back. The subscribers requested the Committee to do something to enable them to get their money back.34. We do not find that the limits put are violative of Article 19(1)(g) of the Constitution. In any case they are in the interests of the subscribers. However, we have no doubt that in view of the inflation in the country, the appropriate authorities, in case a demand is so raised, from time to time increase the limits. However, we do not find it necessary to give any direction in this behalf.35. These provisions are again regulatory and are with a view to avoid fraud on the subscribers by delaying their payments.SECTION 2038. In view of this submission on behalf of the Union of India no further discussion is required in regard to the objection of the appellants/petitioners on non-payment of interest.39. We find no reason for the appellants/petitioners to have any objection to Clause (a) or (c) of Section 21. As regards maximum commission of 5% of the chit amount, the objection does not appear to be legitimate because any foreman is not debarred from doing any other business and he is not supposed to incur the expenditure at the cost of the subscribers and then claim higher commission. Expert Bodies have only recommendation two per cent commission whereas the Act provided for 5 per cent commission. We do not find any thing unreasonable in respect of the commission.40. Again objection to Section 25 is meaningless. This is a normal duty of the foreman which has been converted into a statutory duty. We do not find anything unreasonable. The provision is in subscribers interest.SECTION 4841. The objection to the vires of Section 48 as to the circumstances in which chits are to be wound up is merely staled to be rejected.42. All the provisions are in the interest of the subscribers and are very material. In any case if the order is unreasonable a party has a right of appeal under Section 59 of the Act.
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State of Maharashtra & Others Vs. Brijlal Sadasukh Modani | aid from the Central Government or a State Government or from any corporation established by or under a Central, Provincial or State Act, or any authority or body owned or controlled or aided by the Government or a Government company as defined in Section 617 of the Companies Act, 1956 (1 of 1956);" 16. On a perusal of the decisions of this Court, it is manifest that stress has always been laid on Section 2(c)(ix) of the 1988 Act as a consequence of which the fall out is that the registered cooperative society must have received financial aid from the Central Government or the State Government or any other institution mentioned therein.17. The High Court has referred to various provisions of the 1949 Act and proceeded on the status of cooperative society and eventually has held that:- "So far as the Bank is concerned, the Central Government has not purchased any share of the Bank. It is argued by the learned A.P.P. that the power conferred on the Reserve Bank of India and the Central Registrar under the provisions of the Banking Regulation Act are sufficient proof to arrive at conclusion that the functioning of the Bank is regulated and controlled by the Reserve Bank of India. We do not accept the proposition advanced by the learned APP. It is settled position that general regulations under an Act, like the Companies Act or Cooperative Societies Act, would not render the activities of a company or a society as subject to control of the State. Whatever control exercised by the Government or its authorities under the provisions of the Act are meant to ensure proper functioning of the society. The Government or in this case the Reserve Bank of India or any other statutory authorities have no role to play in day-to-day functioning of the societies/banks much less control over the recruitment of the staff, its service conditions etc. Considering the provisions of the different enactments more particularly the provisions of the Banking Regulation Act 1949, we are of the view that the Reserve Bank of India or the Government or its authorities do not exercise any direct, deep and pervasive control over the functioning of the Bank." 18. And again :- "... Therefore it would not be reasonable and proper now to relegate the petitioner to alternative forum by asking him to appear before respondent No. 3 and agitate the same issues." 19. In Prabhakarrao (supra) the Court was dealing with the issue whether the High Court was justified in holding that the accused was not a public servant. In the said case, the High Court had placed heavy reliance on the authority of State of Maharashtra v. Laljit Rajshi Shah, 2000(2) R.C.R.(Criminal) 71 : (2000) 2 SCC 699. In P. Venku Reddy (supra), the Court has distinguished the said decision and referred to Section 2 of the 1988 Act and in that context observed thus :- "3. Under clause (iii) of Section 2(c), any person in the service or pay of a corporation established by or under a Central, Provincial or State Act or an authority or a body owned or controlled or aided by the Government and under clause (ix) the President, Secretary and other office-bearers of a registered cooperative society engaged in agriculture, industry, have been included in the definition of "public servant".4. The question for consideration is whether the accused in the present case comes within the purview of the aforementioned clauses or any other clause of Section 2(c) of the Prevention of Corruption Act, 1988. For determination of the question, enquiry into facts, relating to the management, control and funding of the society, is necessary to be ascertained." 20. As we notice, the High Court has really been swayed by the concept of Article 12 of the Constitution, the provisions contained in the 1949 Act and in a mercurial manner taking note of the fact that the multi-state society is not controlled or aided by the Government has arrived at the conclusion. In our considered opinion, even any grant or any aid at the time of establishment of the society or in any construction or in any structural concept or any aspect would be an aid. We are inclined to think so as the term `aid has not been defined. A sprinkle of aid to the society will also bring an employee within the definition of `public servant. The concept in entirety has to be understood in the backdrop of corruption. In Shri Ram Singh (supra), this Court had to say this :- "Corruption in a civilised society is a disease like cancer, which if not detected in time, is sure to maliganise (sic) the polity of the country leading to disastrous consequences. It is termed as a plague which is not only contagious but if not controlled spreads like a fire in a jungle. Its virus is compared with HIV leading to AIDS, being incurable. It has also been termed as royal thievery. The socio-political system exposed to such a dreaded communicable disease is likely to crumble under its own weight. Corruption is opposed to democracy and social order, being not only anti-people, but aimed and targeted against them. It affects the economy and destroys the cultural heritage. Unless nipped in the bud at the earliest, it is likely to cause turbulence - shaking of the socio-economic-political system in an otherwise healthy, wealthy, effective and vibrating society." 21. We share the said perception, and reiterate with agony. The ingemination has to be realised with sanctity. Therefore, we are of the convinced opinion that it was entirely unnecessary on the part of the High Court to enter into elaborate deliberation to arrive at the conclusion that the respondent was not a public servant. Regard being had to the facts of the case, we think it would be apposite that it is left to be dealt with in the course of trial whether the society concerned has ever been granted any kind of aid or not. | 1[ds]21. We share the said perception, and reiterate with agony. The ingemination has to be realised with sanctity. Therefore, we are of the convinced opinion that it was entirely unnecessary on the part of the High Court to enter into elaborate deliberation to arrive at the conclusion that the respondent was not a public servant. Regard being had to the facts of the case, we think it would be apposite that it is left to be dealt with in the course of trial whether the society concerned has ever been granted any kind of aid or not.As far as State of Madhya Pradesh is concerned, there is no difficulty as the M.P. Cooperative Societies Act, 1960 itself declares the authorities as public servant. The issue that arises for consideration in the present case is whether asociety which handles crores of rupees and the persons who handle such huge amounts of money should be allowed to escape the rigour of corruption charges under the 1988 Act on the ground that they do not come under the ambit and sweep of Article 12 of the Constitution or solely because of construction placed under Section 2(c) (ix) of the 1988 Act. That apart, another significant issue also arises for consideration. Section 2(ix) to make an employee of a cooperative society provides certain conditions or conditions precedent to be satisfied and, therefore, the question would be, whether the High Court by only stating that it is the admitted position should have quashed the proceeding. There are various stages and hence, the thrust of the matter is in a corruption case whether exercise of jurisdiction under Section 482 of the Code of Criminal Procedure, 1973 is warrantable. In this regard, the relevant paragraphs from the Statement of Objects and Reasons are requisite to be reproduced.On a perusal of the decisions of this Court, it is manifest that stress has always been laid on Section 2(c)(ix) of the 1988 Act as a consequence of which the fall out is that the registered cooperative society must have received financial aid from the Central Government or the State Government or any other institution mentioned therein.17. The High Court has referred to various provisions of the 1949 Act and proceeded on the status of cooperative society and eventually has heldfar as the Bank is concerned, the Central Government has not purchased any share of the Bank. It is argued by the learned A.P.P. that the power conferred on the Reserve Bank of India and the Central Registrar under the provisions of the Banking Regulation Act are sufficient proof to arrive at conclusion that the functioning of the Bank is regulated and controlled by the Reserve Bank of India. We do not accept the proposition advanced by the learned APP. It is settled position that general regulations under an Act, like the Companies Act or Cooperative Societies Act, would not render the activities of a company or a society as subject to control of the State. Whatever control exercised by the Government or its authorities under the provisions of the Act are meant to ensure proper functioning of the society. The Government or in this case the Reserve Bank of India or any other statutory authorities have no role to play infunctioning of the societies/banks much less control over the recruitment of the staff, its service conditions etc. Considering the provisions of the different enactments more particularly the provisions of the Banking Regulation Act 1949, we are of the view that the Reserve Bank of India or the Government or its authorities do not exercise any direct, deep and pervasive control over the functioning of the Bank.... Therefore it would not be reasonable and proper now to relegate the petitioner to alternative forum by asking him to appear before respondent No. 3 and agitate the same issues.In Prabhakarrao (supra) the Court was dealing with the issue whether the High Court was justified in holding that the accused was not a public servant. In the said case, the High Court had placed heavy reliance on the authority of State of Maharashtra v. Laljit Rajshi Shah, 2000(2) R.C.R.(Criminal) 71 : (2000) 2 SCC 699. In P. Venku Reddy (supra), the Court has distinguished the said decision and referred to Section 2 of the 1988 Act and in that context observed thusUnder clause (iii) of Section 2(c), any person in the service or pay of a corporation established by or under a Central, Provincial or State Act or an authority or a body owned or controlled or aided by the Government and under clause (ix) the President, Secretary and otherof a registered cooperative society engaged in agriculture, industry, have been included in the definition of "public servant".4. The question for consideration is whether the accused in the present case comes within the purview of the aforementioned clauses or any other clause of Section 2(c) of the Prevention of Corruption Act, 1988. For determination of the question, enquiry into facts, relating to the management, control and funding of the society, is necessary to be ascertained.As we notice, the High Court has really been swayed by the concept of Article 12 of the Constitution, the provisions contained in the 1949 Act and in a mercurial manner taking note of the fact that thesociety is not controlled or aided by the Government has arrived at the conclusion. In our considered opinion, even any grant or any aid at the time of establishment of the society or in any construction or in any structural concept or any aspect would be an aid. We are inclined to think so as the term `aid has not been defined. A sprinkle of aid to the society will also bring an employee within the definition of `public servant. The concept in entirety has to be understood in the backdrop of corruption. In Shri Ram Singh (supra), this Court had to say thisin a civilised society is a disease like cancer, which if not detected in time, is sure to maliganise (sic) the polity of the country leading to disastrous consequences. It is termed as a plague which is not only contagious but if not controlled spreads like a fire in a jungle. Its virus is compared with HIV leading to AIDS, being incurable. It has also been termed as royal thievery. Thesystem exposed to such a dreaded communicable disease is likely to crumble under its own weight. Corruption is opposed to democracy and social order, being not onlybut aimed and targeted against them. It affects the economy and destroys the cultural heritage. Unless nipped in the bud at the earliest, it is likely to cause turbulenceshaking of thesystem in an otherwise healthy, wealthy, effective and vibrating society." | 1 | 4,903 | 1,247 | ### Instruction:
Evaluate the case proceeding to forecast the court's decision (1 for yes, 0 for no), and elucidate the reasoning behind this prediction with important textual evidence from the case.
### Input:
aid from the Central Government or a State Government or from any corporation established by or under a Central, Provincial or State Act, or any authority or body owned or controlled or aided by the Government or a Government company as defined in Section 617 of the Companies Act, 1956 (1 of 1956);" 16. On a perusal of the decisions of this Court, it is manifest that stress has always been laid on Section 2(c)(ix) of the 1988 Act as a consequence of which the fall out is that the registered cooperative society must have received financial aid from the Central Government or the State Government or any other institution mentioned therein.17. The High Court has referred to various provisions of the 1949 Act and proceeded on the status of cooperative society and eventually has held that:- "So far as the Bank is concerned, the Central Government has not purchased any share of the Bank. It is argued by the learned A.P.P. that the power conferred on the Reserve Bank of India and the Central Registrar under the provisions of the Banking Regulation Act are sufficient proof to arrive at conclusion that the functioning of the Bank is regulated and controlled by the Reserve Bank of India. We do not accept the proposition advanced by the learned APP. It is settled position that general regulations under an Act, like the Companies Act or Cooperative Societies Act, would not render the activities of a company or a society as subject to control of the State. Whatever control exercised by the Government or its authorities under the provisions of the Act are meant to ensure proper functioning of the society. The Government or in this case the Reserve Bank of India or any other statutory authorities have no role to play in day-to-day functioning of the societies/banks much less control over the recruitment of the staff, its service conditions etc. Considering the provisions of the different enactments more particularly the provisions of the Banking Regulation Act 1949, we are of the view that the Reserve Bank of India or the Government or its authorities do not exercise any direct, deep and pervasive control over the functioning of the Bank." 18. And again :- "... Therefore it would not be reasonable and proper now to relegate the petitioner to alternative forum by asking him to appear before respondent No. 3 and agitate the same issues." 19. In Prabhakarrao (supra) the Court was dealing with the issue whether the High Court was justified in holding that the accused was not a public servant. In the said case, the High Court had placed heavy reliance on the authority of State of Maharashtra v. Laljit Rajshi Shah, 2000(2) R.C.R.(Criminal) 71 : (2000) 2 SCC 699. In P. Venku Reddy (supra), the Court has distinguished the said decision and referred to Section 2 of the 1988 Act and in that context observed thus :- "3. Under clause (iii) of Section 2(c), any person in the service or pay of a corporation established by or under a Central, Provincial or State Act or an authority or a body owned or controlled or aided by the Government and under clause (ix) the President, Secretary and other office-bearers of a registered cooperative society engaged in agriculture, industry, have been included in the definition of "public servant".4. The question for consideration is whether the accused in the present case comes within the purview of the aforementioned clauses or any other clause of Section 2(c) of the Prevention of Corruption Act, 1988. For determination of the question, enquiry into facts, relating to the management, control and funding of the society, is necessary to be ascertained." 20. As we notice, the High Court has really been swayed by the concept of Article 12 of the Constitution, the provisions contained in the 1949 Act and in a mercurial manner taking note of the fact that the multi-state society is not controlled or aided by the Government has arrived at the conclusion. In our considered opinion, even any grant or any aid at the time of establishment of the society or in any construction or in any structural concept or any aspect would be an aid. We are inclined to think so as the term `aid has not been defined. A sprinkle of aid to the society will also bring an employee within the definition of `public servant. The concept in entirety has to be understood in the backdrop of corruption. In Shri Ram Singh (supra), this Court had to say this :- "Corruption in a civilised society is a disease like cancer, which if not detected in time, is sure to maliganise (sic) the polity of the country leading to disastrous consequences. It is termed as a plague which is not only contagious but if not controlled spreads like a fire in a jungle. Its virus is compared with HIV leading to AIDS, being incurable. It has also been termed as royal thievery. The socio-political system exposed to such a dreaded communicable disease is likely to crumble under its own weight. Corruption is opposed to democracy and social order, being not only anti-people, but aimed and targeted against them. It affects the economy and destroys the cultural heritage. Unless nipped in the bud at the earliest, it is likely to cause turbulence - shaking of the socio-economic-political system in an otherwise healthy, wealthy, effective and vibrating society." 21. We share the said perception, and reiterate with agony. The ingemination has to be realised with sanctity. Therefore, we are of the convinced opinion that it was entirely unnecessary on the part of the High Court to enter into elaborate deliberation to arrive at the conclusion that the respondent was not a public servant. Regard being had to the facts of the case, we think it would be apposite that it is left to be dealt with in the course of trial whether the society concerned has ever been granted any kind of aid or not.
### Response:
1
### Explanation:
itself declares the authorities as public servant. The issue that arises for consideration in the present case is whether asociety which handles crores of rupees and the persons who handle such huge amounts of money should be allowed to escape the rigour of corruption charges under the 1988 Act on the ground that they do not come under the ambit and sweep of Article 12 of the Constitution or solely because of construction placed under Section 2(c) (ix) of the 1988 Act. That apart, another significant issue also arises for consideration. Section 2(ix) to make an employee of a cooperative society provides certain conditions or conditions precedent to be satisfied and, therefore, the question would be, whether the High Court by only stating that it is the admitted position should have quashed the proceeding. There are various stages and hence, the thrust of the matter is in a corruption case whether exercise of jurisdiction under Section 482 of the Code of Criminal Procedure, 1973 is warrantable. In this regard, the relevant paragraphs from the Statement of Objects and Reasons are requisite to be reproduced.On a perusal of the decisions of this Court, it is manifest that stress has always been laid on Section 2(c)(ix) of the 1988 Act as a consequence of which the fall out is that the registered cooperative society must have received financial aid from the Central Government or the State Government or any other institution mentioned therein.17. The High Court has referred to various provisions of the 1949 Act and proceeded on the status of cooperative society and eventually has heldfar as the Bank is concerned, the Central Government has not purchased any share of the Bank. It is argued by the learned A.P.P. that the power conferred on the Reserve Bank of India and the Central Registrar under the provisions of the Banking Regulation Act are sufficient proof to arrive at conclusion that the functioning of the Bank is regulated and controlled by the Reserve Bank of India. We do not accept the proposition advanced by the learned APP. It is settled position that general regulations under an Act, like the Companies Act or Cooperative Societies Act, would not render the activities of a company or a society as subject to control of the State. Whatever control exercised by the Government or its authorities under the provisions of the Act are meant to ensure proper functioning of the society. The Government or in this case the Reserve Bank of India or any other statutory authorities have no role to play infunctioning of the societies/banks much less control over the recruitment of the staff, its service conditions etc. Considering the provisions of the different enactments more particularly the provisions of the Banking Regulation Act 1949, we are of the view that the Reserve Bank of India or the Government or its authorities do not exercise any direct, deep and pervasive control over the functioning of the Bank.... Therefore it would not be reasonable and proper now to relegate the petitioner to alternative forum by asking him to appear before respondent No. 3 and agitate the same issues.In Prabhakarrao (supra) the Court was dealing with the issue whether the High Court was justified in holding that the accused was not a public servant. In the said case, the High Court had placed heavy reliance on the authority of State of Maharashtra v. Laljit Rajshi Shah, 2000(2) R.C.R.(Criminal) 71 : (2000) 2 SCC 699. In P. Venku Reddy (supra), the Court has distinguished the said decision and referred to Section 2 of the 1988 Act and in that context observed thusUnder clause (iii) of Section 2(c), any person in the service or pay of a corporation established by or under a Central, Provincial or State Act or an authority or a body owned or controlled or aided by the Government and under clause (ix) the President, Secretary and otherof a registered cooperative society engaged in agriculture, industry, have been included in the definition of "public servant".4. The question for consideration is whether the accused in the present case comes within the purview of the aforementioned clauses or any other clause of Section 2(c) of the Prevention of Corruption Act, 1988. For determination of the question, enquiry into facts, relating to the management, control and funding of the society, is necessary to be ascertained.As we notice, the High Court has really been swayed by the concept of Article 12 of the Constitution, the provisions contained in the 1949 Act and in a mercurial manner taking note of the fact that thesociety is not controlled or aided by the Government has arrived at the conclusion. In our considered opinion, even any grant or any aid at the time of establishment of the society or in any construction or in any structural concept or any aspect would be an aid. We are inclined to think so as the term `aid has not been defined. A sprinkle of aid to the society will also bring an employee within the definition of `public servant. The concept in entirety has to be understood in the backdrop of corruption. In Shri Ram Singh (supra), this Court had to say thisin a civilised society is a disease like cancer, which if not detected in time, is sure to maliganise (sic) the polity of the country leading to disastrous consequences. It is termed as a plague which is not only contagious but if not controlled spreads like a fire in a jungle. Its virus is compared with HIV leading to AIDS, being incurable. It has also been termed as royal thievery. Thesystem exposed to such a dreaded communicable disease is likely to crumble under its own weight. Corruption is opposed to democracy and social order, being not onlybut aimed and targeted against them. It affects the economy and destroys the cultural heritage. Unless nipped in the bud at the earliest, it is likely to cause turbulenceshaking of thesystem in an otherwise healthy, wealthy, effective and vibrating society."
|
Dinanath Pansari Vs. Collector & D. M. Keonjhar & Anr | by the District Magistrate from the failure of the petitioner to account for more than 21 out of 149 tyres, yet, this activity of the petitioner could not reasonably lead to the inference that it was necessary to detain the petitioner for the purpose of maintaining the supplies of the essential commodity in future. Reliance was placed upon Debu Mahto v. State of West Bengal, AIR 1974 SC 816 = (1974 Cri LJ 699) the facts of which have little connection with the facts of the case of the petitioner who must have appeared to the detaining authorities to be using his dual capacity, one as a licensed dealer of tyres and tubes and another as the Manager of the United Commercial Company, as a cover for systematic concealed illegal sale at exorbitant prices.7. As the Manager of the United Commercial Company, the petitioner was certainly not a licensed dealer. The 149 tyres had been obtained by the company for actual use on the trucks but most of them had, apparently, been disposed of in what is known as the "black market." The provisions relating to licensed dealers did not warrant such sales which were struck by the provisions of clause 2 of the Orissa Automobile Tyres and Tubes Control Order, 1973. This provides as follows:"2. Licensing of dealers - (1) No person shall obtain, attempt to obtain, or store for sale or distribution or offer for sal e or sell automobile tyres and tubes except under and in accordance with the terms and conditions of a license issued in this behalf by the Licensing Authority.(2) Every dealer who is doing business on the commencement of the order shall apply for the Licence within fifteen days of such commencement."8. The petitioner had not been detained for any irregularity or illegality committed as a licensed dealer, but as a person who seemed to have been diverting tyres from their pretended use, for which a large stock of tyres had been obtained directly from manufacturers, to sates in what is known as the "black market" as a regular side occupation. He was unable to repel the allegation that such a transaction with one Narayan Singh had been detected. He put forward what did not appear to be an honest plea - that be bad loaned two tyres to Narayan Singh who bad deposited Rs. 5,000/- as security. However, it is not for this Court to pronounce on possible inferences from evidence for or against the petitioner. It is for the detaining authorities to satisfy themselves about these matters and about the need to order to preventive detention and its duration. The Advisory Board had also indorsed the action of the detaining authorities.9. It was submitted on behalf of the petitioner that, after a direction given on 19-8-1974 by the Collector, Keonjhar, to the tyre manufacturing Companies not to supply tyres to the company as an owner of a fleet of trucks, the sources of supplies of tyres were dried up and there could be no necessity to detain the petitioner. We were referred to Pusparaj and Co. v. Collector of Balasore, ILR (1972) Cut 747 = (AIR 1973 Orissa 6) to show that such a direction was not legal. If that is so, the petitioner can obtain relief against the direction by appropriate proceedings. We cannot pronounce here upon its legality.10.The question whether the petitioner had satisfactorily accounted for the 149 tyres purchased from manufacturers from 14-2-1974 to 27-4-1974 was also one of fact. If the petitioners case was that all the 149 tyres had been actually used in this period on the ten trucks, as he would like to make out, he was in the best position to prove this fact. He could not take shelter behind the plea that the detaining authorities did not ask the manufacturers to give the numbers of tyres sold by them to the United Commercial Company when the petitioner, called upon to explain what had happened to the 149 tyres, could not himself give their numbers or show that he had them all fitted on to his trucks, or that he had to discard so many tyres in this period.No stock of discarded tyres was evidently strewn by the petitioner to the Magistrate who came to his premises to inquire into actual facts. However, such questions of sufficiency of evidence are not for this Court at all to determine. We mention them only as an attempt was made to raise them before us.11. We are unable to hold that the impugned detention order against the petitioner is either arbitrary or not connected with the purposes for which a detention may be ordered under Section 3 (1) (a) (iii) of the Act. In considering the legality of such an order we cannot function as a Court of Appeal. If there is any material to justify the passing of the detention order the necessity for it is a matter of subjective assessment and satisfaction by the detaining authority with which no Court would be ordinarily justified in interfering. It is only when the order is shown to be of such a nature that it could not possibly fall within the scope of the law conferring the power to make it that this Court would intervene to quash it.A reference to ILR (1972) Cut 747 = (AIR 1973 Orissa 6) (supra), itself shows that the need to take drastic steps for maintaining the supplies of an essential commodity, which had become scarce, was there in Orissa. This Court would not interfere even if two views about the existence of the need to detain for the object set out in Section 3 (l) (a) (iii) of the Act were possible. It was for the detaining authorities to determine the duration of the need to detain the petitioner provided they comply with the provisions of law whenever they do so. We are unable to find any legal flaw in the proceedings which resulted in the impugned detention order of 6-7-1974. | 0[ds]8. The petitioner had not been detained for any irregularity or illegality committed as a licensed dealer, but as a person who seemed to have been diverting tyres from their pretended use, for which a large stock of tyres had been obtained directly from manufacturers, to sates in what is known as the "black market" as a regular side occupation. He was unable to repel the allegation that such a transaction with one Narayan Singh had been detected. He put forward what did not appear to be an honest plea - that be bad loaned two tyres to Narayan Singh who bad deposited Rs. 5,000/- as security. However, it is not for this Court to pronounce on possible inferences from evidence for or against the petitioner. It is for the detaining authorities to satisfy themselves about these matters and about the need to order to preventive detention and its duration. The Advisory Board had also indorsed the action of the detainingwere referred to Pusparaj and Co. v. Collector of Balasore, ILR (1972) Cut 747 = (AIR 1973 Orissa 6) to show that such a direction was not legal. If that is so, the petitioner can obtain relief against the direction by appropriate proceedings. We cannot pronounce here upon its legality.10.The question whether the petitioner had satisfactorily accounted for the 149 tyres purchased from manufacturers from 14-2-1974 to 27-4-1974 was also one of fact. If the petitioners case was that all the 149 tyres had been actually used in this period on the ten trucks, as he would like to make out, he was in the best position to prove this fact. He could not take shelter behind the plea that the detaining authorities did not ask the manufacturers to give the numbers of tyres sold by them to the United Commercial Company when the petitioner, called upon to explain what had happened to the 149 tyres, could not himself give their numbers or show that he had them all fitted on to his trucks, or that he had to discard so many tyres in this period.No stock of discarded tyres was evidently strewn by the petitioner to the Magistrate who came to his premises to inquire into actual facts. However, such questions of sufficiency of evidence are not for this Court at all to determine. We mention them only as an attempt was made to raise them before us.11. We are unable to hold that the impugned detention order against the petitioner is either arbitrary or not connected with the purposes for which a detention may be ordered under Section 3 (1) (a) (iii) of the Act. In considering the legality of such an order we cannot function as a Court of Appeal. If there is any material to justify the passing of the detention order the necessity for it is a matter of subjective assessment and satisfaction by the detaining authority with which no Court would be ordinarily justified in interfering. It is only when the order is shown to be of such a nature that it could not possibly fall within the scope of the law conferring the power to make it that this Court would intervene to quash it.A reference to ILR (1972) Cut 747 = (AIR 1973 Orissa 6) (supra), itself shows that the need to take drastic steps for maintaining the supplies of an essential commodity, which had become scarce, was there in Orissa. This Court would not interfere even if two views about the existence of the need to detain for the object set out in Section 3 (l) (a) (iii) of the Act were possible. It was for the detaining authorities to determine the duration of the need to detain the petitioner provided they comply with the provisions of law whenever they do so. We are unable to find any legal flaw in the proceedings which resulted in the impugned detention order of 6-7-1974. | 0 | 2,310 | 717 | ### Instruction:
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by the District Magistrate from the failure of the petitioner to account for more than 21 out of 149 tyres, yet, this activity of the petitioner could not reasonably lead to the inference that it was necessary to detain the petitioner for the purpose of maintaining the supplies of the essential commodity in future. Reliance was placed upon Debu Mahto v. State of West Bengal, AIR 1974 SC 816 = (1974 Cri LJ 699) the facts of which have little connection with the facts of the case of the petitioner who must have appeared to the detaining authorities to be using his dual capacity, one as a licensed dealer of tyres and tubes and another as the Manager of the United Commercial Company, as a cover for systematic concealed illegal sale at exorbitant prices.7. As the Manager of the United Commercial Company, the petitioner was certainly not a licensed dealer. The 149 tyres had been obtained by the company for actual use on the trucks but most of them had, apparently, been disposed of in what is known as the "black market." The provisions relating to licensed dealers did not warrant such sales which were struck by the provisions of clause 2 of the Orissa Automobile Tyres and Tubes Control Order, 1973. This provides as follows:"2. Licensing of dealers - (1) No person shall obtain, attempt to obtain, or store for sale or distribution or offer for sal e or sell automobile tyres and tubes except under and in accordance with the terms and conditions of a license issued in this behalf by the Licensing Authority.(2) Every dealer who is doing business on the commencement of the order shall apply for the Licence within fifteen days of such commencement."8. The petitioner had not been detained for any irregularity or illegality committed as a licensed dealer, but as a person who seemed to have been diverting tyres from their pretended use, for which a large stock of tyres had been obtained directly from manufacturers, to sates in what is known as the "black market" as a regular side occupation. He was unable to repel the allegation that such a transaction with one Narayan Singh had been detected. He put forward what did not appear to be an honest plea - that be bad loaned two tyres to Narayan Singh who bad deposited Rs. 5,000/- as security. However, it is not for this Court to pronounce on possible inferences from evidence for or against the petitioner. It is for the detaining authorities to satisfy themselves about these matters and about the need to order to preventive detention and its duration. The Advisory Board had also indorsed the action of the detaining authorities.9. It was submitted on behalf of the petitioner that, after a direction given on 19-8-1974 by the Collector, Keonjhar, to the tyre manufacturing Companies not to supply tyres to the company as an owner of a fleet of trucks, the sources of supplies of tyres were dried up and there could be no necessity to detain the petitioner. We were referred to Pusparaj and Co. v. Collector of Balasore, ILR (1972) Cut 747 = (AIR 1973 Orissa 6) to show that such a direction was not legal. If that is so, the petitioner can obtain relief against the direction by appropriate proceedings. We cannot pronounce here upon its legality.10.The question whether the petitioner had satisfactorily accounted for the 149 tyres purchased from manufacturers from 14-2-1974 to 27-4-1974 was also one of fact. If the petitioners case was that all the 149 tyres had been actually used in this period on the ten trucks, as he would like to make out, he was in the best position to prove this fact. He could not take shelter behind the plea that the detaining authorities did not ask the manufacturers to give the numbers of tyres sold by them to the United Commercial Company when the petitioner, called upon to explain what had happened to the 149 tyres, could not himself give their numbers or show that he had them all fitted on to his trucks, or that he had to discard so many tyres in this period.No stock of discarded tyres was evidently strewn by the petitioner to the Magistrate who came to his premises to inquire into actual facts. However, such questions of sufficiency of evidence are not for this Court at all to determine. We mention them only as an attempt was made to raise them before us.11. We are unable to hold that the impugned detention order against the petitioner is either arbitrary or not connected with the purposes for which a detention may be ordered under Section 3 (1) (a) (iii) of the Act. In considering the legality of such an order we cannot function as a Court of Appeal. If there is any material to justify the passing of the detention order the necessity for it is a matter of subjective assessment and satisfaction by the detaining authority with which no Court would be ordinarily justified in interfering. It is only when the order is shown to be of such a nature that it could not possibly fall within the scope of the law conferring the power to make it that this Court would intervene to quash it.A reference to ILR (1972) Cut 747 = (AIR 1973 Orissa 6) (supra), itself shows that the need to take drastic steps for maintaining the supplies of an essential commodity, which had become scarce, was there in Orissa. This Court would not interfere even if two views about the existence of the need to detain for the object set out in Section 3 (l) (a) (iii) of the Act were possible. It was for the detaining authorities to determine the duration of the need to detain the petitioner provided they comply with the provisions of law whenever they do so. We are unable to find any legal flaw in the proceedings which resulted in the impugned detention order of 6-7-1974.
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8. The petitioner had not been detained for any irregularity or illegality committed as a licensed dealer, but as a person who seemed to have been diverting tyres from their pretended use, for which a large stock of tyres had been obtained directly from manufacturers, to sates in what is known as the "black market" as a regular side occupation. He was unable to repel the allegation that such a transaction with one Narayan Singh had been detected. He put forward what did not appear to be an honest plea - that be bad loaned two tyres to Narayan Singh who bad deposited Rs. 5,000/- as security. However, it is not for this Court to pronounce on possible inferences from evidence for or against the petitioner. It is for the detaining authorities to satisfy themselves about these matters and about the need to order to preventive detention and its duration. The Advisory Board had also indorsed the action of the detainingwere referred to Pusparaj and Co. v. Collector of Balasore, ILR (1972) Cut 747 = (AIR 1973 Orissa 6) to show that such a direction was not legal. If that is so, the petitioner can obtain relief against the direction by appropriate proceedings. We cannot pronounce here upon its legality.10.The question whether the petitioner had satisfactorily accounted for the 149 tyres purchased from manufacturers from 14-2-1974 to 27-4-1974 was also one of fact. If the petitioners case was that all the 149 tyres had been actually used in this period on the ten trucks, as he would like to make out, he was in the best position to prove this fact. He could not take shelter behind the plea that the detaining authorities did not ask the manufacturers to give the numbers of tyres sold by them to the United Commercial Company when the petitioner, called upon to explain what had happened to the 149 tyres, could not himself give their numbers or show that he had them all fitted on to his trucks, or that he had to discard so many tyres in this period.No stock of discarded tyres was evidently strewn by the petitioner to the Magistrate who came to his premises to inquire into actual facts. However, such questions of sufficiency of evidence are not for this Court at all to determine. We mention them only as an attempt was made to raise them before us.11. We are unable to hold that the impugned detention order against the petitioner is either arbitrary or not connected with the purposes for which a detention may be ordered under Section 3 (1) (a) (iii) of the Act. In considering the legality of such an order we cannot function as a Court of Appeal. If there is any material to justify the passing of the detention order the necessity for it is a matter of subjective assessment and satisfaction by the detaining authority with which no Court would be ordinarily justified in interfering. It is only when the order is shown to be of such a nature that it could not possibly fall within the scope of the law conferring the power to make it that this Court would intervene to quash it.A reference to ILR (1972) Cut 747 = (AIR 1973 Orissa 6) (supra), itself shows that the need to take drastic steps for maintaining the supplies of an essential commodity, which had become scarce, was there in Orissa. This Court would not interfere even if two views about the existence of the need to detain for the object set out in Section 3 (l) (a) (iii) of the Act were possible. It was for the detaining authorities to determine the duration of the need to detain the petitioner provided they comply with the provisions of law whenever they do so. We are unable to find any legal flaw in the proceedings which resulted in the impugned detention order of 6-7-1974.
|
Formula One World Championship Ltd Vs. Commissioer Of Income Tax, International Txation-3 Delhi | event. The conceptualization of the event and the right to include it in any particular circuit, such as Buddh Circuit is that of the FOWC; it decides the venue and the participating teams are bound to it to compete in the race in the terms agreed with the FOWC. All these, in the opinion of the Court, unequivocally, show that the FOWC carried on business in India for the duration of the race (and for two weeks before the race and a week thereafter). Every right, which it possessed was monetized; the US$ 40 million which Jaypee paid was only a part of that commercial exploitation by the FOWC. 58. Consequently, the Court concludes that the FOWC carried on business in India within the meaning of expression under Article 5(1) of the DTAA. It is consequently held that the AAR fell into error of law in holding that FOWC did not function through a PE/carry on business through a fixed place of business in India. 74. In view of the above, it is difficult to accept the arguments of the appellants that it is Jaypee who was responsible for conducting races and had complete control over the Event in question. Mere construction of the track by Jaypee at its expense will be of no consequence. Its ownership or organising other events by Jaypee is also immaterial. Our examination is limited to the conduct of the F-1 Championship and control over the track during that period. Specific arrangement between the parties relating to the aforesaid, which is elaborated above and which FOWC and Jaypee unsuccessfully endeavoured to ignore, has in fact turned the table against them. It is also difficult to accept their submission that FOWC had no role in the conduct of the Championship and its role came to an end with granting permission to host the Event as a round of the championship. We also reject the argument of the appellants that the Buddh International Circuit was not under the control and at the disposal of FOWC. 75. No doubt, FOWC, as CRH of these events, is in the business of exploiting these rights, including intellectual property rights. However, these became possible, in the instant case, only with the actual conduct of these races and active participation of FOWC in the said races, with access and control over the circuit. 76. We are of the opinion that the test laid down by the Andhra Pradesh High Court in Visakhapatnam Port Trust case fully stands satisfied. Not only the Buddh International Circuit is a fixed place where the commercial/economic activity of conducting F-1 Championship was carried out, one could clearly discern that it was a virtual projection of the foreign enterprise, namely, Formula-1 (i.e. FOWC) on the soil of this country. It is already noted above that as per Philip Baker (A Manual on the OECD Model Tax Convention on Income and on Capital]), a PE must have three characteristics: stability, productivity and dependence. All characteristics are present in this case. Fixed place of business in the form of physical location, i.e. Buddh International Circuit, was at the disposal of FOWC through which it conducted business. Aesthetics of law and taxation jurisprudence leave no doubt in our mind that taxable event has taken place in India and non-resident FOWC is liable to pay tax in India on the income it has earned on this soil. 77. We are now left with two other incidental issues which were raised by Mr. Datar. First was on the interpretation of Section 195 of the Act. It cannot be disputed that a person who makes the payment to a non-resident is under an obligation to deduct tax under Section 195 of the Act on such payments. Mr. Rohatgi had submitted, and rightly so, that this issue is covered by the judgment in the case of GE India Technology Centre Private Limited (Refer Footnote 23]). Precisely this very judgment is taken note of and relied upon by the High Court also in holding that since payments made by Jaypee to FOWC under the RPC were business income of the FOWC through PE at the Buddh International Circuit, and, therefore, chargeable to tax, Jaypee was bound to make appropriate deductions from the amounts paid under Section 195 of the Act. 78. We are, however, inclined to accept the submission of Mr. Datar that only that portion of the income of FOWC, which is attributable to the said PE, would be treated as business income of FOWC and only that part of income deduction was required to be made under Section 195 of the Act. In GE India Technology Centre Private Limited (Refer Footnote 23]), this Court has clarified that though there is an obligation to deduct tax, the obligation is limited to the appropriate portion of income which is chargeable to tax in India and in respect of other payments where no tax is payable, recourse is to be made under Section 195(2) of the Act. It would be for the Assessing Officer to adjudicate upon the aforesaid aspects while passing the Assessment Order, namely, how much business income of FOWC is attributable to PE in India, which is chargeable to tax. At that stage, Jaypee can also press its argument that penalty etc. be not charged as the move on the part of Jaypee in not deducting tax at source was bona fide. We make it clear that we have not expressed any opinion either way. 79. Insofar as the argument of Mr. Datar on the powers of the High Court under Article 226 of the Constitution of India is concerned, we are not impressed by the said argument. It is Jaypee itself which had filed the writ petition (and for that matter FOWC as well) and they had challenged the orders of AAR on certain aspects. The High Court has examined legal issues while delivering the impugned judgment, of course having regard to the facts which were culled out from the documents on record. | 0[ds]13. The bone of contention before this Court pertains to the issue of existence of a PE of FOWC in India. We may say at the outset that the arguments advanced by both the parties before us were virtually the same arguments which were advanced before the High Court as well. Therefore, spelling out the submissions of the parties before the High Court may not be necessary as it would be duplicating and repetitive.15. In the present case, we are concerned with the consideration received by FOWC as a result of Agreement signed with Jaypee Sports. FOWC, being a UK Company, is admittedly the non-resident in India17. It is clear from the reading of the said clause that it includes all those incomes, whether directly or indirectly, which are accruing or arising through or from any business connection in India. It is, thus, clear that an income which is earned directly or indirectly, i.e. even indirectly, is to be deemed to accrue or earned in India. Further, such an income should have some business connection in India. Explanation (1) for the purpose of this clause provides five explanations from clauses (a) to (e). Clause (a) stipulates that where all the business operations are not carried in India and only some such operations of business are carried in India, the income of the business deemed under this clause to accrue or arise in India shall be only such part of the income as is reasonably attributable to the operations carried in India. We are not concerned with clauses (b) to (e).18. This exception, thus, clarifies and declares that even when business activity is carried through a person who is acting on behalf of the non-resident (which means agent of the non-resident), it will be treated that the non-resident is having business connection in India.19. If a non-resident has a PE in India, then business connection in India stands established27. The principal test, in order to ascertain as toestablishment has a fixed place of business ornot, is that such physically located premises have to be `at the disposal of the enterprise. For this purpose, it is not necessary that the premises are owned or even rented by the enterprise. It will be sufficient if the premises are put at the disposal of the enterprise. However, merely giving access to such a place to the enterprise for the purposes of the project would not suffice. The place would be treated as `at the disposal of the enterprise when the enterprise has right to use the said place and has control thereupon37. Having got a fair idea of what would constitute a PE, we may advert to the discussion in that part of the impugned judgment where the High Court has given its reasons to conclude that FOWC had a PE in India in the relevant Assessment Year. However, before that, it would be necessary to refer to the salient provisions of the relevant agreements between the parties, not only between FOWC and Jaypee, but some agreements which were entered into by the group companies of FOWC with Jaypee38. We have already mentioned above that there is an Agreement between FIA and FOAM which is dated April 24, 2001 whereby FIA has parted with the commercial rights in favour of FOAM making FOAM exclusive CRH. Thereafter, vide the aforesaid agreement FOAM transferred the commercial rights in favour of FOWC with effect from 2011 for a period of 10 years. Insofar as Concorde Agreement which is signed between FIA, FOWC and teams is concerned, that is of the year 200939. It is relevant to mention that before RPC dated September 13, 2011 was entered into between FOWC and Jaypee, one Organisation Agreement (OA) dated January 20, 2011 was signed between FIA/FMSCI and Jaypee. As per this agreement, Jaypee was to organise the event. Thereafter, another agreement known as `Title Sponsorship Agreement dated August 16, 2011 was signed between Beta Prema 2 (an associated company of FOWC) and Bharti Airtel, as per which Beta Prema 2 transferred title sponsorship rights to Bharti Airtel for US$ 8 million in respect of the race which was conducted on October 29, 2011. It is thereafter that RPC dated September 13, 2011 was signed by FOWC and Jaypee. That was one month before the scheduled date of race, which was fixed as October 29, 2011. Under this agreement, right to host, stage and promote the event was given to Jaypee by FOWC. As per the Revenue, FOWC carried on business in India through a fixed place of business, namely, the Buddh International Circuit65. We have pondered over the aforesaid submissions of the learned counsel for the parties with all seriousness and sincerity they deserve. We have also minutely gone through the material placed on record. We have kept in mind the governing law that has already been stated in detail. We are also conscious of the approach that is needed to examine these kinds of issues, as discussed in the judgments referred to by Mr. Dave. Likewise, we have also microscopically examined the judgment of the High Court which is under challenge67. We are of the firm opinion, and it cannot be denied, that Buddh International Circuit is a fixed place. From this circuit different races, including the Grand Prix is conducted, which is undoubtedly an economic/business activity. The core question is as to whether this was put at the disposal of FOWC? Whether this was a fixed place of business of FOWC is the next question. We would like to start our discussion on a crucial parameter viz. the manner in which commercial rights, which are held by FOWC and its affiliates, have been exploited in the instant case. For this purpose entire arrangement between FOWC and its associates on the one hand and Jaypee on the other hand, is to be kept in mind. Various agreements cannot be looked into by isolating them from each other. Their wholesome reading would bring out the real transaction between the parties. Such an approach is essentially required to find out as to who is having real and dominant control over the Event, thereby providing an answer to the question as to whether Buddh International Circuit was at the disposal of FOWC and whether it carried out any business therefrom or not. There is an inalienable relevance of witnessing the wholesome arrangement in order to have complete picture of the relationship between FOWC and Jaypee. That would enable us to capture the real essence of FOWCs role69. We are in agreement with the aforesaid analysis which correctly captures the substance of the relevant clauses of the agreement70. We are also of the opinion that the High Court has rightly concluded that having regard to the duration of the event, which was for limited days, and for the entire duration FOWC had full access through its personnel, number of days for which the access was there would not make any difference.71. A stand at a trade fair, occupied regularly for three weeks a year, through which an enterprise obtained contracts for a significant part of its annual sales, was held to constitute a PE (Refer Footnote 4]). Likewise, a temporary restaurant operated in a mirror tent at a Dutch flower show for a period of seven months was held to constitute a PE (Refer Footnote 5])73. Coming to the second aspect of the issue, namely, whether FOWC carried on any business and commercial activity in India or not, substantial part of this aspect has already been discussed and taken care of above. Without being repetitive and pleonastic or tautologous, we may only add that FOWC is the Commercial Right Holder (CRH). These rights can be exploited with the conduct of F-1 Championship, which is organised in various countries. It was decided to have this championship in India as well. In order to undertake conducting of such races, the first requirement is to have a track for this purpose. Then, teams are needed who would participate in the competition. Another requirement is to have the public/viewers who would be interested in witnessing such races from the places built around the track. Again, for augmenting the earnings in these events, there would be advertisements, media rights, etc. as well. It is FOWC and its affiliates which have been responsible for all the aforesaid activities. The Concorde Agreement is signed between FIA, FOA and FOWC whereby not only FOWC became Commercial Rights Holder for 100 years, this agreement further enabled participation of the teams who agreed for such participation in the FIA Championship each year for every event and undertook to participate in each event with two cars. FIA undertook to ensure that events were held and FOWC, as CRH, undertook to enter into contracts with event promoters and host such events. All possible commercial rights, including advertisement, media rights, etc. and even right to sell paddock seats, were assumed by FOWC and its associates. Thus, as a part of its business, FOWC (as well as its affiliates) undertook the aforesaid commercial activities in India.74. In view of the above, it is difficult to accept the arguments of the appellants that it is Jaypee who was responsible for conducting races and had complete control over the Event in question. Mere construction of the track by Jaypee at its expense will be of no consequence. Its ownership or organising other events by Jaypee is also immaterial. Our examination is limited to the conduct of the F-1 Championship and control over the track during that period. Specific arrangement between the parties relating to the aforesaid, which is elaborated above and which FOWC and Jaypee unsuccessfully endeavoured to ignore, has in fact turned the table against them. It is also difficult to accept their submission that FOWC had no role in the conduct of the Championship and its role came to an end with granting permission to host the Event as a round of the championship. We also reject the argument of the appellants that the Buddh International Circuit was not under the control and at the disposal of FOWC75. No doubt, FOWC, as CRH of these events, is in the business of exploiting these rights, including intellectual property rights. However, these became possible, in the instant case, only with the actual conduct of these races and active participation of FOWC in the said races, with access and control over the circuit76. We are of the opinion that the test laid down by the Andhra Pradesh High Court in Visakhapatnam Port Trust case fully stands satisfied. Not only the Buddh International Circuit is a fixed place where the commercial/economic activity of conducting F-1 Championship was carried out, one could clearly discern that it was a virtual projection of the foreign enterprise, namely, Formula-1 (i.e. FOWC) on the soil of this country. It is already noted above that as per Philip Baker (A Manual on the OECD Model Tax Convention on Income and on Capital]), a PE must have three characteristics: stability, productivity and dependence. All characteristics are present in this case. Fixed place of business in the form of physical location, i.e. Buddh International Circuit, was at the disposal of FOWC through which it conducted business. Aesthetics of law and taxation jurisprudence leave no doubt in our mind that taxable event has taken place in India and non-resident FOWC is liable to pay tax in India on the income it has earned on this soil77. We are now left with two other incidental issues which were raised by Mr. Datar. First was on the interpretation of Section 195 of the Act. It cannot be disputed that a person who makes the payment to a non-resident is under an obligation to deduct tax under Section 195 of the Act on such payments. Mr. Rohatgi had submitted, and rightly so, that this issue is covered by the judgment in the case of GE India Technology Centre Private Limited (Refer Footnote 23]). Precisely this very judgment is taken note of and relied upon by the High Court also in holding that since payments made by Jaypee to FOWC under the RPC were business income of the FOWC through PE at the Buddh International Circuit, and, therefore, chargeable to tax, Jaypee was bound to make appropriate deductions from the amounts paid under Section 195 of the Act78. We are, however, inclined to accept the submission of Mr. Datar that only that portion of the income of FOWC, which is attributable to the said PE, would be treated as business income of FOWC and only that part of income deduction was required to be made under Section 195 of the Act. In GE India Technology Centre Private Limited (Refer Footnote 23]), this Court has clarified that though there is an obligation to deduct tax, the obligation is limited to the appropriate portion of income which is chargeable to tax in India and in respect of other payments where no tax is payable, recourse is to be made under Section 195(2) of the Act. It would be for the Assessing Officer to adjudicate upon the aforesaid aspects while passing the Assessment Order, namely, how much business income of FOWC is attributable to PE in India, which is chargeable to tax. At that stage, Jaypee can also press its argument that penalty etc. be not charged as the move on the part of Jaypee in not deducting tax at source was bona fide. We make it clear that we have not expressed any opinion either way79. Insofar as the argument of Mr. Datar on the powers of the High Court under Article 226 of the Constitution of India is concerned, we are not impressed by the said argument. It is Jaypee itself which had filed the writ petition (and for that matter FOWC as well) and they had challenged the orders of AAR on certain aspects. The High Court has examined legal issues while delivering the impugned judgment, of course having regard to the facts which were culled out from the documents on record | 0 | 26,229 | 2,614 | ### Instruction:
Forecast the likely verdict of the case (granting (1) or denying (0) the appeal) and then rationalize your prediction by pinpointing and explaining pivotal sentences in the case document.
### Input:
event. The conceptualization of the event and the right to include it in any particular circuit, such as Buddh Circuit is that of the FOWC; it decides the venue and the participating teams are bound to it to compete in the race in the terms agreed with the FOWC. All these, in the opinion of the Court, unequivocally, show that the FOWC carried on business in India for the duration of the race (and for two weeks before the race and a week thereafter). Every right, which it possessed was monetized; the US$ 40 million which Jaypee paid was only a part of that commercial exploitation by the FOWC. 58. Consequently, the Court concludes that the FOWC carried on business in India within the meaning of expression under Article 5(1) of the DTAA. It is consequently held that the AAR fell into error of law in holding that FOWC did not function through a PE/carry on business through a fixed place of business in India. 74. In view of the above, it is difficult to accept the arguments of the appellants that it is Jaypee who was responsible for conducting races and had complete control over the Event in question. Mere construction of the track by Jaypee at its expense will be of no consequence. Its ownership or organising other events by Jaypee is also immaterial. Our examination is limited to the conduct of the F-1 Championship and control over the track during that period. Specific arrangement between the parties relating to the aforesaid, which is elaborated above and which FOWC and Jaypee unsuccessfully endeavoured to ignore, has in fact turned the table against them. It is also difficult to accept their submission that FOWC had no role in the conduct of the Championship and its role came to an end with granting permission to host the Event as a round of the championship. We also reject the argument of the appellants that the Buddh International Circuit was not under the control and at the disposal of FOWC. 75. No doubt, FOWC, as CRH of these events, is in the business of exploiting these rights, including intellectual property rights. However, these became possible, in the instant case, only with the actual conduct of these races and active participation of FOWC in the said races, with access and control over the circuit. 76. We are of the opinion that the test laid down by the Andhra Pradesh High Court in Visakhapatnam Port Trust case fully stands satisfied. Not only the Buddh International Circuit is a fixed place where the commercial/economic activity of conducting F-1 Championship was carried out, one could clearly discern that it was a virtual projection of the foreign enterprise, namely, Formula-1 (i.e. FOWC) on the soil of this country. It is already noted above that as per Philip Baker (A Manual on the OECD Model Tax Convention on Income and on Capital]), a PE must have three characteristics: stability, productivity and dependence. All characteristics are present in this case. Fixed place of business in the form of physical location, i.e. Buddh International Circuit, was at the disposal of FOWC through which it conducted business. Aesthetics of law and taxation jurisprudence leave no doubt in our mind that taxable event has taken place in India and non-resident FOWC is liable to pay tax in India on the income it has earned on this soil. 77. We are now left with two other incidental issues which were raised by Mr. Datar. First was on the interpretation of Section 195 of the Act. It cannot be disputed that a person who makes the payment to a non-resident is under an obligation to deduct tax under Section 195 of the Act on such payments. Mr. Rohatgi had submitted, and rightly so, that this issue is covered by the judgment in the case of GE India Technology Centre Private Limited (Refer Footnote 23]). Precisely this very judgment is taken note of and relied upon by the High Court also in holding that since payments made by Jaypee to FOWC under the RPC were business income of the FOWC through PE at the Buddh International Circuit, and, therefore, chargeable to tax, Jaypee was bound to make appropriate deductions from the amounts paid under Section 195 of the Act. 78. We are, however, inclined to accept the submission of Mr. Datar that only that portion of the income of FOWC, which is attributable to the said PE, would be treated as business income of FOWC and only that part of income deduction was required to be made under Section 195 of the Act. In GE India Technology Centre Private Limited (Refer Footnote 23]), this Court has clarified that though there is an obligation to deduct tax, the obligation is limited to the appropriate portion of income which is chargeable to tax in India and in respect of other payments where no tax is payable, recourse is to be made under Section 195(2) of the Act. It would be for the Assessing Officer to adjudicate upon the aforesaid aspects while passing the Assessment Order, namely, how much business income of FOWC is attributable to PE in India, which is chargeable to tax. At that stage, Jaypee can also press its argument that penalty etc. be not charged as the move on the part of Jaypee in not deducting tax at source was bona fide. We make it clear that we have not expressed any opinion either way. 79. Insofar as the argument of Mr. Datar on the powers of the High Court under Article 226 of the Constitution of India is concerned, we are not impressed by the said argument. It is Jaypee itself which had filed the writ petition (and for that matter FOWC as well) and they had challenged the orders of AAR on certain aspects. The High Court has examined legal issues while delivering the impugned judgment, of course having regard to the facts which were culled out from the documents on record.
### Response:
0
### Explanation:
to have the public/viewers who would be interested in witnessing such races from the places built around the track. Again, for augmenting the earnings in these events, there would be advertisements, media rights, etc. as well. It is FOWC and its affiliates which have been responsible for all the aforesaid activities. The Concorde Agreement is signed between FIA, FOA and FOWC whereby not only FOWC became Commercial Rights Holder for 100 years, this agreement further enabled participation of the teams who agreed for such participation in the FIA Championship each year for every event and undertook to participate in each event with two cars. FIA undertook to ensure that events were held and FOWC, as CRH, undertook to enter into contracts with event promoters and host such events. All possible commercial rights, including advertisement, media rights, etc. and even right to sell paddock seats, were assumed by FOWC and its associates. Thus, as a part of its business, FOWC (as well as its affiliates) undertook the aforesaid commercial activities in India.74. In view of the above, it is difficult to accept the arguments of the appellants that it is Jaypee who was responsible for conducting races and had complete control over the Event in question. Mere construction of the track by Jaypee at its expense will be of no consequence. Its ownership or organising other events by Jaypee is also immaterial. Our examination is limited to the conduct of the F-1 Championship and control over the track during that period. Specific arrangement between the parties relating to the aforesaid, which is elaborated above and which FOWC and Jaypee unsuccessfully endeavoured to ignore, has in fact turned the table against them. It is also difficult to accept their submission that FOWC had no role in the conduct of the Championship and its role came to an end with granting permission to host the Event as a round of the championship. We also reject the argument of the appellants that the Buddh International Circuit was not under the control and at the disposal of FOWC75. No doubt, FOWC, as CRH of these events, is in the business of exploiting these rights, including intellectual property rights. However, these became possible, in the instant case, only with the actual conduct of these races and active participation of FOWC in the said races, with access and control over the circuit76. We are of the opinion that the test laid down by the Andhra Pradesh High Court in Visakhapatnam Port Trust case fully stands satisfied. Not only the Buddh International Circuit is a fixed place where the commercial/economic activity of conducting F-1 Championship was carried out, one could clearly discern that it was a virtual projection of the foreign enterprise, namely, Formula-1 (i.e. FOWC) on the soil of this country. It is already noted above that as per Philip Baker (A Manual on the OECD Model Tax Convention on Income and on Capital]), a PE must have three characteristics: stability, productivity and dependence. All characteristics are present in this case. Fixed place of business in the form of physical location, i.e. Buddh International Circuit, was at the disposal of FOWC through which it conducted business. Aesthetics of law and taxation jurisprudence leave no doubt in our mind that taxable event has taken place in India and non-resident FOWC is liable to pay tax in India on the income it has earned on this soil77. We are now left with two other incidental issues which were raised by Mr. Datar. First was on the interpretation of Section 195 of the Act. It cannot be disputed that a person who makes the payment to a non-resident is under an obligation to deduct tax under Section 195 of the Act on such payments. Mr. Rohatgi had submitted, and rightly so, that this issue is covered by the judgment in the case of GE India Technology Centre Private Limited (Refer Footnote 23]). Precisely this very judgment is taken note of and relied upon by the High Court also in holding that since payments made by Jaypee to FOWC under the RPC were business income of the FOWC through PE at the Buddh International Circuit, and, therefore, chargeable to tax, Jaypee was bound to make appropriate deductions from the amounts paid under Section 195 of the Act78. We are, however, inclined to accept the submission of Mr. Datar that only that portion of the income of FOWC, which is attributable to the said PE, would be treated as business income of FOWC and only that part of income deduction was required to be made under Section 195 of the Act. In GE India Technology Centre Private Limited (Refer Footnote 23]), this Court has clarified that though there is an obligation to deduct tax, the obligation is limited to the appropriate portion of income which is chargeable to tax in India and in respect of other payments where no tax is payable, recourse is to be made under Section 195(2) of the Act. It would be for the Assessing Officer to adjudicate upon the aforesaid aspects while passing the Assessment Order, namely, how much business income of FOWC is attributable to PE in India, which is chargeable to tax. At that stage, Jaypee can also press its argument that penalty etc. be not charged as the move on the part of Jaypee in not deducting tax at source was bona fide. We make it clear that we have not expressed any opinion either way79. Insofar as the argument of Mr. Datar on the powers of the High Court under Article 226 of the Constitution of India is concerned, we are not impressed by the said argument. It is Jaypee itself which had filed the writ petition (and for that matter FOWC as well) and they had challenged the orders of AAR on certain aspects. The High Court has examined legal issues while delivering the impugned judgment, of course having regard to the facts which were culled out from the documents on record
|
Bhikhubhai Vithlabhai Patel Vs. State Of Gujarat | acts reasonably and in good faith and upon lawful and relevant grounds of public interest. The whole conception of unfettered discretion is inappropriate to a public authority, which possesses powers solely in order that it may use them for the public good’ There is nothing paradoxical in the imposition of such legal limits. It would indeed be paradoxical if they were not imposed.” 33. The Court is entitled to examine whether there has been any material available with the State Government and the reasons recorded, if any, in the formation of opinion and whether they have any rational connection with or relevant bearing on the formation of the opinion. The Court is entitled particularly, in the event, when the formation of the opinion is challenged to determine whether the formation of opinion is arbitrary, capricious or whimsical. It is always open to the court to examine the question whether reasons for formation of opinion have rational connection or relevant bearing to the formation of such opinion and are not extraneous to the purposes of the statute.34. In the affidavit in reply filed on behalf of the State Government in the High Court, it was averred what weighed with the State Government to exercise its power under Section 17 (1) (a) (ii) of the Act was public interest at large. The State government thought it fit to classify the lands in question for educational use so that there is a specific pocket of educational institutional area in the fast developing city of Surat where its population in the last decade, has almost doubled. If such educational institutional pockets in the adjoining land, where there already exists the complex of South Gujarat University, are not ensured in the development plan of the city like Surat, then, in that case, land would not be available in future. This would resultantly make people to travel long distance from the city area for educational purpose. Public interest parameter is undoubtedly a valid consideration that could have been taken into account by the State Government. But this aspect of the matter is stated for the first time in the affidavit in reply and is not born out by the record. There is nothing on record suggesting as to what public interest parameter weighed with the State Government. The question is: was there any material available on record in support of what has been pleaded in the reply affidavit? 35. Be that as it may, the impugned preliminary notification itself does not reflect formation of any opinion by the State Government that it had become necessary to make substantial modifications in the draft development plan and, for that reason, instead of returning in the plan, decided to publish the modifications so considered necessary in the Official Gazette along with the notice inviting suggestions or objections with respect to the proposed modifications. It is very well settled, public orders publicly made, in exercise of a statutory authority, cannot be construed in the light of explanations subsequently given by the decision making authority. Public orders made by authorities are meant to have public effect and must be construed objectively with reference to the language used in the order itself. (See - Gordhandas Bhanji and Mohinder Singh Gill & Anr. Vs. The Chief Election Commissioner, New Delhi). 36. Neither the preliminary notification itself nor the records disclose the formation of any opinion by the State Government much less any consideration that any necessity as such had arisen to make substantial modifications in the draft development plan.37. On consideration of the facts and the material available on record, it is established that the State Government took the action proposing to make substantial modifications to the plan without forming of any opinion, which is a condition precedent for the use of power under proviso to Section 17(1)(a)(ii). The power, to restrict the use of land by the owners thereof, is a drastic power. The designation or reservation of the land and its use results in severe abridgment of the right to property. Statutory provisions enabling the State or its authorities to impose restrictions on the right to use one’s own land are required to be construed strictly. The legislature has, it seems to us, prescribed certain conditions to prevent the abuse of power and to ensure just exercise of power. Section 17 and more particularly the proviso to Section 17 (1) (a) (ii) prescribes some of the conditions precedent for the exercise of power. The order proposing to make substantial modifications, in breach of any one of those conditions, will undoubtedly be void. On a successful showing the order proposing substantial modifications and designating the land of the appellants for educational use under Section 12 (2) (o) of the Act has been made without the Statement Government applying its mind to the aspect of necessity or without forming an honest opinion on that aspect, it will, we have no doubt, be void.38. For the view we have taken to strike down both the notifications and declare them ultra vires it is unnecessary to go into various other contentions urged before us.39. The appellants are deprived of their right to use the land for residential purposes for over a period of more than a quarter century. The Authority included the land in the residential zone but the State Government reserved the land for the purposes of South Gujarat University but the authority for whose benefit it was required failed to acquire the land leading to re-reservation of the land for the very same purpose which was ultimately struck down by this Court in Bhavnagar University (supra).40. The present move of the State Government to designate the land for the educational use under Section 12 (2) (o) of the Act is declared ultra vires and void and this shall put an end to the controversy enabling the appellants to utilize the land for residential purposes. The authorities including the State Government shall accordingly do the needful, without creating any further hurdle in the matter. | 1[ds]19. A plain reading of Section 17 suggests that on receipt of draft development plan the State Government may sanction the draft development plan, for the whole of the area covered by the plan or separately for any part thereof; return the draft development plan for modifying the plan in such a manner as may direct; but in cases where the State Government is of opinion that the substantial modifications in the draft development plan are necessary, it may, instead of returning them to the authority or the authorised officer, publish the modifications so considered necessary along with the notice in the prescribed manner inviting suggestions or objections with respect to the proposed modifications. It may even refuse to accord sanction to the draft development plan and direct to prepare a fresh development plan under the provisions of the Act. Indeed a very wide power is conferred upon the State Government in the matter of sanctioning of the draft development plan. In the instant case we are concerned with the action of the State Government in making substantial modifications in the revised draft development plan. Section 21 of the Act mandates that the same procedure as provided for preparation and sanction of draft development plan including the one under section 17 would be applicable even in respect of revision of development plan.It is true the State Government is not bound by such opinion and entitled to take its own decision in the matter provided there is material available on record to form opinion that substantial modifications in the draft development plan were necessary. Formation of opinion is a condition precedent for setting the law in motion proposing substantial modifications in the draft development plan.22. Any opinion of the Government to be formed is not subject to objective test. The language leaves no room for the relevance of a judicial examination as to the sufficiency of the grounds on which the Government acted in forming its opinion. But there must be material based on which alone the State Government could form its opinion that it has become necessary to make substantial modification in the draft development plan.In the case in hand, wasthere any material before the State Government for its consideration that it had become necessary to make substantial modifications to the draft developmentplan? The emphatic answer is, none. The record does not reveal that there has been any consideration by the State Government that necessity had arisen to make substantial modifications to the draft development plan. We are of the view that there has been no formation of the opinion by the State Government which is a condition precedent for exercising the power under the proviso to Section 17 (1) (a) (ii) of the Act.We are of the view that the construction placed on the expression ‘reason towill equally be applicable to the expression ‘is ofemployed in the proviso to Section 17 (1) (a) (ii) of the Act. The expression ‘is ofthat substantial modifications in the draft development plan and regulations, ‘arein our considered opinion, does not confer any unlimited discretion on the Government. The discretion, if any, conferred upon the State Government to make substantial modifications in the draft development plan is not unfettered. There is nothing like absolute or unfettered discretion and at any rate in the case of statutory powers.The Court is entitled to examine whether there has been any material available with the State Government and the reasons recorded, if any, in the formation of opinion and whether they have any rational connection with or relevant bearing on the formation of the opinion. The Court is entitled particularly, in the event, when the formation of the opinion is challenged to determine whether the formation of opinion is arbitrary, capricious or whimsical. It is always open to the court to examine the question whether reasons for formation of opinion have rational connection or relevant bearing to the formation of such opinion and are not extraneous to the purposes of the statute.34. In the affidavit in reply filed on behalf of the State Government in the High Court, it was averred what weighed with the State Government to exercise its power under Section 17 (1) (a) (ii) of the Act was public interest at large. The State government thought it fit to classify the lands in question for educational use so that there is a specific pocket of educational institutional area in the fast developing city of Surat where its population in the last decade, has almost doubled. If such educational institutional pockets in the adjoining land, where there already exists the complex of South Gujarat University, are not ensured in the development plan of the city like Surat, then, in that case, land would not be available in future. This would resultantly make people to travel long distance from the city area for educational purpose. Public interest parameter is undoubtedly a valid consideration that could have been taken into account by the State Government. But this aspect of the matter is stated for the first time in the affidavit in reply and is not born out by the record. There is nothing on record suggesting as to what public interest parameter weighed with the State Government.Neither the preliminary notification itself nor the records disclose the formation of any opinion by the State Government much less any consideration that any necessity as such had arisen to make substantial modifications in the draft development plan.37. On consideration of the facts and the material available on record, it is established that the State Government took the action proposing to make substantial modifications to the plan without forming of any opinion, which is a condition precedent for the use of power under proviso to Section 17(1)(a)(ii). The power, to restrict the use of land by the owners thereof, is a drastic power. The designation or reservation of the land and its use results in severe abridgment of the right to property. Statutory provisions enabling the State or its authorities to impose restrictions on the right to useown land are required to be construed strictly. The legislature has, it seems to us, prescribed certain conditions to prevent the abuse of power and to ensure just exercise of power. Section 17 and more particularly the proviso to Section 17 (1) (a) (ii) prescribes some of the conditions precedent for the exercise of power. The order proposing to make substantial modifications, in breach of any one of those conditions, will undoubtedly be void. On a successful showing the order proposing substantial modifications and designating the land of the appellants for educational use under Section 12 (2) (o) of the Act has been made without the Statement Government applying its mind to the aspect of necessity or without forming an honest opinion on that aspect, it will, we have no doubt, be void.38. For the view we have taken to strike down both the notifications and declare them ultra vires it is unnecessary to go into various other contentions urged before us.39. The appellants are deprived of their right to use the land for residential purposes for over a period of more than a quarter century. The Authority included the land in the residential zone but the State Government reserved the land for the purposes of South Gujarat University but the authority for whose benefit it was required failed to acquire the land leading to re-reservation of the land for the very same purpose which was ultimately struck down by this Court in Bhavnagar University (supra).40. The present move of the State Government to designate the land for the educational use under Section 12 (2) (o) of the Act is declared ultra vires and void and this shall put an end to the controversy enabling the appellants to utilize the land for residential purposes. The authorities including the State Government shall accordingly do the needful, without creating any further hurdle in the matter. | 1 | 7,308 | 1,444 | ### Instruction:
Predict whether the case will result in an affirmative (1) or negative (0) decision for the appeal, and then provide a thorough explanation using key sentences to support your prediction.
### Input:
acts reasonably and in good faith and upon lawful and relevant grounds of public interest. The whole conception of unfettered discretion is inappropriate to a public authority, which possesses powers solely in order that it may use them for the public good’ There is nothing paradoxical in the imposition of such legal limits. It would indeed be paradoxical if they were not imposed.” 33. The Court is entitled to examine whether there has been any material available with the State Government and the reasons recorded, if any, in the formation of opinion and whether they have any rational connection with or relevant bearing on the formation of the opinion. The Court is entitled particularly, in the event, when the formation of the opinion is challenged to determine whether the formation of opinion is arbitrary, capricious or whimsical. It is always open to the court to examine the question whether reasons for formation of opinion have rational connection or relevant bearing to the formation of such opinion and are not extraneous to the purposes of the statute.34. In the affidavit in reply filed on behalf of the State Government in the High Court, it was averred what weighed with the State Government to exercise its power under Section 17 (1) (a) (ii) of the Act was public interest at large. The State government thought it fit to classify the lands in question for educational use so that there is a specific pocket of educational institutional area in the fast developing city of Surat where its population in the last decade, has almost doubled. If such educational institutional pockets in the adjoining land, where there already exists the complex of South Gujarat University, are not ensured in the development plan of the city like Surat, then, in that case, land would not be available in future. This would resultantly make people to travel long distance from the city area for educational purpose. Public interest parameter is undoubtedly a valid consideration that could have been taken into account by the State Government. But this aspect of the matter is stated for the first time in the affidavit in reply and is not born out by the record. There is nothing on record suggesting as to what public interest parameter weighed with the State Government. The question is: was there any material available on record in support of what has been pleaded in the reply affidavit? 35. Be that as it may, the impugned preliminary notification itself does not reflect formation of any opinion by the State Government that it had become necessary to make substantial modifications in the draft development plan and, for that reason, instead of returning in the plan, decided to publish the modifications so considered necessary in the Official Gazette along with the notice inviting suggestions or objections with respect to the proposed modifications. It is very well settled, public orders publicly made, in exercise of a statutory authority, cannot be construed in the light of explanations subsequently given by the decision making authority. Public orders made by authorities are meant to have public effect and must be construed objectively with reference to the language used in the order itself. (See - Gordhandas Bhanji and Mohinder Singh Gill & Anr. Vs. The Chief Election Commissioner, New Delhi). 36. Neither the preliminary notification itself nor the records disclose the formation of any opinion by the State Government much less any consideration that any necessity as such had arisen to make substantial modifications in the draft development plan.37. On consideration of the facts and the material available on record, it is established that the State Government took the action proposing to make substantial modifications to the plan without forming of any opinion, which is a condition precedent for the use of power under proviso to Section 17(1)(a)(ii). The power, to restrict the use of land by the owners thereof, is a drastic power. The designation or reservation of the land and its use results in severe abridgment of the right to property. Statutory provisions enabling the State or its authorities to impose restrictions on the right to use one’s own land are required to be construed strictly. The legislature has, it seems to us, prescribed certain conditions to prevent the abuse of power and to ensure just exercise of power. Section 17 and more particularly the proviso to Section 17 (1) (a) (ii) prescribes some of the conditions precedent for the exercise of power. The order proposing to make substantial modifications, in breach of any one of those conditions, will undoubtedly be void. On a successful showing the order proposing substantial modifications and designating the land of the appellants for educational use under Section 12 (2) (o) of the Act has been made without the Statement Government applying its mind to the aspect of necessity or without forming an honest opinion on that aspect, it will, we have no doubt, be void.38. For the view we have taken to strike down both the notifications and declare them ultra vires it is unnecessary to go into various other contentions urged before us.39. The appellants are deprived of their right to use the land for residential purposes for over a period of more than a quarter century. The Authority included the land in the residential zone but the State Government reserved the land for the purposes of South Gujarat University but the authority for whose benefit it was required failed to acquire the land leading to re-reservation of the land for the very same purpose which was ultimately struck down by this Court in Bhavnagar University (supra).40. The present move of the State Government to designate the land for the educational use under Section 12 (2) (o) of the Act is declared ultra vires and void and this shall put an end to the controversy enabling the appellants to utilize the land for residential purposes. The authorities including the State Government shall accordingly do the needful, without creating any further hurdle in the matter.
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which the Government acted in forming its opinion. But there must be material based on which alone the State Government could form its opinion that it has become necessary to make substantial modification in the draft development plan.In the case in hand, wasthere any material before the State Government for its consideration that it had become necessary to make substantial modifications to the draft developmentplan? The emphatic answer is, none. The record does not reveal that there has been any consideration by the State Government that necessity had arisen to make substantial modifications to the draft development plan. We are of the view that there has been no formation of the opinion by the State Government which is a condition precedent for exercising the power under the proviso to Section 17 (1) (a) (ii) of the Act.We are of the view that the construction placed on the expression ‘reason towill equally be applicable to the expression ‘is ofemployed in the proviso to Section 17 (1) (a) (ii) of the Act. The expression ‘is ofthat substantial modifications in the draft development plan and regulations, ‘arein our considered opinion, does not confer any unlimited discretion on the Government. The discretion, if any, conferred upon the State Government to make substantial modifications in the draft development plan is not unfettered. There is nothing like absolute or unfettered discretion and at any rate in the case of statutory powers.The Court is entitled to examine whether there has been any material available with the State Government and the reasons recorded, if any, in the formation of opinion and whether they have any rational connection with or relevant bearing on the formation of the opinion. The Court is entitled particularly, in the event, when the formation of the opinion is challenged to determine whether the formation of opinion is arbitrary, capricious or whimsical. It is always open to the court to examine the question whether reasons for formation of opinion have rational connection or relevant bearing to the formation of such opinion and are not extraneous to the purposes of the statute.34. In the affidavit in reply filed on behalf of the State Government in the High Court, it was averred what weighed with the State Government to exercise its power under Section 17 (1) (a) (ii) of the Act was public interest at large. The State government thought it fit to classify the lands in question for educational use so that there is a specific pocket of educational institutional area in the fast developing city of Surat where its population in the last decade, has almost doubled. If such educational institutional pockets in the adjoining land, where there already exists the complex of South Gujarat University, are not ensured in the development plan of the city like Surat, then, in that case, land would not be available in future. This would resultantly make people to travel long distance from the city area for educational purpose. Public interest parameter is undoubtedly a valid consideration that could have been taken into account by the State Government. But this aspect of the matter is stated for the first time in the affidavit in reply and is not born out by the record. There is nothing on record suggesting as to what public interest parameter weighed with the State Government.Neither the preliminary notification itself nor the records disclose the formation of any opinion by the State Government much less any consideration that any necessity as such had arisen to make substantial modifications in the draft development plan.37. On consideration of the facts and the material available on record, it is established that the State Government took the action proposing to make substantial modifications to the plan without forming of any opinion, which is a condition precedent for the use of power under proviso to Section 17(1)(a)(ii). The power, to restrict the use of land by the owners thereof, is a drastic power. The designation or reservation of the land and its use results in severe abridgment of the right to property. Statutory provisions enabling the State or its authorities to impose restrictions on the right to useown land are required to be construed strictly. The legislature has, it seems to us, prescribed certain conditions to prevent the abuse of power and to ensure just exercise of power. Section 17 and more particularly the proviso to Section 17 (1) (a) (ii) prescribes some of the conditions precedent for the exercise of power. The order proposing to make substantial modifications, in breach of any one of those conditions, will undoubtedly be void. On a successful showing the order proposing substantial modifications and designating the land of the appellants for educational use under Section 12 (2) (o) of the Act has been made without the Statement Government applying its mind to the aspect of necessity or without forming an honest opinion on that aspect, it will, we have no doubt, be void.38. For the view we have taken to strike down both the notifications and declare them ultra vires it is unnecessary to go into various other contentions urged before us.39. The appellants are deprived of their right to use the land for residential purposes for over a period of more than a quarter century. The Authority included the land in the residential zone but the State Government reserved the land for the purposes of South Gujarat University but the authority for whose benefit it was required failed to acquire the land leading to re-reservation of the land for the very same purpose which was ultimately struck down by this Court in Bhavnagar University (supra).40. The present move of the State Government to designate the land for the educational use under Section 12 (2) (o) of the Act is declared ultra vires and void and this shall put an end to the controversy enabling the appellants to utilize the land for residential purposes. The authorities including the State Government shall accordingly do the needful, without creating any further hurdle in the matter.
|
Commissioner Of Income-Tax, Punjab Vs. Indian Woollen Textile Mills | Shah, J.1. M/s. Indian Woollen Textiles Mills Amritsar -hereinafter called the assessee had branches at different places in India, one of which was an industrial undertaking conducted in the name of Eldee Velvet and Silk Mills-called for the sake of brevity "Eldee. "Eldee had advanced Rs. 3,21,460/- to another concern, the Bombay Fine Worsted Manufacturers Castle Mills-hereinafter called Castle. In the assessment year 1951-52, the assessee claimed under S. 15C of the Indian Income-tax Act 1922, exemption from tax in respect of 6 per cent of the capital employed in Eldee as a newly established undertaking and sought to include in the computation of the capital so employed Rs. 3,21,460/- advanced to Castle. The Income-tax Officer, Special Circle, Amritsar, and the Appellate Assistant Commissioner rejected the claim. But the Income-tax Appellate Tribunal modified the assessment and directed inclusion of the amount advanced to Castle in the computation of capital invested for the purpose of S. 15C. An application submitted under S 66(1) of the Indian Income-tax Act to the Tribunal to refer a question which it was contended by the Commissioner arose out of the order of the Tribunal was rejected and the petition of the Commissioner under S. 66(2) for an order directing the Tribunal to state the case and refer it to the High Court was also dismissed. With special leave the Commissioner has appealed to this Court.2. The question in dispute before the Revenue authorities was whether the business called Castle at Bombay was a branch of the assessee. The Appellate Assistant Commissioner rejected the claim of the assessee to include the amount of Rs. 3,21,460/- in the capital employed in the undertaking Eldee, because in his view there were in these two undertakings the same eight partners with a share of -/2/- (two annas) each, and that the constitution of both the undertakings being the same, Castle could not be regarded as a separate entity. The Tribunal disagreed with the view of the Appellate Assistant Commissioner, relying upon only one circumstance, viz., that in the assessment for the year 1951-52 the income from Castle had not been computed and included in the assessment of the assessee. It did not consider the other questions whether the constitution and ownership of the two businesses "were the same. The High Court declined to require the Tribunal to state the case holding that the finding of the Tribunal was one of fact as it was based on the inference arising from the non-inclusion by the Income-tax Officer in the assessment in question of the income of Castle and that "the factor taken into consideration by the Appellate Tribunal in coming to the conclusion, it did, was a relevant factor.3. Section 66 (2) invests the High Court with jurisdiction to require the Appellate Tribunal to state a case and to refer it, if the Appellant Tribunal has refused to state the case on the ground that no question of law arises, and the High Court being approached by the aggrieved party within the period of limitation prescribed, is not satisfied about the correctness of the decision of the Appellate Tribunal refusing to state the case. Under the Income-tax Act is for the Tribunal to decide all questions of fact: the High Court has the power merely to advise the Tribunal on questions of law arising out of the order of the Tribunal. In so advising the High Court must accept the findings of the Tribunal on matters of appreciation of evidence. But the refusal of the Tribunal to state a case for the opinion of the High Court, on the view that a question of law does not arise out of the order is not conclusive. The High Court has the power to call upon the Tribunal to state the case if in its view a question of law arises out of the order of the Tribunal. Such a question may arise out of the findings of the Tribunal, and also if the Tribunal has misdirected itself in law in arriving at its finding. It is not open to the Court to discard the Tribunals finding of fact, if there is some evidence to support the finding of the Tribunal on a question of fact, even if on a review of the evidence the Court might have arrived at a different conclusion. It must however appear that the Tribunal had considered evidence covering all the essential matters before arriving at its conclusion. If the conclusion of the Tribunal is based upon some evidence ignoring other essential matters, it cannot be regarded as a finding not giving rise to a question liable to be referred to the Court.4. Non-inclusion of the income of Castle in the assessment of the assessee may have been a relevant circumstance, but its effect had to be considered in the light of other circumstances on which the Appellate Assistant Commissioner had relied. Moreover, reliance place by the Tribunal upon the single circumstance on which its decision was founded had proceeded on an assumption that in the previous year to the year of assessment 1951-52. Castle had carried on business and had earned income. The observations made by the Appellant Assistant Commissioner about, Castle being separately assessed at Bombay in the status of a registered firm apparently refer to assessment of that business in subsequent years and not in the year of assessment 1951-52.The conclusion of the Tribunal therefore suffers from a double infirmity : it assumes the only fact on which its conclusion is founded and ignores other relevant matters on which the Appellate Assistant Commissioner relied in support of his conclusion. The Tribunal has therefore misdirected itself in law in arriving at its finding, and in refusing to require the Tribunal to state the case and to refer it, the High Court was, in our view, in error. | 1[ds]3. Section 66 (2) invests the High Court with jurisdiction to require the Appellate Tribunal to state a case and to refer it, if the Appellant Tribunal has refused to state the case on the ground that no question of law arises, and the High Court being approached by the aggrieved party within the period of limitation prescribed, is not satisfied about the correctness of the decision of the Appellate Tribunal refusing to state the case. Under the Income-tax Act is for the Tribunal to decide all questions of fact: the High Court has the power merely to advise the Tribunal on questions of law arising out of the order of the Tribunal. In so advising the High Court must accept the findings of the Tribunal on matters of appreciation of evidence. But the refusal of the Tribunal to state a case for the opinion of the High Court, on the view that a question of law does not arise out of the order is not conclusive. The High Court has the power to call upon the Tribunal to state the case if in its view a question of law arises out of the order of the Tribunal. Such a question may arise out of the findings of the Tribunal, and also if the Tribunal has misdirected itself in law in arriving at its finding. It is not open to the Court to discard the Tribunals finding of fact, if there is some evidence to support the finding of the Tribunal on a question of fact, even if on a review of the evidence the Court might have arrived at a different conclusion. It must however appear that the Tribunal had considered evidence covering all the essential matters before arriving at its conclusion. If the conclusion of the Tribunal is based upon some evidence ignoring other essential matters, it cannot be regarded as a finding not giving rise to a question liable to be referred to the Court.4. Non-inclusion of the income of Castle in the assessment of the assessee may have been a relevant circumstance, but its effect had to be considered in the light of other circumstances on which the Appellate Assistant Commissioner had relied. Moreover, reliance place by the Tribunal upon the single circumstance on which its decision was founded had proceeded on an assumption that in the previous year to the year of assessment 1951-52. Castle had carried on business and had earned income. The observations made by the Appellant Assistant Commissioner about, Castle being separately assessed at Bombay in the status of a registered firm apparently refer to assessment of that business in subsequent years and not in the year of assessment 1951-52.The conclusion of the Tribunal therefore suffers from a double infirmity : it assumes the only fact on which its conclusion is founded and ignores other relevantwhich the Appellate Assistant Commissioner relied in support of his conclusion. The Tribunal has therefore misdirected itself in law in arriving at its finding, and in refusing to require the Tribunal to state the case and to refer it, the High Court was, in our view, in error. | 1 | 1,050 | 559 | ### Instruction:
Hypothesize the court's verdict (affirmation (1) or negation (0) of the appeal), and then clarify this hypothesis by interpreting significant sentences from the case proceeding.
### Input:
Shah, J.1. M/s. Indian Woollen Textiles Mills Amritsar -hereinafter called the assessee had branches at different places in India, one of which was an industrial undertaking conducted in the name of Eldee Velvet and Silk Mills-called for the sake of brevity "Eldee. "Eldee had advanced Rs. 3,21,460/- to another concern, the Bombay Fine Worsted Manufacturers Castle Mills-hereinafter called Castle. In the assessment year 1951-52, the assessee claimed under S. 15C of the Indian Income-tax Act 1922, exemption from tax in respect of 6 per cent of the capital employed in Eldee as a newly established undertaking and sought to include in the computation of the capital so employed Rs. 3,21,460/- advanced to Castle. The Income-tax Officer, Special Circle, Amritsar, and the Appellate Assistant Commissioner rejected the claim. But the Income-tax Appellate Tribunal modified the assessment and directed inclusion of the amount advanced to Castle in the computation of capital invested for the purpose of S. 15C. An application submitted under S 66(1) of the Indian Income-tax Act to the Tribunal to refer a question which it was contended by the Commissioner arose out of the order of the Tribunal was rejected and the petition of the Commissioner under S. 66(2) for an order directing the Tribunal to state the case and refer it to the High Court was also dismissed. With special leave the Commissioner has appealed to this Court.2. The question in dispute before the Revenue authorities was whether the business called Castle at Bombay was a branch of the assessee. The Appellate Assistant Commissioner rejected the claim of the assessee to include the amount of Rs. 3,21,460/- in the capital employed in the undertaking Eldee, because in his view there were in these two undertakings the same eight partners with a share of -/2/- (two annas) each, and that the constitution of both the undertakings being the same, Castle could not be regarded as a separate entity. The Tribunal disagreed with the view of the Appellate Assistant Commissioner, relying upon only one circumstance, viz., that in the assessment for the year 1951-52 the income from Castle had not been computed and included in the assessment of the assessee. It did not consider the other questions whether the constitution and ownership of the two businesses "were the same. The High Court declined to require the Tribunal to state the case holding that the finding of the Tribunal was one of fact as it was based on the inference arising from the non-inclusion by the Income-tax Officer in the assessment in question of the income of Castle and that "the factor taken into consideration by the Appellate Tribunal in coming to the conclusion, it did, was a relevant factor.3. Section 66 (2) invests the High Court with jurisdiction to require the Appellate Tribunal to state a case and to refer it, if the Appellant Tribunal has refused to state the case on the ground that no question of law arises, and the High Court being approached by the aggrieved party within the period of limitation prescribed, is not satisfied about the correctness of the decision of the Appellate Tribunal refusing to state the case. Under the Income-tax Act is for the Tribunal to decide all questions of fact: the High Court has the power merely to advise the Tribunal on questions of law arising out of the order of the Tribunal. In so advising the High Court must accept the findings of the Tribunal on matters of appreciation of evidence. But the refusal of the Tribunal to state a case for the opinion of the High Court, on the view that a question of law does not arise out of the order is not conclusive. The High Court has the power to call upon the Tribunal to state the case if in its view a question of law arises out of the order of the Tribunal. Such a question may arise out of the findings of the Tribunal, and also if the Tribunal has misdirected itself in law in arriving at its finding. It is not open to the Court to discard the Tribunals finding of fact, if there is some evidence to support the finding of the Tribunal on a question of fact, even if on a review of the evidence the Court might have arrived at a different conclusion. It must however appear that the Tribunal had considered evidence covering all the essential matters before arriving at its conclusion. If the conclusion of the Tribunal is based upon some evidence ignoring other essential matters, it cannot be regarded as a finding not giving rise to a question liable to be referred to the Court.4. Non-inclusion of the income of Castle in the assessment of the assessee may have been a relevant circumstance, but its effect had to be considered in the light of other circumstances on which the Appellate Assistant Commissioner had relied. Moreover, reliance place by the Tribunal upon the single circumstance on which its decision was founded had proceeded on an assumption that in the previous year to the year of assessment 1951-52. Castle had carried on business and had earned income. The observations made by the Appellant Assistant Commissioner about, Castle being separately assessed at Bombay in the status of a registered firm apparently refer to assessment of that business in subsequent years and not in the year of assessment 1951-52.The conclusion of the Tribunal therefore suffers from a double infirmity : it assumes the only fact on which its conclusion is founded and ignores other relevant matters on which the Appellate Assistant Commissioner relied in support of his conclusion. The Tribunal has therefore misdirected itself in law in arriving at its finding, and in refusing to require the Tribunal to state the case and to refer it, the High Court was, in our view, in error.
### Response:
1
### Explanation:
3. Section 66 (2) invests the High Court with jurisdiction to require the Appellate Tribunal to state a case and to refer it, if the Appellant Tribunal has refused to state the case on the ground that no question of law arises, and the High Court being approached by the aggrieved party within the period of limitation prescribed, is not satisfied about the correctness of the decision of the Appellate Tribunal refusing to state the case. Under the Income-tax Act is for the Tribunal to decide all questions of fact: the High Court has the power merely to advise the Tribunal on questions of law arising out of the order of the Tribunal. In so advising the High Court must accept the findings of the Tribunal on matters of appreciation of evidence. But the refusal of the Tribunal to state a case for the opinion of the High Court, on the view that a question of law does not arise out of the order is not conclusive. The High Court has the power to call upon the Tribunal to state the case if in its view a question of law arises out of the order of the Tribunal. Such a question may arise out of the findings of the Tribunal, and also if the Tribunal has misdirected itself in law in arriving at its finding. It is not open to the Court to discard the Tribunals finding of fact, if there is some evidence to support the finding of the Tribunal on a question of fact, even if on a review of the evidence the Court might have arrived at a different conclusion. It must however appear that the Tribunal had considered evidence covering all the essential matters before arriving at its conclusion. If the conclusion of the Tribunal is based upon some evidence ignoring other essential matters, it cannot be regarded as a finding not giving rise to a question liable to be referred to the Court.4. Non-inclusion of the income of Castle in the assessment of the assessee may have been a relevant circumstance, but its effect had to be considered in the light of other circumstances on which the Appellate Assistant Commissioner had relied. Moreover, reliance place by the Tribunal upon the single circumstance on which its decision was founded had proceeded on an assumption that in the previous year to the year of assessment 1951-52. Castle had carried on business and had earned income. The observations made by the Appellant Assistant Commissioner about, Castle being separately assessed at Bombay in the status of a registered firm apparently refer to assessment of that business in subsequent years and not in the year of assessment 1951-52.The conclusion of the Tribunal therefore suffers from a double infirmity : it assumes the only fact on which its conclusion is founded and ignores other relevantwhich the Appellate Assistant Commissioner relied in support of his conclusion. The Tribunal has therefore misdirected itself in law in arriving at its finding, and in refusing to require the Tribunal to state the case and to refer it, the High Court was, in our view, in error.
|
State Of Assam & Anr Vs. Kuseswar Saikia And Ors | promotion of persons to be Additional District Judges or Additional Sessions Judges is not vested in the High Court. That is the function of the Governor under Art. 233. This follows from the language of the article itself:"(a) Appointments of persons to be, and the posting and promotion of, district judges in any State shall be made by the Governor of the State in consultation with the High Court exercising jurisdiction in relation to such State.x x x x x x"The language seems to have given trouble to the High Court. The High Court holds:(1) appointment to be a District Judge is to be made by the Governor in consultation with the High Court vide Art. 233; and(2) promotion of a District Judge and not promotion to be a District Judge is also be made by the Governor in consultation with the High Court vide Art. 233.The High Court gives the example of selection grade posts in the cadre of District Judges which according to it is a case of promotion of a District Judge.5. The reading of the article by the High Court is, with respect, contrary to the grammar and punctuation of the article. The learned Chief Justice seems to thinkthat the expression promotion of governs District Judges ignoring the comma that follows the word of. The article, if suitably expanded, reads as under:"Appointments of persons to be, and the posting and promotion of (persons to be), District Judges etc."It means that appointment as well as promotion of persons to be District Judges is a matter for the Governor in consultation with the High Court and the expression District Judge includes an additional District Judge and an Additional Sessions Judge. It must be remembered that District Judges may be directly appointed or may be promoted from the subordinate ranks of the judiciary. The article is intended to take care of both.It concerns initial appointment and initial promotion of persons to be either District Judges or any of the categories included in it. Further promotion of District Judges is a matter of control of the high Court. What is said of District Judges here applies equally to Additional District Judges and Additional Sessions Judges. Therefore when the Governor appointed Rajkhowa an Additional District Judge, it could either be an appointment or a promotion under Art. 233. If it was an appointment it was clearly a matter under Art. 233. If the notification be treated as promotion of Rajkhowa from the junior service to the senior service it was a promotion of a person to be a District Judge which expression, as shown above, includes an Additional District Judge. In our opinion it was the latter. Thus there is no doubt that the appointment of Rajkhowa as Additional District Judge by the Governor was a promotion and was made under Art. 233. It could not be made under Art. 235 which deals with posts subordinate to a District Judge including an Additional District Judge and an Additional Sessions Judge. The High Court was in error in holding that the appointment of Rajkhowa to the position of an Additional District Judge was invalid because the order was made by the Governor instead of the High Court. The appointment or promotion was perfectly valid and according to the Constitution.6. The brings us to the next point in the case which arises as a side issue involving the Legal Secretary, who is also an appellant here. The Civil Courts Act was amended by the Assam Legislature by Act XII of 1967 which came into force on 16th August, 1967. The designation of subordinate judge was altered to Assistant District Judge. On August 17, 1967 new rules for the Assam Judicial Services were brought into force. The Judicial Service was reconstituted as follows:Grade I1. District and Sessions Judge.2. Registrar.3. Presiding Officer, Industrial Tribunal.4. Presiding Official, Labour Court.Grade II1. Additional District Magistrate.2. Assistant District Judge.3. Deputy Registrar.Grade III1. Munsiff.2. Judicial Magistrate.3. Sub-Divisional Magistrate (Judicial)4. Assistant Registrar.The High Court was of opinion that this was deliberately done to grab at the power of promoting subordinate judges by taking advantage of the definition of District Judge which includes an Assistant District Judge. By this device, which the High Court described as a fraud upon the Constitution the power of promotion vested in the High Court in respect to persons belonging to the Judicial Service of a State and holding posts inferior to the post of the District Judge the jurisdiction of the High Court under Art. 235 was taken away. Formerly, the subordinate service was composed of two grades and promotion between the two grades was made by the High Court. Under the new rules there is only one grade (i.e. grade III) in which Art. 235 can operate if at all. Since all the posts there are equal and carry equal and carry equal pay there is no scope for promotion at all. The High Court is thus right that there is no scope for the exercise of the power of the High Court to make promotions in the case of persons below the rank of District Judges (which term includes an Assistant District Judge). The High Court was thus far right - but the High Court is not right in thinking that it can ignore the hierarchy of courts in Assam as established by law and treat the change as of no consequence. The remedy is not to go against the Civil Court Act as amended, but to have the amendment rescinded. We are of the view that the change is likely to lead to an impairment of the independence of the judiciary at the lowest levels whose promotion which was vested by the Constitution in the High Court advisedly, will no longer be entirely in the hands of the High Court. The remedy for it is by amendment of the law to restore the former position. We may say that we do not approve of the change of mere name without any additional benefits. | 1[ds]Article 235 vests in the High Court the control over District Courts and Courts subordinate thereto, including the posting and promotion and grant of leave to persons belonging to the judicial service of a State and holding any post inferior to the post of District Judge. By reason of the definitions given in Art. 236, the expression Judicial Service means a service consisting exclusively of persons intended to fill the post of District Judge and other Civil Judicial posts inferior to the District Judge and the expression "District Judge" includes among others an Additional District Judge and an Additional Sessions Judge. The promotion of persons belonging to the judicial service but holding post inferior to a District Judge vests in the High Court. As the expression District Judge includes an additional District Judge and an Additions Sessions Judge, they rank above those persons whose promotion is vested in the High Court under Art. 235. Therefore, the promotion of persons to be Additional District Judges or Additional Sessions Judges is not vested in the High Court. That is the function of the Governor under Art. 233.The reading of the article by the High Court is, with respect, contrary to the grammar and punctuation of the article. The learned Chief Justice seems to thinkthat the expression promotion of governs District Judges ignoring the comma that follows the word of. The article, if suitably expanded, reads asof persons to be, and the posting and promotion of (persons to be), District Judgesmeans that appointment as well as promotion of persons to be District Judges is a matter for the Governor in consultation with the High Court and the expression District Judge includes an additional District Judge and an Additional Sessions Judge. It must be remembered that District Judges may be directly appointed or may be promoted from the subordinate ranks of the judiciary. The article is intended to take care of both.It concerns initial appointment and initial promotion of persons to be either District Judges or any of the categories included in it. Further promotion of District Judges is a matter of control of the high Court. What is said of District Judges here applies equally to Additional District Judges and Additional Sessions Judges. Therefore when the Governor appointed Rajkhowa an Additional District Judge, it could either be an appointment or a promotion under Art. 233. If it was an appointment it was clearly a matter under Art. 233. If the notification be treated as promotion of Rajkhowa from the junior service to the senior service it was a promotion of a person to be a District Judge which expression, as shown above, includes an Additional District Judge. In our opinion it was the latter. Thus there is no doubt that the appointment of Rajkhowa as Additional District Judge by the Governor was a promotion and was made under Art. 233. It could not be made under Art. 235 which deals with posts subordinate to a District Judge including an Additional District Judge and an Additional Sessions Judge. The High Court was in error in holding that the appointment of Rajkhowa to the position of an Additional District Judge was invalid because the order was made by the Governor instead of the High Court. The appointment or promotion was perfectly valid and according to the Constitution.6. The brings us to the next point in the case which arises as a side issue involving the Legal Secretary, who is also an appellant here. The Civil Courts Act was amended by the Assam Legislature by Act XII of 1967 which came into force on 16th August, 1967. The designation of subordinate judge was altered to Assistant District Judge. On August 17, 1967 new rules for the Assam Judicial Services were brought intoHigh Court was of opinion that this was deliberately done to grab at the power of promoting subordinate judges by taking advantage of the definition of District Judge which includes an Assistant District Judge. By this device, which the High Court described as a fraud upon the Constitution the power of promotion vested in the High Court in respect to persons belonging to the Judicial Service of a State and holding posts inferior to the post of the District Judge the jurisdiction of the High Court under Art. 235 was taken away. Formerly, the subordinate service was composed of two grades and promotion between the two grades was made by the High Court. Under the new rules there is only one grade (i.e. grade III) in which Art. 235 can operate if at all. Since all the posts there are equal and carry equal and carry equal pay there is no scope for promotion at all. The High Court is thus right that there is no scope for the exercise of the power of the High Court to make promotions in the case of persons below the rank of District Judges (which term includes an Assistant District Judge). The High Court was thus far right - but the High Court is not right in thinking that it can ignore the hierarchy of courts in Assam as established by law and treat the change as of no consequence. The remedy is not to go against the Civil Court Act as amended, but to have the amendment rescinded. We are of the view that the change is likely to lead to an impairment of the independence of the judiciary at the lowest levels whose promotion which was vested by the Constitution in the High Court advisedly, will no longer be entirely in the hands of the High Court. The remedy for it is by amendment of the law to restore the former position. We may say that we do not approve of the change of mere name without any additional benefits. | 1 | 2,246 | 1,040 | ### Instruction:
Speculate on the likely judgment (yes (1) or no (0) to the appeal) and then delve into the case proceeding to elucidate your prediction, focusing on critical sentences.
### Input:
promotion of persons to be Additional District Judges or Additional Sessions Judges is not vested in the High Court. That is the function of the Governor under Art. 233. This follows from the language of the article itself:"(a) Appointments of persons to be, and the posting and promotion of, district judges in any State shall be made by the Governor of the State in consultation with the High Court exercising jurisdiction in relation to such State.x x x x x x"The language seems to have given trouble to the High Court. The High Court holds:(1) appointment to be a District Judge is to be made by the Governor in consultation with the High Court vide Art. 233; and(2) promotion of a District Judge and not promotion to be a District Judge is also be made by the Governor in consultation with the High Court vide Art. 233.The High Court gives the example of selection grade posts in the cadre of District Judges which according to it is a case of promotion of a District Judge.5. The reading of the article by the High Court is, with respect, contrary to the grammar and punctuation of the article. The learned Chief Justice seems to thinkthat the expression promotion of governs District Judges ignoring the comma that follows the word of. The article, if suitably expanded, reads as under:"Appointments of persons to be, and the posting and promotion of (persons to be), District Judges etc."It means that appointment as well as promotion of persons to be District Judges is a matter for the Governor in consultation with the High Court and the expression District Judge includes an additional District Judge and an Additional Sessions Judge. It must be remembered that District Judges may be directly appointed or may be promoted from the subordinate ranks of the judiciary. The article is intended to take care of both.It concerns initial appointment and initial promotion of persons to be either District Judges or any of the categories included in it. Further promotion of District Judges is a matter of control of the high Court. What is said of District Judges here applies equally to Additional District Judges and Additional Sessions Judges. Therefore when the Governor appointed Rajkhowa an Additional District Judge, it could either be an appointment or a promotion under Art. 233. If it was an appointment it was clearly a matter under Art. 233. If the notification be treated as promotion of Rajkhowa from the junior service to the senior service it was a promotion of a person to be a District Judge which expression, as shown above, includes an Additional District Judge. In our opinion it was the latter. Thus there is no doubt that the appointment of Rajkhowa as Additional District Judge by the Governor was a promotion and was made under Art. 233. It could not be made under Art. 235 which deals with posts subordinate to a District Judge including an Additional District Judge and an Additional Sessions Judge. The High Court was in error in holding that the appointment of Rajkhowa to the position of an Additional District Judge was invalid because the order was made by the Governor instead of the High Court. The appointment or promotion was perfectly valid and according to the Constitution.6. The brings us to the next point in the case which arises as a side issue involving the Legal Secretary, who is also an appellant here. The Civil Courts Act was amended by the Assam Legislature by Act XII of 1967 which came into force on 16th August, 1967. The designation of subordinate judge was altered to Assistant District Judge. On August 17, 1967 new rules for the Assam Judicial Services were brought into force. The Judicial Service was reconstituted as follows:Grade I1. District and Sessions Judge.2. Registrar.3. Presiding Officer, Industrial Tribunal.4. Presiding Official, Labour Court.Grade II1. Additional District Magistrate.2. Assistant District Judge.3. Deputy Registrar.Grade III1. Munsiff.2. Judicial Magistrate.3. Sub-Divisional Magistrate (Judicial)4. Assistant Registrar.The High Court was of opinion that this was deliberately done to grab at the power of promoting subordinate judges by taking advantage of the definition of District Judge which includes an Assistant District Judge. By this device, which the High Court described as a fraud upon the Constitution the power of promotion vested in the High Court in respect to persons belonging to the Judicial Service of a State and holding posts inferior to the post of the District Judge the jurisdiction of the High Court under Art. 235 was taken away. Formerly, the subordinate service was composed of two grades and promotion between the two grades was made by the High Court. Under the new rules there is only one grade (i.e. grade III) in which Art. 235 can operate if at all. Since all the posts there are equal and carry equal and carry equal pay there is no scope for promotion at all. The High Court is thus right that there is no scope for the exercise of the power of the High Court to make promotions in the case of persons below the rank of District Judges (which term includes an Assistant District Judge). The High Court was thus far right - but the High Court is not right in thinking that it can ignore the hierarchy of courts in Assam as established by law and treat the change as of no consequence. The remedy is not to go against the Civil Court Act as amended, but to have the amendment rescinded. We are of the view that the change is likely to lead to an impairment of the independence of the judiciary at the lowest levels whose promotion which was vested by the Constitution in the High Court advisedly, will no longer be entirely in the hands of the High Court. The remedy for it is by amendment of the law to restore the former position. We may say that we do not approve of the change of mere name without any additional benefits.
### Response:
1
### Explanation:
Article 235 vests in the High Court the control over District Courts and Courts subordinate thereto, including the posting and promotion and grant of leave to persons belonging to the judicial service of a State and holding any post inferior to the post of District Judge. By reason of the definitions given in Art. 236, the expression Judicial Service means a service consisting exclusively of persons intended to fill the post of District Judge and other Civil Judicial posts inferior to the District Judge and the expression "District Judge" includes among others an Additional District Judge and an Additional Sessions Judge. The promotion of persons belonging to the judicial service but holding post inferior to a District Judge vests in the High Court. As the expression District Judge includes an additional District Judge and an Additions Sessions Judge, they rank above those persons whose promotion is vested in the High Court under Art. 235. Therefore, the promotion of persons to be Additional District Judges or Additional Sessions Judges is not vested in the High Court. That is the function of the Governor under Art. 233.The reading of the article by the High Court is, with respect, contrary to the grammar and punctuation of the article. The learned Chief Justice seems to thinkthat the expression promotion of governs District Judges ignoring the comma that follows the word of. The article, if suitably expanded, reads asof persons to be, and the posting and promotion of (persons to be), District Judgesmeans that appointment as well as promotion of persons to be District Judges is a matter for the Governor in consultation with the High Court and the expression District Judge includes an additional District Judge and an Additional Sessions Judge. It must be remembered that District Judges may be directly appointed or may be promoted from the subordinate ranks of the judiciary. The article is intended to take care of both.It concerns initial appointment and initial promotion of persons to be either District Judges or any of the categories included in it. Further promotion of District Judges is a matter of control of the high Court. What is said of District Judges here applies equally to Additional District Judges and Additional Sessions Judges. Therefore when the Governor appointed Rajkhowa an Additional District Judge, it could either be an appointment or a promotion under Art. 233. If it was an appointment it was clearly a matter under Art. 233. If the notification be treated as promotion of Rajkhowa from the junior service to the senior service it was a promotion of a person to be a District Judge which expression, as shown above, includes an Additional District Judge. In our opinion it was the latter. Thus there is no doubt that the appointment of Rajkhowa as Additional District Judge by the Governor was a promotion and was made under Art. 233. It could not be made under Art. 235 which deals with posts subordinate to a District Judge including an Additional District Judge and an Additional Sessions Judge. The High Court was in error in holding that the appointment of Rajkhowa to the position of an Additional District Judge was invalid because the order was made by the Governor instead of the High Court. The appointment or promotion was perfectly valid and according to the Constitution.6. The brings us to the next point in the case which arises as a side issue involving the Legal Secretary, who is also an appellant here. The Civil Courts Act was amended by the Assam Legislature by Act XII of 1967 which came into force on 16th August, 1967. The designation of subordinate judge was altered to Assistant District Judge. On August 17, 1967 new rules for the Assam Judicial Services were brought intoHigh Court was of opinion that this was deliberately done to grab at the power of promoting subordinate judges by taking advantage of the definition of District Judge which includes an Assistant District Judge. By this device, which the High Court described as a fraud upon the Constitution the power of promotion vested in the High Court in respect to persons belonging to the Judicial Service of a State and holding posts inferior to the post of the District Judge the jurisdiction of the High Court under Art. 235 was taken away. Formerly, the subordinate service was composed of two grades and promotion between the two grades was made by the High Court. Under the new rules there is only one grade (i.e. grade III) in which Art. 235 can operate if at all. Since all the posts there are equal and carry equal and carry equal pay there is no scope for promotion at all. The High Court is thus right that there is no scope for the exercise of the power of the High Court to make promotions in the case of persons below the rank of District Judges (which term includes an Assistant District Judge). The High Court was thus far right - but the High Court is not right in thinking that it can ignore the hierarchy of courts in Assam as established by law and treat the change as of no consequence. The remedy is not to go against the Civil Court Act as amended, but to have the amendment rescinded. We are of the view that the change is likely to lead to an impairment of the independence of the judiciary at the lowest levels whose promotion which was vested by the Constitution in the High Court advisedly, will no longer be entirely in the hands of the High Court. The remedy for it is by amendment of the law to restore the former position. We may say that we do not approve of the change of mere name without any additional benefits.
|
AJOY DEBBARMA Vs. THE STATE OF TRIPURA | extending full age relaxation to them irrespective of the number of years required and for recruitments to be held till 31 st March, 2023 to compete for the post of teachers. It is also emphasized that only such ad-hoc teachers who fulfil the requisite qualifications and are otherwise eligible for employment, are being considered for such age relaxation. The affidavit also annexed a copy of Miscellaneous Application Diary No.11372 of 2020 which had indicated that there were about 10,618 vacant posts in Group-C and Group-D in different Departments and which had prayed:- A) Permit the State Government to consider and appoint these discharged ad-hoc teachers, to vacant sanctioned Group-C/Group-D posts in the services of the State of Tripura on fulfilment of the eligibility conditions and with age relaxation wherever it is required: B) Permit age relaxation in respect of such appointments as prayed hereinabove, of the ad-hoc teachers against sanctioned vacant non-technical Group-C and Group-D posts in different State Government Department. 14. In appeal arising out of Special Leave Petition (Civil)D.No.1324 of 2020, an application was filed seeking permission to file additional documents. In terms of the document at Annexure A-2 the total vacant posts of teachers in the State were 20,165. The documents appended to the application were relied upon to submit that from 16.09.2016 till 29.05.2020, only 4,300 teachers were appointed in various categories in the State. Dr. Rajeev Dhavan, learned Senior Advocate appearing for the concerned appellants submitted that considering the vacant posts of teachers in the State, the teachers whose services were disengaged and terminated after the completion of Academic Session 2019-2020 be suitably re-employed. It was further submitted that even if some such candidates were selected as teachers after allowing them age relaxation or even if some of the candidates were given alternate employment, some glaring issues would still arise as (a) their past service would not be counted for any purpose; (b) they would start at the bottom in the concerned service or employment; and (c) it would be a case of degradation if the teachers were offered employment in Group-C and Group-D. 15. Mr. Kapil Sibal, learned Senior Advocate, appearing for some other appellants, also submitted that the concerned candidates be accommodated considering the vacancy situation, while Mr. Jaideep Gupta, learned Senior Advocate, appearing in another set of matters submitted that, it would certainly be a case of degradation if the former teachers were given appointments in Group-C and Group-D. On the other hand, Mr. Colin Gonsalves, learned Senior Advocate, appearing for some of the appellants submitted that his clients were willing to accept the alternate employment provided they were given chance to acquire the requisite qualification. 16. Mr. Maninder Singh, learned Senior Advocate, appearing for the State submitted that the selection and appointments were set aside by the High Court vide its decision in Tanmoy Nath (2014) 2 TLR 731 as being arbitrary and illegal; and that it was found by the High Court that the selection was based purely on oral interview and suffered from nepotism and favouritism. He submitted that if the appointments themselves were illegal and the selection was set aside being arbitrary and invalid, the past service of such teachers could not be recognised in any manner and that the State Government had afforded adequate opportunity to the concerned candidates by giving age relaxation and apart therefrom no other benefit could be extended to such candidates. Responding to the annexures appended to the application filed in the appeal arising out of Special Leave Petition (Civil) D.No.1324 of 2020, it was submitted that the figure of 20,165, being alleged vacant posts of teachers in the State, was not correct. Such figure was arrived at after taking into account the attempt on part of the State to create about 12,000 posts in Group-C in non- teaching category in the year 2017, which was subject matter of the action in the Contempt Petition before this Court in its Order dated 04.10.2017 and subsequent Orders. 17. The questions concerning legality and validity of the entire selection process and the appointments of about 10,323 teachers were gone into in detail in Tanmoy Nath (2014) 2 TLR 731 . The findings rendered by the High Court and its conclusions were accepted by this Court while dismissing the appeals arising therefrom. Though the services of the concerned teachers were initially protected only upto 31.12.2017, accepting the plea made on behalf of the State, the concerned date was extended from time to time. It is a matter of record that the services of such candidates now stand terminated. In terms of the directions issued in Tanmoy Nath (2014) 2 TLR 731 and appeal arising therefrom, the State is obliged to conduct selection process in which the concerned candidates will be entitled to participate with age relaxation. The age relaxation has now been afforded by the State in all selections till 31.03.2023, which benefit is quite adequate and proper. 18. In our view, considering the fact that the very selection and appointments were found to be illegal and invalid, no other advantage can be conferred upon the concerned candidates. It must be noted that the attempt on part of the State in offering certain alternate employment is not to degrade the teachers but some solace is being offered even in cases where the candidates do not succeed in the selections to the posts of teachers. The candidates, if they are otherwise competent and eligible, will certainly have every opportunity till 31.03.2023 to get selected for the posts of teachers in the State and by way of additional benefit those who are unsuccessful in such attempts may retain the alternate employment. In our view, it does not amount to any degradation. 19. Though the notice was confined to the question of age relaxation as was made clear in the Order dated 07.02.2020, we have considered submissions which were not strictly confined to said question. We, however, do not find any substance in the contentions, which are therefore rejected. | 0[ds]17. The questions concerning legality and validity of the entire selection process and the appointments of about 10,323 teachers were gone into in detail in Tanmoy Nath (2014) 2 TLR 731 . The findings rendered by the High Court and its conclusions were accepted by this Court while dismissing the appeals arising therefrom. Though the services of the concerned teachers were initially protected only upto 31.12.2017, accepting the plea made on behalf of the State, the concerned date was extended from time to time. It is a matter of record that the services of such candidates now stand terminated. In terms of the directions issued in Tanmoy Nath (2014) 2 TLR 731 and appeal arising therefrom, the State is obliged to conduct selection process in which the concerned candidates will be entitled to participate with age relaxation. The age relaxation has now been afforded by the State in all selections till 31.03.2023, which benefit is quite adequate and proper.18. In our view, considering the fact that the very selection and appointments were found to be illegal and invalid, no other advantage can be conferred upon the concerned candidates. It must be noted that the attempt on part of the State in offering certain alternate employment is not to degrade the teachers but some solace is being offered even in cases where the candidates do not succeed in the selections to the posts of teachers. The candidates, if they are otherwise competent and eligible, will certainly have every opportunity till 31.03.2023 to get selected for the posts of teachers in the State and by way of additional benefit those who are unsuccessful in such attempts may retain the alternate employment. In our view, it does not amount to any degradation.19. Though the notice was confined to the question of age relaxation as was made clear in the Order dated 07.02.2020, we have considered submissions which were not strictly confined to said question. We, however, do not find any substance in the contentions, which are therefore rejected. | 0 | 4,636 | 368 | ### Instruction:
Forecast the likely verdict of the case (granting (1) or denying (0) the appeal) and then rationalize your prediction by pinpointing and explaining pivotal sentences in the case document.
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extending full age relaxation to them irrespective of the number of years required and for recruitments to be held till 31 st March, 2023 to compete for the post of teachers. It is also emphasized that only such ad-hoc teachers who fulfil the requisite qualifications and are otherwise eligible for employment, are being considered for such age relaxation. The affidavit also annexed a copy of Miscellaneous Application Diary No.11372 of 2020 which had indicated that there were about 10,618 vacant posts in Group-C and Group-D in different Departments and which had prayed:- A) Permit the State Government to consider and appoint these discharged ad-hoc teachers, to vacant sanctioned Group-C/Group-D posts in the services of the State of Tripura on fulfilment of the eligibility conditions and with age relaxation wherever it is required: B) Permit age relaxation in respect of such appointments as prayed hereinabove, of the ad-hoc teachers against sanctioned vacant non-technical Group-C and Group-D posts in different State Government Department. 14. In appeal arising out of Special Leave Petition (Civil)D.No.1324 of 2020, an application was filed seeking permission to file additional documents. In terms of the document at Annexure A-2 the total vacant posts of teachers in the State were 20,165. The documents appended to the application were relied upon to submit that from 16.09.2016 till 29.05.2020, only 4,300 teachers were appointed in various categories in the State. Dr. Rajeev Dhavan, learned Senior Advocate appearing for the concerned appellants submitted that considering the vacant posts of teachers in the State, the teachers whose services were disengaged and terminated after the completion of Academic Session 2019-2020 be suitably re-employed. It was further submitted that even if some such candidates were selected as teachers after allowing them age relaxation or even if some of the candidates were given alternate employment, some glaring issues would still arise as (a) their past service would not be counted for any purpose; (b) they would start at the bottom in the concerned service or employment; and (c) it would be a case of degradation if the teachers were offered employment in Group-C and Group-D. 15. Mr. Kapil Sibal, learned Senior Advocate, appearing for some other appellants, also submitted that the concerned candidates be accommodated considering the vacancy situation, while Mr. Jaideep Gupta, learned Senior Advocate, appearing in another set of matters submitted that, it would certainly be a case of degradation if the former teachers were given appointments in Group-C and Group-D. On the other hand, Mr. Colin Gonsalves, learned Senior Advocate, appearing for some of the appellants submitted that his clients were willing to accept the alternate employment provided they were given chance to acquire the requisite qualification. 16. Mr. Maninder Singh, learned Senior Advocate, appearing for the State submitted that the selection and appointments were set aside by the High Court vide its decision in Tanmoy Nath (2014) 2 TLR 731 as being arbitrary and illegal; and that it was found by the High Court that the selection was based purely on oral interview and suffered from nepotism and favouritism. He submitted that if the appointments themselves were illegal and the selection was set aside being arbitrary and invalid, the past service of such teachers could not be recognised in any manner and that the State Government had afforded adequate opportunity to the concerned candidates by giving age relaxation and apart therefrom no other benefit could be extended to such candidates. Responding to the annexures appended to the application filed in the appeal arising out of Special Leave Petition (Civil) D.No.1324 of 2020, it was submitted that the figure of 20,165, being alleged vacant posts of teachers in the State, was not correct. Such figure was arrived at after taking into account the attempt on part of the State to create about 12,000 posts in Group-C in non- teaching category in the year 2017, which was subject matter of the action in the Contempt Petition before this Court in its Order dated 04.10.2017 and subsequent Orders. 17. The questions concerning legality and validity of the entire selection process and the appointments of about 10,323 teachers were gone into in detail in Tanmoy Nath (2014) 2 TLR 731 . The findings rendered by the High Court and its conclusions were accepted by this Court while dismissing the appeals arising therefrom. Though the services of the concerned teachers were initially protected only upto 31.12.2017, accepting the plea made on behalf of the State, the concerned date was extended from time to time. It is a matter of record that the services of such candidates now stand terminated. In terms of the directions issued in Tanmoy Nath (2014) 2 TLR 731 and appeal arising therefrom, the State is obliged to conduct selection process in which the concerned candidates will be entitled to participate with age relaxation. The age relaxation has now been afforded by the State in all selections till 31.03.2023, which benefit is quite adequate and proper. 18. In our view, considering the fact that the very selection and appointments were found to be illegal and invalid, no other advantage can be conferred upon the concerned candidates. It must be noted that the attempt on part of the State in offering certain alternate employment is not to degrade the teachers but some solace is being offered even in cases where the candidates do not succeed in the selections to the posts of teachers. The candidates, if they are otherwise competent and eligible, will certainly have every opportunity till 31.03.2023 to get selected for the posts of teachers in the State and by way of additional benefit those who are unsuccessful in such attempts may retain the alternate employment. In our view, it does not amount to any degradation. 19. Though the notice was confined to the question of age relaxation as was made clear in the Order dated 07.02.2020, we have considered submissions which were not strictly confined to said question. We, however, do not find any substance in the contentions, which are therefore rejected.
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17. The questions concerning legality and validity of the entire selection process and the appointments of about 10,323 teachers were gone into in detail in Tanmoy Nath (2014) 2 TLR 731 . The findings rendered by the High Court and its conclusions were accepted by this Court while dismissing the appeals arising therefrom. Though the services of the concerned teachers were initially protected only upto 31.12.2017, accepting the plea made on behalf of the State, the concerned date was extended from time to time. It is a matter of record that the services of such candidates now stand terminated. In terms of the directions issued in Tanmoy Nath (2014) 2 TLR 731 and appeal arising therefrom, the State is obliged to conduct selection process in which the concerned candidates will be entitled to participate with age relaxation. The age relaxation has now been afforded by the State in all selections till 31.03.2023, which benefit is quite adequate and proper.18. In our view, considering the fact that the very selection and appointments were found to be illegal and invalid, no other advantage can be conferred upon the concerned candidates. It must be noted that the attempt on part of the State in offering certain alternate employment is not to degrade the teachers but some solace is being offered even in cases where the candidates do not succeed in the selections to the posts of teachers. The candidates, if they are otherwise competent and eligible, will certainly have every opportunity till 31.03.2023 to get selected for the posts of teachers in the State and by way of additional benefit those who are unsuccessful in such attempts may retain the alternate employment. In our view, it does not amount to any degradation.19. Though the notice was confined to the question of age relaxation as was made clear in the Order dated 07.02.2020, we have considered submissions which were not strictly confined to said question. We, however, do not find any substance in the contentions, which are therefore rejected.
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Chief Controlling Revenue Authorityandsuperintendent Of St Vs. Maharashtra Sugar Mills Ltd | of a document arises, as a public servant it is his duty to make the reference. If he omits to do so it is within the power of the Court to direct him to discharge that duty and make a reference to the Court.(9) Mr. Daphtary on behalf of the appellant tried to distinguish this case on the ground that the scheme of the Income-tax Act was different from the scheme of the Stamp Act. In our opinion, the observations quoted above the and principles underlying the same are applicable to the duty cast on the appellant under S. 57, Stamp Act and minor points of distinction between the schemes of the two Acts are immaterial for the present discussion. In the words of Lord Cairns the very nature of the thing empowered to be done by the appellant and the conditions under which he has to fix the amount of the duty, couple the power with the duty to state a case for the opinion of the Court. The provisions of S. 51 (1) and (3) run on the same lines as S. 59, Stamp Act. Mr. Daphtary next pointed out that there was a difference in the scheme of the Act, because when the Collector issued a certificate under S. 32, even though his assessment might be faulty and against the interest of the State, the State or the appellant had no remedy. This overlooks the provisions of the section empowering the Collector to issue the certificate. The scheme of the Stamp Act may be briefly noticed. Chapter II contains provisions about the liability of the instrument to duty, of the time of stamping instruments, of values for duty and provisions as to the officer to whom duty is payable. Chapter III which contains only two sections deals with the adjudication as to stamps. The first (s. 31) is where an instrument, whether executed or not and whether previously stamped or not, is brought to the Collector with an application to have his opinion as to the duty with which it is chargeable. For obtaining that opinion the applicant has to pay a fee. The Collector may call for information and take evidence. After he has done so he determines the amount of the stamp duty and certifies under S. 32 that the full duty with which it is chargeable has been paid. It is obvious that the party applying is interested in obtaining the opinion and therefore he cannot object to the certificate of the Collector. If the Collector himself is in doubt he has the power under S. 56(2) to ask for the opinion of the appellant. It is therefore clear that in respect of these two provisions under Chapter III no grievance could exist on either side. From S. 33 and Chapter IV onwards there are provisions in which the opinion of the Stamp Officer and of the party interested in pay the stamp duty may come in conflict. The sections in chaps. IV, V and VI ending with S. 61, deal with situations arising from such difference of opinion. S. 57(a) falls under this heading. In our opinion, therefore, this contention of the appellant fails.(10) The next point urged was whether the High Court has jurisdiction to order the Revenue Authority to state a case in face of the Provisions of s. 226, Government of India Act, 1935. The argument was urged in tow parts: Firstly, that this being a revenue matter, the jurisdiction of the Court was excluded. Secondly, that the matter had ceased to be in the stage of assessment but had reached to stage of collection of stamp duty. On that ground the present case was sought to be distinguished from Alcocks case,. In our opinion this argument of the appellant must also fail. A similar argument based on the wording of the corresponding s. 106 (2), Government of India Act, 1915, as mentioned above, was urged in Alcocks case,. On that point their Lordships observed as follows:"Upon the point thus broadly stated their Lordships have no difficulty in pronouncing a decision. To argue that if the Legislature say that a public officer, even a revenue officer, shall do a thing and he, without cause or justification, refused to do that thing, yet the Specific Relief Act would not be applicable and there would be no power in the Court to compel him to give relief to the subject is to state a proposition to which their Lordships must refuse assent."In dealing with the argument that because of S. 106(2), Government of India Act, 1915, the High Court had no jurisdiction to make the order, the Board observed as follows:"In their Lordships view the order of High Court to a revenue officer to do his statutory duty would not be the exercise of original jurisdiction in any matter concerning the revenue. "(11) In our opinion, in the present case also, the respondent seeks the Courts intervention to make the appellant perform his statutory duty to state a case. That is not exercising the original jurisdiction of the Court in any matter concerning the revenue. It is only asking the appellant to perform his statutory duty. The further argument that the proceedings in this case had passed beyond the stage of assessment and had reached the stage of enforcing payment is again irrelevant because by the relief granted by the High Court no attempt is made to obstruct the Revenue Authority in the discharge of his duties. At one stage an injunction was granted against the appellant but that has been cancelled. (12) In fact, this aspect of the discussion is only academic because if payment of enforced and the opinion of the Court, on the statement of the case is against the appellant, he will have to act in conformity with that opinion under S. 59 (2), Stamp Act, and refund whatever may be held to be recovered in excess.(13) In our opinion therefore the contentions of the appellant fail and | 0[ds](5) In our opinion the appellants contentions are unsound. The first contention then S. 57. Stamp Act, gives only a discretion and does not cast a duty on the appellant to make a reference overlooks the fact that the appellant has not to make a reference only when he is in doubt about his decision or conclusion . In his conclusion the party liable to pay the assessed stamp duty is materially interested. The appellants decision is not necessarily based only on the reading of the entries in the Schedule to the Stamp Act. As in the present case, the question under what item stomp duty is leviable may depend on the true construction of a document . It may also involve the decision of the question, as in the present case, as to what is the effect of the Courts order directing a rectification of the instrument. it does not appear, on principle, sound to hold that these difficult questions should be left under the Stamp Act to the final decision of the appellant, and if the party affected by the assessment has a grievance there is no relief at all in law for him. The construction of a document is not always an early matter and on the ground that it is a substantial question of law, parties have been permitted to take the matter up to the highest Court. If so, it appears difficult to start with the assumption that because this is a Revenue Act the decision of the appellant should be considered final and conclusive. The provisions of S. 56 (2) and S. 60 giving power to the Collector and the Court to send a statements of case to the appellant and the High Court respectively, in our opinion, instead of helping the appellant, go against his contention. In those two sections this power is given when the referring authority has a doubt to solve for himself. The absence of the words "feels doubt as to the amount of duty to be paid in respect of an instrument" in S. 57 supports the view that the reference contemplated under that section is not for the benefit of the appellant only but ensures also for the benefit of the party affected by the assessment. In our opinion, the power contained in S. 57 in the nature of an obligation or is coupled with an obligation and under the circumstances can be demanded to be used also by the parties affected by the assessment of the stampour opinion, the observations quoted above the and principles underlying the same are applicable to the duty cast on the appellant under S. 57, Stamp Act and minor points of distinction between the schemes of the two Acts are immaterial for the present discussion. In the words of Lord Cairns the very nature of the thing empowered to be done by the appellant and the conditions under which he has to fix the amount of the duty, couple the power with the duty to state a case for the opinion of the Court. The provisions of S. 51 (1) and (3) run on the same lines as S. 59, Stamp Act. Mr. Daphtary next pointed out that there was a difference in the scheme of the Act, because when the Collector issued a certificate under S. 32, even though his assessment might be faulty and against the interest of the State, the State or the appellant had no remedy. This overlooks the provisions of the section empowering the Collector to issue the certificate. The scheme of the Stamp Act may be briefly noticed. Chapter II contains provisions about the liability of the instrument to duty, of the time of stamping instruments, of values for duty and provisions as to the officer to whom duty is payable. Chapter III which contains only two sections deals with the adjudication as to stamps. The first (s. 31) is where an instrument, whether executed or not and whether previously stamped or not, is brought to the Collector with an application to have his opinion as to the duty with which it is chargeable. For obtaining that opinion the applicant has to pay a fee. The Collector may call for information and take evidence. After he has done so he determines the amount of the stamp duty and certifies under S. 32 that the full duty with which it is chargeable has been paid. It is obvious that the party applying is interested in obtaining the opinion and therefore he cannot object to the certificate of the Collector. If the Collector himself is in doubt he has the power under S. 56(2) to ask for the opinion of the appellant. It is therefore clear that in respect of these two provisions under Chapter III no grievance could exist on either side. From S. 33 and Chapter IV onwards there are provisions in which the opinion of the Stamp Officer and of the party interested in pay the stamp duty may come in conflict. The sections in chaps. IV, V and VI ending with S. 61, deal with situations arising from such difference of opinion. S. 57(a) falls under this heading. In our opinion, therefore, this contention of the appellantIn our opinion therefore the contentions of the appellant fail | 0 | 4,191 | 963 | ### Instruction:
Estimate the outcome of the case (positive (1) or negative (0) for the appellant) and then give a reasoned explanation by examining important sentences within the case documentation.
### Input:
of a document arises, as a public servant it is his duty to make the reference. If he omits to do so it is within the power of the Court to direct him to discharge that duty and make a reference to the Court.(9) Mr. Daphtary on behalf of the appellant tried to distinguish this case on the ground that the scheme of the Income-tax Act was different from the scheme of the Stamp Act. In our opinion, the observations quoted above the and principles underlying the same are applicable to the duty cast on the appellant under S. 57, Stamp Act and minor points of distinction between the schemes of the two Acts are immaterial for the present discussion. In the words of Lord Cairns the very nature of the thing empowered to be done by the appellant and the conditions under which he has to fix the amount of the duty, couple the power with the duty to state a case for the opinion of the Court. The provisions of S. 51 (1) and (3) run on the same lines as S. 59, Stamp Act. Mr. Daphtary next pointed out that there was a difference in the scheme of the Act, because when the Collector issued a certificate under S. 32, even though his assessment might be faulty and against the interest of the State, the State or the appellant had no remedy. This overlooks the provisions of the section empowering the Collector to issue the certificate. The scheme of the Stamp Act may be briefly noticed. Chapter II contains provisions about the liability of the instrument to duty, of the time of stamping instruments, of values for duty and provisions as to the officer to whom duty is payable. Chapter III which contains only two sections deals with the adjudication as to stamps. The first (s. 31) is where an instrument, whether executed or not and whether previously stamped or not, is brought to the Collector with an application to have his opinion as to the duty with which it is chargeable. For obtaining that opinion the applicant has to pay a fee. The Collector may call for information and take evidence. After he has done so he determines the amount of the stamp duty and certifies under S. 32 that the full duty with which it is chargeable has been paid. It is obvious that the party applying is interested in obtaining the opinion and therefore he cannot object to the certificate of the Collector. If the Collector himself is in doubt he has the power under S. 56(2) to ask for the opinion of the appellant. It is therefore clear that in respect of these two provisions under Chapter III no grievance could exist on either side. From S. 33 and Chapter IV onwards there are provisions in which the opinion of the Stamp Officer and of the party interested in pay the stamp duty may come in conflict. The sections in chaps. IV, V and VI ending with S. 61, deal with situations arising from such difference of opinion. S. 57(a) falls under this heading. In our opinion, therefore, this contention of the appellant fails.(10) The next point urged was whether the High Court has jurisdiction to order the Revenue Authority to state a case in face of the Provisions of s. 226, Government of India Act, 1935. The argument was urged in tow parts: Firstly, that this being a revenue matter, the jurisdiction of the Court was excluded. Secondly, that the matter had ceased to be in the stage of assessment but had reached to stage of collection of stamp duty. On that ground the present case was sought to be distinguished from Alcocks case,. In our opinion this argument of the appellant must also fail. A similar argument based on the wording of the corresponding s. 106 (2), Government of India Act, 1915, as mentioned above, was urged in Alcocks case,. On that point their Lordships observed as follows:"Upon the point thus broadly stated their Lordships have no difficulty in pronouncing a decision. To argue that if the Legislature say that a public officer, even a revenue officer, shall do a thing and he, without cause or justification, refused to do that thing, yet the Specific Relief Act would not be applicable and there would be no power in the Court to compel him to give relief to the subject is to state a proposition to which their Lordships must refuse assent."In dealing with the argument that because of S. 106(2), Government of India Act, 1915, the High Court had no jurisdiction to make the order, the Board observed as follows:"In their Lordships view the order of High Court to a revenue officer to do his statutory duty would not be the exercise of original jurisdiction in any matter concerning the revenue. "(11) In our opinion, in the present case also, the respondent seeks the Courts intervention to make the appellant perform his statutory duty to state a case. That is not exercising the original jurisdiction of the Court in any matter concerning the revenue. It is only asking the appellant to perform his statutory duty. The further argument that the proceedings in this case had passed beyond the stage of assessment and had reached the stage of enforcing payment is again irrelevant because by the relief granted by the High Court no attempt is made to obstruct the Revenue Authority in the discharge of his duties. At one stage an injunction was granted against the appellant but that has been cancelled. (12) In fact, this aspect of the discussion is only academic because if payment of enforced and the opinion of the Court, on the statement of the case is against the appellant, he will have to act in conformity with that opinion under S. 59 (2), Stamp Act, and refund whatever may be held to be recovered in excess.(13) In our opinion therefore the contentions of the appellant fail and
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0
### Explanation:
(5) In our opinion the appellants contentions are unsound. The first contention then S. 57. Stamp Act, gives only a discretion and does not cast a duty on the appellant to make a reference overlooks the fact that the appellant has not to make a reference only when he is in doubt about his decision or conclusion . In his conclusion the party liable to pay the assessed stamp duty is materially interested. The appellants decision is not necessarily based only on the reading of the entries in the Schedule to the Stamp Act. As in the present case, the question under what item stomp duty is leviable may depend on the true construction of a document . It may also involve the decision of the question, as in the present case, as to what is the effect of the Courts order directing a rectification of the instrument. it does not appear, on principle, sound to hold that these difficult questions should be left under the Stamp Act to the final decision of the appellant, and if the party affected by the assessment has a grievance there is no relief at all in law for him. The construction of a document is not always an early matter and on the ground that it is a substantial question of law, parties have been permitted to take the matter up to the highest Court. If so, it appears difficult to start with the assumption that because this is a Revenue Act the decision of the appellant should be considered final and conclusive. The provisions of S. 56 (2) and S. 60 giving power to the Collector and the Court to send a statements of case to the appellant and the High Court respectively, in our opinion, instead of helping the appellant, go against his contention. In those two sections this power is given when the referring authority has a doubt to solve for himself. The absence of the words "feels doubt as to the amount of duty to be paid in respect of an instrument" in S. 57 supports the view that the reference contemplated under that section is not for the benefit of the appellant only but ensures also for the benefit of the party affected by the assessment. In our opinion, the power contained in S. 57 in the nature of an obligation or is coupled with an obligation and under the circumstances can be demanded to be used also by the parties affected by the assessment of the stampour opinion, the observations quoted above the and principles underlying the same are applicable to the duty cast on the appellant under S. 57, Stamp Act and minor points of distinction between the schemes of the two Acts are immaterial for the present discussion. In the words of Lord Cairns the very nature of the thing empowered to be done by the appellant and the conditions under which he has to fix the amount of the duty, couple the power with the duty to state a case for the opinion of the Court. The provisions of S. 51 (1) and (3) run on the same lines as S. 59, Stamp Act. Mr. Daphtary next pointed out that there was a difference in the scheme of the Act, because when the Collector issued a certificate under S. 32, even though his assessment might be faulty and against the interest of the State, the State or the appellant had no remedy. This overlooks the provisions of the section empowering the Collector to issue the certificate. The scheme of the Stamp Act may be briefly noticed. Chapter II contains provisions about the liability of the instrument to duty, of the time of stamping instruments, of values for duty and provisions as to the officer to whom duty is payable. Chapter III which contains only two sections deals with the adjudication as to stamps. The first (s. 31) is where an instrument, whether executed or not and whether previously stamped or not, is brought to the Collector with an application to have his opinion as to the duty with which it is chargeable. For obtaining that opinion the applicant has to pay a fee. The Collector may call for information and take evidence. After he has done so he determines the amount of the stamp duty and certifies under S. 32 that the full duty with which it is chargeable has been paid. It is obvious that the party applying is interested in obtaining the opinion and therefore he cannot object to the certificate of the Collector. If the Collector himself is in doubt he has the power under S. 56(2) to ask for the opinion of the appellant. It is therefore clear that in respect of these two provisions under Chapter III no grievance could exist on either side. From S. 33 and Chapter IV onwards there are provisions in which the opinion of the Stamp Officer and of the party interested in pay the stamp duty may come in conflict. The sections in chaps. IV, V and VI ending with S. 61, deal with situations arising from such difference of opinion. S. 57(a) falls under this heading. In our opinion, therefore, this contention of the appellantIn our opinion therefore the contentions of the appellant fail
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The Gramophone Co. of India Ltd Vs. The Collector of Customs, Calcutta | music recorded on audio cassettes which was a service activity akin to photo-processing industry and could not be called a manufacturing activity and therefore the appellant was not entitled to have the contract registered under Project Import Regulation, 1986. 7. The sole question arising for decision is whether the activity in which the appellant is engaged amounts to a process necessary for manufacture or production of a commodity or its activity is designed merely to offer services of any description. 8. Paras 3, 4 and 5 of Project Imports Regulations, 1986 which are relevant for the decision of this appeal are extracted and reproduced hereunder :- 3. Definitions - For the purposes of these regulations : (1) "industrial plants" means an industrial system designed to be employed directly in the performance of any process necessary for manufacture, production or extraction of a commodity, but does not include - (i) establishment designed to offer services of any description such as hotels, hospitals, photographic studios, photographic film processing laboratories, photocopying studios, laundries, garages and workshops; or (ii) a single machine or a composite machine, within the machine assigned to it, in Notes 3 and 4 to Section XVI of the said First Schedule : 4. Eligibility - The assessment under the said heading No. 98.01 shall be available only to those goods which are imported (whether in one or more than one consignment) against one or more specific contracts, which have been registered with the appropriate Customs House in the manner specified in regulation 5 and such contract or contracts has or have been or registered. 5. Registration of contracts. (1) Every importer claiming assessment of the goods falling under the said heading No. 98.01 on or before their importation shall apply in writing to the proper officer at the port where the goods are to be imported or where the duty is to be paid for registeration of the contract or contracts as the case may be." 9. It is not disputed that the machine forming subject matter of the contract in question enables duplicating of audio cassettes from the mother cassette. The mother cassette is loaded in the machine and on being operated the machine multiples the audio recording on several audio cassettes of a specified number at a high speed. The blank audio cassettes are converted into pre-recorded audio cassettes. This activity is systematically carried on large scale and such pre-recorded audio cassettes are offered in bulk sale to the traders who in turn offer the same for sale to consumers. 10. According to the appellant the various activities involved in the manufacture of a pre-recorded audio-cassette are as under : (i) Preparation of a master tape in the studio; (ii) Manufacture of plastic cassettes parts, like cassette body, leather case, etc. from plastic raw material with the help of injection moulding facility; (iii) Assembly of cassette parts to make a C-O tape; (iv) High Speed transfer of music signals from 1/2" master tape to 1/8" pancakes; (v) Assembly of recorded pancakes into cassettes; (vi) Polymeric plate making for printing machines; (vii) Printing of information on cassette body; (viii) Printing of inlay cards; (ix) testing and cellowrapping of the finished cassettes. The machines which were the subject of the Contract dated 6.11.1989 were required for the 4th mentioned item, namely, high speed transfer of music signals from 1/2" Master Tape to 1/8" pancakes. 11. The term `manufacture is not defined in the Customs Act. In the allowed Act, namely the Central Excise Act, 1944 also, the term `manufacture is not to be found defined though vide clause (f) of Section 2 an inclusive definition is given of the term `manufacture so as to include certain processes also therein. 12. `Manufacture came up for the consideration of Constitution Bench in M/s Ujagar Prints v. Union of India, 1988(38) ELT 353 SC. It was held that if there should come into existence a new Article with a distinctive character and use, as a result of the processing, the essential condition justifying manufacture of goods is satisfied. The following passage in the Permanent Edition of "Words and Phrases" was referred to with approval in Delhi Cloth and General Mills AIR 1963 SC 791 , 795 :- "Manufacture implies a change, but every change is not manufacture and yet every change of an article is the result of treatment, labour and manipulation. But something more is necessary and there must be transformation; a new and different article must emerge having a distinctive name, character or use." 13. In a series of decisions [to wit, Decorative Laminates (India) Pvt. Ltd. - 1996(88) ELT 186, Union of India v. Parle Products Pvt. Ltd - 1994(74) ELT 492, Laminate Packing (P) Ltd. - 1990(49) ELT 326, Empire Industries Limited - 1985(20) ELT 179] the view taken consistently by this Court is that the moment there is transformation into a new commodity commercially known as a distinct and separate commodity having its own character, use and name whether it be the result of one process or several processes, manufacture takes place; the transformation of the goods into a new and different article should be such that in the commercial world it is known as another and different article. Pre-recorded audio cassettes are certainly goods known in the market as distinct and different from blank audio cassettes. The two have different uses. A pre-recorded audio cassette is generally sold by reference to its name or title which is suggestive of the contents of the audio recording on the cassette. The appellant is indulging in a mass production of such pre-recorded audio cassettes. It is a manufacturing activity. The appellants activity cannot be compared with a person sitting in the market extending facility of recording any demanded music or sounds on a blank audio cassette brought by or made available to the customer, which activity may be called a service. The Tribunal was not right in equating the appellants activity with photo-processing and holding the appellant a service industry. | 0[ds]11. The term `manufacture is not defined in the Customs Act. In the allowed Act, namely the Central Excise Act, 1944 also, the term `manufacture is not to be found defined though vide clause (f) of Section 2 an inclusive definition is given of the term `manufacture so as to include certain processes also therein.`Manufacture came up for the consideration of Constitution Bench in M/s Ujagar Prints v. Union of India, 1988(38) ELT 353 SC. It was held that if there should come into existence a new Article with a distinctive character and use, as a result of the processing, the essential condition justifying manufacture of goods is satisfied. The following passage in the Permanent Edition of "Words and Phrases" was referred to with approval in Delhi Cloth and General Mills AIR 1963 SC 791 , 795implies a change, but every change is not manufacture and yet every change of an article is the result of treatment, labour and manipulation. But something more is necessary and there must be transformation; a new and different article must emerge having a distinctive name, character or use.In a series of decisions [to wit, Decorative Laminates (India) Pvt. Ltd.1996(88) ELT 186, Union of India v. Parle Products Pvt. Ltd1994(74) ELT 492, Laminate Packing (P) Ltd.1990(49) ELT 326, Empire Industries Limited1985(20) ELT 179] the view taken consistently by this Court is that the moment there is transformation into a new commodity commercially known as a distinct and separate commodity having its own character, use and name whether it be the result of one process or several processes, manufacture takes place; the transformation of the goods into a new and different article should be such that in the commercial world it is known as another and different article.audio cassettes are certainly goods known in the market as distinct and different from blank audio cassettes. The two have different uses. Aprerecorded audio cassetteis generally sold by reference to its name or title which is suggestive of the contents of the audio recording on the cassette. The appellant is indulging in a mass production of suchaudio cassettes. It is a manufacturing activity. The appellants activity cannot be compared with a person sitting in the market extending facility of recording any demanded music or sounds on a blank audio cassette brought by or made available to the customer, which activity may be called a service. The Tribunal was not right in equating the appellants activity withand holding the appellant a service industry. | 0 | 1,871 | 480 | ### Instruction:
Make a prediction on the court's ruling (acceptance (1) or rejection (0) of the petition), and then dissect the proceeding to provide a detailed explanation using key textual passages.
### Input:
music recorded on audio cassettes which was a service activity akin to photo-processing industry and could not be called a manufacturing activity and therefore the appellant was not entitled to have the contract registered under Project Import Regulation, 1986. 7. The sole question arising for decision is whether the activity in which the appellant is engaged amounts to a process necessary for manufacture or production of a commodity or its activity is designed merely to offer services of any description. 8. Paras 3, 4 and 5 of Project Imports Regulations, 1986 which are relevant for the decision of this appeal are extracted and reproduced hereunder :- 3. Definitions - For the purposes of these regulations : (1) "industrial plants" means an industrial system designed to be employed directly in the performance of any process necessary for manufacture, production or extraction of a commodity, but does not include - (i) establishment designed to offer services of any description such as hotels, hospitals, photographic studios, photographic film processing laboratories, photocopying studios, laundries, garages and workshops; or (ii) a single machine or a composite machine, within the machine assigned to it, in Notes 3 and 4 to Section XVI of the said First Schedule : 4. Eligibility - The assessment under the said heading No. 98.01 shall be available only to those goods which are imported (whether in one or more than one consignment) against one or more specific contracts, which have been registered with the appropriate Customs House in the manner specified in regulation 5 and such contract or contracts has or have been or registered. 5. Registration of contracts. (1) Every importer claiming assessment of the goods falling under the said heading No. 98.01 on or before their importation shall apply in writing to the proper officer at the port where the goods are to be imported or where the duty is to be paid for registeration of the contract or contracts as the case may be." 9. It is not disputed that the machine forming subject matter of the contract in question enables duplicating of audio cassettes from the mother cassette. The mother cassette is loaded in the machine and on being operated the machine multiples the audio recording on several audio cassettes of a specified number at a high speed. The blank audio cassettes are converted into pre-recorded audio cassettes. This activity is systematically carried on large scale and such pre-recorded audio cassettes are offered in bulk sale to the traders who in turn offer the same for sale to consumers. 10. According to the appellant the various activities involved in the manufacture of a pre-recorded audio-cassette are as under : (i) Preparation of a master tape in the studio; (ii) Manufacture of plastic cassettes parts, like cassette body, leather case, etc. from plastic raw material with the help of injection moulding facility; (iii) Assembly of cassette parts to make a C-O tape; (iv) High Speed transfer of music signals from 1/2" master tape to 1/8" pancakes; (v) Assembly of recorded pancakes into cassettes; (vi) Polymeric plate making for printing machines; (vii) Printing of information on cassette body; (viii) Printing of inlay cards; (ix) testing and cellowrapping of the finished cassettes. The machines which were the subject of the Contract dated 6.11.1989 were required for the 4th mentioned item, namely, high speed transfer of music signals from 1/2" Master Tape to 1/8" pancakes. 11. The term `manufacture is not defined in the Customs Act. In the allowed Act, namely the Central Excise Act, 1944 also, the term `manufacture is not to be found defined though vide clause (f) of Section 2 an inclusive definition is given of the term `manufacture so as to include certain processes also therein. 12. `Manufacture came up for the consideration of Constitution Bench in M/s Ujagar Prints v. Union of India, 1988(38) ELT 353 SC. It was held that if there should come into existence a new Article with a distinctive character and use, as a result of the processing, the essential condition justifying manufacture of goods is satisfied. The following passage in the Permanent Edition of "Words and Phrases" was referred to with approval in Delhi Cloth and General Mills AIR 1963 SC 791 , 795 :- "Manufacture implies a change, but every change is not manufacture and yet every change of an article is the result of treatment, labour and manipulation. But something more is necessary and there must be transformation; a new and different article must emerge having a distinctive name, character or use." 13. In a series of decisions [to wit, Decorative Laminates (India) Pvt. Ltd. - 1996(88) ELT 186, Union of India v. Parle Products Pvt. Ltd - 1994(74) ELT 492, Laminate Packing (P) Ltd. - 1990(49) ELT 326, Empire Industries Limited - 1985(20) ELT 179] the view taken consistently by this Court is that the moment there is transformation into a new commodity commercially known as a distinct and separate commodity having its own character, use and name whether it be the result of one process or several processes, manufacture takes place; the transformation of the goods into a new and different article should be such that in the commercial world it is known as another and different article. Pre-recorded audio cassettes are certainly goods known in the market as distinct and different from blank audio cassettes. The two have different uses. A pre-recorded audio cassette is generally sold by reference to its name or title which is suggestive of the contents of the audio recording on the cassette. The appellant is indulging in a mass production of such pre-recorded audio cassettes. It is a manufacturing activity. The appellants activity cannot be compared with a person sitting in the market extending facility of recording any demanded music or sounds on a blank audio cassette brought by or made available to the customer, which activity may be called a service. The Tribunal was not right in equating the appellants activity with photo-processing and holding the appellant a service industry.
### Response:
0
### Explanation:
11. The term `manufacture is not defined in the Customs Act. In the allowed Act, namely the Central Excise Act, 1944 also, the term `manufacture is not to be found defined though vide clause (f) of Section 2 an inclusive definition is given of the term `manufacture so as to include certain processes also therein.`Manufacture came up for the consideration of Constitution Bench in M/s Ujagar Prints v. Union of India, 1988(38) ELT 353 SC. It was held that if there should come into existence a new Article with a distinctive character and use, as a result of the processing, the essential condition justifying manufacture of goods is satisfied. The following passage in the Permanent Edition of "Words and Phrases" was referred to with approval in Delhi Cloth and General Mills AIR 1963 SC 791 , 795implies a change, but every change is not manufacture and yet every change of an article is the result of treatment, labour and manipulation. But something more is necessary and there must be transformation; a new and different article must emerge having a distinctive name, character or use.In a series of decisions [to wit, Decorative Laminates (India) Pvt. Ltd.1996(88) ELT 186, Union of India v. Parle Products Pvt. Ltd1994(74) ELT 492, Laminate Packing (P) Ltd.1990(49) ELT 326, Empire Industries Limited1985(20) ELT 179] the view taken consistently by this Court is that the moment there is transformation into a new commodity commercially known as a distinct and separate commodity having its own character, use and name whether it be the result of one process or several processes, manufacture takes place; the transformation of the goods into a new and different article should be such that in the commercial world it is known as another and different article.audio cassettes are certainly goods known in the market as distinct and different from blank audio cassettes. The two have different uses. Aprerecorded audio cassetteis generally sold by reference to its name or title which is suggestive of the contents of the audio recording on the cassette. The appellant is indulging in a mass production of suchaudio cassettes. It is a manufacturing activity. The appellants activity cannot be compared with a person sitting in the market extending facility of recording any demanded music or sounds on a blank audio cassette brought by or made available to the customer, which activity may be called a service. The Tribunal was not right in equating the appellants activity withand holding the appellant a service industry.
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Kartar Singh Vs. State of Punjab | Australia and Canada etc.) - having regard to the legal competence of the Legislature to make the law prescribing a different mode of proof, the meaningful purpose and object of the legislation, the gravity of terrorism unleashed by the terrorists and disruptionists endangering not only the sovereignty and integrity of the country but also the normal life of the citizens, and the reluctance of even the victims as well as the public in coming forward, at the risk of their life, to give evidence - hold that the impugned Section cannot be said to be suffering from any vice of unconstitutionality. In fact, if the exigencies of certain situation warrant such a legislation then it is constitutionally permissible as ruled in a number of decisions of this Court, provided none of the fundamental rights under Chapter III of the Constitution is infringed. 276. In view of the legal position vesting authority on higher police officer to record the confession hitherto enjoyed by the judicial officer in the normal procedure, we state that there should be no breach of procedure and the accepted norms of recording the confession which should reflect only the true and voluntary statement and there should be no room for hypercriticism that the authority has obtained an invented confession as a source of proof irrespective of the truth and creditability as it could be ironically put that when a Judge remarked, Am I not to hear the truth, the prosecution giving a startling answer, No, Your Lordship is to hear only the evidence. 277. As the Act now stands after its amendment consequent upon the deletion of Section 21(1)C), a confession made by a person before a police officer can be made admissible in the trial of such person not only as against the person but also against the co-accused, abettor or conspirator provided that the co- accused, abettor or conspirator is charged and tried in the same case together with the accused, namely, the maker of the confession. The present position is in conformity with Section 30 of the Evidence Act. 278. Under Section 21(1)(d), in a prosecution for an offence under sub-section (1) of Section 3, if it is proved that the accused had made a confession of the offence to any person other than a police officer, the Designated Court could raise a presumption that the accused had committed such offence unless the contrary is proved. By Act 43 of 1993, clause (d) of Section 21(1)(d) has now been omitted. The resultant position is that no presumption can be raised by the Designated Court against the accused as to offences under Section 3 on the basis of Section 21. 279. As per Section 15(1), a confession can either be reduced into writing or recorded on any mechanical device like cassettes, tapes or sound tracks from which sounds or images can be reproduced. As rightly pointed out by the learned counsel since the recording of evidence on mechanical device can be tampered, tailored, tinkered, edited and erased etc. we strongly feel that there must be some severe safeguards which should be scrupulously observed while recording a confession under Section 15(1) so that the possibility of extorting any false confession can be prevented to some appreciable extent. 280. Sub-section (2) of Section 15 enjoins a statutory obligation on the part of the police officer recording the confession to explain to the person making it that he is not bound to make a confession and to give a statutory warning that if he does so it may be used as evidence against him. 281. Rule 15 of the TADA Rules imposes certain conditions on the police officer with regard to the mode of recording the confession and requires the police officer to make a memorandum at the end of the confession to the effect that he has explained to the maker that he was not bound to make the confession and that the confession, if made by him, would be used as against him and that he recorded the confession only on being satisfied that it was voluntarily made. Rule 15(5) requires that every confession recorded under Section 15 should be sent forthwith either to the Chief Metropolitan Magistrate or the Chief Judicial Magistrate having jurisdiction over the area in which such confession has been recorded and the Magistrate should forthwith forward the recorded confession received by him to the Designated Court taking cognizance of the offence. 282. For the foregoing discussion, we hold that Section 15 is not liable to be struck down since that Section does not offend either Article 14 or 21 of the Constitution. 283. Notwithstanding our final conclusion made in relation to the intendment of Section 15, we would hasten to add that the recording of a confession by a Magistrate under Section 164 of the Code is not excluded by any exclusionary provision in the TADA Act, contrary to the Code but on the other hand the police officer investigating the case under the TADA can get the confession or statement of a person indicted with any offence under any of the provisions of the TADA recorded by any Metropolitan Magistrate, Judicial Magistrate, Executive Magistrate or Special Executive Magistrate of whom the two latter Magistrates are included in Section 164(1) by sub-Section (3) of Section 20 of the TADA Act and empowered to record confession. 284. The net result is that any confession or statement of a person under the TADA Act can be recorded either by a police officer not lower in rank than of a Superintendent of Police, in exercise of the powers conferred under Section 15 or by a Metropolitan Magistrate or Judicial Magistrate or Executive Magistrate or Special Executive Magistrate who are empowered to record any confession under Section 164(1) in view of sub-Section (3) of Section 20 of the TADA. As we will be elaborately dealing with Section 20(3) in the later part of this judgment, we do not like to go into detail any more. | 1[ds]70. Having regard to the limitation placed by Article 245(1) on the legislative power of the legislature of the State in the matter of enactment of laws having application within the territorial limits of the State only, the ambit of the field of legislation with respect to "public order" under Entry 1 in the State List has to be confined to disorders of lesser gravity having an impact within the boundaries of the State. Activities of a more serious nature which threaten the security and integrity of the country as a whole would not be within the legislative field assigned to the States under Entry 1 of the State List but would fall within the ambit of Entry 1 of the Union List relating to defence of India and in any event under the residuary power conferred on Parliament under Article 248 read with Entry 97 of the Union List. The petitioners can succeed in their challenge to the validity of the Act with regard to the legislative competence of Parliament, only if it can be said that the Act deals with activities relating to public order which are confined to the territories of a particularway in which the alleged violent crimes is shown to have been perpetrated, the manner in which they have been cruelly executed, the vulnerable territorial frontiers which form part of the scene of unprecedented and unprovoked occurrences, lead to an inescapable illation and conclusion that the activities of the terrorists and disruptionists pose a serious challenge to the very existence of sovereignty as well as to the security of India notwithstanding the fact whether such threats or challenges come by way of external aggression or internal disturbance.The above definitions, would themselves make it clear that the expression `Terrorist and Disruptive Activities deployed in the preamble of the Act (28 of 1987 | 1 | 37,994 | 326 | ### Instruction:
Make a prediction on the court's ruling (acceptance (1) or rejection (0) of the petition), and then dissect the proceeding to provide a detailed explanation using key textual passages.
### Input:
Australia and Canada etc.) - having regard to the legal competence of the Legislature to make the law prescribing a different mode of proof, the meaningful purpose and object of the legislation, the gravity of terrorism unleashed by the terrorists and disruptionists endangering not only the sovereignty and integrity of the country but also the normal life of the citizens, and the reluctance of even the victims as well as the public in coming forward, at the risk of their life, to give evidence - hold that the impugned Section cannot be said to be suffering from any vice of unconstitutionality. In fact, if the exigencies of certain situation warrant such a legislation then it is constitutionally permissible as ruled in a number of decisions of this Court, provided none of the fundamental rights under Chapter III of the Constitution is infringed. 276. In view of the legal position vesting authority on higher police officer to record the confession hitherto enjoyed by the judicial officer in the normal procedure, we state that there should be no breach of procedure and the accepted norms of recording the confession which should reflect only the true and voluntary statement and there should be no room for hypercriticism that the authority has obtained an invented confession as a source of proof irrespective of the truth and creditability as it could be ironically put that when a Judge remarked, Am I not to hear the truth, the prosecution giving a startling answer, No, Your Lordship is to hear only the evidence. 277. As the Act now stands after its amendment consequent upon the deletion of Section 21(1)C), a confession made by a person before a police officer can be made admissible in the trial of such person not only as against the person but also against the co-accused, abettor or conspirator provided that the co- accused, abettor or conspirator is charged and tried in the same case together with the accused, namely, the maker of the confession. The present position is in conformity with Section 30 of the Evidence Act. 278. Under Section 21(1)(d), in a prosecution for an offence under sub-section (1) of Section 3, if it is proved that the accused had made a confession of the offence to any person other than a police officer, the Designated Court could raise a presumption that the accused had committed such offence unless the contrary is proved. By Act 43 of 1993, clause (d) of Section 21(1)(d) has now been omitted. The resultant position is that no presumption can be raised by the Designated Court against the accused as to offences under Section 3 on the basis of Section 21. 279. As per Section 15(1), a confession can either be reduced into writing or recorded on any mechanical device like cassettes, tapes or sound tracks from which sounds or images can be reproduced. As rightly pointed out by the learned counsel since the recording of evidence on mechanical device can be tampered, tailored, tinkered, edited and erased etc. we strongly feel that there must be some severe safeguards which should be scrupulously observed while recording a confession under Section 15(1) so that the possibility of extorting any false confession can be prevented to some appreciable extent. 280. Sub-section (2) of Section 15 enjoins a statutory obligation on the part of the police officer recording the confession to explain to the person making it that he is not bound to make a confession and to give a statutory warning that if he does so it may be used as evidence against him. 281. Rule 15 of the TADA Rules imposes certain conditions on the police officer with regard to the mode of recording the confession and requires the police officer to make a memorandum at the end of the confession to the effect that he has explained to the maker that he was not bound to make the confession and that the confession, if made by him, would be used as against him and that he recorded the confession only on being satisfied that it was voluntarily made. Rule 15(5) requires that every confession recorded under Section 15 should be sent forthwith either to the Chief Metropolitan Magistrate or the Chief Judicial Magistrate having jurisdiction over the area in which such confession has been recorded and the Magistrate should forthwith forward the recorded confession received by him to the Designated Court taking cognizance of the offence. 282. For the foregoing discussion, we hold that Section 15 is not liable to be struck down since that Section does not offend either Article 14 or 21 of the Constitution. 283. Notwithstanding our final conclusion made in relation to the intendment of Section 15, we would hasten to add that the recording of a confession by a Magistrate under Section 164 of the Code is not excluded by any exclusionary provision in the TADA Act, contrary to the Code but on the other hand the police officer investigating the case under the TADA can get the confession or statement of a person indicted with any offence under any of the provisions of the TADA recorded by any Metropolitan Magistrate, Judicial Magistrate, Executive Magistrate or Special Executive Magistrate of whom the two latter Magistrates are included in Section 164(1) by sub-Section (3) of Section 20 of the TADA Act and empowered to record confession. 284. The net result is that any confession or statement of a person under the TADA Act can be recorded either by a police officer not lower in rank than of a Superintendent of Police, in exercise of the powers conferred under Section 15 or by a Metropolitan Magistrate or Judicial Magistrate or Executive Magistrate or Special Executive Magistrate who are empowered to record any confession under Section 164(1) in view of sub-Section (3) of Section 20 of the TADA. As we will be elaborately dealing with Section 20(3) in the later part of this judgment, we do not like to go into detail any more.
### Response:
1
### Explanation:
70. Having regard to the limitation placed by Article 245(1) on the legislative power of the legislature of the State in the matter of enactment of laws having application within the territorial limits of the State only, the ambit of the field of legislation with respect to "public order" under Entry 1 in the State List has to be confined to disorders of lesser gravity having an impact within the boundaries of the State. Activities of a more serious nature which threaten the security and integrity of the country as a whole would not be within the legislative field assigned to the States under Entry 1 of the State List but would fall within the ambit of Entry 1 of the Union List relating to defence of India and in any event under the residuary power conferred on Parliament under Article 248 read with Entry 97 of the Union List. The petitioners can succeed in their challenge to the validity of the Act with regard to the legislative competence of Parliament, only if it can be said that the Act deals with activities relating to public order which are confined to the territories of a particularway in which the alleged violent crimes is shown to have been perpetrated, the manner in which they have been cruelly executed, the vulnerable territorial frontiers which form part of the scene of unprecedented and unprovoked occurrences, lead to an inescapable illation and conclusion that the activities of the terrorists and disruptionists pose a serious challenge to the very existence of sovereignty as well as to the security of India notwithstanding the fact whether such threats or challenges come by way of external aggression or internal disturbance.The above definitions, would themselves make it clear that the expression `Terrorist and Disruptive Activities deployed in the preamble of the Act (28 of 1987
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New India Assurance Co. Ltd Vs. Smt. Sita Bai | M. Srinivasan, J. 1. Leave granted.2. Respondents 1 to 4 filed a claim petition before the Motor Accident Claims Tribunal, Khandwa against respondents 5, 6 and the appellant herein - New India Assurance Co. Ltd. The claim petition arose out of an accident which took place at 10.00 A.M. on 16.4.1987. Bus No. CPO-9104, owned by respondent No. 5 and driven by respondent No. 6 was involved in that accident in which one Smt. Salta Bai suffered fatal injuries. The Motor Accident Claims Tribunal vide order dated 22.9.1990 opined that the bus in question was insured with the appellant-Insurance Company for the period 16.4.1987 to 15.4.1988 (both days inclusive) and, thus, the owner (respondent No. 5) as well as the Insurance Company (appellant herein) were liable under the provisions of Section 92-A of the Motor Vehicles Act (hereinafter the Act). An amount of Rs. 15,000/- was accordingly directed to be paid as ad-interim compensation to respondents 1 to 4 under Section 92-A of the Act. The order of the Motor Accident Claims Tribunal was put in issue and a first appeal was filed in the High Court of M.P. at Jabalpur. On 11th March, 1991, a learned Single Judge of the High Court relying upon the law laid down by this Court in New India Assurance Co. Ltd. v. Ram Dayal and others, 1990(2) SCC 680, held that the appeal had no merits and dismissed the same summarily. Aggrieved, the appellant-Insurance Company is before us by special leave.3. A brief notice of some of the admitted facts would be advantageous at this stage.The proposal for insuring the vehicle in question was made by the owner of the vehicle on 16.4.1987 at 2100 hours. The cover note was issued by the appellant in respect of that vehicle, being No. P/70802 on 16.4.1987 at 2100 hours. The Insurance Policy (Exh.P/5) was later on issued in which also the date of commencement of the insurance policy was recorded as 16.4.1987 (2100 hours). The accident, in question, in which Smt. Salta Bai received fatal injuries had admittedly occurred at 10.00 A.M. on 16.4.1987, i.e., much before the commencement of the insurance policy.4. The High Court opined that the insurance policy dated 16.4.1987 covered the period of the accident also because the policy would be deemed to have commenced at midnight of 15.4.1987 and 16.4.1987. The High Court in taking this view relied upon the judgment in Ram Dayals case (supra). 5. The correctness and applicability of the judgment in Ram Dayals case (supra) came up for consideration before this Court subsequently in a number of cases. In New India Assurance Co. Ltd. v. Bhagwati Devi and others, Civil Appeal No. 1550 of 1994, decided on 10.2.1998, a three-Judge Bench of this Court relied upon the view taken in National Insurance Co. Ltd. v. Jikubhai Nathuji Dabhi (Smt.) and others, 1997(1) SCC 66, wherein it had been held that if there is a special contract, mentioning in the policy the time when it was bought, the insurance policy would be operative from that time and not from the previous midnight as was the case in Ram Dayals case, where no time from which the insurance policy was to become effective had been mentioned. It was held that should there be no contract to the contrary, an insurance policy becomes operative from the previous midnight, when bought during the day following, but in cases where there is a mention of the specific time for the purchase of the policy, then a special contract comes into being and the policy becomes effective from the time mentioned in the cover note/the policy itself. The judgment in Jikubhais case (supra) has been subsequently followed in Oriental Insurance Co. Ltd. v. Sunita Rathi and others, 1998(1) SCC 365 : 1998(1) RCR (Civil) 429 (SC), by a three-Judge of this Court also.6. In the fact situation of this case since the commencement of the policy at 2100 hours on 16.4.1987 was after the accident which had occurred at 1000 hours on 16.4.1987, the Tribunal as well as the High Court were wrong in burdening the appellant-Insurance Company, with any liability under Section 92-A of the Motor Vehicles Act by applying the law laid down in Ram Dayals case (supra), which on facts, had no application to this case. This case is squarely covered by the judgment in Jikhubhais case (supra) and the other judgments following it as noticed above. | 1[ds]6. In the fact situation of this case since the commencement of the policy at 2100 hours on 16.4.1987 was after the accident which had occurred at 1000 hours on 16.4.1987, the Tribunal as well as the High Court were wrong in burdening the appellant-Insurance Company, with any liability under Section 92-A of the Motor Vehicles Act by applying the law laid down in Ram Dayals case (supra), which on facts, had no application to this case. This case is squarely covered by the judgment in Jikhubhais case (supra) and the other judgments following it as noticed above. | 1 | 847 | 113 | ### Instruction:
Speculate on the likely judgment (yes (1) or no (0) to the appeal) and then delve into the case proceeding to elucidate your prediction, focusing on critical sentences.
### Input:
M. Srinivasan, J. 1. Leave granted.2. Respondents 1 to 4 filed a claim petition before the Motor Accident Claims Tribunal, Khandwa against respondents 5, 6 and the appellant herein - New India Assurance Co. Ltd. The claim petition arose out of an accident which took place at 10.00 A.M. on 16.4.1987. Bus No. CPO-9104, owned by respondent No. 5 and driven by respondent No. 6 was involved in that accident in which one Smt. Salta Bai suffered fatal injuries. The Motor Accident Claims Tribunal vide order dated 22.9.1990 opined that the bus in question was insured with the appellant-Insurance Company for the period 16.4.1987 to 15.4.1988 (both days inclusive) and, thus, the owner (respondent No. 5) as well as the Insurance Company (appellant herein) were liable under the provisions of Section 92-A of the Motor Vehicles Act (hereinafter the Act). An amount of Rs. 15,000/- was accordingly directed to be paid as ad-interim compensation to respondents 1 to 4 under Section 92-A of the Act. The order of the Motor Accident Claims Tribunal was put in issue and a first appeal was filed in the High Court of M.P. at Jabalpur. On 11th March, 1991, a learned Single Judge of the High Court relying upon the law laid down by this Court in New India Assurance Co. Ltd. v. Ram Dayal and others, 1990(2) SCC 680, held that the appeal had no merits and dismissed the same summarily. Aggrieved, the appellant-Insurance Company is before us by special leave.3. A brief notice of some of the admitted facts would be advantageous at this stage.The proposal for insuring the vehicle in question was made by the owner of the vehicle on 16.4.1987 at 2100 hours. The cover note was issued by the appellant in respect of that vehicle, being No. P/70802 on 16.4.1987 at 2100 hours. The Insurance Policy (Exh.P/5) was later on issued in which also the date of commencement of the insurance policy was recorded as 16.4.1987 (2100 hours). The accident, in question, in which Smt. Salta Bai received fatal injuries had admittedly occurred at 10.00 A.M. on 16.4.1987, i.e., much before the commencement of the insurance policy.4. The High Court opined that the insurance policy dated 16.4.1987 covered the period of the accident also because the policy would be deemed to have commenced at midnight of 15.4.1987 and 16.4.1987. The High Court in taking this view relied upon the judgment in Ram Dayals case (supra). 5. The correctness and applicability of the judgment in Ram Dayals case (supra) came up for consideration before this Court subsequently in a number of cases. In New India Assurance Co. Ltd. v. Bhagwati Devi and others, Civil Appeal No. 1550 of 1994, decided on 10.2.1998, a three-Judge Bench of this Court relied upon the view taken in National Insurance Co. Ltd. v. Jikubhai Nathuji Dabhi (Smt.) and others, 1997(1) SCC 66, wherein it had been held that if there is a special contract, mentioning in the policy the time when it was bought, the insurance policy would be operative from that time and not from the previous midnight as was the case in Ram Dayals case, where no time from which the insurance policy was to become effective had been mentioned. It was held that should there be no contract to the contrary, an insurance policy becomes operative from the previous midnight, when bought during the day following, but in cases where there is a mention of the specific time for the purchase of the policy, then a special contract comes into being and the policy becomes effective from the time mentioned in the cover note/the policy itself. The judgment in Jikubhais case (supra) has been subsequently followed in Oriental Insurance Co. Ltd. v. Sunita Rathi and others, 1998(1) SCC 365 : 1998(1) RCR (Civil) 429 (SC), by a three-Judge of this Court also.6. In the fact situation of this case since the commencement of the policy at 2100 hours on 16.4.1987 was after the accident which had occurred at 1000 hours on 16.4.1987, the Tribunal as well as the High Court were wrong in burdening the appellant-Insurance Company, with any liability under Section 92-A of the Motor Vehicles Act by applying the law laid down in Ram Dayals case (supra), which on facts, had no application to this case. This case is squarely covered by the judgment in Jikhubhais case (supra) and the other judgments following it as noticed above.
### Response:
1
### Explanation:
6. In the fact situation of this case since the commencement of the policy at 2100 hours on 16.4.1987 was after the accident which had occurred at 1000 hours on 16.4.1987, the Tribunal as well as the High Court were wrong in burdening the appellant-Insurance Company, with any liability under Section 92-A of the Motor Vehicles Act by applying the law laid down in Ram Dayals case (supra), which on facts, had no application to this case. This case is squarely covered by the judgment in Jikhubhais case (supra) and the other judgments following it as noticed above.
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COMMISSIONER OF INCOME TAX KOLKATA XII Vs. M/S CALCUTTA EXPORT COMPANY | or brokerage, rent, royalty, fees for professional services or fees for technical services payable to a resident, or amounts payable to a contractor or sub-contractor, being resident, for carrying out any work (including supply of labour for carrying out any work), on which tax is deductible at source under Chapter XVII-B and such tax has not been deducted or; after deduction, has not paid on or before the due date specified in sub-section (1) of Section 139: Provided that where in respect of any such sum, tax has been deducted in any subsequent year, or has been deducted during the previous year but paid after the due date specified in sub-section (1) of section 139, such sum shall be allowed as a deducted in computing the income of the previous year in which such tax has been paid. 24. Thus, the Finance Act, 2010 further relaxed the rigors of Section 40(a)(ia) of the IT Act to provide that all TDS made during the previous year can be deposited with the Government by the due date of filing the return of income. The idea was to allow additional time to the deductors to deposit the TDS so made. However, the Memorandum explaining the provisions of the Finance Bill, 2010 expressly mentioned as follows: This amendment is proposed to take effect retrospectively from 1st April, 2010 and will, accordingly, apply in relation to the Assessment Year 2010-11 and subsequent years. 25. The controversy surrounding the above amendment was whether the amendment being curative in nature should be applied retrospectively i.e., from the date of insertion of the provisions of Section 40(a)(ia) or to be applicable from the date of enforcement. 26. TDS results in collection of tax and the deductor discharges dual responsibility of collection of tax and its deposition to the government. Strict compliance of Section 40(a)(ia) may be justified keeping in view the legislative object and purpose behind the provision but a provision of such nature, the purpose of which is to ensure tax compliance and not to punish the tax payer, should not be allowed to be converted into an iron rod provision which metes out stern punishment and results in malevolent results, disproportionate to the offending act and aim of the legislation. Legislature can and do experiment and intervene from time to time when they feel and notice that the existing provision is causing and creating unintended and excessive hardships to citizens and subject or have resulted in great inconvenience and uncomfortable results. Obedience to law is mandatory and has to be enforced but the magnitude of punishment must not be disproportionate by what is required and necessary. The consequences and the injury caused, if disproportionate do and can result in amendments which have the effect of streamlining and correcting anomalies. As discussed above, the amendments made in 2008 and 2010 were steps in the said direction only. Legislative purpose and the object of the said amendments were to ensure payment and deposit of TDS with the Government. 27. A proviso which is inserted to remedy unintended consequences and to make the provision workable, a proviso which supplies an obvious omission in the Section, is required to be read into the Section to give the Section a reasonable interpretation and requires to be treated as retrospective in operation so that a reasonable interpretation can be given to the Section as a whole. 28. The purpose of the amendment made by the Finance Act, 2010 is to solve the anomalies that the insertion of section 40(a)(ia) was causing to the bona fide tax payer. The amendment, even if not given operation retrospectively, may not materially be of consequence to the Revenue when the tax rates are stable and uniform or in cases of big assessees having substantial turnover and equally huge expenses and necessary cushion to absorb the effect. However, marginal and medium taxpayers, who work at low gross product rate and when expenditure which becomes subject matter of an order under Section 40(a)(ia) is substantial, can suffer severe adverse consequences if the amendment made in 2010 is not given retrospective operation i.e., from the date of substitution of the provision. Transferring or shifting expenses to a subsequent year, in such cases, will not wipe off the adverse effect and the financial stress. Such could not be the intention of the legislature. Hence, the amendment made by the Finance Act, 2010 being curative in nature required to be given retrospective operation i.e., from the date of insertion of the said provision. 29. Further, in Allied Motors (P) Limited (supra), this Court while dealing with a similar question with regard to the retrospective effect of the amendment made in section 43-B of the Income Tax Act,1961 has held that the new proviso to Section 43B should be given retrospective effect from the inception on the ground that the proviso was added to remedy unintended consequences and supply an obvious omission. The proviso ensured reasonable interpretation and retrospective effect would serve the object behind the enactment. The aforesaid view has consistently been followed by this Court in the following cases, viz., Whirlpool of India Ltd., vs. CIT, New Delhi (2000) 245 ITR 3 , CIT vs. Amrit Banaspati (2002) 255 ITR 117 and CIT vs. Alom Enterprises Ltd. (2009) 319 ITR 306. 30. Hence, in light of the forgoing discussion and the binding effect of the judgment given in Allied Moters (supra), we are of the view that the amended provision of Sec 40(a)(ia) of the IT Act should be interpreted liberally and equitable and applies retrospectively from the date when Section 40(a)(ia) was inserted i.e., with effect from the Assessment Year 2005-2006 so that an assessee should not suffer unintended and deleterious consequences beyond what the object and purpose of the provision mandates. As the developments with regard to the Section recorded above shows that the amendment was curative in nature, it should be given retrospective operation as if the amended provision existed even at the time of its insertion. | 1[ds]13. The dispute in the present case revolves around the fact that whether the amendment made by the Finance Act, 2010 to the provisions of Section 40 (a) (ia) of the IT Act is retrospective in nature so as to apply to the present case or not.If it is so, then the tax duly paid by the assessee on 01.08.2005 is well in accordance with law and the assessee is allowed to claim deduction for the tax deducted and paid to the government, in the previous year in which the tax was deducted.14. For deciding as to the retrospective effect of the amendment made by Finance Act, 2010, it is required to see the Section as it stands before and after the amendment made through the Finance Act, 2010 and the purpose of such insertion or amendment to the said provisions. The provisions of Section 40(a)(ia) came into force in the year 200516. The purpose is very much clear from the above referred explanation by the memorandum that it came with a purpose to ensure tax compliance. The fact that the intention of the legislature was not to punish the assessee is further reflected from a bare reading of the provisions of Section 40(a)(ia) of the IT Act. It only results in shifting of the year in which the expenditure can be claimed as deduction. In a case where the tax deducted at source was duly deposited with the government within the prescribed time, the said amount can be claimed as a deduction from the income in the previous year in which the TDS was deducted. However, when the amount deducted in the form of TDS was deposited with the government after the expiry of period allowed for such deposit then the deductions can be claimed for such deposited TDS amount only in the previous year in which such payment was made to the government.17. However, it has caused some genuine and apparent hardship to the assesses especially in respect of tax deducted at source in the last month of the previous year, the due date for payment of which as per the time specified in Section 200 (1) of IT Act was only on 7 of April in the next year. The assessee in such case, thus, had a period of only seven days to pay the tax deducted at source from the expenditure incurred in the month of March so as to avoid disallowance of the said expenditure under Section 40(a)(ia) of IT Act.19. The above amendments made by the Finance Act, 2008 thus provided that no disallowance under Section 40 (a) (ia) of the IT Act shall be made in respect of the expenditure incurred in the month of March if the tax deducted at source on such expenditure has been paid before the due date of filing of the return. It is important to mention here that the amendment was given retrospective operation from the date of 01.04.2005 i.e., from the very date of substitution of the provision.20. Therefore, the assesses were, after the said amendment in 2008, classified in two categories namely; one; those who have deducted that tax during the last month of the previous year and two; those who have deducted the tax in the remaining eleven months of the previous year. It was provided that in case of assessees falling under the first category, no disallowance under Section 40(a) (ia) of the IT Act shall be made if the tax deducted by them during the last month of the previous year has been paid on or before the last day of filing of return in accordance with the provisions of Section 139(1) of the IT Act for the said previous year. In case, the assessees are falling under the second category, no disallowance under Section 40(a)(ia) of IT Act where the tax was deducted before the last month of the previous year and the same was credited to the government before the expiry of the previous year. The net effect is that the assessee could not claim deduction for the TDS amount in the previous year in which the tax was deducted and the benefit of such deductions can be claimed in the next year only.21. The amendment though has addressed the concerns of the assesses falling in the first category but with regard to the case falling in the second category, it was still resulting into unintended consequences and causing grave and genuine hardships to the assesses who had substantially complied with the relevant TDS provisions by deducting the tax at source and by paying the same to the credit of the Government before the due date of filing of their returns under Section 139(1) of the IT Act. The disability to claim deductions on account of such lately credited sum of TDS in assessment of the previous year in which it was deducted, was detrimental to the small traders who may not be in a position to bear the burden of such disallowance in the present Assessment Year.22. In order to remedy this position and to remove hardships which were being caused to the assessees belonging to such second category, amendments have been made in the provisions of Section 40(a) (ia) by the Finance Act, 2010.24. Thus, the Finance Act, 2010 further relaxed the rigors of Section 40(a)(ia) of the IT Act to provide that all TDS made during the previous year can be deposited with the Government by the due date of filing the return of income. The idea was to allow additional time to the deductors to deposit the TDS so made. However, the Memorandum explaining the provisions of the Finance Bill, 2010 expressly mentioned as follows: This amendment is proposed to take effect retrospectively from 1st April, 2010 and will, accordingly, apply in relation to the Assessment Year 2010-11 and subsequent years.25. The controversy surrounding the above amendment was whether the amendment being curative in nature should be applied retrospectively i.e., from the date of insertion of the provisions of Section 40(a)(ia) or to be applicable from the date of enforcement.26. TDS results in collection of tax and the deductor discharges dual responsibility of collection of tax and its deposition to the government. Strict compliance of Section 40(a)(ia) may be justified keeping in view the legislative object and purpose behind the provision but a provision of such nature, the purpose of which is to ensure tax compliance and not to punish the tax payer, should not be allowed to be converted into an iron rod provision which metes out stern punishment and results in malevolent results, disproportionate to the offending act and aim of the legislation. Legislature can and do experiment and intervene from time to time when they feel and notice that the existing provision is causing and creating unintended and excessive hardships to citizens and subject or have resulted in great inconvenience and uncomfortable results. Obedience to law is mandatory and has to be enforced but the magnitude of punishment must not be disproportionate by what is required and necessary. The consequences and the injury caused, if disproportionate do and can result in amendments which have the effect of streamlining and correcting anomalies. As discussed above, the amendments made in 2008 and 2010 were steps in the said direction only. Legislative purpose and the object of the said amendments were to ensure payment and deposit of TDS with the Government.27. A proviso which is inserted to remedy unintended consequences and to make the provision workable, a proviso which supplies an obvious omission in the Section, is required to be read into the Section to give the Section a reasonable interpretation and requires to be treated as retrospective in operation so that a reasonable interpretation can be given to the Section as a whole.28. The purpose of the amendment made by the Finance Act, 2010 is to solve the anomalies that the insertion of section 40(a)(ia) was causing to the bona fide tax payer. The amendment, even if not given operation retrospectively, may not materially be of consequence to the Revenue when the tax rates are stable and uniform or in cases of big assessees having substantial turnover and equally huge expenses and necessary cushion to absorb the effect. However, marginal and medium taxpayers, who work at low gross product rate and when expenditure which becomes subject matter of an order under Section 40(a)(ia) is substantial, can suffer severe adverse consequences if the amendment made in 2010 is not given retrospective operation i.e., from the date of substitution of the provision. Transferring or shifting expenses to a subsequent year, in such cases, will not wipe off the adverse effect and the financial stress. Such could not be the intention of the legislature. Hence, the amendment made by the Finance Act, 2010 being curative in nature required to be given retrospective operation i.e., from the date of insertion of the said provision.29. Further, in Allied Motors (P) Limited (supra), this Court while dealing with a similar question with regard to the retrospective effect of the amendment made in section 43-B of the Income Tax Act,1961 has held that the new proviso to Section 43B should be given retrospective effect from the inception on the ground that the proviso was added to remedy unintended consequences and supply an obvious omission. The proviso ensured reasonable interpretation and retrospective effect would serve the object behind the enactment. The aforesaid view has consistently been followed by this Court in the following cases, viz., Whirlpool of India Ltd., vs. CIT, New Delhi (2000) 245 ITR 3 , CIT vs. Amrit Banaspati (2002) 255 ITR 117 and CIT vs. Alom Enterprises Ltd. (2009) 319 ITR 306. 30. Hence, in light of the forgoing discussion and the binding effect of the judgment given in Allied Moters (supra), we are of the view that the amended provision of Sec 40(a)(ia) of the IT Act should be interpreted liberally and equitable and applies retrospectively from the date when Section 40(a)(ia) was inserted i.e., with effect from the Assessment Year 2005-2006 so that an assessee should not suffer unintended and deleterious consequences beyond what the object and purpose of the provision mandates. As the developments with regard to the Section recorded above shows that the amendment was curative in nature, it should be given retrospective operation as if the amended provision existed even at the time of its insertion. | 1 | 3,952 | 1,949 | ### Instruction:
Make a prediction on the court's ruling (acceptance (1) or rejection (0) of the petition), and then dissect the proceeding to provide a detailed explanation using key textual passages.
### Input:
or brokerage, rent, royalty, fees for professional services or fees for technical services payable to a resident, or amounts payable to a contractor or sub-contractor, being resident, for carrying out any work (including supply of labour for carrying out any work), on which tax is deductible at source under Chapter XVII-B and such tax has not been deducted or; after deduction, has not paid on or before the due date specified in sub-section (1) of Section 139: Provided that where in respect of any such sum, tax has been deducted in any subsequent year, or has been deducted during the previous year but paid after the due date specified in sub-section (1) of section 139, such sum shall be allowed as a deducted in computing the income of the previous year in which such tax has been paid. 24. Thus, the Finance Act, 2010 further relaxed the rigors of Section 40(a)(ia) of the IT Act to provide that all TDS made during the previous year can be deposited with the Government by the due date of filing the return of income. The idea was to allow additional time to the deductors to deposit the TDS so made. However, the Memorandum explaining the provisions of the Finance Bill, 2010 expressly mentioned as follows: This amendment is proposed to take effect retrospectively from 1st April, 2010 and will, accordingly, apply in relation to the Assessment Year 2010-11 and subsequent years. 25. The controversy surrounding the above amendment was whether the amendment being curative in nature should be applied retrospectively i.e., from the date of insertion of the provisions of Section 40(a)(ia) or to be applicable from the date of enforcement. 26. TDS results in collection of tax and the deductor discharges dual responsibility of collection of tax and its deposition to the government. Strict compliance of Section 40(a)(ia) may be justified keeping in view the legislative object and purpose behind the provision but a provision of such nature, the purpose of which is to ensure tax compliance and not to punish the tax payer, should not be allowed to be converted into an iron rod provision which metes out stern punishment and results in malevolent results, disproportionate to the offending act and aim of the legislation. Legislature can and do experiment and intervene from time to time when they feel and notice that the existing provision is causing and creating unintended and excessive hardships to citizens and subject or have resulted in great inconvenience and uncomfortable results. Obedience to law is mandatory and has to be enforced but the magnitude of punishment must not be disproportionate by what is required and necessary. The consequences and the injury caused, if disproportionate do and can result in amendments which have the effect of streamlining and correcting anomalies. As discussed above, the amendments made in 2008 and 2010 were steps in the said direction only. Legislative purpose and the object of the said amendments were to ensure payment and deposit of TDS with the Government. 27. A proviso which is inserted to remedy unintended consequences and to make the provision workable, a proviso which supplies an obvious omission in the Section, is required to be read into the Section to give the Section a reasonable interpretation and requires to be treated as retrospective in operation so that a reasonable interpretation can be given to the Section as a whole. 28. The purpose of the amendment made by the Finance Act, 2010 is to solve the anomalies that the insertion of section 40(a)(ia) was causing to the bona fide tax payer. The amendment, even if not given operation retrospectively, may not materially be of consequence to the Revenue when the tax rates are stable and uniform or in cases of big assessees having substantial turnover and equally huge expenses and necessary cushion to absorb the effect. However, marginal and medium taxpayers, who work at low gross product rate and when expenditure which becomes subject matter of an order under Section 40(a)(ia) is substantial, can suffer severe adverse consequences if the amendment made in 2010 is not given retrospective operation i.e., from the date of substitution of the provision. Transferring or shifting expenses to a subsequent year, in such cases, will not wipe off the adverse effect and the financial stress. Such could not be the intention of the legislature. Hence, the amendment made by the Finance Act, 2010 being curative in nature required to be given retrospective operation i.e., from the date of insertion of the said provision. 29. Further, in Allied Motors (P) Limited (supra), this Court while dealing with a similar question with regard to the retrospective effect of the amendment made in section 43-B of the Income Tax Act,1961 has held that the new proviso to Section 43B should be given retrospective effect from the inception on the ground that the proviso was added to remedy unintended consequences and supply an obvious omission. The proviso ensured reasonable interpretation and retrospective effect would serve the object behind the enactment. The aforesaid view has consistently been followed by this Court in the following cases, viz., Whirlpool of India Ltd., vs. CIT, New Delhi (2000) 245 ITR 3 , CIT vs. Amrit Banaspati (2002) 255 ITR 117 and CIT vs. Alom Enterprises Ltd. (2009) 319 ITR 306. 30. Hence, in light of the forgoing discussion and the binding effect of the judgment given in Allied Moters (supra), we are of the view that the amended provision of Sec 40(a)(ia) of the IT Act should be interpreted liberally and equitable and applies retrospectively from the date when Section 40(a)(ia) was inserted i.e., with effect from the Assessment Year 2005-2006 so that an assessee should not suffer unintended and deleterious consequences beyond what the object and purpose of the provision mandates. As the developments with regard to the Section recorded above shows that the amendment was curative in nature, it should be given retrospective operation as if the amended provision existed even at the time of its insertion.
### Response:
1
### Explanation:
resulting into unintended consequences and causing grave and genuine hardships to the assesses who had substantially complied with the relevant TDS provisions by deducting the tax at source and by paying the same to the credit of the Government before the due date of filing of their returns under Section 139(1) of the IT Act. The disability to claim deductions on account of such lately credited sum of TDS in assessment of the previous year in which it was deducted, was detrimental to the small traders who may not be in a position to bear the burden of such disallowance in the present Assessment Year.22. In order to remedy this position and to remove hardships which were being caused to the assessees belonging to such second category, amendments have been made in the provisions of Section 40(a) (ia) by the Finance Act, 2010.24. Thus, the Finance Act, 2010 further relaxed the rigors of Section 40(a)(ia) of the IT Act to provide that all TDS made during the previous year can be deposited with the Government by the due date of filing the return of income. The idea was to allow additional time to the deductors to deposit the TDS so made. However, the Memorandum explaining the provisions of the Finance Bill, 2010 expressly mentioned as follows: This amendment is proposed to take effect retrospectively from 1st April, 2010 and will, accordingly, apply in relation to the Assessment Year 2010-11 and subsequent years.25. The controversy surrounding the above amendment was whether the amendment being curative in nature should be applied retrospectively i.e., from the date of insertion of the provisions of Section 40(a)(ia) or to be applicable from the date of enforcement.26. TDS results in collection of tax and the deductor discharges dual responsibility of collection of tax and its deposition to the government. Strict compliance of Section 40(a)(ia) may be justified keeping in view the legislative object and purpose behind the provision but a provision of such nature, the purpose of which is to ensure tax compliance and not to punish the tax payer, should not be allowed to be converted into an iron rod provision which metes out stern punishment and results in malevolent results, disproportionate to the offending act and aim of the legislation. Legislature can and do experiment and intervene from time to time when they feel and notice that the existing provision is causing and creating unintended and excessive hardships to citizens and subject or have resulted in great inconvenience and uncomfortable results. Obedience to law is mandatory and has to be enforced but the magnitude of punishment must not be disproportionate by what is required and necessary. The consequences and the injury caused, if disproportionate do and can result in amendments which have the effect of streamlining and correcting anomalies. As discussed above, the amendments made in 2008 and 2010 were steps in the said direction only. Legislative purpose and the object of the said amendments were to ensure payment and deposit of TDS with the Government.27. A proviso which is inserted to remedy unintended consequences and to make the provision workable, a proviso which supplies an obvious omission in the Section, is required to be read into the Section to give the Section a reasonable interpretation and requires to be treated as retrospective in operation so that a reasonable interpretation can be given to the Section as a whole.28. The purpose of the amendment made by the Finance Act, 2010 is to solve the anomalies that the insertion of section 40(a)(ia) was causing to the bona fide tax payer. The amendment, even if not given operation retrospectively, may not materially be of consequence to the Revenue when the tax rates are stable and uniform or in cases of big assessees having substantial turnover and equally huge expenses and necessary cushion to absorb the effect. However, marginal and medium taxpayers, who work at low gross product rate and when expenditure which becomes subject matter of an order under Section 40(a)(ia) is substantial, can suffer severe adverse consequences if the amendment made in 2010 is not given retrospective operation i.e., from the date of substitution of the provision. Transferring or shifting expenses to a subsequent year, in such cases, will not wipe off the adverse effect and the financial stress. Such could not be the intention of the legislature. Hence, the amendment made by the Finance Act, 2010 being curative in nature required to be given retrospective operation i.e., from the date of insertion of the said provision.29. Further, in Allied Motors (P) Limited (supra), this Court while dealing with a similar question with regard to the retrospective effect of the amendment made in section 43-B of the Income Tax Act,1961 has held that the new proviso to Section 43B should be given retrospective effect from the inception on the ground that the proviso was added to remedy unintended consequences and supply an obvious omission. The proviso ensured reasonable interpretation and retrospective effect would serve the object behind the enactment. The aforesaid view has consistently been followed by this Court in the following cases, viz., Whirlpool of India Ltd., vs. CIT, New Delhi (2000) 245 ITR 3 , CIT vs. Amrit Banaspati (2002) 255 ITR 117 and CIT vs. Alom Enterprises Ltd. (2009) 319 ITR 306. 30. Hence, in light of the forgoing discussion and the binding effect of the judgment given in Allied Moters (supra), we are of the view that the amended provision of Sec 40(a)(ia) of the IT Act should be interpreted liberally and equitable and applies retrospectively from the date when Section 40(a)(ia) was inserted i.e., with effect from the Assessment Year 2005-2006 so that an assessee should not suffer unintended and deleterious consequences beyond what the object and purpose of the provision mandates. As the developments with regard to the Section recorded above shows that the amendment was curative in nature, it should be given retrospective operation as if the amended provision existed even at the time of its insertion.
|
ATUL CHANDRA DAS(D) TR.LRS Vs. RABINDRA NATH BHATTACHARYA(D)TR.LRS.&ORS | company, life assurance company, Life Insurance Corporation of India, mutual insurance company, provident insurance society or from a provident fund; (e) an advance made on the basis of a negotiable instrument as defined in the Negotiable Instruments Act, 1881, (26 of 1881) other than a promissory note; (f) Omitted by W.B. Money Lender Amendment Act, (Act IV of 1931) (g) * * * * (h) a loan made to or by the Administrator General and Official Trustee of West Bengal or the Commissioner of Wakfs or the Official Assignee or the Official Receiver of the High Court in Calcutta; (i) a loan or debenture in respect of which dealings are listed on any Stock Exchange;?13. Commercial loan is defined in Section 2(4) of the State Act. Section 2(22) defines suit to which this Act applies. It reads as follows:-"2(22) ?suit to which this Act applies? means any suit or proceeding instituted or filed on or after the 1 st day of January, 1939 or pending on that date and includes a proceeding in execution- (a) for the recovery of a loan advanced before or after the commencement of this Act; (b) for the enforcement of any agreement entered into before or after the commencement of this Act, whether by way of settlement of account or otherwise, or of any security so taken, in respect of any loan advanced whether before or after the commencement of this Act; or (c) for the redemption of any security given before or after the commencement of this Act in respect of any loan advanced whether before or after the commencement of this Act.?14. Section 36 comes under the heading ‘Reopening of transactions?. It deals with the power of the Court to exercise all or any of the various powers which are mentioned therein. Sub Section 4 of Section 36 reads as follows:-?36(4). This Section shall apply to any Suit, whatever it forms may be, if such suit is substantially one for the recovery of a loan or for the enforcement of any agreement of security in respect of a loan or for the redemption of money such security.?15. It will be noticed that a Suit for redemption is mentioned as suit to which Section 36 applies. Section 38 undoubtedly enables the borrowers to seek a direction for taking accounts. 16. We have noticed the relief which was sought in the suit which was considered by the learned Single Judge in Swarnalata Tat AIR 1984 Calcutta 130. In fact, Court in the said case could not find a mortgage proved also. The reliefs on the other hand in the suit filed by Bhattacharya include reliefs relating to redemption in the form it is asked for. In fact, no issue in this regard was taken before the Trial Court. We see no reason to non-suit, the Bhattacharyas on this ground which is taken for the reasons which we have given. 17. The last contention taken is that Section 37(a) of the State Act is repugnant to Section 58(c) of the Central Act namely, the Transfer of Property Act. The contention runs as follows:- Money lending falls as entry (30) in the State List. Transfer of Property other than agricultural land falls in Entry 6 in the concurrent list. The State legislature in enacting Section 37(a) of the State Act, a law relating to money lending has made a law which is inconsistent and therefore, repugnant to the law made by the Parliament in Section 58(c) of the Transfer of Property Act. This contention is taken for the first time in this Court. We also see no merit in the same at any rate. Section 37(A) is traceable to the Entry ‘Transfer of Property? which is found in the concurrent list. Article 254 of the Constitution of India reads as follows:-?254. Inconsistency between laws made by Parliament and laws made by the Legislatures of States (1) If any provision of a law made by the Legislature of a State is repugnant to any provision of a law made by Parliament which Parliament is competent to enact, or to any provision of an existing law with respect to one of the matters enumerated in the Concurrent List, then, subject to the provisions of clause ( 2 ), the law made by Parliament, whether passed before or after the law made by the Legislature of such State, or, as the case may be, the existing law, shall prevail and the law made by the Legislature of the State shall, to the extent of the repugnancy, be void. (2) Where a law made by the Legislature of a State with respect to one of the matters enumerated in the concurrent List contains any provision repugnant to the provisions of an earlier law made by Parliament or an existing law with respect to that matter, then, the law so made by the Legislature of such State shall, if it has been reserved for the consideration of the President and has received his assent, prevail in that State: Provided that nothing in this clause shall prevent Parliament from enacting at any time any law with respect to the same matter including a law adding to, amending, varying or repealing the law so made by the Legislature of the State .?18. In this case proceeding on the basis that there is an inconsistency between Section 58(c) of the Transfer of Property Act and Section 37(A) of the State Act, in view of the assent given by the President, the matter falls under Article 254(2). Therefore, despite the inconsistency, Section 37(A) of the State Act will prevail in the State. 19. The argument that being part of State Act which is the Money Lending Act and Money lending is in the state list and therefore, it is a case of legislative, incompetence, does not appeal to us. We have found that the provisions of 37(A) is traceable to the Entry ‘Transfer of Property? in the Concurrent List and that Article 254(2) saves the provision. | 0[ds]10. Keeping Section 58(c) side by side with Section 37(a) of the State Act, the conclusion is inevitable that the State legislature has intended to override the effect of proviso to Section 58(c) of the Transfer of Property Act by enacting Section 37(a) in the State Act. Section 37(a) was incorporated by way of an amendment in the State Act. Reading of Section 37(a) brings out the Legislative intent with unambiguous clarity and therefore the High court was right in relying upon Section 37(a) of the State Act to find that though it was by agreement dated 07.12.1959 which is a separate document that condition to make it a mortgage was incorporated it would not make any difference. We may also notice that despite the sale deed dated 27.11.1959, the Bhattacharyas continued to be in possession of the plaint scheduled property and it has been found that they paid the taxes. It is further found that the market value of the property would not have been less than Rs.30 thousand as on the date of the alleged sale namely 27.11.1959.It will be noticed that a Suit for redemption is mentioned as suit to which Section 36 applies. Section 38 undoubtedly enables the borrowers to seek a direction for taking accounts.We have noticed the relief which was sought in the suit which was considered by the learned Single Judge in Swarnalata Tat AIR 1984 Calcutta 130. In fact, Court in the said case could not find a mortgage proved also. The reliefs on the other hand in the suit filed by Bhattacharya include reliefs relating to redemption in the form it is asked for. In fact, no issue in this regard was taken before the Trial Court. We see no reason to non-suit, the Bhattacharyas on this ground which is taken for the reasons which we have given.The last contention taken is that Section 37(a) of the State Act is repugnant to Section 58(c) of the Central Act namely, the Transfer of Property Act. The contention runs as follows:- Money lending falls as entry (30) in the State List. Transfer of Property other than agricultural land falls in Entry 6 in the concurrent list. The State legislature in enacting Section 37(a) of the State Act, a law relating to money lending has made a law which is inconsistent and therefore, repugnant to the law made by the Parliament in Section 58(c) of the Transfer of Property Act. This contention is taken for the first time in this Court. We also see no merit in the same at any rate. Section 37(A) is traceable to the Entry ‘Transfer of Property? which is found in the concurrent list.In this case proceeding on the basis that there is an inconsistency between Section 58(c) of the Transfer of Property Act and Section 37(A) of the State Act, in view of the assent given by the President, the matter falls under Article 254(2). Therefore, despite the inconsistency, Section 37(A) of the State Act will prevail in the State.The argument that being part of State Act which is the Money Lending Act and Money lending is in the state list and therefore, it is a case of legislative, incompetence, does not appeal to us. We have found that the provisions of 37(A) is traceable to the Entry ‘Transfer of Property? in the Concurrent List and that Article 254(2) saves the provision. | 0 | 4,800 | 664 | ### Instruction:
Speculate on the likely judgment (yes (1) or no (0) to the appeal) and then delve into the case proceeding to elucidate your prediction, focusing on critical sentences.
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company, life assurance company, Life Insurance Corporation of India, mutual insurance company, provident insurance society or from a provident fund; (e) an advance made on the basis of a negotiable instrument as defined in the Negotiable Instruments Act, 1881, (26 of 1881) other than a promissory note; (f) Omitted by W.B. Money Lender Amendment Act, (Act IV of 1931) (g) * * * * (h) a loan made to or by the Administrator General and Official Trustee of West Bengal or the Commissioner of Wakfs or the Official Assignee or the Official Receiver of the High Court in Calcutta; (i) a loan or debenture in respect of which dealings are listed on any Stock Exchange;?13. Commercial loan is defined in Section 2(4) of the State Act. Section 2(22) defines suit to which this Act applies. It reads as follows:-"2(22) ?suit to which this Act applies? means any suit or proceeding instituted or filed on or after the 1 st day of January, 1939 or pending on that date and includes a proceeding in execution- (a) for the recovery of a loan advanced before or after the commencement of this Act; (b) for the enforcement of any agreement entered into before or after the commencement of this Act, whether by way of settlement of account or otherwise, or of any security so taken, in respect of any loan advanced whether before or after the commencement of this Act; or (c) for the redemption of any security given before or after the commencement of this Act in respect of any loan advanced whether before or after the commencement of this Act.?14. Section 36 comes under the heading ‘Reopening of transactions?. It deals with the power of the Court to exercise all or any of the various powers which are mentioned therein. Sub Section 4 of Section 36 reads as follows:-?36(4). This Section shall apply to any Suit, whatever it forms may be, if such suit is substantially one for the recovery of a loan or for the enforcement of any agreement of security in respect of a loan or for the redemption of money such security.?15. It will be noticed that a Suit for redemption is mentioned as suit to which Section 36 applies. Section 38 undoubtedly enables the borrowers to seek a direction for taking accounts. 16. We have noticed the relief which was sought in the suit which was considered by the learned Single Judge in Swarnalata Tat AIR 1984 Calcutta 130. In fact, Court in the said case could not find a mortgage proved also. The reliefs on the other hand in the suit filed by Bhattacharya include reliefs relating to redemption in the form it is asked for. In fact, no issue in this regard was taken before the Trial Court. We see no reason to non-suit, the Bhattacharyas on this ground which is taken for the reasons which we have given. 17. The last contention taken is that Section 37(a) of the State Act is repugnant to Section 58(c) of the Central Act namely, the Transfer of Property Act. The contention runs as follows:- Money lending falls as entry (30) in the State List. Transfer of Property other than agricultural land falls in Entry 6 in the concurrent list. The State legislature in enacting Section 37(a) of the State Act, a law relating to money lending has made a law which is inconsistent and therefore, repugnant to the law made by the Parliament in Section 58(c) of the Transfer of Property Act. This contention is taken for the first time in this Court. We also see no merit in the same at any rate. Section 37(A) is traceable to the Entry ‘Transfer of Property? which is found in the concurrent list. Article 254 of the Constitution of India reads as follows:-?254. Inconsistency between laws made by Parliament and laws made by the Legislatures of States (1) If any provision of a law made by the Legislature of a State is repugnant to any provision of a law made by Parliament which Parliament is competent to enact, or to any provision of an existing law with respect to one of the matters enumerated in the Concurrent List, then, subject to the provisions of clause ( 2 ), the law made by Parliament, whether passed before or after the law made by the Legislature of such State, or, as the case may be, the existing law, shall prevail and the law made by the Legislature of the State shall, to the extent of the repugnancy, be void. (2) Where a law made by the Legislature of a State with respect to one of the matters enumerated in the concurrent List contains any provision repugnant to the provisions of an earlier law made by Parliament or an existing law with respect to that matter, then, the law so made by the Legislature of such State shall, if it has been reserved for the consideration of the President and has received his assent, prevail in that State: Provided that nothing in this clause shall prevent Parliament from enacting at any time any law with respect to the same matter including a law adding to, amending, varying or repealing the law so made by the Legislature of the State .?18. In this case proceeding on the basis that there is an inconsistency between Section 58(c) of the Transfer of Property Act and Section 37(A) of the State Act, in view of the assent given by the President, the matter falls under Article 254(2). Therefore, despite the inconsistency, Section 37(A) of the State Act will prevail in the State. 19. The argument that being part of State Act which is the Money Lending Act and Money lending is in the state list and therefore, it is a case of legislative, incompetence, does not appeal to us. We have found that the provisions of 37(A) is traceable to the Entry ‘Transfer of Property? in the Concurrent List and that Article 254(2) saves the provision.
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10. Keeping Section 58(c) side by side with Section 37(a) of the State Act, the conclusion is inevitable that the State legislature has intended to override the effect of proviso to Section 58(c) of the Transfer of Property Act by enacting Section 37(a) in the State Act. Section 37(a) was incorporated by way of an amendment in the State Act. Reading of Section 37(a) brings out the Legislative intent with unambiguous clarity and therefore the High court was right in relying upon Section 37(a) of the State Act to find that though it was by agreement dated 07.12.1959 which is a separate document that condition to make it a mortgage was incorporated it would not make any difference. We may also notice that despite the sale deed dated 27.11.1959, the Bhattacharyas continued to be in possession of the plaint scheduled property and it has been found that they paid the taxes. It is further found that the market value of the property would not have been less than Rs.30 thousand as on the date of the alleged sale namely 27.11.1959.It will be noticed that a Suit for redemption is mentioned as suit to which Section 36 applies. Section 38 undoubtedly enables the borrowers to seek a direction for taking accounts.We have noticed the relief which was sought in the suit which was considered by the learned Single Judge in Swarnalata Tat AIR 1984 Calcutta 130. In fact, Court in the said case could not find a mortgage proved also. The reliefs on the other hand in the suit filed by Bhattacharya include reliefs relating to redemption in the form it is asked for. In fact, no issue in this regard was taken before the Trial Court. We see no reason to non-suit, the Bhattacharyas on this ground which is taken for the reasons which we have given.The last contention taken is that Section 37(a) of the State Act is repugnant to Section 58(c) of the Central Act namely, the Transfer of Property Act. The contention runs as follows:- Money lending falls as entry (30) in the State List. Transfer of Property other than agricultural land falls in Entry 6 in the concurrent list. The State legislature in enacting Section 37(a) of the State Act, a law relating to money lending has made a law which is inconsistent and therefore, repugnant to the law made by the Parliament in Section 58(c) of the Transfer of Property Act. This contention is taken for the first time in this Court. We also see no merit in the same at any rate. Section 37(A) is traceable to the Entry ‘Transfer of Property? which is found in the concurrent list.In this case proceeding on the basis that there is an inconsistency between Section 58(c) of the Transfer of Property Act and Section 37(A) of the State Act, in view of the assent given by the President, the matter falls under Article 254(2). Therefore, despite the inconsistency, Section 37(A) of the State Act will prevail in the State.The argument that being part of State Act which is the Money Lending Act and Money lending is in the state list and therefore, it is a case of legislative, incompetence, does not appeal to us. We have found that the provisions of 37(A) is traceable to the Entry ‘Transfer of Property? in the Concurrent List and that Article 254(2) saves the provision.
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Lt. Governor Of Delhi & Ors Vs. M/S. Ganesh Flour Mills Co. Ltd | Commissioner. This application too was rejected by the Chief Commissioner on the ground of being barred by time. The respondent thereafter moved the High Court for a direction to the Chief Commissioner to refer the question of law formulated by the respondent to the High Court. In addition to that, the respondent filed a petition under Articles 226 and 227 of the Constitution of India for a direction to the appellants to decide the respondents application for amendment of the registration certificate in accordance with law.3. The writ petition was resisted by the appellants. The High Court accepted the writ petition and held that the words of clause (c) of sub-section (3) of Section 8 of the Act were wide enough to cover the goods in question. According to the High Court, it was not necessary that those goods should be capable of being used directly for the purpose of packing. It was quite enough if the intention of the dealer was to acquire them in order that they might be used for packing of goods for sale even if in that process of adapting them for such use, they had to undergo some change in shape or form. It was further observed that the respondents object was to convert the tin sheets and tin plates into tin containers with a view that the same might be filled with the vegetable oil products to be sold to different parties.4. Before proceeding further, we may set out sub-section (1) and clause (c) of sub-section (3) of S. 8 of the Act :"(1) Every dealer, who in the course of inter-State trade or commerce -(a) sells to the Government any goods or(b) sells to a registered dealer other than the Government goods of a description referred to in sub-section (3)shall be liable to pay tax under this Act, which shall be three per cent of his turnover.(3) The goods referred to in cl. (b) of sub-section (1) -(b) * * * *(c) are containers or other materials specified in the certificate of registration of the registered dealer purchasing the goods being containers or materials intended for being used for the packing of goods for sale;"* * * * "5. Mr. Aiyar on behalf of the appellants has argued that tin sheets and tin plates are not covered by clause (c) of sub-section (3) of S. 8 of the Act reproduced above as those goods constitute neither containers nor "materials intended for being used for packing of goods for sale". Mr. Rameshwar Nath on behalf of the respondent has not disputed that tin sheets and tin plates do not constitute containers, but, according to him, they fall in the category of materials intended for being used for packing of goods for sale. There is, in our opinion, considerable force in this submission of Mr. Rameshwar Nath. The materials referred to in clause (c) according to its plain language should be such as are intended for being used for the packing of goods for sale. Once the intention of using the materials for packing of goods for sale is proved, the requirements of the clause would be satisfied. The High Court has found that the respondent purchased tin sheets and tin plates from dealers in Bihar and elsewhere with a view to convert those sheets and plates into tin containers in order to fill the same with vegetable oil products for being sold to different parties. This finding of the High Court has not been questioned before us. It has, however, been urged on behalf of the appellants that as tin sheets and tin plates cannot be used by the respondent unless they are converted into containers, the respondent cannot invoke the benefit of clause (c) of sub-section (3) of Section 8 of the Act. We find it difficult to accept this contention. The fact that the sheets and tin plates have to be subjected by the respondent to the process of cutting and moulding into tin containers would not take them out of the category of materials intended for being used for the packing of goods for sale. The cutting and moulding is essential for putting the tin sheets and tin plates into shape with a view to adapt them for actual user. The process of cutting and moulding does not alter the nature of the "materials intended for being used for packing of goods for sale" it only facilitates the actual user for packing.6. We are also of the view that packing materials are necessary not only for solid articles but also for those in liquid and semi-liquid form. According to observations on page 22 of Encylopaedia Britannica, Vol. 17, 1968 Edition, in a society that produces foodstuffs and manufactured articles in one locality and uses them in another, a wrapping or container is necessary during storage, transport and sale. The functions of a package are : (1) to contain a convenient-seized unit or amount of a product (2) to protect it in transit (3) to aid its safe delivery to the consumers and (4) in some cases to display the product and promote its sale or to act as a dispenser of it. Originally instituted to produce simple containers, the packaging industry has expanded to meet the demands for processed and preserved foods, rather than seasonal crops, and to distribute increased varieties of manufactured items. Packaging reflects developments in other industries, especially petrochemicals and plastics, whereby new materials and methods of construction have been provided for containers. It has further been observed that cans, both tin and aluminium, are now used for ready cooked products, brewery products, soft drinks, and many oils and semi-solids. Where a reclosable pack is needed, lever-lid or slip-lid cans are used instead of sealed cans.7. As the tin sheets and tin plates purchased by the respondent were intended to be used for packing of vegetable products sold by the respondent, the respondent in our opinion, was entitled to invoke the benefit of clause (c) reproduced above. | 0[ds]There is, in our opinion, considerable force in this submission of Mr. Rameshwar Nath. The materials referred to in clause (c) according to its plain language should be such as are intended for being used for the packing of goods for sale. Once the intention of using the materials for packing of goods for sale is proved, the requirements of the clause would be satisfied.We are also of the view that packing materials are necessary not only for solid articles but also for those in liquid and semi-liquid form. According to observations on page 22 of Encylopaedia Britannica, Vol. 17, 1968 Edition, in a society that produces foodstuffs and manufactured articles in one locality and uses them in another, a wrapping or container is necessary during storage, transport and sale. The functions of a package are : (1) to contain a convenient-seized unit or amount of a product (2) to protect it in transit (3) to aid its safe delivery to the consumers and (4) in some cases to display the product and promote its sale or to act as a dispenser of it. Originally instituted to produce simple containers, the packaging industry has expanded to meet the demands for processed and preserved foods, rather than seasonal crops, and to distribute increased varieties of manufactured items. Packaging reflects developments in other industries, especially petrochemicals and plastics, whereby new materials and methods of construction have been provided for containers. It has further been observed that cans, both tin and aluminium, are now used for ready cooked products, brewery products, soft drinks, and many oils and semi-solids. Where a reclosable pack is needed, lever-lid or slip-lid cans are used instead of sealed cans.7. As the tin sheets and tin plates purchased by the respondent were intended to be used for packing of vegetable products sold by the respondent, the respondent in our opinion, was entitled to invoke the benefit of clause (c) reproducedthe intention of using the materials for packing of goods for sale is proved, the requirements of the clause would be satisfied.The High Court has found that the respondent purchased tin sheets and tin plates from dealers in Bihar and elsewhere with a view to convert those sheets and plates into tin containers in order to fill the same with vegetable oil products for being sold to different parties. This finding of the High Court has not been questioned beforefact that the sheets and tin plates have to be subjected by the respondent to the process of cutting and moulding into tin containers would not take them out of the category of materials intended for being used for the packing of goods for sale. The cutting and moulding is essential for putting the tin sheets and tin plates into shape with a view to adapt them for actual user. The process of cutting and moulding does not alter the nature of the "materials intended for being used for packing of goods for sale" it only facilitates the actual user for packing. | 0 | 1,597 | 555 | ### Instruction:
Project the court's decision (favor (1) or against (0) the appeal) based on the case proceeding, and subsequently give an in-depth explanation by analyzing relevant sentences from the document.
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Commissioner. This application too was rejected by the Chief Commissioner on the ground of being barred by time. The respondent thereafter moved the High Court for a direction to the Chief Commissioner to refer the question of law formulated by the respondent to the High Court. In addition to that, the respondent filed a petition under Articles 226 and 227 of the Constitution of India for a direction to the appellants to decide the respondents application for amendment of the registration certificate in accordance with law.3. The writ petition was resisted by the appellants. The High Court accepted the writ petition and held that the words of clause (c) of sub-section (3) of Section 8 of the Act were wide enough to cover the goods in question. According to the High Court, it was not necessary that those goods should be capable of being used directly for the purpose of packing. It was quite enough if the intention of the dealer was to acquire them in order that they might be used for packing of goods for sale even if in that process of adapting them for such use, they had to undergo some change in shape or form. It was further observed that the respondents object was to convert the tin sheets and tin plates into tin containers with a view that the same might be filled with the vegetable oil products to be sold to different parties.4. Before proceeding further, we may set out sub-section (1) and clause (c) of sub-section (3) of S. 8 of the Act :"(1) Every dealer, who in the course of inter-State trade or commerce -(a) sells to the Government any goods or(b) sells to a registered dealer other than the Government goods of a description referred to in sub-section (3)shall be liable to pay tax under this Act, which shall be three per cent of his turnover.(3) The goods referred to in cl. (b) of sub-section (1) -(b) * * * *(c) are containers or other materials specified in the certificate of registration of the registered dealer purchasing the goods being containers or materials intended for being used for the packing of goods for sale;"* * * * "5. Mr. Aiyar on behalf of the appellants has argued that tin sheets and tin plates are not covered by clause (c) of sub-section (3) of S. 8 of the Act reproduced above as those goods constitute neither containers nor "materials intended for being used for packing of goods for sale". Mr. Rameshwar Nath on behalf of the respondent has not disputed that tin sheets and tin plates do not constitute containers, but, according to him, they fall in the category of materials intended for being used for packing of goods for sale. There is, in our opinion, considerable force in this submission of Mr. Rameshwar Nath. The materials referred to in clause (c) according to its plain language should be such as are intended for being used for the packing of goods for sale. Once the intention of using the materials for packing of goods for sale is proved, the requirements of the clause would be satisfied. The High Court has found that the respondent purchased tin sheets and tin plates from dealers in Bihar and elsewhere with a view to convert those sheets and plates into tin containers in order to fill the same with vegetable oil products for being sold to different parties. This finding of the High Court has not been questioned before us. It has, however, been urged on behalf of the appellants that as tin sheets and tin plates cannot be used by the respondent unless they are converted into containers, the respondent cannot invoke the benefit of clause (c) of sub-section (3) of Section 8 of the Act. We find it difficult to accept this contention. The fact that the sheets and tin plates have to be subjected by the respondent to the process of cutting and moulding into tin containers would not take them out of the category of materials intended for being used for the packing of goods for sale. The cutting and moulding is essential for putting the tin sheets and tin plates into shape with a view to adapt them for actual user. The process of cutting and moulding does not alter the nature of the "materials intended for being used for packing of goods for sale" it only facilitates the actual user for packing.6. We are also of the view that packing materials are necessary not only for solid articles but also for those in liquid and semi-liquid form. According to observations on page 22 of Encylopaedia Britannica, Vol. 17, 1968 Edition, in a society that produces foodstuffs and manufactured articles in one locality and uses them in another, a wrapping or container is necessary during storage, transport and sale. The functions of a package are : (1) to contain a convenient-seized unit or amount of a product (2) to protect it in transit (3) to aid its safe delivery to the consumers and (4) in some cases to display the product and promote its sale or to act as a dispenser of it. Originally instituted to produce simple containers, the packaging industry has expanded to meet the demands for processed and preserved foods, rather than seasonal crops, and to distribute increased varieties of manufactured items. Packaging reflects developments in other industries, especially petrochemicals and plastics, whereby new materials and methods of construction have been provided for containers. It has further been observed that cans, both tin and aluminium, are now used for ready cooked products, brewery products, soft drinks, and many oils and semi-solids. Where a reclosable pack is needed, lever-lid or slip-lid cans are used instead of sealed cans.7. As the tin sheets and tin plates purchased by the respondent were intended to be used for packing of vegetable products sold by the respondent, the respondent in our opinion, was entitled to invoke the benefit of clause (c) reproduced above.
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### Explanation:
There is, in our opinion, considerable force in this submission of Mr. Rameshwar Nath. The materials referred to in clause (c) according to its plain language should be such as are intended for being used for the packing of goods for sale. Once the intention of using the materials for packing of goods for sale is proved, the requirements of the clause would be satisfied.We are also of the view that packing materials are necessary not only for solid articles but also for those in liquid and semi-liquid form. According to observations on page 22 of Encylopaedia Britannica, Vol. 17, 1968 Edition, in a society that produces foodstuffs and manufactured articles in one locality and uses them in another, a wrapping or container is necessary during storage, transport and sale. The functions of a package are : (1) to contain a convenient-seized unit or amount of a product (2) to protect it in transit (3) to aid its safe delivery to the consumers and (4) in some cases to display the product and promote its sale or to act as a dispenser of it. Originally instituted to produce simple containers, the packaging industry has expanded to meet the demands for processed and preserved foods, rather than seasonal crops, and to distribute increased varieties of manufactured items. Packaging reflects developments in other industries, especially petrochemicals and plastics, whereby new materials and methods of construction have been provided for containers. It has further been observed that cans, both tin and aluminium, are now used for ready cooked products, brewery products, soft drinks, and many oils and semi-solids. Where a reclosable pack is needed, lever-lid or slip-lid cans are used instead of sealed cans.7. As the tin sheets and tin plates purchased by the respondent were intended to be used for packing of vegetable products sold by the respondent, the respondent in our opinion, was entitled to invoke the benefit of clause (c) reproducedthe intention of using the materials for packing of goods for sale is proved, the requirements of the clause would be satisfied.The High Court has found that the respondent purchased tin sheets and tin plates from dealers in Bihar and elsewhere with a view to convert those sheets and plates into tin containers in order to fill the same with vegetable oil products for being sold to different parties. This finding of the High Court has not been questioned beforefact that the sheets and tin plates have to be subjected by the respondent to the process of cutting and moulding into tin containers would not take them out of the category of materials intended for being used for the packing of goods for sale. The cutting and moulding is essential for putting the tin sheets and tin plates into shape with a view to adapt them for actual user. The process of cutting and moulding does not alter the nature of the "materials intended for being used for packing of goods for sale" it only facilitates the actual user for packing.
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Parbat S/O Namdeo Naikwadi Vs. The Indian Oil Corporation Limited, | find it relevant to refer to two Judgments of the Apex Court. In the case of Yogesh Bhardwaj vs. State of U.P. and others, reported in (1990) 3 Supreme Court Cases, Page 355, the Apex Court in Para 17 and 21 observed thus:"17. Residence is a physical fact. No volition is needed to establish it. Unlike in the case of a domicile of choice, animus manendi is not an essential requirement of residence. Any period of physical presence, however short, may constitute residence provided it is not transitory, fleeting or casual. Intention is not relevant to prove the physical fact of residence except to the extent of showing that it is not a mere fleeting or transitory existence. To insist on an element of volition is to confuse the features of residence with those of domicile.21. While residence and intention are the two essential elements constituting the domicile of choice, residence in its own right is a connecting factor in a national legal system for purposes of taxation, jurisdiction, service of summons, voting etc. To read into residence volition as a necessary element is, as stated above, to mistake residence for domicile of choice, and that is the error which the High Court appears to have committed. Where residence is prescribed within a unified legal system as a qualifying condition, it is essential that the expression is so understood as to have the widest room for the full enjoyment of the right of equality before the law. Any construction which works to the disadvantage of the citizen lawfully seeking legitimate avenues of progress within the country will be out of harmony with the guaranteed rights under the Constitution, and such a construction must necessarily be avoided."21. In the case of Union of India and others vs. Dudh Nath Prasad, reported in (2000) 2 Supreme Court Cases, Page 20, the Apex Court in Para 19 to 18 21 observed thus:"19. Learned counsel for the appellants then attempted to import the concept of domicile as understood in Private International law, in his arguments and contended that before a person can be said to be "Ordinarily residing" at a particular place, he must satisfy all the requirements which go to constitute domicile. He further contended that since the respondent was born in a village in the State of Bihar, he shall be treated to have his domicile of nativity in that State. We are not prepared to accept this contention.20. In Tomlins Law Dictionary, "domicile" has been defined as "the place where a man has his home."21. In Whicker v. Hume it was held that a persons domicile means, generally speaking, the place where he has his permanent home.22. In McMullen v. Wadsworth it was observed that the Roman law still holds good that it is not by naked assertion but by deeds and acts that a domicil is established.23. Lord Macnaghten in Winans v. A.G. observed that: "Domicil of origin, or, as it is sometimes called, perhaps less accurately, domicil of birth, differs from domicil of choice mainly in this that its character is more enduring, its hold stronger and less easily shaken off."24. In Ross v. Ross, Lord Buckmaster while dealing with a case relating to change of domicile observed that:"Declarations of intention are rightly regarded as determining the question of a change of domicil, but they must be examined by considering the person to whom, the purposes for which, and the circumstances in which they are made, and they must further be fortified and carried into effect by conduct and action consistent with the declared expression".25. In another case, namely, Ramsay v. Liverpool Royal Infirmary Lord Dunedin observed at p. 594 that: "The animus of changing domicil may be inferred from the factum of residence."26. Etymologically, "residence" and "domicile" carry the same meaning, inasmuch as both refer to the permanent home, but under Private International Law, "domicile" carries a little different sense and exhibits many facets. In spite of having a permanent home, a person may have a commercial, a political or forensic domicile. Domicile may also take many colours; it may be the domicile of origin, domicile of choice, domicile by operation of law or domicile of dependence. In Private International Law, "domicile" jurisprudentially has a different concept altogether. It plays an important role in the Conflict of Laws. The subject has been elaborately considered by Dicey in his book "Conflict of Laws" (6th Edn.) as also in another book by Phillimore on Domicil. An equally valuable discussion is to be found in Private International jurisprudence by Foote and by Westlake on Private International Law."22. Considering the definitions of term "domicile" and "residence" as dealt with in the dictionaries and the Judgments cited supra, it is noted that the domicile and residence are different and yet related concepts. They have to be understood in the context in which they are used having regard to the nature and purpose. The purpose for which clause 2.2 in the advertisement is framed by the Respondent No.1 Oil Company, is to obtain proof of residence of a person at which place the Company decided to offer and run the retail outlet. The retail outlet is to be sanctioned at village Khanapur, TalukaAkole, District-Ahmednagar and therefore, rightfully the Respondent No.1 company demanded a Residence Certificate issued by Talathi or Tahsildar. It is true that the other candidates did file Residence Certificates issued by the respective Talathis but the Petitioner submitted a Domicile Certificate.23. In the facts of the case, we find that the Petitioners Domicile Certificate and even Residence Certificate annexed to the Petition refers to his residence at village Gardani, Taluka-Akole, whereas the Respondent No.1 was to sanction retail outlet at village Khanapur, which is reflected at sr. no.183 of the advertisement. The explanation of the Petitioner on that ground does not satisfy condition of proof of residence of village Khanapur. We therefore, find that the Petitioner has failed to make out any case for getting the impugned communication quashed and set aside. | 0[ds]13. After reading clause 2.2 of the advertisement, we are of the view that the said clause in respect of submission of Residence Certificate could have been clearly drafted and worded by the Respondent No.1 company. We had even verified from some of the disposed matters, the clauses in respect of Residence proof framed, by the Company and it is noticed that the same are not worded in identical fashion in which present clause 2.2 is worded. But at the same time, we could gather that the thrust of the clause is in respect of demand of Residence Certificate from the candidate. The Company had even mentioned that the said Residence Certificate issued by Talathi or Taluka Tahsildar is required.We had probed the matter little more because it was informed to the Court that the requirement of Residence Certificate of the present nature was part of advertisement in several cases and therefore the Respondent No.1 Company was keen to have final word on the said issue so that the Company could properly frame the clauses in future in the advertisement in respect of submission of Residence Certificate and the candidates properly and clearly understand the same.We have noticed that the Respondent No.1 in the present advertisement, had prescribed the proforma of applications to be submitted by the partners of the firm, cooperative societies etc. We noticed that time and again on rejection of application on the ground of want of Residence Certificate, Petitions have been filed in this Court. To avoid litigation on the issue and to have clarity on the issue, we find that it would be appropriate that if the Respondent No.1 Company drafts necessary clauses in more clear words if necessary by providing a proforma of the Residence Certificate which is required by theconcept of domicile has no relevance to the applicability of municipal laws, whether made by the Union of India or by the States. It would not, therefore, in our opinion be right to say that a citizen of India is domiciled in one state or another forming part of the Union of India.It is true and there we agree with the argument advanced on behalf of the State Governments, that the word domicile in the Rules of some of the State Governments prescribing domiciliary requirement for admission to medical colleges situate within their territories, is used not in its technical legal sense but in a popular sense as meaning residence and is intended to convey the idea of intention to reside permanently or indefinitely.The concept of domicile if used for a purpose other than its legitimate purpose may give rise to lethal radiations which may in the long run tend to break up the unity and integrity of the country. We would, therefore, strongly urge upon the State Governments to exercise this wrong use of the expression domicile from the rules regulating admissions to their educational institutions and particularly medical colleges and to desist from introducing and maintaining domiciliary requirement as a condition of eligibility for such admissions.While residence and intention are the two essential elements constituting the domicile of choice, residence in its own right is a connecting factor in a national legal system for purposes of taxation, jurisdiction, service of summons, voting etc. To read into residence volition as a necessary element is, as stated above, to mistake residence for domicile of choice, and that is the error which the High Court appears to have committed. Where residence is prescribed within a unified legal system as a qualifying condition, it is essential that the expression is so understood as to have the widest room for the full enjoyment of the right of equality before the law. Any construction which works to the disadvantage of the citizen lawfully seeking legitimate avenues of progress within the country will be out of harmony with the guaranteed rights under the Constitution, and such a construction must necessarily be avoided.Considering the definitions of term "domicile" and "residence" as dealt with in the dictionaries and the Judgments cited supra, it is noted that the domicile and residence are different and yet related concepts. They have to be understood in the context in which they are used having regard to the nature and purpose. The purpose for which clause 2.2 in the advertisement is framed by the Respondent No.1 Oil Company, is to obtain proof of residence of a person at which place the Company decided to offer and run the retail outlet. The retail outlet is to be sanctioned at village Khanapur, TalukaAkole,and therefore, rightfully the Respondent No.1 company demanded a Residence Certificate issued by Talathi or Tahsildar. It is true that the other candidates did file Residence Certificates issued by the respective Talathis but the Petitioner submitted a Domicile Certificate.23. In the facts of the case, we find that the Petitioners Domicile Certificate and even Residence Certificate annexed to the Petition refers to his residence at village Gardani,whereas the Respondent No.1 was to sanction retail outlet at village Khanapur, which is reflected at sr. no.183 of the advertisement. The explanation of the Petitioner on that ground does not satisfy condition of proof of residence of village Khanapur. We therefore, find that the Petitioner has failed to make out any case for getting the impugned communication quashed and set aside. | 0 | 3,159 | 944 | ### Instruction:
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find it relevant to refer to two Judgments of the Apex Court. In the case of Yogesh Bhardwaj vs. State of U.P. and others, reported in (1990) 3 Supreme Court Cases, Page 355, the Apex Court in Para 17 and 21 observed thus:"17. Residence is a physical fact. No volition is needed to establish it. Unlike in the case of a domicile of choice, animus manendi is not an essential requirement of residence. Any period of physical presence, however short, may constitute residence provided it is not transitory, fleeting or casual. Intention is not relevant to prove the physical fact of residence except to the extent of showing that it is not a mere fleeting or transitory existence. To insist on an element of volition is to confuse the features of residence with those of domicile.21. While residence and intention are the two essential elements constituting the domicile of choice, residence in its own right is a connecting factor in a national legal system for purposes of taxation, jurisdiction, service of summons, voting etc. To read into residence volition as a necessary element is, as stated above, to mistake residence for domicile of choice, and that is the error which the High Court appears to have committed. Where residence is prescribed within a unified legal system as a qualifying condition, it is essential that the expression is so understood as to have the widest room for the full enjoyment of the right of equality before the law. Any construction which works to the disadvantage of the citizen lawfully seeking legitimate avenues of progress within the country will be out of harmony with the guaranteed rights under the Constitution, and such a construction must necessarily be avoided."21. In the case of Union of India and others vs. Dudh Nath Prasad, reported in (2000) 2 Supreme Court Cases, Page 20, the Apex Court in Para 19 to 18 21 observed thus:"19. Learned counsel for the appellants then attempted to import the concept of domicile as understood in Private International law, in his arguments and contended that before a person can be said to be "Ordinarily residing" at a particular place, he must satisfy all the requirements which go to constitute domicile. He further contended that since the respondent was born in a village in the State of Bihar, he shall be treated to have his domicile of nativity in that State. We are not prepared to accept this contention.20. In Tomlins Law Dictionary, "domicile" has been defined as "the place where a man has his home."21. In Whicker v. Hume it was held that a persons domicile means, generally speaking, the place where he has his permanent home.22. In McMullen v. Wadsworth it was observed that the Roman law still holds good that it is not by naked assertion but by deeds and acts that a domicil is established.23. Lord Macnaghten in Winans v. A.G. observed that: "Domicil of origin, or, as it is sometimes called, perhaps less accurately, domicil of birth, differs from domicil of choice mainly in this that its character is more enduring, its hold stronger and less easily shaken off."24. In Ross v. Ross, Lord Buckmaster while dealing with a case relating to change of domicile observed that:"Declarations of intention are rightly regarded as determining the question of a change of domicil, but they must be examined by considering the person to whom, the purposes for which, and the circumstances in which they are made, and they must further be fortified and carried into effect by conduct and action consistent with the declared expression".25. In another case, namely, Ramsay v. Liverpool Royal Infirmary Lord Dunedin observed at p. 594 that: "The animus of changing domicil may be inferred from the factum of residence."26. Etymologically, "residence" and "domicile" carry the same meaning, inasmuch as both refer to the permanent home, but under Private International Law, "domicile" carries a little different sense and exhibits many facets. In spite of having a permanent home, a person may have a commercial, a political or forensic domicile. Domicile may also take many colours; it may be the domicile of origin, domicile of choice, domicile by operation of law or domicile of dependence. In Private International Law, "domicile" jurisprudentially has a different concept altogether. It plays an important role in the Conflict of Laws. The subject has been elaborately considered by Dicey in his book "Conflict of Laws" (6th Edn.) as also in another book by Phillimore on Domicil. An equally valuable discussion is to be found in Private International jurisprudence by Foote and by Westlake on Private International Law."22. Considering the definitions of term "domicile" and "residence" as dealt with in the dictionaries and the Judgments cited supra, it is noted that the domicile and residence are different and yet related concepts. They have to be understood in the context in which they are used having regard to the nature and purpose. The purpose for which clause 2.2 in the advertisement is framed by the Respondent No.1 Oil Company, is to obtain proof of residence of a person at which place the Company decided to offer and run the retail outlet. The retail outlet is to be sanctioned at village Khanapur, TalukaAkole, District-Ahmednagar and therefore, rightfully the Respondent No.1 company demanded a Residence Certificate issued by Talathi or Tahsildar. It is true that the other candidates did file Residence Certificates issued by the respective Talathis but the Petitioner submitted a Domicile Certificate.23. In the facts of the case, we find that the Petitioners Domicile Certificate and even Residence Certificate annexed to the Petition refers to his residence at village Gardani, Taluka-Akole, whereas the Respondent No.1 was to sanction retail outlet at village Khanapur, which is reflected at sr. no.183 of the advertisement. The explanation of the Petitioner on that ground does not satisfy condition of proof of residence of village Khanapur. We therefore, find that the Petitioner has failed to make out any case for getting the impugned communication quashed and set aside.
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13. After reading clause 2.2 of the advertisement, we are of the view that the said clause in respect of submission of Residence Certificate could have been clearly drafted and worded by the Respondent No.1 company. We had even verified from some of the disposed matters, the clauses in respect of Residence proof framed, by the Company and it is noticed that the same are not worded in identical fashion in which present clause 2.2 is worded. But at the same time, we could gather that the thrust of the clause is in respect of demand of Residence Certificate from the candidate. The Company had even mentioned that the said Residence Certificate issued by Talathi or Taluka Tahsildar is required.We had probed the matter little more because it was informed to the Court that the requirement of Residence Certificate of the present nature was part of advertisement in several cases and therefore the Respondent No.1 Company was keen to have final word on the said issue so that the Company could properly frame the clauses in future in the advertisement in respect of submission of Residence Certificate and the candidates properly and clearly understand the same.We have noticed that the Respondent No.1 in the present advertisement, had prescribed the proforma of applications to be submitted by the partners of the firm, cooperative societies etc. We noticed that time and again on rejection of application on the ground of want of Residence Certificate, Petitions have been filed in this Court. To avoid litigation on the issue and to have clarity on the issue, we find that it would be appropriate that if the Respondent No.1 Company drafts necessary clauses in more clear words if necessary by providing a proforma of the Residence Certificate which is required by theconcept of domicile has no relevance to the applicability of municipal laws, whether made by the Union of India or by the States. It would not, therefore, in our opinion be right to say that a citizen of India is domiciled in one state or another forming part of the Union of India.It is true and there we agree with the argument advanced on behalf of the State Governments, that the word domicile in the Rules of some of the State Governments prescribing domiciliary requirement for admission to medical colleges situate within their territories, is used not in its technical legal sense but in a popular sense as meaning residence and is intended to convey the idea of intention to reside permanently or indefinitely.The concept of domicile if used for a purpose other than its legitimate purpose may give rise to lethal radiations which may in the long run tend to break up the unity and integrity of the country. We would, therefore, strongly urge upon the State Governments to exercise this wrong use of the expression domicile from the rules regulating admissions to their educational institutions and particularly medical colleges and to desist from introducing and maintaining domiciliary requirement as a condition of eligibility for such admissions.While residence and intention are the two essential elements constituting the domicile of choice, residence in its own right is a connecting factor in a national legal system for purposes of taxation, jurisdiction, service of summons, voting etc. To read into residence volition as a necessary element is, as stated above, to mistake residence for domicile of choice, and that is the error which the High Court appears to have committed. Where residence is prescribed within a unified legal system as a qualifying condition, it is essential that the expression is so understood as to have the widest room for the full enjoyment of the right of equality before the law. Any construction which works to the disadvantage of the citizen lawfully seeking legitimate avenues of progress within the country will be out of harmony with the guaranteed rights under the Constitution, and such a construction must necessarily be avoided.Considering the definitions of term "domicile" and "residence" as dealt with in the dictionaries and the Judgments cited supra, it is noted that the domicile and residence are different and yet related concepts. They have to be understood in the context in which they are used having regard to the nature and purpose. The purpose for which clause 2.2 in the advertisement is framed by the Respondent No.1 Oil Company, is to obtain proof of residence of a person at which place the Company decided to offer and run the retail outlet. The retail outlet is to be sanctioned at village Khanapur, TalukaAkole,and therefore, rightfully the Respondent No.1 company demanded a Residence Certificate issued by Talathi or Tahsildar. It is true that the other candidates did file Residence Certificates issued by the respective Talathis but the Petitioner submitted a Domicile Certificate.23. In the facts of the case, we find that the Petitioners Domicile Certificate and even Residence Certificate annexed to the Petition refers to his residence at village Gardani,whereas the Respondent No.1 was to sanction retail outlet at village Khanapur, which is reflected at sr. no.183 of the advertisement. The explanation of the Petitioner on that ground does not satisfy condition of proof of residence of village Khanapur. We therefore, find that the Petitioner has failed to make out any case for getting the impugned communication quashed and set aside.
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General Labour Union (Red Flag), Bombay Vs. Ahmedabad Manufacturing and Calico Printing Company Limited and Others | 1. The appellant-union had filed a complaint before the Industrial Court under the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 (the Act) complaining of the breach of Items 1(a), (b), 4(a), (f) and 6 of Schedule II and Items 7, 9 and 10 of Schedule IV of the said Act. The case of the complainant-union was that the 21 workmen who were working in one of the canteens of the respondent-company, were not given the service conditions as were available to the other workmen of the company and there was also a threat of termination of their services. It is an admitted fact that these workmen were employed by a contractor who was given a contract to run the canteen in question. The complaint, however, was filed on the footing that the workmen were the employees of the company and, therefore, the breach committed and the threats of retrenchments were cognizable by the Industrial Court, under the said Act. Even in the complaint, there was no case made out that the workmen in question had ever been accepted by the company as its employees. However, the complaint proceeded on the basis as if the workmen were a part of the work-force of the company. The facts on record reveal that the workmen were never recognised by the respondent-company as its workmen and it was the consistent contention of the company that they were not its employees. The Industrial Court dismissed the complaint holding that since the workmen were not the workmen of the respondent-company, the complaint was not maintainable under the said Act. The High Court in writ petition confirmed the said finding and dismissed the petition also on the same ground. Hence the present appeal 2. As pointed out both by the Industrial Court and the High Court, it was not established that the workmen in question were the workmen of the respondent-company. In the circumstances, no complaint could lie under the Act as is held by the two courts below. We, therefore, find nothing wrong in the decision impugned before us. The workmen have first to establish that they are the workmen of the respondent-company before they can file any complaint under the Act. Admittedly, this has not been done. It is open for the workmen to raise an appropriate industrial dispute in that behalf if they are entitled to do so before they resort to the provisions of the present Act. | 0[ds]2. As pointed out both by the Industrial Court and the High Court, it was not established that the workmen in question were the workmen of the. In the circumstances, no complaint could lie under the Act as is held by the two courts below. We, therefore, find nothing wrong in the decision impugned before us. The workmen have first to establish that they are the workmen of they before they can file any complaint under the Act. Admittedly, this has not been done. It is open for the workmen to raise an appropriate industrial dispute in that behalf if they are entitled to do so before they resort to the provisions of the present Act. | 0 | 458 | 132 | ### Instruction:
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1. The appellant-union had filed a complaint before the Industrial Court under the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 (the Act) complaining of the breach of Items 1(a), (b), 4(a), (f) and 6 of Schedule II and Items 7, 9 and 10 of Schedule IV of the said Act. The case of the complainant-union was that the 21 workmen who were working in one of the canteens of the respondent-company, were not given the service conditions as were available to the other workmen of the company and there was also a threat of termination of their services. It is an admitted fact that these workmen were employed by a contractor who was given a contract to run the canteen in question. The complaint, however, was filed on the footing that the workmen were the employees of the company and, therefore, the breach committed and the threats of retrenchments were cognizable by the Industrial Court, under the said Act. Even in the complaint, there was no case made out that the workmen in question had ever been accepted by the company as its employees. However, the complaint proceeded on the basis as if the workmen were a part of the work-force of the company. The facts on record reveal that the workmen were never recognised by the respondent-company as its workmen and it was the consistent contention of the company that they were not its employees. The Industrial Court dismissed the complaint holding that since the workmen were not the workmen of the respondent-company, the complaint was not maintainable under the said Act. The High Court in writ petition confirmed the said finding and dismissed the petition also on the same ground. Hence the present appeal 2. As pointed out both by the Industrial Court and the High Court, it was not established that the workmen in question were the workmen of the respondent-company. In the circumstances, no complaint could lie under the Act as is held by the two courts below. We, therefore, find nothing wrong in the decision impugned before us. The workmen have first to establish that they are the workmen of the respondent-company before they can file any complaint under the Act. Admittedly, this has not been done. It is open for the workmen to raise an appropriate industrial dispute in that behalf if they are entitled to do so before they resort to the provisions of the present Act.
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2. As pointed out both by the Industrial Court and the High Court, it was not established that the workmen in question were the workmen of the. In the circumstances, no complaint could lie under the Act as is held by the two courts below. We, therefore, find nothing wrong in the decision impugned before us. The workmen have first to establish that they are the workmen of they before they can file any complaint under the Act. Admittedly, this has not been done. It is open for the workmen to raise an appropriate industrial dispute in that behalf if they are entitled to do so before they resort to the provisions of the present Act.
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Williamsons (India) Private, Limited Vs. Its Workmen | no grievance about the relief granted by the award in respect of leave with pay and allowances.Just as the wage structure with scales of increments cannot reasonably be constructed unless the financial position of the appellant is properly ascertained and the result of the impact of the wage structure in future is judged, so adequate dearness allowance provision also cannot be made unless the said facts are ascertained. That is why the award in regard to wage structure and the dearness allowance must be set aside. For the same reasons, the award in respect of the gratuity must also be set aside. The demand in respect of retrospective operation of these provisions must, as a consequence, be set aside.6. That takes us to the demand for medical aid. The tribunal has ordered that medical relief should be given by the appellant to its employees on the same lines as Gillanders Arbuthnot & Co. The direction issued by the tribunal requires that the company should bear the cost of simple prescriptions and also pay Rs. 3 on any patent or proprietary medicine included in any single prescription by the companys doctor. No ceiling has been placed in respect of medical aid and the fact that the company has no doctor of its own has not been taken into account. Besides, the main basis of the relief granted by the tribunal under this demand appears to be that the tribunal was inclined to treat the appellant as comparable to Gillanders Arbuthnot & Co. We would, therefore, set aside this part of the award as well.7. That leaves the question of bonus to be considered. Sri Sastri has raised two conditions against the award in respect of bonus. His first argument is that in directing the appellant to pay three months total wages as bonus, the tribunal has departed from the usual convention in such matters which is to award a specified number of months basic wages and not total wages as bonus. The second contention raised by Sri Sastri goes to the root of the matter. He contends that the calculations made by the tribunal contain an obvious mistake in regard to the allowance made for income-tax. It appears that in the statement filed by the appellant, it had claimed deduction of Rs. 43, 449 by way of tax and this claim was made on this specific ground that the said amount of tax had in fact, been paid for the year 1956-57 which is relevant. There is no doubt that what the tribunal has to find in working out the formula is not the amount of tax actually paid but the amount of tax which under the relevant rates would be payable notionally on the profits determined under the formula. There is no dispute about the amount of profits; the dispute is about the rate. The tribunal has calculated income-tax at seven annas in a rupee, whereas Sri Sastri contends that the proper rate is 61.5 nP in a rupee and in support of his argument he has referred us to the relevant provisions of the Finance Act (18 of 1956). On the other hand Sri Dudhia has contended that in proceedings between the parties in this Court in relation to stay, an affidavit had been made on behalf of the appellant admitting that the relevant rate for tax is 51.5 nP. That, no doubt, appears to be so; but the rate at which tax has to be levied has to be governed by the relevant provision of the statute and if Sri Sastri can show that the rate prescribed by the statute is 61.5 nP then the affidavit on which Sri Dudhia relies cannot go against the appellant. It must be held to be a mistake committed by the person who made mistake committed by the person who made the affidavit. We would have ourselves decided this question in appeal, but Sri Dudhia has argued that before determining the rate which was applicable, considerations of rebate will have to be borne in mind and he, therefore, contends that he should be given a chance to justify the finding of the tribunal that the rate was seven annas in a rupee and no more. According to Sri Dudhia, it would not be possible for him to say what rebates the appellant could claim and how the rate would not be 61.5 nP but seven annas. Since we are remanding the matter for the consideration of the major items of dispute between the parties, we have decided to set aside that portion of the award which deals with bonus and send this dispute for the consideration of the tribunal on the narrow point as to the relevant rate at which the calculation of the income-tax should be governed. If the rate turns out to be 61.5 nP. as alleged by Sri Sastri, then, of course, there would be no scope for making any payment of bonus. If the rate turns out to be seven annas in a rupee as at present assumed by the tribunal, then the only point which the tribunal may consider is whether three months total wages should be awarded as bonus or three months basic wages, or any thing less.Since we are setting aside the award in regard to demands 1, 2, 4, 6, 8 and 9, it follows that the terms of employment between the appellant and the respondents would be governed by the existing conditions until a fresh award is made by the tribunal. It appears that pending the appeal in this Court, the appellant has paid dearness allowance at the increased rate awarded by the tribunal to the respondents. But the payment of the said dearness allowance will now have to be stopped until a new award is made. It would be open to the respondents to apply to the tribunal for any interim order in that behalf and if such an application is made, the tribunal may deal with it in accordance with law. | 1[ds]Ex. C3 which has been printed in the paper book before us, clearly shows that the quotation have considerably been reduced in a large number of articles and in some cases, they have been cancelled and the extent of the business of the appellant has naturally been proportionately reduced. Ex. C2 which refers to the financial position of the appellant also tells a similar story. Indeed, the tribunal itself has accepted the appellants case that if business has not so far shown signs of collapse, it is partly because of its old stocks. Thefor the years 1956, 1957 and 1958 show that whereas the appellant had valued its goodwill at a lakh of rupees and has adjusted its profit and loss accounts on that basis, it owes debts to a large extent and its reserve or surplus is very little. Having regard to these facts, it is not easy to appreciate how the tribunal reached the conclusion that the financial position of the appellant was very satisfactory and that it could be compared in that behalf to Gillanders Arbuthnot & Co. It may be that the tribunal happens to know that some other concerns which were dealing in import of foreign goods have turned to trade in indigenous goods or have substituted some other kind of business and have prospered in the new line. But, surely, that cannot be a valid or legitimate basis for assuming by anticipation the appellant would also undertake a new line of business and will prosper in it. It isthat in constructing a wage structure with a scale of increments, industrial adjudication had to take aview and it has to examine very carefully the impact of the wage structure on the financial position of the concern in question. Having found that the business of the appellant was on the decline and that in the light of business in which the appellant was operating so far there was no chance of improvement, the tribunal should have hesitated before imposing additional burden on the appellant by constructing a new wage structure. Therefore, in our opinion, having regard to the findings of fact recorded by the tribunal, the appellant is entitled to contend that the ultimate decision of the tribunal about the financial capacity of the appellant is based purely on speculation and that such speculation cannot supply a proper basis for the decision of the main dispute between the parties.There is another argument which has been strongly pressed before us and that is that the tribunal was in error in treating Gillanders Arbuthnot & Co. as a comparable concern. This Court has repeatedly observed that in considering the question about comparable concerns, tribunals should bear in mind all the relevant facts in relation to the problem. The extent of the business carried by the concern, the capital invested by them, the profits made by them, the nature of the business carried on by them, their standing, the strength of their Labour force, the presence or absence and the extent of reserves, the divides declared by them and the prospects about the future of their businessthese and all other relevant facts have to be born in mind. In the present case, the tribunal itself was conscious that the Gillanders Arbuthnot & Co. was a much bigger concern with a much bigger capital and with a much larger business spread all over India. Even so, the tribunal thought that because the number of employees engaged by Gillanders Arbuthnot was much larger, whereas the employees engaged by the appellant were only sixteen, it would be safe to compare Gillanders Arbuthnot & Co., with the appellant. It our opinion, the approach adopted by the tribunal in dealing with this aspect of the question is open to serious criticism. Therefore, we are satisfied that the criticism, made by Sri Sastri against the award in so far as it assumes thai Gillanders Arbuthnot was a comparable concern, is also not withoutfact, having come to the conclusion that the reasons given by the tribunal in support of its finding that the appellant should bear the financial burden of the wage structure devised by the award are not satisfactory, we tried to see if we could settle the dispute ourselves in appeal, but that turned out to be very difficult; and so, we have decided to set aside the award and send the case back for disposal in accordance with law in the light of this judgment.5. Of the demands referred to the industrial tribunal for adjudication, no grievance has been made before us in reject of demand 3 in regard to washing allowance; demand 5 in regard to leave with pay and allowance and demand 7 in regard to uniforms. In respect of demand 5 as to leave with pay and allowances, Sri Sastri had first attempted to argue that the provisions made by the award under this demand were unreasonable, but Sri Dudhia pointed out that the material provisions in that behalf are consistent with the statutory provisions which have now been included in the Bombay Shops and Establishments Act (79 of 1948) by the Amending Act 26 of 1961. Therefore there is no grievance about the relief granted by the award in respect of leave with pay and allowances.Just as the wage structure with scales of increments cannot reasonably be constructed unless the financial position of the appellant is properly ascertained and the result of the impact of the wage structure in future is judged, so adequate dearness allowance provision also cannot be made unless the said facts are ascertained. That is why the award in regard to wage structure and the dearness allowance must be set aside. For the same reasons, the award in respect of the gratuity must also be set aside. The demand in respect of retrospective operation of these provisions must, as a consequence, be set aside.6. That takes us to the demand for medical aid. The tribunal has ordered that medical relief should be given by the appellant to its employees on the same lines as Gillanders Arbuthnot & Co. The direction issued by the tribunal requires that the company should bear the cost of simple prescriptions and also pay Rs. 3 on any patent or proprietary medicine included in any single prescription by the companys doctor. No ceiling has been placed in respect of medical aid and the fact that the company has no doctor of its own has not been taken into account. Besides, the main basis of the relief granted by the tribunal under this demand appears to be that the tribunal was inclined to treat the appellant as comparable to Gillanders Arbuthnot & Co. We would, therefore, set aside this part of the award asappears that in the statement filed by the appellant, it had claimed deduction of Rs. 43, 449 by way of tax and this claim was made on this specific ground that the said amount of tax had in fact, been paid for the yearwhich is relevant. There is no doubt that what the tribunal has to find in working out the formula is not the amount of tax actually paid but the amount of tax which under the relevant rates would be payable notionally on the profits determined under the formula. There is no dispute about the amount of profits; the dispute is about the rate. The tribunal has calculatedat seven annas in a rupee, whereas Sri Sastri contends that the proper rate is 61.5 nP in a rupee and in support of his argument he has referred us to the relevant provisions of the Finance Act (18 ofno doubt, appears to be so; but the rate at which tax has to be levied has to be governed by the relevant provision of the statute and if Sri Sastri can show that the rate prescribed by the statute is 61.5 nP then the affidavit on which Sri Dudhia relies cannot go against the appellant. It must be held to be a mistake committed by the person who made mistake committed by the person who made the affidavit. We would have ourselves decided this question in appeal, but Sri Dudhia has argued that before determining the rate which was applicable, considerations of rebate will have to be borne in mind and he, therefore, contends that he should be given a chance to justify the finding of the tribunal that the rate was seven annas in a rupee and nowe are remanding the matter for the consideration of the major items of dispute between the parties, we have decided to set aside that portion of the award which deals with bonus and send this dispute for the consideration of the tribunal on the narrow point as to the relevant rate at which the calculation of theshould be governed. If the rate turns out to be 61.5 nP. as alleged by Sri Sastri, then, of course, there would be no scope for making any payment of bonus. If the rate turns out to be seven annas in a rupee as at present assumed by the tribunal, then the only point which the tribunal may consider is whether three months total wages should be awarded as bonus or three months basic wages, or any thing less.Since we are setting aside the award in regard to demands 1, 2, 4, 6, 8 and 9, it follows that the terms of employment between the appellant and the respondents would be governed by the existing conditions until a fresh award is made by the tribunal. It appears that pending the appeal in this Court, the appellant has paid dearness allowance at the increased rate awarded by the tribunal to the respondents. But the payment of the said dearness allowance will now have to be stopped until a new award is made. It would be open to the respondents to apply to the tribunal for any interim order in that behalf and if such an application is made, the tribunal may deal with it in accordance with law. | 1 | 3,130 | 1,796 | ### Instruction:
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no grievance about the relief granted by the award in respect of leave with pay and allowances.Just as the wage structure with scales of increments cannot reasonably be constructed unless the financial position of the appellant is properly ascertained and the result of the impact of the wage structure in future is judged, so adequate dearness allowance provision also cannot be made unless the said facts are ascertained. That is why the award in regard to wage structure and the dearness allowance must be set aside. For the same reasons, the award in respect of the gratuity must also be set aside. The demand in respect of retrospective operation of these provisions must, as a consequence, be set aside.6. That takes us to the demand for medical aid. The tribunal has ordered that medical relief should be given by the appellant to its employees on the same lines as Gillanders Arbuthnot & Co. The direction issued by the tribunal requires that the company should bear the cost of simple prescriptions and also pay Rs. 3 on any patent or proprietary medicine included in any single prescription by the companys doctor. No ceiling has been placed in respect of medical aid and the fact that the company has no doctor of its own has not been taken into account. Besides, the main basis of the relief granted by the tribunal under this demand appears to be that the tribunal was inclined to treat the appellant as comparable to Gillanders Arbuthnot & Co. We would, therefore, set aside this part of the award as well.7. That leaves the question of bonus to be considered. Sri Sastri has raised two conditions against the award in respect of bonus. His first argument is that in directing the appellant to pay three months total wages as bonus, the tribunal has departed from the usual convention in such matters which is to award a specified number of months basic wages and not total wages as bonus. The second contention raised by Sri Sastri goes to the root of the matter. He contends that the calculations made by the tribunal contain an obvious mistake in regard to the allowance made for income-tax. It appears that in the statement filed by the appellant, it had claimed deduction of Rs. 43, 449 by way of tax and this claim was made on this specific ground that the said amount of tax had in fact, been paid for the year 1956-57 which is relevant. There is no doubt that what the tribunal has to find in working out the formula is not the amount of tax actually paid but the amount of tax which under the relevant rates would be payable notionally on the profits determined under the formula. There is no dispute about the amount of profits; the dispute is about the rate. The tribunal has calculated income-tax at seven annas in a rupee, whereas Sri Sastri contends that the proper rate is 61.5 nP in a rupee and in support of his argument he has referred us to the relevant provisions of the Finance Act (18 of 1956). On the other hand Sri Dudhia has contended that in proceedings between the parties in this Court in relation to stay, an affidavit had been made on behalf of the appellant admitting that the relevant rate for tax is 51.5 nP. That, no doubt, appears to be so; but the rate at which tax has to be levied has to be governed by the relevant provision of the statute and if Sri Sastri can show that the rate prescribed by the statute is 61.5 nP then the affidavit on which Sri Dudhia relies cannot go against the appellant. It must be held to be a mistake committed by the person who made mistake committed by the person who made the affidavit. We would have ourselves decided this question in appeal, but Sri Dudhia has argued that before determining the rate which was applicable, considerations of rebate will have to be borne in mind and he, therefore, contends that he should be given a chance to justify the finding of the tribunal that the rate was seven annas in a rupee and no more. According to Sri Dudhia, it would not be possible for him to say what rebates the appellant could claim and how the rate would not be 61.5 nP but seven annas. Since we are remanding the matter for the consideration of the major items of dispute between the parties, we have decided to set aside that portion of the award which deals with bonus and send this dispute for the consideration of the tribunal on the narrow point as to the relevant rate at which the calculation of the income-tax should be governed. If the rate turns out to be 61.5 nP. as alleged by Sri Sastri, then, of course, there would be no scope for making any payment of bonus. If the rate turns out to be seven annas in a rupee as at present assumed by the tribunal, then the only point which the tribunal may consider is whether three months total wages should be awarded as bonus or three months basic wages, or any thing less.Since we are setting aside the award in regard to demands 1, 2, 4, 6, 8 and 9, it follows that the terms of employment between the appellant and the respondents would be governed by the existing conditions until a fresh award is made by the tribunal. It appears that pending the appeal in this Court, the appellant has paid dearness allowance at the increased rate awarded by the tribunal to the respondents. But the payment of the said dearness allowance will now have to be stopped until a new award is made. It would be open to the respondents to apply to the tribunal for any interim order in that behalf and if such an application is made, the tribunal may deal with it in accordance with law.
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support of its finding that the appellant should bear the financial burden of the wage structure devised by the award are not satisfactory, we tried to see if we could settle the dispute ourselves in appeal, but that turned out to be very difficult; and so, we have decided to set aside the award and send the case back for disposal in accordance with law in the light of this judgment.5. Of the demands referred to the industrial tribunal for adjudication, no grievance has been made before us in reject of demand 3 in regard to washing allowance; demand 5 in regard to leave with pay and allowance and demand 7 in regard to uniforms. In respect of demand 5 as to leave with pay and allowances, Sri Sastri had first attempted to argue that the provisions made by the award under this demand were unreasonable, but Sri Dudhia pointed out that the material provisions in that behalf are consistent with the statutory provisions which have now been included in the Bombay Shops and Establishments Act (79 of 1948) by the Amending Act 26 of 1961. Therefore there is no grievance about the relief granted by the award in respect of leave with pay and allowances.Just as the wage structure with scales of increments cannot reasonably be constructed unless the financial position of the appellant is properly ascertained and the result of the impact of the wage structure in future is judged, so adequate dearness allowance provision also cannot be made unless the said facts are ascertained. That is why the award in regard to wage structure and the dearness allowance must be set aside. For the same reasons, the award in respect of the gratuity must also be set aside. The demand in respect of retrospective operation of these provisions must, as a consequence, be set aside.6. That takes us to the demand for medical aid. The tribunal has ordered that medical relief should be given by the appellant to its employees on the same lines as Gillanders Arbuthnot & Co. The direction issued by the tribunal requires that the company should bear the cost of simple prescriptions and also pay Rs. 3 on any patent or proprietary medicine included in any single prescription by the companys doctor. No ceiling has been placed in respect of medical aid and the fact that the company has no doctor of its own has not been taken into account. Besides, the main basis of the relief granted by the tribunal under this demand appears to be that the tribunal was inclined to treat the appellant as comparable to Gillanders Arbuthnot & Co. We would, therefore, set aside this part of the award asappears that in the statement filed by the appellant, it had claimed deduction of Rs. 43, 449 by way of tax and this claim was made on this specific ground that the said amount of tax had in fact, been paid for the yearwhich is relevant. There is no doubt that what the tribunal has to find in working out the formula is not the amount of tax actually paid but the amount of tax which under the relevant rates would be payable notionally on the profits determined under the formula. There is no dispute about the amount of profits; the dispute is about the rate. The tribunal has calculatedat seven annas in a rupee, whereas Sri Sastri contends that the proper rate is 61.5 nP in a rupee and in support of his argument he has referred us to the relevant provisions of the Finance Act (18 ofno doubt, appears to be so; but the rate at which tax has to be levied has to be governed by the relevant provision of the statute and if Sri Sastri can show that the rate prescribed by the statute is 61.5 nP then the affidavit on which Sri Dudhia relies cannot go against the appellant. It must be held to be a mistake committed by the person who made mistake committed by the person who made the affidavit. We would have ourselves decided this question in appeal, but Sri Dudhia has argued that before determining the rate which was applicable, considerations of rebate will have to be borne in mind and he, therefore, contends that he should be given a chance to justify the finding of the tribunal that the rate was seven annas in a rupee and nowe are remanding the matter for the consideration of the major items of dispute between the parties, we have decided to set aside that portion of the award which deals with bonus and send this dispute for the consideration of the tribunal on the narrow point as to the relevant rate at which the calculation of theshould be governed. If the rate turns out to be 61.5 nP. as alleged by Sri Sastri, then, of course, there would be no scope for making any payment of bonus. If the rate turns out to be seven annas in a rupee as at present assumed by the tribunal, then the only point which the tribunal may consider is whether three months total wages should be awarded as bonus or three months basic wages, or any thing less.Since we are setting aside the award in regard to demands 1, 2, 4, 6, 8 and 9, it follows that the terms of employment between the appellant and the respondents would be governed by the existing conditions until a fresh award is made by the tribunal. It appears that pending the appeal in this Court, the appellant has paid dearness allowance at the increased rate awarded by the tribunal to the respondents. But the payment of the said dearness allowance will now have to be stopped until a new award is made. It would be open to the respondents to apply to the tribunal for any interim order in that behalf and if such an application is made, the tribunal may deal with it in accordance with law.
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United Provinces Electric Supply Co. Ltd. Allahabad Vs. T. N. Chatterjee | been validly retired having reached the age of superannuation on that date under that clause.14. In view of the previous decisions of this court and in particular that of Guest Keen Williams Pvt. Ltd. (1960) 1 SCR 348 = (AIR 1959 SC 1279 ) it has not been disputed that in the industrial dispute which was referred it was open to the Industrial Tribunal or the Labour Court to determine the age of retirement of superannuation notwithstanding that clause 32 of the Standing Orders as certified in 1961 had been legally and validly certified. Indeed in Guest Keen Williams Pvt. Ltd. it was not disputed that even this court could give an appropriate direction which might be considered reasonable with regard to fixing the age of superannuation. As stated before, according to clause 32 of the Standing Orders, as certified in April 1961, the age of superannuation was fixed at 58. The appellant filed an appeal and the appellate authority refixed the age at 55 years. It appears that in the case of Agra Electric Supply Co. (1970) 1 SCR 808 = (AIR 1970 SC 512 ) also a similar Standing Order had been certified and on appeal the age of retirement was reduced from 58 to 55 years by the appellate authority. This Court in that case held the Standing Order fixing the age at 55 years applicable not only to those employees who were employed subsequently but also to all workmen who were in employment at the time when the Standing Orders became legally applicable. It does not appear in that case that any such argument was raised that the matter should be remitted either to the Industrial Tribunal or the Labour Court to fix the age of superannuation or that this court itself might do so as was the course followed in the case of Guest Keen Williams Pvt. Ltd. in which the age was fixed at 60 years with regard to those employees who had raised the dispute on the ground that the Standing Orders could not govern them as they had been employed before the Standing Orders became applicable. After considering the entire material and keeping in mind the fact that according to the appellate authority even the age of retirement at 55 was fair and reasonable we are of the view that the age of superannuation of the respondents in the present case, should be 58 years. In other words, it will be the same as was fixed by the Certifying Officer by modifying clause 32 on April 22, 1961.15. Lastly we must deal with the contention raised on behalf of the respondents that the order of the Allahabad High Court made on July 12, 1966 quashing the award after following the decision of this court in Guest Keen Williams Pvt. Ltd. should be deemed to be final and should debar any fresh consideration or decision of that point by virtue of the rule or principle of res judicata. It is noteworthy that the order of the Allahabad High Court was not final against which the matter could have been taken in appeal either to a Division Bench of the High Court or to this court. Reliance has been placed on a decision of this court in Management of Northern Railway Co-operative Society Ltd. v. Industrial Tribunal Rajasthan, Jaipur, (1967) 2 SCR 476 = (AIR 1967 SC 1182 ) where reference had been made by the State Government to the Industrial Tribunal on the Railway Workers Union having raised an industrial dispute against the Management of the Northern Railway Co-operative Society Ltd. The society filed a writ petition on the ground that the dispute having been raised by the Railway Workers Union and not by the Societys own employees the reference to the Tribunal was not competent. The High Court dismissed the petition. Thereafter the Tribunal heard the matter and gave its decision in favour of the workman concerned. The society appealed to this court by special leave. It was held that the order of the High Court was not interlocutory but was a final order in regard to the proceedings under Art. 226. The appropriate remedy for the appellant in that case was to appeal against the High Courts order and that not having been done the appellants plea relating to the competency of the reference was barred by res judicata as the same had been raised before the High Court and had been rejected. The present case is clearly distinguishable inasmuch as the order made by the High Court was not final and a remand had been directed presumably under Art. 227 of the Constitution. That order in fact did not finally terminate any proceedings at all. The proceedings were terminated only by the award against which the present appeal has been brought by special leave. We are unable to see how the decision in the aforesaid case can afford any assistance to the respondents before us. Indeed the case which is more apposite is Satyadhyan Ghosal v. Smt. Deorajin Debi, (1960) 3 SCR 590 = (AIR 1960 SC 941 ). There an order of remand had been made by the High Court while exercising powers under S. 115 of the Code of Civil Procedure. It was observed after referring to the various decisions of the Privy Council, that the order of remand was interlocutory and did not purport to dispose of the case. A party is not bound to appeal against every interlocutory order which is a step in the procedure that leads up to a final decision or award. The following observations from this case may be reproduced with advantage:"Interlocutory judgments which have the force of a decree must be distinguished from other interlocutory judgments which are a step towards the decision of the dispute between parties by way of a decree or a final order".We are unable, therefore, to accede to the contention that the rule of res judicata could be invoked by the respondent in the present case. | 1[ds]In our opinion the principle applied in the latter case is fully supported by the scheme of the Act and was rightly extended and applied in Agra Electric Supply Co. Ltd. (1970) 1 SCR 808 = (AIR 1970 SC 512 ).We concur with the view expressed therein that it was not intended by the legislature that different sets of conditions should apply to employees depending on whether a workman was employed before the Standing Orders were certified or after, which would defeat the very object of the legislation. In the preamble it is stated in categorical terms "whereas it is expedient to require employers in industrial establishments to define with sufficient precision the conditions of employment under them and to make the said conditions known to workmen employed by them". Not only the object but the scheme of the Act is such that the employers must define precisely the conditions of employment of all the employers must define precisely the conditions of employment of all the employees and have the same certified by the Certifying Officer against whose orders an appeal lies to the appellate authority. The right given to workmen to express their view and to raise objections is of great significance. They can even ask for modification of the Standing Orders in accordance with Section 10 of the Act. Every possible safeguard has been provided for keeping the workmen informed about their conditions of service so that they can take whatever steps they desire or are advised to take in their interest before the Certifying Officer or the appellate authority. It is also very difficult to conceive taking each individual item in the schedule how there can be different conditions for different employees depending upon the point of time when they came to be employed; for instance Item 3 relates to shift working. Is it possible to suggest that for the same kind of work employees who were in employment before the Standing Orders were certified would have different hours of shift from the other employees who were employed subsequently? In the very nature of things a great deal of irritation and annoyance between employees inter se would result if any such discrimination is made in any of the items in the Schedule. It has been rightly pointed out in Agra Electric Supply Co. Ltd. that this would only lead to industrial unrest and not industrial peace, the latter being the principal object of legislation.In our judgment much assistance or help cannot be derived from Para 16 of the Model Standing Orders as contained in Schedule 1 to the Industrial Employment (Standing Orders) Central Rules 1946. Retirement which is mentioned there may be under the terms of contract of employment entered into between the employer and the employees. Section 2 (oo) of the Industrial Disputes Act 1947, throws a certain amount of light on thepresent case is clearly distinguishable inasmuch as the order made by the High Court was not final and a remand had been directed presumably under Art. 227 of the Constitution. That order in fact did not finally terminate any proceedings at all. The proceedings were terminated only by the award against which the present appeal has been brought by special leave. We are unable to see how the decision in the aforesaid case can afford any assistance to the respondents before us. Indeed the case which is more apposite is Satyadhyan Ghosal v. Smt. Deorajin Debi, (1960) 3 SCR 590 = (AIR 1960 SC 941 ). There an order of remand had been made by the High Court while exercising powers under S. 115 of theCode of Civil Procedure. It was observed after referring to the various decisions of the Privy Council, that the order of remand was interlocutory and did not purport to dispose of the case. A party is not bound to appeal against every interlocutory order which is a step in the procedure that leads up to a final decision or award. The following observations from this case may be reproduced withjudgments which have the force of a decree must be distinguished from other interlocutory judgments which are a step towards the decision of the dispute between parties by way of a decree or a finalare unable, therefore, to accede to the contention that the rule of res judicata could be invoked by the respondent in the present case. | 1 | 6,294 | 776 | ### Instruction:
Judge the probable resolution of the case (approval (1) or disapproval (0)), and elaborate on this forecast by extracting and interpreting significant sentences from the proceeding.
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been validly retired having reached the age of superannuation on that date under that clause.14. In view of the previous decisions of this court and in particular that of Guest Keen Williams Pvt. Ltd. (1960) 1 SCR 348 = (AIR 1959 SC 1279 ) it has not been disputed that in the industrial dispute which was referred it was open to the Industrial Tribunal or the Labour Court to determine the age of retirement of superannuation notwithstanding that clause 32 of the Standing Orders as certified in 1961 had been legally and validly certified. Indeed in Guest Keen Williams Pvt. Ltd. it was not disputed that even this court could give an appropriate direction which might be considered reasonable with regard to fixing the age of superannuation. As stated before, according to clause 32 of the Standing Orders, as certified in April 1961, the age of superannuation was fixed at 58. The appellant filed an appeal and the appellate authority refixed the age at 55 years. It appears that in the case of Agra Electric Supply Co. (1970) 1 SCR 808 = (AIR 1970 SC 512 ) also a similar Standing Order had been certified and on appeal the age of retirement was reduced from 58 to 55 years by the appellate authority. This Court in that case held the Standing Order fixing the age at 55 years applicable not only to those employees who were employed subsequently but also to all workmen who were in employment at the time when the Standing Orders became legally applicable. It does not appear in that case that any such argument was raised that the matter should be remitted either to the Industrial Tribunal or the Labour Court to fix the age of superannuation or that this court itself might do so as was the course followed in the case of Guest Keen Williams Pvt. Ltd. in which the age was fixed at 60 years with regard to those employees who had raised the dispute on the ground that the Standing Orders could not govern them as they had been employed before the Standing Orders became applicable. After considering the entire material and keeping in mind the fact that according to the appellate authority even the age of retirement at 55 was fair and reasonable we are of the view that the age of superannuation of the respondents in the present case, should be 58 years. In other words, it will be the same as was fixed by the Certifying Officer by modifying clause 32 on April 22, 1961.15. Lastly we must deal with the contention raised on behalf of the respondents that the order of the Allahabad High Court made on July 12, 1966 quashing the award after following the decision of this court in Guest Keen Williams Pvt. Ltd. should be deemed to be final and should debar any fresh consideration or decision of that point by virtue of the rule or principle of res judicata. It is noteworthy that the order of the Allahabad High Court was not final against which the matter could have been taken in appeal either to a Division Bench of the High Court or to this court. Reliance has been placed on a decision of this court in Management of Northern Railway Co-operative Society Ltd. v. Industrial Tribunal Rajasthan, Jaipur, (1967) 2 SCR 476 = (AIR 1967 SC 1182 ) where reference had been made by the State Government to the Industrial Tribunal on the Railway Workers Union having raised an industrial dispute against the Management of the Northern Railway Co-operative Society Ltd. The society filed a writ petition on the ground that the dispute having been raised by the Railway Workers Union and not by the Societys own employees the reference to the Tribunal was not competent. The High Court dismissed the petition. Thereafter the Tribunal heard the matter and gave its decision in favour of the workman concerned. The society appealed to this court by special leave. It was held that the order of the High Court was not interlocutory but was a final order in regard to the proceedings under Art. 226. The appropriate remedy for the appellant in that case was to appeal against the High Courts order and that not having been done the appellants plea relating to the competency of the reference was barred by res judicata as the same had been raised before the High Court and had been rejected. The present case is clearly distinguishable inasmuch as the order made by the High Court was not final and a remand had been directed presumably under Art. 227 of the Constitution. That order in fact did not finally terminate any proceedings at all. The proceedings were terminated only by the award against which the present appeal has been brought by special leave. We are unable to see how the decision in the aforesaid case can afford any assistance to the respondents before us. Indeed the case which is more apposite is Satyadhyan Ghosal v. Smt. Deorajin Debi, (1960) 3 SCR 590 = (AIR 1960 SC 941 ). There an order of remand had been made by the High Court while exercising powers under S. 115 of the Code of Civil Procedure. It was observed after referring to the various decisions of the Privy Council, that the order of remand was interlocutory and did not purport to dispose of the case. A party is not bound to appeal against every interlocutory order which is a step in the procedure that leads up to a final decision or award. The following observations from this case may be reproduced with advantage:"Interlocutory judgments which have the force of a decree must be distinguished from other interlocutory judgments which are a step towards the decision of the dispute between parties by way of a decree or a final order".We are unable, therefore, to accede to the contention that the rule of res judicata could be invoked by the respondent in the present case.
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In our opinion the principle applied in the latter case is fully supported by the scheme of the Act and was rightly extended and applied in Agra Electric Supply Co. Ltd. (1970) 1 SCR 808 = (AIR 1970 SC 512 ).We concur with the view expressed therein that it was not intended by the legislature that different sets of conditions should apply to employees depending on whether a workman was employed before the Standing Orders were certified or after, which would defeat the very object of the legislation. In the preamble it is stated in categorical terms "whereas it is expedient to require employers in industrial establishments to define with sufficient precision the conditions of employment under them and to make the said conditions known to workmen employed by them". Not only the object but the scheme of the Act is such that the employers must define precisely the conditions of employment of all the employers must define precisely the conditions of employment of all the employees and have the same certified by the Certifying Officer against whose orders an appeal lies to the appellate authority. The right given to workmen to express their view and to raise objections is of great significance. They can even ask for modification of the Standing Orders in accordance with Section 10 of the Act. Every possible safeguard has been provided for keeping the workmen informed about their conditions of service so that they can take whatever steps they desire or are advised to take in their interest before the Certifying Officer or the appellate authority. It is also very difficult to conceive taking each individual item in the schedule how there can be different conditions for different employees depending upon the point of time when they came to be employed; for instance Item 3 relates to shift working. Is it possible to suggest that for the same kind of work employees who were in employment before the Standing Orders were certified would have different hours of shift from the other employees who were employed subsequently? In the very nature of things a great deal of irritation and annoyance between employees inter se would result if any such discrimination is made in any of the items in the Schedule. It has been rightly pointed out in Agra Electric Supply Co. Ltd. that this would only lead to industrial unrest and not industrial peace, the latter being the principal object of legislation.In our judgment much assistance or help cannot be derived from Para 16 of the Model Standing Orders as contained in Schedule 1 to the Industrial Employment (Standing Orders) Central Rules 1946. Retirement which is mentioned there may be under the terms of contract of employment entered into between the employer and the employees. Section 2 (oo) of the Industrial Disputes Act 1947, throws a certain amount of light on thepresent case is clearly distinguishable inasmuch as the order made by the High Court was not final and a remand had been directed presumably under Art. 227 of the Constitution. That order in fact did not finally terminate any proceedings at all. The proceedings were terminated only by the award against which the present appeal has been brought by special leave. We are unable to see how the decision in the aforesaid case can afford any assistance to the respondents before us. Indeed the case which is more apposite is Satyadhyan Ghosal v. Smt. Deorajin Debi, (1960) 3 SCR 590 = (AIR 1960 SC 941 ). There an order of remand had been made by the High Court while exercising powers under S. 115 of theCode of Civil Procedure. It was observed after referring to the various decisions of the Privy Council, that the order of remand was interlocutory and did not purport to dispose of the case. A party is not bound to appeal against every interlocutory order which is a step in the procedure that leads up to a final decision or award. The following observations from this case may be reproduced withjudgments which have the force of a decree must be distinguished from other interlocutory judgments which are a step towards the decision of the dispute between parties by way of a decree or a finalare unable, therefore, to accede to the contention that the rule of res judicata could be invoked by the respondent in the present case.
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M/S. The Abu Marble Mining Private Limited Vs. The Regional Directors | accordingly held that the employees working at the site were not covered by the definition of "employee" under Section 2(9).On the other hand, on behalf of the respondents, their learned counsel has firstly placed reliance in the judgment of ESIC Vs. Premier Timber Supplies, 1991 1 CLR 669 to contend that even temporary employees as well as causal employees are covered. There can be no dispute that they will be covered if the employees are employed by the principal employer in work connected with or incidental to the work of the factory. In M/s. Siddheshwar & Co., Hubli Vs. ESIC, 1998 LAB I.C.157, the issue before the learned Single Judge of the Karnataka High Court was whether casuals employed would be covered. The learned Judge observed that even if the employees are unidentified today or not was irrelevant and in the light of that, dismissed the Appeal preferred by the company. In Poona Industrial Hotel Ltd., Vs. I.C. Sarin & Anr., 1980, LAB I.C., 100, the question before the Division Bench of this Court was whether in view of the fact that the kitchen fell within the definition of "factory", the other establishment would also be covered and the employees working in the hotel fell within the definition of "employee" under Section 2(9). One of the arguments advanced was that at the highest, it is employees working in the kitchen alone who would be covered and not in the other premises. The learned Division Bench observed as under:"There is not only geographical unity, but unity of ownership between the hotel and the kitchen in which food for the guests of the hotel is manufactured. In these circumstances, we do not see how kitchen can be carved out as a separate geographical or legal entity and treated as separate premises from the hotel as a whole. On the contrary, on the facts of this case it is inevitable that the kitchen must be treated as part of the hotel in view of the main function which has been assigned to it viz., The preparation of food for the purpose of catering to the needs of the patrons accommodated in the hotel."9. Considering all these judgments, we now come back to the facts of this case. We have earlier noted the evidence on record. From the evidence on record, what is clear is that the contractor was only doing the work of laying tiles/marble. Even the polishing work at the site, from the evidence of Sharma, was not done by the contractor. It was done either by the company or given on contract. The work of the factory, as has come in the evidence, was processing marble stones which was cutting, polishing and finishing, according to size. As pointed out earlier, the employees to be covered have either to be working under the supervision of the principal employer or his agent and doing work, which is ordinarily part of the work of the factory or establishment. From the evidence nothing has been placed on record to show that the appellant principal employer was supervising the work of the immediate employer i.e. the contractor. The only evidence that has come on record is that it is the person who had given the contract to the appellant who was supervising the work. This cannot be said to be supervision by the employer. The test of supervision must be the test as laid down by the Apex Court in the case of CESC Ltd. & Ors. (supra). Those tests are, therefore, not satisfied. We have also earlier noted that the immediate employer or the contractor cannot also be said to be the agent of the appellant as the immediate contractor was engaged by the principal employer to carry out the work of laying of the marble and paying to him consideration on the piece rate basis. The test of the agent again, as contained in the provisions of Section 182 of the Indian Contract Act and as laid down in CESC Ltd. & Ors. (supra) are not satisfied. The contractor is not working under the supervision of the "principal employer or his agent. The immediate employer will not fall within head (b) as split up and seen in paragraph 3.10. The other test to be applied is whether the work of laying, even in a case of a complete contract can be said to be incidental to the work of the factory or establishment. The work of the factory, as has come in evidence, is cutting, polishing and finishing. It is only when a complete contract is taken, the principal employer is required to carry out also the work of laying or fixing the marble. Merely because the establishment is a "factory" it does not mean that even contractors employees engaged by an employee would necessarily fall within the definition of "employee" under Section 2(9). They must do work incidental to the purpose of the factory. The work of the factory has been spelt out earlier. Merely because the material is supplied at the site and that is laid by the contractor i.e. Immediate employer it cannot be said that, that would be work which is incidental to the work of the factory or for the purpose of the factory. Incidental for the purpose of the factory would mean that it has some connection with the ordinary work of the factory. That is not the evidence in the instant case. The work of the factory is cutting and polishing marble. Head "c" of the definition of employee in paragraph 3 will also not be attracted.11. We are clearly, therefore, of the opinion that on the material on record there was nothing to show that the employees engaged by the immediate employer fell within the extended definition of "employee" within the meaning of Section 2(9) of the ESIC Act. We are, therefore clearly of the opinion that the learned Single Judge erred in law in holding that the test of supervision and agency had been satisfied. | 1[ds]9. Considering all these judgments, we now come back to the facts of this case. We have earlier noted the evidence on record. From the evidence on record, what is clear is that the contractor was only doing the work of laying tiles/marble. Even the polishing work at the site, from the evidence of Sharma, was not done by the contractor. It was done either by the company or given on contract. The work of the factory, as has come in the evidence, was processing marble stones which was cutting, polishing and finishing, according to size. As pointed out earlier, the employees to be covered have either to be working under the supervision of the principal employer or his agent and doing work, which is ordinarily part of the work of the factory or establishment. From the evidence nothing has been placed on record to show that the appellant principal employer was supervising the work of the immediate employer i.e. the contractor. The only evidence that has come on record is that it is the person who had given the contract to the appellant who was supervising the work. This cannot be said to be supervision by the employer. The test of supervision must be the test as laid down by the Apex Court in the case of CESC Ltd.Ors. (supra). Those tests are, therefore, not satisfied. We have also earlier noted that the immediate employer or the contractor cannot also be said to be the agent of the appellant as the immediate contractor was engaged by the principal employer to carry out the work of laying of the marble and paying to him consideration on the piece rate basis. The test of the agent again, as contained in the provisions of Section 182 of the Indian Contract Act and as laid down in CESC Ltd.Ors. (supra) are not satisfied. The contractor is not working under the supervision of the "principal employer or his agent. The immediate employer will not fall within head (b) as split up and seen in paragraph 3.10. The other test to be applied is whether the work of laying, even in a case of a complete contract can be said to be incidental to the work of the factory or establishment. The work of the factory, as has come in evidence, is cutting, polishing and finishing. It is only when a complete contract is taken, the principal employer is required to carry out also the work of laying or fixing the marble. Merely because the establishment is a "factory" it does not mean that even contractors employees engaged by an employee would necessarily fall within the definition of "employee" under Section 2(9). They must do work incidental to the purpose of the factory. The work of the factory has been spelt out earlier. Merely because the material is supplied at the site and that is laid by the contractor i.e. Immediate employer it cannot be said that, that would be work which is incidental to the work of the factory or for the purpose of the factory. Incidental for the purpose of the factory would mean that it has some connection with the ordinary work of the factory. That is not the evidence in the instant case. The work of the factory is cutting and polishing marble. Head "c" of the definition of employee in paragraph 3 will also not be attracted.11. We are clearly, therefore, of the opinion that on the material on record there was nothing to show that the employees engaged by the immediate employer fell within the extended definition of "employee" within the meaning of Section 2(9) of the ESIC Act. We are, therefore clearly of the opinion that the learned Single Judge erred in law in holding that the test of supervision and agency had been satisfied. | 1 | 5,141 | 721 | ### Instruction:
Judge the probable resolution of the case (approval (1) or disapproval (0)), and elaborate on this forecast by extracting and interpreting significant sentences from the proceeding.
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accordingly held that the employees working at the site were not covered by the definition of "employee" under Section 2(9).On the other hand, on behalf of the respondents, their learned counsel has firstly placed reliance in the judgment of ESIC Vs. Premier Timber Supplies, 1991 1 CLR 669 to contend that even temporary employees as well as causal employees are covered. There can be no dispute that they will be covered if the employees are employed by the principal employer in work connected with or incidental to the work of the factory. In M/s. Siddheshwar & Co., Hubli Vs. ESIC, 1998 LAB I.C.157, the issue before the learned Single Judge of the Karnataka High Court was whether casuals employed would be covered. The learned Judge observed that even if the employees are unidentified today or not was irrelevant and in the light of that, dismissed the Appeal preferred by the company. In Poona Industrial Hotel Ltd., Vs. I.C. Sarin & Anr., 1980, LAB I.C., 100, the question before the Division Bench of this Court was whether in view of the fact that the kitchen fell within the definition of "factory", the other establishment would also be covered and the employees working in the hotel fell within the definition of "employee" under Section 2(9). One of the arguments advanced was that at the highest, it is employees working in the kitchen alone who would be covered and not in the other premises. The learned Division Bench observed as under:"There is not only geographical unity, but unity of ownership between the hotel and the kitchen in which food for the guests of the hotel is manufactured. In these circumstances, we do not see how kitchen can be carved out as a separate geographical or legal entity and treated as separate premises from the hotel as a whole. On the contrary, on the facts of this case it is inevitable that the kitchen must be treated as part of the hotel in view of the main function which has been assigned to it viz., The preparation of food for the purpose of catering to the needs of the patrons accommodated in the hotel."9. Considering all these judgments, we now come back to the facts of this case. We have earlier noted the evidence on record. From the evidence on record, what is clear is that the contractor was only doing the work of laying tiles/marble. Even the polishing work at the site, from the evidence of Sharma, was not done by the contractor. It was done either by the company or given on contract. The work of the factory, as has come in the evidence, was processing marble stones which was cutting, polishing and finishing, according to size. As pointed out earlier, the employees to be covered have either to be working under the supervision of the principal employer or his agent and doing work, which is ordinarily part of the work of the factory or establishment. From the evidence nothing has been placed on record to show that the appellant principal employer was supervising the work of the immediate employer i.e. the contractor. The only evidence that has come on record is that it is the person who had given the contract to the appellant who was supervising the work. This cannot be said to be supervision by the employer. The test of supervision must be the test as laid down by the Apex Court in the case of CESC Ltd. & Ors. (supra). Those tests are, therefore, not satisfied. We have also earlier noted that the immediate employer or the contractor cannot also be said to be the agent of the appellant as the immediate contractor was engaged by the principal employer to carry out the work of laying of the marble and paying to him consideration on the piece rate basis. The test of the agent again, as contained in the provisions of Section 182 of the Indian Contract Act and as laid down in CESC Ltd. & Ors. (supra) are not satisfied. The contractor is not working under the supervision of the "principal employer or his agent. The immediate employer will not fall within head (b) as split up and seen in paragraph 3.10. The other test to be applied is whether the work of laying, even in a case of a complete contract can be said to be incidental to the work of the factory or establishment. The work of the factory, as has come in evidence, is cutting, polishing and finishing. It is only when a complete contract is taken, the principal employer is required to carry out also the work of laying or fixing the marble. Merely because the establishment is a "factory" it does not mean that even contractors employees engaged by an employee would necessarily fall within the definition of "employee" under Section 2(9). They must do work incidental to the purpose of the factory. The work of the factory has been spelt out earlier. Merely because the material is supplied at the site and that is laid by the contractor i.e. Immediate employer it cannot be said that, that would be work which is incidental to the work of the factory or for the purpose of the factory. Incidental for the purpose of the factory would mean that it has some connection with the ordinary work of the factory. That is not the evidence in the instant case. The work of the factory is cutting and polishing marble. Head "c" of the definition of employee in paragraph 3 will also not be attracted.11. We are clearly, therefore, of the opinion that on the material on record there was nothing to show that the employees engaged by the immediate employer fell within the extended definition of "employee" within the meaning of Section 2(9) of the ESIC Act. We are, therefore clearly of the opinion that the learned Single Judge erred in law in holding that the test of supervision and agency had been satisfied.
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1
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9. Considering all these judgments, we now come back to the facts of this case. We have earlier noted the evidence on record. From the evidence on record, what is clear is that the contractor was only doing the work of laying tiles/marble. Even the polishing work at the site, from the evidence of Sharma, was not done by the contractor. It was done either by the company or given on contract. The work of the factory, as has come in the evidence, was processing marble stones which was cutting, polishing and finishing, according to size. As pointed out earlier, the employees to be covered have either to be working under the supervision of the principal employer or his agent and doing work, which is ordinarily part of the work of the factory or establishment. From the evidence nothing has been placed on record to show that the appellant principal employer was supervising the work of the immediate employer i.e. the contractor. The only evidence that has come on record is that it is the person who had given the contract to the appellant who was supervising the work. This cannot be said to be supervision by the employer. The test of supervision must be the test as laid down by the Apex Court in the case of CESC Ltd.Ors. (supra). Those tests are, therefore, not satisfied. We have also earlier noted that the immediate employer or the contractor cannot also be said to be the agent of the appellant as the immediate contractor was engaged by the principal employer to carry out the work of laying of the marble and paying to him consideration on the piece rate basis. The test of the agent again, as contained in the provisions of Section 182 of the Indian Contract Act and as laid down in CESC Ltd.Ors. (supra) are not satisfied. The contractor is not working under the supervision of the "principal employer or his agent. The immediate employer will not fall within head (b) as split up and seen in paragraph 3.10. The other test to be applied is whether the work of laying, even in a case of a complete contract can be said to be incidental to the work of the factory or establishment. The work of the factory, as has come in evidence, is cutting, polishing and finishing. It is only when a complete contract is taken, the principal employer is required to carry out also the work of laying or fixing the marble. Merely because the establishment is a "factory" it does not mean that even contractors employees engaged by an employee would necessarily fall within the definition of "employee" under Section 2(9). They must do work incidental to the purpose of the factory. The work of the factory has been spelt out earlier. Merely because the material is supplied at the site and that is laid by the contractor i.e. Immediate employer it cannot be said that, that would be work which is incidental to the work of the factory or for the purpose of the factory. Incidental for the purpose of the factory would mean that it has some connection with the ordinary work of the factory. That is not the evidence in the instant case. The work of the factory is cutting and polishing marble. Head "c" of the definition of employee in paragraph 3 will also not be attracted.11. We are clearly, therefore, of the opinion that on the material on record there was nothing to show that the employees engaged by the immediate employer fell within the extended definition of "employee" within the meaning of Section 2(9) of the ESIC Act. We are, therefore clearly of the opinion that the learned Single Judge erred in law in holding that the test of supervision and agency had been satisfied.
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Western India Plywood Ltd Vs. Shri. P. Ashokan | ESI being a welfare legislation, the Parliament could not have intended to create a bar against the workmen claiming more advantageous benefit under the Workmens Compensation Act. The Single judge of the High Court dismissed the writ petition filed by the employer but the Division Bench, in appeal, held that in view of the bar created by Section 53, the application for compensation filed by Trehan was not maintainable. This Court analysed the provisions of Section 53 of the ESI Act and observed at page 260 as follows : "In this background and context we have to consider the effect of the bar created by Section 53 of the ESI Act. Bar is against receiving or recovering any compensation or damages under the Workmens Compensation Act or any other law for the time being in force or otherwise in respect of an employment injury. The bar is absolute as can be seen from the use of the words shall not be entitled to receive or recover, ``whether from the employer of the insured persons or from any other person, ``any compensation or damages and ``under the Workmens Compensation Act, 1923 (8 of 1923), or otherwise. The words ``employed by the legislature are clear and unequivocal. When such a bar is created in clear and express terms it would neither be permissible nor proper to infer a different intention by referring to the previous history of the legislation. That would amount to bypassing the bar and defeating the object of the provision. In view of the clear language of the section we find no justification in interpreting or construing it as not taking away the right of the workman who is an insured person and an employee under the ESI Act to claim compensation under the Workmens Compensation Act. We are of the opinion that the High Court was right in holding that in view of the bar created by Section 53 the application under the Workmens Compensation Act was not maintainable. The judgment under appeal in the present case of the Full Bench of the Kerala High Court was considered and it was observed that ``we cannot agree with some of the assumptions and observations made by the Kerala High Court. Moreover, the Kerala High Court has taken that view without referring to and considering the effect of the clear and express words used in that Section. 10. In view of the aforesaid observations in Trehans case, with which we respectfully agree, it is clear that the respondent could not make a claim for damages. Sections 53 disentitles an employee who has suffered an employment injury from receiving or recovering compensation or damages under the Workmens Compensation Act or any other law for the time being in force or otherwise. The use of the expression ``or otherwise would clearly indicate that this Section is not limited to ousting the relief claimed only under any statute but the wordings of the section are such that an insured person would not be entitled to make a claim in Torts which has the force of law under the ESI Act. Even though the ESI Act is a beneficial legislation the legislature had thought if fit to prohibit an insured person from receiving or recovering compensation or damages under any other law, including Torts, in cases where the injury had been sustained by him is an employment injury.11. The ESI Act has been enacted to provide certain benefits to the employees in case of sickness, maternity and employment injury and make provisions in respect thereof. Under this Act contribution is made not only by the employee but also by the employer. The claims by the employees against the employer where the relationship of the employer and employee exists were meant to be governed by the ESI Act alone. It is precisely for this reason that the Madras High Court in Mangalammas case (supra) had observed that the object of Section 53 of the ESI Act was to save the employer from facing more than one claim in relation to the same accident. This, in our opinion, is the correct reading of the said provision. This being so the claim of the respondent for damages being barred under Section 53 of the ESI Act, the trial Court was right in dismissing the application under Order 33 Rule 1 of the Code of Civil Procedure.12. The position in law being clear and concluded by the decision of this Court in Trehans case (supra) we see no justification for the Court not exercising its jurisdiction under Article 136, as was contended by the respondents counsel. The incorrect decision on a point of law of the High Court has to be corrected. 13. During the course of hearing it had been argued that Section 53 should not be construed in such a way that an insured person cannot raise a claim against a third party in the event of his suffering an employment injury. It was submitted that though qua the employer only one remedy may be available, namely, under the ESI Act but as far as third persons are concerned Section 53 cannot be taken up as a defence to an action in tort in a claim being made for damages because the ESI Act creates certain rights as a result of the employment qua the employer and has no application as far as third parties are concerned. In this connection it was submitted that the use of the words `employment injury in Section 53 relates to a claim which is relatable to the employment of the insured person with his employer. 14. In our opinion, though there is considerable force in the said submission but it is not necessary for the decision of the present case to decide this issue finally because in the instant case the claim which was sought to be made was not against the third party but against the employer itself. Perhaps this question may require consideration in an appropriate case. 15. | 1[ds]10. In view of the aforesaid observations in Trehans case, with which we respectfully agree, it is clear that the respondent could not make a claim for damages. Sections 53 disentitles an employee who has suffered an employment injury from receiving or recovering compensation or damages under the Workmens Compensation Act or any other law for the time being in force or otherwise. The use of the expression ``or otherwise would clearly indicate that this Section is not limited to ousting the relief claimed only under any statute but the wordings of the section are such that an insured person would not be entitled to make a claim in Torts which has the force of law under the ESI Act. Even though the ESI Act is a beneficial legislation the legislature had thought if fit to prohibit an insured person from receiving or recovering compensation or damages under any other law, including Torts, in cases where the injury had been sustained by him is an employment injury.11. The ESI Act has been enacted to provide certain benefits to the employees in case of sickness, maternity and employment injury and make provisions in respect thereof. Under this Act contribution is made not only by the employee but also by the employer. The claims by the employees against the employer where the relationship of the employer and employee exists were meant to be governed by the ESI Act alone. It is precisely for this reason that the Madras High Court in Mangalammas case (supra) had observed that the object of Section 53 of the ESI Act was to save the employer from facing more than one claim in relation to the same accident. This, in our opinion, is the correct reading of the said provision. This being so the claim of the respondent for damages being barred under Section 53 of the ESI Act, the trial Court was right in dismissing the application under Order 33 Rule 1 of the Code of Civil Procedure.12. The position in law being clear and concluded by the decision of this Court in Trehans case (supra) we see no justification for the Court not exercising its jurisdiction under Article 136, as was contended by the respondents counsel. The incorrect decision on a point of law of the High Court has to be corrected.In our opinion, though there is considerable force in the said submission but it is not necessary for the decision of the present case to decide this issue finally because in the instant case the claim which was sought to be made was not against the third party but against the employer itself. Perhaps this question may require consideration in an appropriate case. | 1 | 2,726 | 482 | ### Instruction:
Predict whether the case will result in an affirmative (1) or negative (0) decision for the appeal, and then provide a thorough explanation using key sentences to support your prediction.
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ESI being a welfare legislation, the Parliament could not have intended to create a bar against the workmen claiming more advantageous benefit under the Workmens Compensation Act. The Single judge of the High Court dismissed the writ petition filed by the employer but the Division Bench, in appeal, held that in view of the bar created by Section 53, the application for compensation filed by Trehan was not maintainable. This Court analysed the provisions of Section 53 of the ESI Act and observed at page 260 as follows : "In this background and context we have to consider the effect of the bar created by Section 53 of the ESI Act. Bar is against receiving or recovering any compensation or damages under the Workmens Compensation Act or any other law for the time being in force or otherwise in respect of an employment injury. The bar is absolute as can be seen from the use of the words shall not be entitled to receive or recover, ``whether from the employer of the insured persons or from any other person, ``any compensation or damages and ``under the Workmens Compensation Act, 1923 (8 of 1923), or otherwise. The words ``employed by the legislature are clear and unequivocal. When such a bar is created in clear and express terms it would neither be permissible nor proper to infer a different intention by referring to the previous history of the legislation. That would amount to bypassing the bar and defeating the object of the provision. In view of the clear language of the section we find no justification in interpreting or construing it as not taking away the right of the workman who is an insured person and an employee under the ESI Act to claim compensation under the Workmens Compensation Act. We are of the opinion that the High Court was right in holding that in view of the bar created by Section 53 the application under the Workmens Compensation Act was not maintainable. The judgment under appeal in the present case of the Full Bench of the Kerala High Court was considered and it was observed that ``we cannot agree with some of the assumptions and observations made by the Kerala High Court. Moreover, the Kerala High Court has taken that view without referring to and considering the effect of the clear and express words used in that Section. 10. In view of the aforesaid observations in Trehans case, with which we respectfully agree, it is clear that the respondent could not make a claim for damages. Sections 53 disentitles an employee who has suffered an employment injury from receiving or recovering compensation or damages under the Workmens Compensation Act or any other law for the time being in force or otherwise. The use of the expression ``or otherwise would clearly indicate that this Section is not limited to ousting the relief claimed only under any statute but the wordings of the section are such that an insured person would not be entitled to make a claim in Torts which has the force of law under the ESI Act. Even though the ESI Act is a beneficial legislation the legislature had thought if fit to prohibit an insured person from receiving or recovering compensation or damages under any other law, including Torts, in cases where the injury had been sustained by him is an employment injury.11. The ESI Act has been enacted to provide certain benefits to the employees in case of sickness, maternity and employment injury and make provisions in respect thereof. Under this Act contribution is made not only by the employee but also by the employer. The claims by the employees against the employer where the relationship of the employer and employee exists were meant to be governed by the ESI Act alone. It is precisely for this reason that the Madras High Court in Mangalammas case (supra) had observed that the object of Section 53 of the ESI Act was to save the employer from facing more than one claim in relation to the same accident. This, in our opinion, is the correct reading of the said provision. This being so the claim of the respondent for damages being barred under Section 53 of the ESI Act, the trial Court was right in dismissing the application under Order 33 Rule 1 of the Code of Civil Procedure.12. The position in law being clear and concluded by the decision of this Court in Trehans case (supra) we see no justification for the Court not exercising its jurisdiction under Article 136, as was contended by the respondents counsel. The incorrect decision on a point of law of the High Court has to be corrected. 13. During the course of hearing it had been argued that Section 53 should not be construed in such a way that an insured person cannot raise a claim against a third party in the event of his suffering an employment injury. It was submitted that though qua the employer only one remedy may be available, namely, under the ESI Act but as far as third persons are concerned Section 53 cannot be taken up as a defence to an action in tort in a claim being made for damages because the ESI Act creates certain rights as a result of the employment qua the employer and has no application as far as third parties are concerned. In this connection it was submitted that the use of the words `employment injury in Section 53 relates to a claim which is relatable to the employment of the insured person with his employer. 14. In our opinion, though there is considerable force in the said submission but it is not necessary for the decision of the present case to decide this issue finally because in the instant case the claim which was sought to be made was not against the third party but against the employer itself. Perhaps this question may require consideration in an appropriate case. 15.
### Response:
1
### Explanation:
10. In view of the aforesaid observations in Trehans case, with which we respectfully agree, it is clear that the respondent could not make a claim for damages. Sections 53 disentitles an employee who has suffered an employment injury from receiving or recovering compensation or damages under the Workmens Compensation Act or any other law for the time being in force or otherwise. The use of the expression ``or otherwise would clearly indicate that this Section is not limited to ousting the relief claimed only under any statute but the wordings of the section are such that an insured person would not be entitled to make a claim in Torts which has the force of law under the ESI Act. Even though the ESI Act is a beneficial legislation the legislature had thought if fit to prohibit an insured person from receiving or recovering compensation or damages under any other law, including Torts, in cases where the injury had been sustained by him is an employment injury.11. The ESI Act has been enacted to provide certain benefits to the employees in case of sickness, maternity and employment injury and make provisions in respect thereof. Under this Act contribution is made not only by the employee but also by the employer. The claims by the employees against the employer where the relationship of the employer and employee exists were meant to be governed by the ESI Act alone. It is precisely for this reason that the Madras High Court in Mangalammas case (supra) had observed that the object of Section 53 of the ESI Act was to save the employer from facing more than one claim in relation to the same accident. This, in our opinion, is the correct reading of the said provision. This being so the claim of the respondent for damages being barred under Section 53 of the ESI Act, the trial Court was right in dismissing the application under Order 33 Rule 1 of the Code of Civil Procedure.12. The position in law being clear and concluded by the decision of this Court in Trehans case (supra) we see no justification for the Court not exercising its jurisdiction under Article 136, as was contended by the respondents counsel. The incorrect decision on a point of law of the High Court has to be corrected.In our opinion, though there is considerable force in the said submission but it is not necessary for the decision of the present case to decide this issue finally because in the instant case the claim which was sought to be made was not against the third party but against the employer itself. Perhaps this question may require consideration in an appropriate case.
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M. K. Paplah & Sons Vs. The Excise Commissioner & Anr | delegated legislation is implied in the speech of Lord Thankerton in the House of Lords in Minister of Health v. The King, 1931 AC 494 (524) where he said:"In this case, as in similar cases that have come before the courts, Parliament has delegated its legislative function to a Minister of the Crown, but in this case Parliament has retained no specific control over the exercise of the function by the Minister, such as a condition that the order should be laid before Parliament and might be annulled by a resolution of either House within a limited period."19. In Institute of Patent Ageats v. Joseph Lockwood, (1894) AC 347, Lord Watson said:"The Legislature retained so far a check that it required that the regulations which they framed should be laid upon the table of both Houses: and of course these regulations should have been annulled by an unfavourable resolution upon a motion made in either House."20. In Bernard Schwartzs "An Introduction to American Administrative Law" it is stated:"In Britain, Parliamentary control over delegated legislation is exercised through the various forms of laying prescribed in enabling Acts. Through them, the legislature is enabled at least in theory to exercise a continuing supervision over administrative rules and regulations."21. As Dean Landis pointed out, the English techniques for laying the rules before the Houses have several virtues. "For one thing, they bring the legislative into close and constant contact with the administrative". See Landis, "The Administrative Process", 77 (l938)22.The legislature may also retain its control over its delegate by exercising its power of repeal. This was the basis on which the Privy Council in Cobb and Co. v. Kropp, (1967) 1 AC 141 (PC) upheld the validity of delegation of the power to fix rates to the Commissioner of Transport in that case. The question there was whether the Queensland Legislature had legislative authority under the impugned Acts to invest the Commissioner for Transport with power to impose and levy licence and Permit fees. It was not disputed before their Lordships that fees imposed are to be regarded as constituting taxation. Accordingly, it was contended that the Legislature had abdicated its exclusive power of levying taxation. The Privy Council held that Queensland Legislature was entitled to use any agent or machinery that it considered appropriate for carrying out the object and the purposes of the Acts and to use the Commissioner for Transport as its instrument to fix and recover the licence and permit fees, provided it preserved its own capacity intact and retained perfect control over him that as it could at any time repeal the legislation and withdraw such authority and discretion as it had vested in him, it had not assigned. transferred or abrogated its sovereign power to levy taxes, nor had it renounced or abdicated its responsibilities in favour of a newly created legislative authority and that, accordingly, the two Acts were valid. Lord Morris of Borthy-Gest said:"What they (the legislature) created by the passing of the Transport Acts could not reasonably be described as a new legislative power or separate legislative body armed with general legislative authority (see R. v. Burah, (1878) 3 A. C. 889 (PC) ). Nor did the Queensland Legislature create and endow with its own capacity a new legislative power not created by the Act to which it owes its own existence (see In re the Initiative and Referendum Act (1919) A.C. 935 at P. 945)."23. The point to be emphasized - and this is rather crucial - is the statement of their Lordships that the legislature preserved its capacity intact and retained perfect control over the Commissioner for Transport inasmuch as it could at any time repeal the legislation and withdraw the authority and discretion it had vested in himand, therefore, the legislature did not abdicate its functions.24. We. Therefore, think that the power to fix the rate of excise duty conferred on the Government by Section 22 of the Act is valid. The dilution of parliamentary watch-dogging of delegated legislation may be deplored but, in the compulsions and complexities of modern life, cannot be helped.25. The last contention raised by the appellant was that Section 19 of the Karnataka Sales Tax Act. 1957 is invalid as it purports to levy sales tax upon the sale of arrack made by the Government to licensees. The appellant submitted that the definition of dealer in Section 2 of that Act excludes the Government of Mysore and that by virtue of the provisions in Section 5 (3) of that Act, no tax could be levied on the sale of arrack by Government to the appellant. We see no merit in this contention. Section 19 of the Act reads :"19. State Government entitled to collect tax as registered dealers -Notwithstanding anything contained in this Act the (government of Mysore shall, in respect of any sale of goods effected by them, be entitled to collect by way of tax any amount which a registered dealer effecting such sale would have been entitled to collect by way of tax under this Act."26. This section makes it clear that notwithstanding anything contained in that Act. the Government shall in respect of any sale of goods effected by it be entitled to collect by way of tax any amount which a registered dealer effecting such sale would have been entitled to collect by way of tax under the Act. The section is clear that the Government could collect the tax on the sale made by it as if it were a registered dealer, notwithstanding anything contained in Section 2 or Section 5. The section itself creates a right in the State to recover and an obligation on the purchaser from the State to Pay the amount. Any imposition of liability or obligation in respect of sale or purchase of goods will be covered by Entry 54 of List II of the Seventh Schedule of the Constitution.27. We do not think that Section 19 is ultra vires the powers of the legislature. | 0[ds]7. It is clear from the return filed before the High Court that the Government purchases arrack from the distillers and keeps it in the warehouse established or licensed under Section 16 and that any removal of arrack after the purchase of the same will attract the liability to pay excise duty.We see no force in this contention. Section 23 provides that excise duty shall be levied on the excisable article issued from a warehouse also. We see no reason to think that a warehouse established or licensed under Section 16 (e) is not warehouse within the meaning of that expression in Section 23.We are not certain whether the preamble of the Act gives any guidance for fixing the rate of excise duty. But that does not mean that the legislature here has no control over the delegate. The legislative control over delegated legislation may take many forms.In this case, we think that Section 71 of the Act which provides for the rule-making power imposes the necessary check upon the wide power given to the government to fix the rate.The point to be emphasized - and this is rather crucial - is the statement of their Lordships that the legislature preserved its capacity intact and retained perfect control over the Commissioner for Transport inasmuch as it could at any time repeal the legislation and withdraw the authority and discretion it had vested in himand, therefore, the legislature did not abdicate its functions.24. We. Therefore, think that the power to fix the rate of excise duty conferred on the Government by Section 22 of the Act is valid. The dilution of parliamentary watch-dogging of delegated legislation may be deplored but, in the compulsions and complexities of modern life, cannot besee no merit in this contention.This section makes it clear that notwithstanding anything contained in that Act. the Government shall in respect of any sale of goods effected by it be entitled to collect by way of tax any amount which a registered dealer effecting such sale would have been entitled to collect by way of tax under the Act. The section is clear that the Government could collect the tax on the sale made by it as if it were a registered dealer, notwithstanding anything contained in Section 2 or Section 5. The section itself creates a right in the State to recover and an obligation on the purchaser from the State to Pay the amount. Any imposition of liability or obligation in respect of sale or purchase of goods will be covered by Entry 54 of List II of the Seventh Schedule of the Constitution.27. We do not think that Section 19 is ultra vires the powers of the legislature. | 0 | 3,768 | 478 | ### Instruction:
Assess the case to predict the court's ruling (favorably (1) or unfavorably (0)), and then expound on this prediction by highlighting and analyzing key textual elements from the proceeding.
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delegated legislation is implied in the speech of Lord Thankerton in the House of Lords in Minister of Health v. The King, 1931 AC 494 (524) where he said:"In this case, as in similar cases that have come before the courts, Parliament has delegated its legislative function to a Minister of the Crown, but in this case Parliament has retained no specific control over the exercise of the function by the Minister, such as a condition that the order should be laid before Parliament and might be annulled by a resolution of either House within a limited period."19. In Institute of Patent Ageats v. Joseph Lockwood, (1894) AC 347, Lord Watson said:"The Legislature retained so far a check that it required that the regulations which they framed should be laid upon the table of both Houses: and of course these regulations should have been annulled by an unfavourable resolution upon a motion made in either House."20. In Bernard Schwartzs "An Introduction to American Administrative Law" it is stated:"In Britain, Parliamentary control over delegated legislation is exercised through the various forms of laying prescribed in enabling Acts. Through them, the legislature is enabled at least in theory to exercise a continuing supervision over administrative rules and regulations."21. As Dean Landis pointed out, the English techniques for laying the rules before the Houses have several virtues. "For one thing, they bring the legislative into close and constant contact with the administrative". See Landis, "The Administrative Process", 77 (l938)22.The legislature may also retain its control over its delegate by exercising its power of repeal. This was the basis on which the Privy Council in Cobb and Co. v. Kropp, (1967) 1 AC 141 (PC) upheld the validity of delegation of the power to fix rates to the Commissioner of Transport in that case. The question there was whether the Queensland Legislature had legislative authority under the impugned Acts to invest the Commissioner for Transport with power to impose and levy licence and Permit fees. It was not disputed before their Lordships that fees imposed are to be regarded as constituting taxation. Accordingly, it was contended that the Legislature had abdicated its exclusive power of levying taxation. The Privy Council held that Queensland Legislature was entitled to use any agent or machinery that it considered appropriate for carrying out the object and the purposes of the Acts and to use the Commissioner for Transport as its instrument to fix and recover the licence and permit fees, provided it preserved its own capacity intact and retained perfect control over him that as it could at any time repeal the legislation and withdraw such authority and discretion as it had vested in him, it had not assigned. transferred or abrogated its sovereign power to levy taxes, nor had it renounced or abdicated its responsibilities in favour of a newly created legislative authority and that, accordingly, the two Acts were valid. Lord Morris of Borthy-Gest said:"What they (the legislature) created by the passing of the Transport Acts could not reasonably be described as a new legislative power or separate legislative body armed with general legislative authority (see R. v. Burah, (1878) 3 A. C. 889 (PC) ). Nor did the Queensland Legislature create and endow with its own capacity a new legislative power not created by the Act to which it owes its own existence (see In re the Initiative and Referendum Act (1919) A.C. 935 at P. 945)."23. The point to be emphasized - and this is rather crucial - is the statement of their Lordships that the legislature preserved its capacity intact and retained perfect control over the Commissioner for Transport inasmuch as it could at any time repeal the legislation and withdraw the authority and discretion it had vested in himand, therefore, the legislature did not abdicate its functions.24. We. Therefore, think that the power to fix the rate of excise duty conferred on the Government by Section 22 of the Act is valid. The dilution of parliamentary watch-dogging of delegated legislation may be deplored but, in the compulsions and complexities of modern life, cannot be helped.25. The last contention raised by the appellant was that Section 19 of the Karnataka Sales Tax Act. 1957 is invalid as it purports to levy sales tax upon the sale of arrack made by the Government to licensees. The appellant submitted that the definition of dealer in Section 2 of that Act excludes the Government of Mysore and that by virtue of the provisions in Section 5 (3) of that Act, no tax could be levied on the sale of arrack by Government to the appellant. We see no merit in this contention. Section 19 of the Act reads :"19. State Government entitled to collect tax as registered dealers -Notwithstanding anything contained in this Act the (government of Mysore shall, in respect of any sale of goods effected by them, be entitled to collect by way of tax any amount which a registered dealer effecting such sale would have been entitled to collect by way of tax under this Act."26. This section makes it clear that notwithstanding anything contained in that Act. the Government shall in respect of any sale of goods effected by it be entitled to collect by way of tax any amount which a registered dealer effecting such sale would have been entitled to collect by way of tax under the Act. The section is clear that the Government could collect the tax on the sale made by it as if it were a registered dealer, notwithstanding anything contained in Section 2 or Section 5. The section itself creates a right in the State to recover and an obligation on the purchaser from the State to Pay the amount. Any imposition of liability or obligation in respect of sale or purchase of goods will be covered by Entry 54 of List II of the Seventh Schedule of the Constitution.27. We do not think that Section 19 is ultra vires the powers of the legislature.
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### Explanation:
7. It is clear from the return filed before the High Court that the Government purchases arrack from the distillers and keeps it in the warehouse established or licensed under Section 16 and that any removal of arrack after the purchase of the same will attract the liability to pay excise duty.We see no force in this contention. Section 23 provides that excise duty shall be levied on the excisable article issued from a warehouse also. We see no reason to think that a warehouse established or licensed under Section 16 (e) is not warehouse within the meaning of that expression in Section 23.We are not certain whether the preamble of the Act gives any guidance for fixing the rate of excise duty. But that does not mean that the legislature here has no control over the delegate. The legislative control over delegated legislation may take many forms.In this case, we think that Section 71 of the Act which provides for the rule-making power imposes the necessary check upon the wide power given to the government to fix the rate.The point to be emphasized - and this is rather crucial - is the statement of their Lordships that the legislature preserved its capacity intact and retained perfect control over the Commissioner for Transport inasmuch as it could at any time repeal the legislation and withdraw the authority and discretion it had vested in himand, therefore, the legislature did not abdicate its functions.24. We. Therefore, think that the power to fix the rate of excise duty conferred on the Government by Section 22 of the Act is valid. The dilution of parliamentary watch-dogging of delegated legislation may be deplored but, in the compulsions and complexities of modern life, cannot besee no merit in this contention.This section makes it clear that notwithstanding anything contained in that Act. the Government shall in respect of any sale of goods effected by it be entitled to collect by way of tax any amount which a registered dealer effecting such sale would have been entitled to collect by way of tax under the Act. The section is clear that the Government could collect the tax on the sale made by it as if it were a registered dealer, notwithstanding anything contained in Section 2 or Section 5. The section itself creates a right in the State to recover and an obligation on the purchaser from the State to Pay the amount. Any imposition of liability or obligation in respect of sale or purchase of goods will be covered by Entry 54 of List II of the Seventh Schedule of the Constitution.27. We do not think that Section 19 is ultra vires the powers of the legislature.
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ENGINEERING ANALYSIS CENTRE OF EXCELLENCE PRIVATE LIMITED Vs. THE COMMISSIONER OF INCOME TAX & ANR | 108. After taking cognizance of these observations, the Committee considers that the option of withholding tax offers a practical way of allocating partial taxing rights in respect of income from digital economy, which shares attributes that may be similar to royalty or fee for technical services, and which can be complied in respect of B2B transactions by the process of withholding. However, such a tax on income would be feasible only if it is included in the tax treaties, which take precedence over Indian domestic laws, unless it is designed as a tax on the gross payment. (emphasis supplied) 162. These reports also do not carry the matter much further as they are recommendatory reports expressing the views of the committee members, which the Government of India may accept or reject. When it comes to DTAA provisions, even if the position put forth in the aforementioned reports were to be accepted, a DTAA would have to be bilaterally amended before any such recommendation can become law in force for the purposes of the Income Tax Act. 163. The learned Additional Solicitor General also sought to rely on a decision of the Audiencia Nacional (Spanish National Court) in Case No. 207019/1990 dated 28.02.1995 and a decision of the Tribunal Supremo (Spanish Supreme Court) in Case No. 8066/1994 dated 02.10.1999. Quite apart from the fact that he only presented certain extracts and not the entire judgment rendered in these cases, these authorities have no relevance to the appeals before us, having been decided on the basis of the taxation law of Spain. 164. The learned Additional Solicitor General then referred to the judgment of this Court in Commissioner of Customs v. G.M. Exports, (2016) 1 SCC 91, and in particular on the four propositions that were culled out in the context of the levy of an anti-dumping duty in consonance with the General Agreement on Tariffs and Trade (GATT), 1994, as follows: 23. A conspectus of the aforesaid authorities would lead to the following conclusions: (1) Article 51(c) of the Constitution of India is a directive principle of State policy which states that the State shall endeavour to foster respect for international law and treaty obligations. As a result, rules of international law which are not contrary to domestic law are followed by the courts in this country. This is a situation in which there is an international treaty to which India is not a signatory or general rules of international law are made applicable. It is in this situation that if there happens to be a conflict between domestic law and international law, domestic law will prevail. (2) In a situation where India is a signatory nation to an international treaty, and a statute is passed pursuant to the said treaty, it is a legitimate aid to the construction of the provisions of such statute that are vague or ambiguous to have recourse to the terms of the treaty to resolve such ambiguity in favour of a meaning that is consistent with the provisions of the treaty. (3) In a situation where India is a signatory nation to an international treaty, and a statute is made in furtherance of such treaty, a purposive rather than a narrow literal construction of such statute is preferred. The interpretation of such a statute should be construed on broad principles of general acceptance rather than earlier domestic precedents, being intended to carry out treaty obligations, and not to be inconsistent with them. (4) In a situation in which India is a signatory nation to an international treaty, and a statute is made to enforce a treaty obligation, and if there be any difference between the language of such statute and a corresponding provision of the treaty, the statutory language should be construed in the same sense as that of the treaty. This is for the reason that in such cases what is sought to be achieved by the international treaty is a uniform international code of law which is to be applied by the courts of all the signatory nations in a manner that leads to the same result in all the signatory nations. 165. The conclusions in the aforestated paragraph have no direct relevance to the facts at hand as the effect of section 90(2) of the Income Tax Act, read with explanation 4 thereof, is to treat the DTAA provisions as the law that must be followed by Indian courts, notwithstanding what may be contained in the Income Tax Act to the contrary, unless more beneficial to the assessee. For all these reasons therefore, these submissions of the learned Additional Solicitor General are rejected. 166. At this juncture, it is also important to point out that vide Circular No. 10/2002 dated 09.10.2002, the Revenue, after referring to section 195 of the Income Tax Act and deciding that a No Objection Certificate from the Department would not be necessary if the person making the remittance is to submit an undertaking along with the certificate of an accountant to the Reserve Bank of India [RBI], has itself made a distinction in the proforma of the certificate to be issued in Annexure B to the aforesaid Circular, between remittances for royalties (see Row No. 5) and remittances for supply of articles or computer software (see Row No. 7), as follows: ANNEXURE B CERTIFICATE Table (emphasis supplied) 167. The Revenue, therefore, when referring to royalties under the DTAA, makes a distinction between such royalties, no doubt in the context of technical services, and remittances for supply of computer software, which is then treated as business profits, taxable under the relevant DTAA depending upon whether there is a PE through which the assessee operates in India. This is one more circumstance to show that the Revenue has itself appreciated the difference between the payment of royalty and the supply/use of computer software in the form of goods, which is then treated as business income of the assessee taxable in India if it has a PE in India. CONCLUSION | 1[ds]25. The scheme of the Income Tax Act, insofar as the question raised before us is concerned, is that for income to be taxed under the Income Tax Act, residence in India, as defined by section 6, is necessary in most cases. By section 4(1), income tax shall be charged for any assessment year at any rate or rates, as defined by section 2(37A) of the Income Tax Act, in respect of the total income of the previous year of every person. Under section 4(2), in respect of income chargeable under sub-section (1) thereof, income tax shall be deducted at source or paid in advance, depending upon the provisions of the Income Tax Act. Importantly, under section 5(2) of the Income Tax Act, the total income of a person who is a non-resident, includes all income from whatever source derived, which accrues or arises or is deemed to accrue or arise to such person in India during such year. This, however, is subject to the provisions of the Income Tax Act. Certain income is deemed to arise or accrue in India, under section 9 of the Income Tax Act, notwithstanding the fact that such income may accrue or arise to a non-resident outside India. One such income is income by way of royalty, which, under section 9(1)(vi) of the Income Tax Act, means the transfer of all or any rights, including the granting of a licence, in respect of any copyright in a literary work.26. That such transaction may be governed by a DTAA is then recognized by section 5(2) read with section 90 of the Income Tax Act, making it clear that the Central Government may enter into any such agreement with the government of another country so as to grant relief in respect of income tax chargeable under the Income Tax Act or under any corresponding law in force in that foreign country, or for the avoidance of double taxation of income under the Income Tax Act and under the corresponding law in force in that country. What is of importance is that once a DTAA applies, the provisions of the Income Tax Act can only apply to the extent that they are more beneficial to the assessee and not otherwise. Further, by explanation 4 to section 90 of the Income Tax Act, it has been clarified by the Parliament that where any term is defined in a DTAA, the definition contained in the DTAA is to be looked at. It is only where there is no such definition that the definition in the Income Tax Act can then be applied. This position has been recognised by this Court in Azadi Bachao Andolan (supra), which held:21. The provisions of Sections 4 and 5 of the Act are expressly made subject to the provisions of this Act, which would include Section 90 of the Act. As to what would happen in the event of a conflict between the provision of the Income Tax Act and a notification issued under Section 90, is no longer res integra.28. A survey of the aforesaid cases makes it clear that the judicial consensus in India has been that Section 90 is specifically intended to enable and empower the Central Government to issue a notification for implementation of the terms of a Double Taxation Avoidance Agreement. When that happens, the provisions of such an agreement, with respect to cases to which they apply, would operate even if inconsistent with the provisions of the Income Tax Act. We approve of the reasoning in the decisions which we have noticed. If it was not the intention of the legislature to make a departure from the general principle of chargeability to tax under Section 4 and the general principle of ascertainment of total income under Section 5 of the Act, then there was no purpose in making those sections subject to the provisions of the Act. The very object of grafting the said two sections with the said clause is to enable the Central Government to issue a notification under Section 90 towards implementation of the terms of DTACs which would automatically override the provisions of the Income Tax Act in the matter of ascertainment of chargeability to income tax and ascertainment of total income, to the extent of inconsistency with the terms of DTAC.27. The machinery provision contained in section 195 of the Income Tax Act is inextricably linked with the charging provision contained in section 9 read with section 4 of the Income Tax Act, as a result of which, a person resident in India, responsible for paying a sum of money, chargeable under the provisions of [the] Act, to a non-resident, shall at the time of credit of such amount to the account of the payee in any mode, deduct tax at source at the rate in force which, under section 2(37A)(iii) of the Income Tax Act, is the rate in force prescribed by the DTAA. Importantly, such deduction is only to be made if the non- resident is liable to pay tax under the charging provision contained in section 9 read with section 4 of the Income Tax Act, read with the DTAA. Thus, it is only when the non-resident is liable to pay income tax in India on income deemed to arise in India and no deduction of TDS is made under section 195(1) of the Income Tax Act, or such person has, after applying section 195(2) of the Income Tax Act, not deducted such proportion of tax as is required, that the consequences of a failure to deduct and pay, reflected in section 201 of the Income Tax Act, follow, by virtue of which the resident-payee is deemed an assessee in default, and thus, is made liable to pay tax, interest and penalty thereon. This position is also made amply clear by the referral order in the concerned appeals from the High Court of Karnataka, namely, the judgment of this Court in GE Technology (supra).31. It will be seen that section 194E of the Income Tax Act belongs to a set of various provisions which deal with TDS, without any reference to chargeability of tax under the Income Tax Act by the concerned non- resident assessee. This section is similar to sections 193 and 194 of the Income Tax Act by which deductions have to be made without any reference to the chargeability of a sum received by a non-resident assessee under the Income Tax Act. On the other hand, as has been noted in GE Technology (supra), at the heart of section 195 of the Income Tax Act is the fact that deductions can only be made if the non- resident assessee is liable to pay tax under the provisions of the Income Tax Act in the first place.32. Thus, the judgment of this Court in PILCOM (supra), dealing with a completely different provision in a completely different setting, has no application to the facts of this case.34. A reading of the aforesaid provisions leads to the following conclusions. Under section 2(o) of the Copyright Act, a literary work includes a computer programme and a computer programme has been defined under section 2(ffc) of the Copyright Act to mean a set of instructions expressed in words, codes, schemes or in any other form capable of causing a computer to perform a particular task or achieve a particular result.35. Though the expression copyright has not been defined separately in the definitions section of the Copyright Act, yet, section 14 makes it clear that copyright means the exclusive right, subject to the provisions of the Act, to do or authorise the doing of certain acts in respect of a work. When an author in relation to a literary work which includes a computer programme, creates such work, such author has the exclusive right, subject to the provisions of the Copyright Act, to do or authorise the doing of several acts in respect of such work or any substantial part thereof. In the case of a computer programme, section 14(b) specifically speaks of two sets of acts – the seven acts enumerated in sub-clause (a) and the eighth act of selling or giving on commercial rental or offering for sale or for commercial rental any copy of the computer programme. Insofar as the seven acts that are set out in sub-clause (a) are concerned, they all delineate how the exclusive right that is with the owner of the copyright may be parted with, i.e., if there is any parting with the right to reproduce the work in any material form; the right to issue copies of the work to the public, not being copies already in circulation; the right to perform the work in public or communicate it to the public; the right to make any cinematograph film or sound recording in respect of the work; the right to make any translation of the work; the right to make any adaptation of the work; or the right to do any of the specified acts in relation to a translation or an adaptation.36. In essence, such right is referred to as copyright, and includes the right to reproduce the work in any material form, issue copies of the work to the public, perform the work in public, or make translations or adaptations of the work. This is made even clearer by the definition of an infringing copy contained in section 2(m) of the Copyright Act, which in relation to a computer programme, i.e., a literary work, means reproduction of the said work. Thus, the right to reproduce a computer programme and exploit the reproduction by way of sale, transfer, license etc. is at the heart of the said exclusive right.What is conspicuous by its absence is the phrase regardless of whether such copy has been sold or given on hire on earlier occasions.38. Importantly, no copyright exists in India outside the provisions of the Copyright Act or any other special law for the time being in force, vide section 16 of the Copyright Act. When the owner of copyright in a literary work assigns wholly or in part, all or any of the rights contained in section 14(a) and (b) of the Copyright Act, in the said work for a consideration, the assignee of such right becomes entitled to all such rights comprised in the copyright that is assigned, and shall be treated as the owner of the copyright of what is assigned to him (see section 18(2) read with section 19(3) of the Copyright Act). Also, under section 30 of the Copyright Act, the owner of the copyright in any literary work may grant any interest in any right mentioned in section 14(a) of the Copyright Act by licence in writing by him to the licensee, under which, for parting with such interest, royalty may become payable (see section 30A of the Copyright Act). When such licence is granted, copyright is infringed when any use, relatable to the said interest/right that is licensed, is contrary to the conditions of the licence so granted. Infringement of copyright takes place when a person makes for sale or hire or sells or lets for hire or offers for sale or hire or distributes…so as to affect prejudicially the owner of the copyright, vide section 51(b) of the Copyright Act. Importantly, the making of copies or adaptation of a computer programme in order to utilise the said computer programme for the purpose for which it was supplied, or to make up back-up copies as a temporary protection against loss, destruction or damage so as to be able to utilise the computer programme for the purpose for which it was supplied, does not constitute an act of infringement of copyright under section 52(1)(aa) of the Copyright Act. In short, what is referred to in section 52(1)(aa) of the Copyright Act would not amount to reproduction so as to amount to an infringement of copyright.39. Section 52(1)(ad) is independent of section 52(1)(aa) of the Copyright Act, and states that the making of copies of a computer programme from a personally legally obtained copy for non-commercial personal use would not amount to an infringement of copyright. However, it is not possible to deduce from this what is sought to be deduced by the learned Additional Solicitor General, namely, that if personally legally obtained copies of a computer programme are to be exploited for commercial use, it would necessarily amount to an infringement of copyright. Section 52(1)(ad) of the Copyright Act cannot be read to negate the effect of section 52(1)(aa), since it deals with a subject matter that is separate and distinct from that contained in section 52(1)(aa) of the Copyright Act.42. The subject matter of each of the DTAAs with which we are concerned is income tax payable in India and a foreign country. Importantly, as is now reflected by explanation 4 to section 90 of the Income Tax Act and under Article 3(2) of the DTAA, the definition of the term royalties shall have the meaning assigned to it by the DTAA, meaning thereby that the expression royalty, when occurring in section 9 of the Income Tax Act, has to be construed with reference to Article 12 of the DTAA.43. Thus, by virtue of Article 12(3) of the DTAA, royalties are payments of any kind received as consideration for the use of, or the right to use, any copyright of a literary work, which includes a computer programme or software.45. A reading of the aforesaid distribution agreement would show that what is granted to the distributor is only a non-exclusive, non-transferable licence to resell computer software, it being expressly stipulated that no copyright in the computer programme is transferred either to the distributor or to the ultimate end-user. This is further amplified by stating that apart from a right to use the computer programme by the end-user himself, there is no further right to sub-license or transfer, nor is there any right to reverse-engineer, modify, reproduce in any manner otherwise than permitted by the licence to the end-user. What is paid by way of consideration, therefore, by the distributor in India to the foreign, non-resident manufacturer or supplier, is the price of the computer programme as goods, either in a medium which stores the software or in a medium by which software is embedded in hardware, which may be then further resold by the distributor to the end-user in India, the distributor making a profit on such resale. Importantly, the distributor does not get the right to use the product at all.46. When it comes to an end-user who is directly sold the computer programme, such end-user can only use it by installing it in the computer hardware owned by the end-user and cannot in any manner reproduce the same for sale or transfer, contrary to the terms imposed by the EULA.47. In all these cases, the licence that is granted vide the EULA, is not a licence in terms of section 30 of the Copyright Act, which transfers an interest in all or any of the rights contained in sections 14(a) and 14(b) of the Copyright Act, but is a licence which imposes restrictions or conditions for the use of computer software. Thus, it cannot be said that any of the EULAs that we are concerned with are referable to section 30 of the Copyright Act, inasmuch as section 30 of the Copyright Act speaks of granting an interest in any of the rights mentioned in sections 14(a) and 14(b) of the Copyright Act. The EULAs in all the appeals before us do not grant any such right or interest, least of all, a right or interest to reproduce the computer software. In point of fact, such reproduction is expressly interdicted, and it is also expressly stated that no vestige of copyright is at all transferred, either to the distributor or to the end-user. A simple illustration to explain the aforesaid position will suffice. If an English publisher sells 2000 copies of a particular book to an Indian distributor, who then resells the same at a profit, no copyright in the aforesaid book is transferred to the Indian distributor, either by way of licence or otherwise, inasmuch as the Indian distributor only makes a profit on the sale of each book. Importantly, there is no right in the Indian distributor to reproduce the aforesaid book and then sell copies of the same. On the other hand, if an English publisher were to sell the same book to an Indian publisher, this time with the right to reproduce and make copies of the aforesaid book with the permission of the author, it can be said that copyright in the book has been transferred by way of licence or otherwise, and what the Indian publisher will pay for, is the right to reproduce the book, which can then be characterised as royalty for the exclusive right to reproduce the book in the territory mentioned by the licence.48. An instructive judgment of this Court in this respect is to be found in State Bank of India v. Collector of Customs, (2000) 1 SCC 727 . In this case, the State Bank of India imported a consignment of computer software and manuals from Kindle Software Ltd., Dublin, Ireland, and cleared the goods for home consumption, and filed an application before the Additional Collector of Customs, claiming a refund of customs duty. After setting out section 14 of the Customs Act 1962 and rule 9(1)(c) of the Customs Valuation (Determination of Price of Imported Goods) Rules, 1988, the Court stated:9. Now, if we refer to the interpretative note relating to Rule 9(1)(c) it says that royalties and licence fees may include, among other things, payments in respect to patents, trademarks and copyrights. There is, however, an exception which says that the charges for the right to reproduce the imported goods in the country of importation shall not be added to the price actually paid or payable for the imported goods in determining the customs value. Further payments made by the buyer for the right to distribute or resell the imported goods shall not be added to the price actually paid or payable for the imported goods if such payments are not a condition of the sale for the exports to the country of importation of the imported goods.11. What we have now to see is if under the agreement SBI has the right to reproduce the imported software and for that purpose SBI has paid royalties and licence fee which have been added to the price actually paid for the imported software for use at the principal place called the Support Centre. If that is so under the press note no customs duty is leviable on the royalty so paid. This takes us to the relevant terms of the agreement which would indicate as to whether or not the royalty/licence fees needed to be included in the value of the imported goods.49. The contention of the State Bank of India that the countrywide licence fee paid by it by way of royalty was for the reproduction of the said software and was thus exempt from customs duty, was turned down by this Court as follows:17. The question that arises for consideration is if licence fee charged towards countrywide use of software in the second invoice could be the charges for the right to reproduction and were these added to the price actually paid or payable for the imported goods. If we refer to the agreement, software is not sold to SBI as such but it was to remain the property of Kindle. There is no other value of the software indicated in the agreement except the licence fee. Price is payable only for allowing SBI to use the software in a limited way at its own centres for a limited period and that is why the amount charged is called the licence fee. After five years SBI is required to pay only recurring licence fee. Countrywide use of the software and reproduction of software are two different things and licence fee for countrywide use cannot be considered as the charges for the right to reproduce the imported goods. Under the agreement copying, storage, removal, etc. are under the strict control of Kindle and all copies are the property of Kindle. SBI can use the software for its internal requirements only. Licence has been given to SBI to use the property of Kindle at its branches and not for reproduction of the software as claimed by SBI. The words in the agreement are specific that SBI shall pay the licensor the initial licence fee and the recurring licence fees for use under the provisions of this agreement.50. The Court then made an important observation, stating:21. Reproduction and use are two different things. Now under the agreement user is specifically limited to licence sites. The transaction as a whole is to be seen. The press note is of no help to SBI. Rule 9(1)(c) and the interpretative note thereto did not apply as nothing was added to the price actually paid for the imported goods by way of royalties etc. Refund would be allowable only if there was something added on to the royalty payment which was not in the present case. The invoice originally presented was complete in itself. The second invoice was not filed along with the bill of entry. In the second invoice also it is the licence fee for the right to use countrywide and it is not the right to reproduce as claimed by SBI. Schedule I to the agreement is module and copies are modalities for the use of software by SBI with various restrictions. If we again refer to clause 6.4 of the agreement there is a complete restraint on SBI which says SBI shall not use, print, copy, reproduce or disclose the software or documentation in whole or in part except as is expressly permitted by the agreement nor shall SBI permit any of the foregoing. SBI is also barred from allowing access to its software or documentation except what is permitted under the agreement. Again SBI is barred from selling, charging or otherwise making the software or documentation available to any person except what is expressly permitted under the agreement. Clause 6.5 of the agreement says that SBI shall not copy or permit copying of the software supplied to it by Kindle save as may be strictly required for delivery to licence sites. The terms of the agreement also apply to the copies.Though this judgment has been delivered under the Customs Act 1962, yet the important differentiation made between the right to reproduce and the right to use computer software has been recognized by this judgment. Whereas the former would amount to a parting of copyright by the owner thereof, the latter would not.This argument has no legs to stand on. It is settled law that in all such cases, the real nature of the transaction must be looked at upon reading the agreement as a whole. Thus, in Sundaram Finance Ltd. v. State of Kerala, (1966) 2 SCR 828 , one of the questions that was raised before this Court was as to the execution of a sale letter acknowledging the sale of a vehicle. This sale letter was dealt with by the Court as follows:The appellants are financiers and their business is to advance loans on favourable terms on the security of vehicles. This is effected by obtaining a promissory-note for repayment of the amount advanced, and a hire-purchase agreement which provides a mechanism for recovery of the amount. It is true that a sale letter is obtained from the customer, but the consideration for the sale letter is only the balance remaining payable to the dealer, after giving credit against the price of the vehicle the amount paid by the customer. The application for a loan, and the letter addressed to the appellants undertaking to insure the vehicle expressly mention that a loan is asked for and granted on the security of the motor-vehicle under the hire- purchase agreement. It is the customer who insures the vehicle, and in the books of the Motor Vehicle Authorities he remains, with the consent of the appellants, owner of the vehicle. Undue importance to the acknowledgment of sale in the sale letter and the recital of sale in the bill and in the receipt cannot therefore be attached. These documents — sale letter, bill and receipt — must be read with the application for granting a loan on the security of the vehicles, the letter in which the customer requests the appellants to pay the balance of the price remaining to be paid by him to the dealer, the promissory-note executed by him for that amount, the undertaking to insure the vehicle, and intimation to the Motor Vehicles Authorities to make note of the hire- purchase agreement.The true effect of a transaction may be determined from the terms of the agreement considered in the light of the surrounding circumstances. In each case, the Court has, unless prohibited by statute, power to go behind the documents and to determine the nature of the transaction, whatever may be the form of the documents. An owner of goods who purports absolutely to convey or acknowledges to have conveyed goods and subsequently purports to hire them under a hire-purchase agreement is not estopped from proving that the real bargain was a loan on the security of the goods. If there is a bona fide and completed sale of goods, evidenced by documents, anterior to and independent of a subsequent and distinct hiring to the vendor, the transaction may not be regarded as a loan transaction, even though the reason for which it was entered into was to raise money. If the real transaction is a loan of money secured by a right of seizure of the goods, the property ostensibly passes under the documents embodying the transaction, but subject to the terms of the hiring agreement, which become part of the buyers title, and confer a licence to seize. When a person desiring to purchase goods and not having sufficient money on hand borrows the amount needed from a third person and pays it over to the vendor, the transaction between the customer and the lender will unquestionably be a loan transaction. The real character of the transaction would not be altered if the lender himself is the owner of the goods and the owner accepts the promise of the purchaser to pay the price or the balance remaining due against delivery of goods. But a hire- purchase agreement is a more complex transaction. The owner under the hire-purchase agreement enters into a transaction of hiring out goods on the terms and conditions set out in the agreement, and the option to purchase exercisable by the customer on payment of all the instalments of hire arises when the instalments are paid and not before. In such a hire-purchase agreement there is no agreement to buy goods; the hirer being under no legal obligation to buy, has an option either to return the goods or to become its owner by payment in full of the stipulated hire and the price for exercising the option. This class of hire- purchase agreements must be distinguished from transactions in which the customer is the owner of the goods and with a view to finance his purchase he enters into an arrangement which is in the form of a hire-purchase agreement with the financier, but in substance evidences a loan transaction, subject to a hiring agreement under which the lender is given the license to seize the goods.In the light of these principles the true nature of the transactions of the appellants may now be stated. The appellants are carrying on the business of financiers: they are not dealing in motor-vehicles. The motor-vehicle purchased by the customer is registered in the name of the customer and remains at all material times so registered in his name. In the letter taken from the customer under which the latter agrees to keep the vehicle insured, it is expressly recited that the vehicle has been given as security for the loan advanced by the appellants. As a security for repayment of the loan, the customer executes a promissory- note for the amount paid by the appellants to the dealer of the vehicle. The so-called sale letter is a formal document which is not made effective by registering the vehicle in the name of the appellants and even the insurance of the vehicle has to be effected as if the customer is the owner. Their right to seize the vehicle is merely a licence to ensure compliance with the terms of the hire-purchase agreement. The customer remains qua the world at large the owner and remains in possession, and on condition of performing the covenants, has a right to continue to remain in possession. The right of the appellants may be extinguished by payment of the amount due to them under the terms of the hire- purchase agreement even before the dates fixed for payment. The agreement undoubtedly contains several onerous covenants, but they are all intended to secure to the appellants recovery of the amount advanced. We are accordingly of the view that the intention of the appellants in obtaining the hire-purchase and the allied agreements was to secure the return of loans advanced to their customers, and no real sale of the vehicle was intended by the customer to the appellants. The transactions were merely financing transactions.52. There can be no doubt as to the real nature of the transactions in the appeals before us. What is licensed by the foreign, non-resident supplier to the distributor and resold to the resident end-user, or directly supplied to the resident end-user, is in fact the sale of a physical object which contains an embedded computer programme, and is therefore, a sale of goods, which, as has been correctly pointed out by the learned counsel for the assessees, is the law declared by this Court in the context of a sales tax statute in Tata Consultancy Services v. State of A.P., 2005 (1) SCC 308 (see paragraph 27).54. There is no doubt that section 9 of the Income Tax Act refers to persons who are non-residents and taxes their income as income which is deemed to accrue or arise in India, thus, making such persons assessees under the Income Tax Act, who are liable to pay tax. There is also no doubt that the person responsible for paying spoken of in section 195 of the Income Tax Act is not a non-resident assessee, but a person resident in India, who is liable to make deductions under section 195 of the Income Tax Act when payments are made by it to the non-resident assessee. The submission of the learned Additional Solicitor General is answered by the judgment of this Court in GE Technology (supra). This judgment, after setting out section 195 of the Income Tax Act, held:8. The most important expression in Section 195(1) consists of the words chargeable under the provisions of the Act. A person paying interest or any other sum to a non- resident is not liable to deduct tax if such sum is not chargeable to tax under the IT Act. For instance, where there is no obligation on the part of the payer and no right to receive the sum by the recipient and that the payment does not arise out of any contract or obligation between the payer and the recipient but is made voluntarily, such payments cannot be regarded as income under the IT Act.9. It may be noted that Section 195 contemplates not merely amounts, the whole of which are pure income payments, it also covers composite payments which have an element of income embedded or incorporated in them. Thus, where an amount is payable to a non-resident, the payer is under an obligation to deduct TAS in respect of such composite payments. The obligation to deduct TAS is, however, limited to the appropriate proportion of income chargeable under the Act forming part of the gross sum of money payable to the non-resident. This obligation being limited to the appropriate proportion of income flows from the words used in Section 195(1), namely, chargeable under the provisions of the Act. It is for this reason that vide Circular No. 728 dated 30-10-1995 CBDT has clarified that the tax deductor can take into consideration the effect of DTAA in respect of payment of royalties and technical fees while deducting TAS. It may also be noted that Section 195(1) is in identical terms with Section 18(3-B) of the 1922 Act.11. While deciding the scope of Section 195(2) it is important to note that the tax which is required to be deducted at source is deductible only out of the chargeable sum. This is the underlying principle of Section 195. Hence, apart from Section 9(1), Sections 4, 5, 9, 90, 91 as well as the provisions of DTAA are also relevant, while applying tax deduction at source provisions.13. If the contention of the Department that the moment there is remittance the obligation to deduct TAS arises is to be accepted then we are obliterating the words chargeable under the provisions of the Act in Section 195(1). The said expression in Section 195(1) shows that the remittance has got to be of a trading receipt, the whole or part of which is liable to tax in India. The payer is bound to deduct TAS only if the tax is assessable in India. If tax is not so assessable, there is no question of TAS being deducted. (See Vijay Ship Breaking Corpn. v. CIT [(2010) 10 SCC 39 : (2009) 314 ITR 309 ] .)14. One more aspect needs to be highlighted. Section 195 falls in Chapter XVII which deals with collection and recovery. Chapter XVII-B deals with deduction at source by the payer. On analysis of various provisions of Chapter XVII one finds the use of different expressions, however, the expression sum chargeable under the provisions of the Act is used only in Section 195. For example, Section 194-C casts an obligation to deduct TAS in respect of any sum paid to any resident. Similarly, Sections 194-EE and 194-F inter alia provide for deduction of tax in respect of any amount referred to in the specified provisions. In none of the provisions we find the expression sum chargeable under the provisions of the Act, which as stated above, is an expression used only in Section 195(1). Therefore, this Court is required to give meaning and effect to the said expression. It follows, therefore, that the obligation to deduct TAS arises only when there is a sum chargeable under the Act.18. If the contention of the Department that any person making payment to a non-resident is necessarily required to deduct TAS then the consequence would be that the Department would be entitled to appropriate the monies deposited by the payer even if the sum paid is not chargeable to tax because there is no provision in the IT Act by which a payer can obtain refund. Section 237 read with Section 199 implies that only the recipient of the sum i.e. the payee could seek a refund. It must therefore follow, if the Department is right, that the law requires tax to be deducted on all payments. The payer, therefore, has to deduct and pay tax, even if the so-called deduction comes out of his own pocket and he has no remedy whatsoever, even where the sum paid by him is not a sum chargeable under the Act. The interpretation of the Department, therefore, not only requires the words chargeable under the provisions of the Act to be omitted, it also leads to an absurd consequence. The interpretation placed by the Department would result in a situation where even when the income has no territorial nexus with India or is not chargeable in India, the Government would nonetheless collect tax. In our view, Section 195(2) provides a remedy by which a person may seek a determination of the appropriate proportion of such sum so chargeable where a proportion of the sum so chargeable is liable to tax.20. We find no merit in these contentions. As stated hereinabove, Section 195(1) uses the expression sum chargeable under the provisions of the Act. We need to give weightage to those words. Further, Section 195 uses the word payer and not the word assessee. The payer is not an assessee. The payer becomes an assessee-in-default only when he fails to fulfil the statutory obligation under Section 195(1). If the payment does not contain the element of income the payer cannot be made liable. He cannot be declared to be an assessee-in-default.21. The abovementioned contention of the Department is based on an apprehension which is ill-founded. The payer is also an assessee under the ordinary provisions of the IT Act. When the payer remits an amount to a non-resident out of India he claims deduction or allowances under the Income Tax Act for the said sum as an expenditure. Under Section 40(a)(i), inserted vide the Finance Act, 1988 w.e.f. 1-4-1989, payment in respect of royalty, fees for technical services or other sums chargeable under the Income Tax Act would not get the benefit of deduction if the assessee fails to deduct TAS in respect of payments outside India which are chargeable under the IT Act. This provision ensures effective compliance with Section 195 of the IT Act relating to tax deduction at source in respect of payments outside India in respect of royalties, fees or other sums chargeable under the IT Act. In a given case where the payer is an assessee he will definitely claim deduction under the IT Act for such remittance and on inquiry if the AO finds that the sums remitted outside India come within the definition of royalty or fees for technical service or other sums chargeable under the IT Act then it would be open to the AO to disallow such claim for deduction. Similarly, vide the Finance Act, 2008 w.e.f. 1-4-2008 sub-section (6) has been inserted in Section 195 which requires the payer to furnish information relating to payment of any sum in such form and manner as may be prescribed by the Board. This provision is brought into force only from 1-4-2008. It will not apply for the period with which we are concerned in these cases before us. Therefore, in our view, there are adequate safeguards in the Act which would prevent revenue leakage.24. In our view, Section 195(2) is based on the principle of proportionality. The said sub-section gets attracted only in cases where the payment made is a composite payment in which a certain proportion of payment has an element of income chargeable to tax in India. It is in this context that the Supreme Court stated: (Transmission Corpn. case [(1999) 7 SCC 266 : (1999) 239 ITR 587 ] , SCC p. 274, para 10)10. … If no such application is filed income tax on such sum is to be deducted and it is the statutory obligation of the person responsible for paying such sum to deduct tax thereon before making payment. He has to discharge the obligation [to TDS].If one reads the observation of the Supreme Court, the words such sum clearly indicate that the observation refers to a case of composite payment where the payer has a doubt regarding the inclusion of an amount in such payment which is exigible to tax in India. In our view, the above observations of this Court in Transmission Corpn. case [(1999) 7 SCC 266 : (1999) 239 ITR 587 ] which is put in italics has been completely, with respect, misunderstood by the Karnataka High Court to mean that it is not open for the payer to contend that if the amount paid by him to the non-resident is not at all chargeable to tax in India, then no TAS is required to be deducted from such payment. This interpretation of the High Court completely loses sight of the plain words of Section 195(1) which in clear terms lays down that tax at source is deductible only from sums chargeable under the provisions of the IT Act i.e. chargeable under Sections 4, 5 and 9 of the IT Act.25. Before concluding we may clarify that in the present case on facts ITO(TDS) had taken the view that since the sale of the software concerned, included a licence to use the same, the payment made by the appellant(s) to foreign suppliers constituted royalty which was deemed to accrue or arise in India and, therefore, TAS was liable to be deducted under Section 195(1) of the Act. The said finding of ITO(TDS) was upheld by CIT(A). However, in the second appeal, ITAT held that such sum paid by the appellant(s) to the foreign software suppliers was not a royalty and that the same did not give rise to any income taxable in India and, therefore, the appellant(s) was not liable to deduct TAS. However, the High Court did not go into the merits of the case and it went straight to conclude that the moment there is remittance an obligation to deduct TAS arises, which view stands hereby overruled.55. What is made clear by the judgment in GE Technology (supra) is the fact that the person spoken of in section 195(1) of the Income Tax Act is liable to make the necessary deductions only if the non-resident is liable to pay tax as an assessee under the Income Tax Act, and not otherwise. This judgment also clarifies, after referring to CBDT Circular No. 728 dated 30.10.1995, that the tax deductor must take into consideration the effect of the DTAA provisions. The crucial link, therefore, is that a deduction is to be made only if tax is payable by the non-resident assessee, which is underscored by this judgment, stating that the charging and machinery provisions contained in sections 9 and 195 of the Income Tax Act are interlinked.56. This conclusion is also echoed in Vodafone International Holdings BV v. Union of India, (2012) 6 SCC 613, wherein the following observations were made on the scope and applicability of section 195 of the Income Tax Act:171. Section 195 casts an obligation on the payer to deduct tax at source (TAS, for short) from payments made to non- residents which payments are chargeable to tax. Such payment(s) must have an element of income embedded in it which is chargeable to tax in India. If the sum paid or credited by the payer is not chargeable to tax then no obligation to deduct the tax would arise. Shareholding in companies incorporated outside India (CGP) is property located outside India. Where such shares become subject-matter of offshore transfer between two non-residents, there is no liability for capital gains tax. In such a case, question of deduction of TAS would not arise.172. If in law the responsibility for payment is on a non- resident, the fact that the payment was made, under the instructions of the non-resident, to its agent/nominee in India or its PE/Branch Office will not absolve the payer of his liability under Section 195 to deduct TAS. Section 195(1) casts a duty upon the payer of any income specified therein to a non-resident to deduct therefrom TAS unless such payer is himself liable to pay income tax thereon as an agent of the payee. Section 201 says that if such person fails to so deduct TAS he shall be deemed to be an assessee-in- default in respect of the deductible amount of tax (Section 201).173. Liability to deduct tax is different from assessment under the Act. Thus, the person on whom the obligation to deduct TAS is cast is not the person who has earned the income. Assessment has to be done after liability to deduct TAS has arisen. The object of Section 195 is to ensure that tax due from non-resident persons is secured at the earliest point of time so that there is no difficulty in collection of tax subsequently at the time of regular assessment.57. The absurd consequence that the resident in India, after making the deduction/payment, would not then get any excess payment made by way of refund when regular assessment takes place, as the non- resident assessee alone would be entitled to such refund, is also pointed out in paragraph 18 of the judgment in GE Technology (supra). It was after keeping all this in view that this Court then set aside the judgment of the High Court of Karnataka dated 24.09.2009 and remanded the case to the High Court for a decision of the question on merits, i.e., on the sole question as to whether the ITAT was justified in holding that the amounts paid by the appellants to the foreign software suppliers did not amount to royalty, as a result of which, no liability to deduct TDS arose.58. Even otherwise, a look at Article 12(2) of the India-Singapore DTAA would demonstrate the fallacy of the aforesaid submission of the learned Additional Solicitor General. Under Article 12(2) of the India- Singapore DTAA, royalties may be taxed in the Contracting State in which they arise (India) and according to the laws of that Contracting State (Indian laws), if the recipient is a beneficial owner of the royalties, and the tax so charged is capped at the rate of 10% or 15%. If the learned Additional Solicitor General is correct in his submission, as the DTAA would then not apply, royalty would be liable to be taxed in India at the rate mentioned in the Income Tax Act which can be much higher than the DTAA rate, as a result of which, the deduction made under section 195 of the Income Tax Act by the person responsible would have to be a proportion of a much higher sum than the tax that is ultimately payable by the non-resident assessee. This equally absurd result cannot be countenanced given the fact that the person liable to deduct tax is only liable to deduct tax first and foremost if the non- resident person is liable to pay tax, and second, that if so liable, is then liable to deduct tax depending on the rate mentioned in the DTAA.59. Further, tearing an article of a specific DTAA, namely Article 30 of the India-USA DTAA, out of context in order to buttress his submission, in a manner far removed from the actual rationale behind that provision, does not commend itself to us.60. Obviously, the logic behind Article 30 of the India-USA DTAA is for reasons connected with USAs municipal taxation laws, and has nothing to do with Indian municipal law governing the liability of persons to deduct tax at source under section 195 of the Income Tax Act. This is reinforced by the fact that the OECD Commentary on Articles 30 and 31 acknowledges the fact that the entry into force provisions, unlike the rest of the provisions in the OECD Model Tax Convention on Income and on Capital, depend on the domestic laws of Contracting States, as follows:COMMENTARY ON ARTICLES 30 AND 31 CONCERNING THE ENTRY INTO FORCE AND THE TERMINATION OF THE CONVENTION3. It is open to Contracting States to agree that the Convention shall enter into force when a specified period has elapsed after the exchange of the instruments of ratification or after the confirmation that each State has completed the procedures required for such entry into force.4. No provisions have been drafted as to the date on which the Convention shall have effect or cease to have effect, since such provisions would largely depend on the domestic laws of the Contracting States concerned. Some of the States assess tax on the income received during the current year, others on the income received during the previous year, others again have a fiscal year which differs from the calendar year. Furthermore, some conventions provide, as regards taxes levied by deduction at the source, a date for the application or termination which differs from the date applying to taxes levied by assessment.61. For all these reasons, we do not permit the learned Additional Solicitor General to have a second bite at the same cherry, albeit through the ingenious argument made by him based on Article 30 of the India-USA DTAA.62. In order to ascertain whether the question which was posed by this Court in GE Technology (supra) was correctly answered by the High Court of Karnataka vide the impugned judgment dated 15.10.2011,(CIT v. Samsung Electronics Co. Ltd., (2012) 345 ITR 494.) the first expression that has to be considered by us is the expression royalty.63. Firstly, it will be seen that when Article 12 of the India-Singapore DTAA defines the term royalties in sub-article (3) thereof, it does so stating that such definition is exhaustive – it uses the expression means. Secondly, the term royalties refers to payments of any kind that are received as a consideration for the use of or the right to use any copyright in a literary work. As opposed to this, the definition contained in explanation 2 to section 9(1)(vi) of the Income Tax Act, is wider in at least three respects:i. It speaks of consideration, but also includes a lump-sum consideration which would not amount to income of the recipient chargeable under the head capital gains;ii. When it speaks of the transfer of all or any rights, it expresslyincludes the granting of a licence in respect thereof; andiii. It states that such transfer must be in respect of any copyright of any literary work.64. However, even where such transfer is in respect of copyright, the transfer of all or any rights in relation to copyright is a sine qua non under explanation 2 to section 9(1)(vi) of the Income Tax Act. In short, there must be transfer by way of licence or otherwise, of all or any of the rights mentioned in section 14(b) read with section 14(a) of the Copyright Act.65. In State of Madras v. Swastik Tobacco Factory, (1966) 3 SCR 79 , this Court construed the words in respect of used in rule 5(1)(i) of the Madras General Sales Tax (Turnover and Assessment) Rules 1939, as follows:The House of Lords in Inland Revenue Commissioners v. Coutts & Co. [(1963) 2 All ER 722, 732], in the context of payment of estate duty, construed the words in respect of in Section 5(2) of the Finance Act, 1894 (57 & 58 Vict, c. 30) and observed that the phrase denoted some imprecise kind of nexus between the property and the estate duty. The House of Lords in Asher v. Seaford Court Estates Ltd. [LR 1950 AC 608] in construing the provisions of Section 2, sub- section (3) of Increase of Rent and Mortgage Interest (Restrictions) Act, 1920 (10 & 11 Geo. 5, c. 17), held that theexpression in respect of m ust be read as equivalent toattributable. The Privy Council in Bicher Ltd. v. CIT [(1962) 3 All ER 294] observed that the said words could mean more than consisting of or namely.It is not necessary to refer to other decisions. It may be accepted that the said expression received a wide interpretation, having regard to the object of the provisions and the setting in which the said words appeared. On the other hand, Indian tax laws use the expression in respect of as synonymous with the expression on: see Article 288 of the Constitution of India; Section 3 of the Indian Income Tax Act, 1922; Sections 3(2) and 3(5), Second Proviso, of the Madras General Sales Tax Act, 1939; Section 3(1-A) of the Central Excise and Salt Act, 1944; and Section 9 of the Kerala Sales Tax Act. We should not be understood to have construed the said provisions, but only have referred to them to state the legislative practice. Consistent with the said practice, Rule 5(1)(i) of the Rules uses the same expression. When the said Rule says excise duty paid in respect of the goods, the excise duty referred to is the excise duty paid under Section 3(1), read with the Schedule of the Central Excises and Salt Act, 1944 (1 of 1944). Under the said Section, read with the Schedule, excise duty is levied on the goods described in the Schedule. Therefore, when Rule 5(1)(i) of the Rules refers to the duty paid in respect of the goods to the Central Government, it necessarily refers to the duty paid on the goods mentioned in the Schedule. As the duty exempted from the gross turnover is the duty so paid under the Central Act, read with the Schedule, the expression in respect of in the context can only mean excise duty paid on goods. In our view, the expression in respect of the goods in Rule 5(1)(i) of the Rules means only on the goods. Even if the word attributable is substituted for the words in respect of, the result will not be different, for the duty paid shall be attributable to the goods. If it was paid on the raw material it can be attributable only to raw material and not to the goods. We, therefore, hold that only excise duty paid on the goods sold by the assessee is deductible from the gross turnover under Rule 5(1)(i) of the Rules.66. The aforesaid meaning accords with the meaning to be given to the expression in respect of contained in explanation 2(v) to section 9(1)(vi) of the Income Tax Act.67. The insertion of sub-sections (v), (vi) and (vii) in section 9(1) of the Income Tax Act, by way of an amendment through the Finance Act 1976,(Act 66 of 1976, (w.e.f 1-6-1976).) was to introduce source-based taxation for income in the hands of a non-resident by way of interest, royalty and fees for technical services. In Carborandum & Co. v. CIT, (1977) 2 SCC 862, this Court, applying residence-based rules of taxation, held that the technical service fees received by the non-resident assessee (relatable to the assessment year 1957-1958) could only be deemed to accrue in India if such income could be attributed to a business connection in India. In the facts of that case, since no part of the foreign assessees operations were carried on in India, the technical services being rendered wholly in foreign territory, it was held that no part of the technical service fees received by the foreign assessee accrued in India.69. Consequently, section 9(1)(vi) of the Income Tax Act was brought into force. The definition of royalty contained in explanation 2(v) of section 9(1)(vi) of the Income Tax Act includes the transfer of all or any rights (including the granting of a licence) in respect of any copyright, literary, artistic or scientific work.71. The transfer of all or any rights (including the granting of a licence) in respect of any copyright, in the context of computer software, is referable to sections 14(a), 14(b) and 30 of the Copyright Act. As has been held hereinabove, the expression in respect of is equivalent to in or attributable to. Thus, explanation 2(v) to section 9(1)(vi) of the Income Tax Act, when it speaks of all of any rights…in respect of copyright is certainly more expansive than the DTAA provision, which speaks of the use of, or the right to use any copyright. This has been recognised by the High Court of Delhi in CIT v. DCM Limited, ITA Nos. 87-89/1992 in its judgment dated 10.03.2011, as follows:9. A bare perusal of Article XIII(3) would show that the expression payments of any kind is circumscribed by the latter part of the definition which speaks of consideration received (including in the form of rentals) for use of or right to use intellectual properties. The Tribunal, in our view, rightly observed that the CIT(A) had erred in coming to the conclusion that the expression payments of any kind was broad enough to include even an outright sale. To drive home this point the Tribunal, once again, has correctly drawn a distinction between the definition of royalty as appearing in the DTAA and that which finds mention in explanation 2 to section 9(1)(vi) of the I.T. Act. A perusal of the provisions of the said explanation would show that it brings within the ambit of royalty a wider range of transactions which would include payments made for transfer of all or any right in patents, inventions, model, design, etc. apart from payments based for use of such right, patent, innovation, model, design, secret formula or process or trade mark or similar property. As a matter of fact, a perusal of clause (i) of explanation 2 of section 9(1)(vi) of the I.T. Act would show that transfer of all or any right could take place by execution of licences as well, which was the methodology adopted by Tate and the assessee in the present case…72. However, when it comes to the expression use of, or the right to use, the same position would obtain under explanation 2(v) of section 9(1)(vi) of the Income Tax Act, inasmuch as, there must, under the licence granted or sale made, be a transfer of any of the rights contained in sections 14(a) or 14(b) of the Copyright Act, for explanation 2(v) to apply. To this extent, there will be no difference in the position between the definition of royalties in the DTAAs and the definition of royalty in explanation 2(v) of section 9(1)(vi) of the Income Tax Act.73. Even if we were to consider the ambit of royalty only under the Income Tax Act on the footing that none of the DTAAs apply to the facts of these cases, the definition of royalty that is contained in explanation 2 to section 9(1)(vi) of the Income Tax Act would make it clear that there has to be a transfer of all or any rights which includes the grant of a licence in respect of any copyright in a literary work. The expression including the granting of a licence in clause (v) of explanation 2 to section 9(1)(vi) of the Income Tax Act, would necessarily mean a licence in which transfer is made of an interest in rights in respect of copyright, namely, that there is a parting with an interest in any of the rights mentioned in section 14(b) read with section 14(a) of the Copyright Act. To this extent, there will be no difference between the position under the DTAA and explanation 2 to section 9(1)(vi) of the Income Tax Act.A reference to the Memorandum explaining the provisions in the Finance Bill 2012 set out hereinabove, would make it clear that the expression as mentioned in Explanation 2 in sub-para (i) of the aforesaid Memorandum shows that explanation 4 was inserted retrospectively to expand the scope of explanation 2(v). In any case, explanation 2(v) contains the expression, the transfer of all or any rights which is an expression that would subsume any right, property or information and is wider than the expression any right, property or information. It is therefore difficult to accept Shri Pardiwalas argument that explanation 4 does not expand the scope of the expression royalty as contained in explanation 2 to section 9(1)(vi) of the Income Tax Act.77. It is equally difficult to accept the learned Additional Solicitor Generals submission that explanation 4 to section 9(1)(vi)of the Income Tax Act is clarificatory of the position as it always stood, since 01.06.1976, for which he strongly relied upon CBDT Circular No. 152 dated 27.11.1974. Quite obviously, such a circular cannot apply as it would then be explanatory of a position that existed even before section 9(1)(vi) was actually inserted in the Income Tax Act vide the Finance Act 1976. Secondly, insofar as section 9(1)(vi) of the Income Tax Act relates to computer software, explanation 3 thereof, refers to computer software for the first time with effect from 01.04.1991, when it was introduced, which was then amended vide the Finance Act 2000. Quite clearly, explanation 4 cannot apply to any right for the use of or the right to use computer software even before the term computer software was inserted in the statute. Likewise, even qua section 2(o) of the Copyright Act, the term computer software was introduced for the first time in the definition of a literary work, and defined under section 2(ffc) only in 1994 (vide Act 38 of 1994).78. Furthermore, it is equally ludicrous for the aforesaid amendment which also inserted explanation 6 to section 9(1)(vi) of the Income Tax Act, to apply with effect from 01.06.1976, when technology relating to transmission by a satellite, optic fibre or other similar technology, was only regulated by the Parliament for the first time through the Cable Television Networks (Regulation) Act, 1995, much after 1976. For all these reasons, it is clear that explanation 4 to section 9(1)(vi) of the Income Tax Act is not clarificatory of the position as of 01.06.1976, but in fact, expands that position to include what is stated therein, vide the Finance Act 2012.This statement, again, in no manner furthers the case of the Revenue that explanation 4 is merely clarificatory of the legal position as it always stood. Likewise, Notification No. 21/2012 dated 13.06.2012, which deals with section 194J of the Income Tax Act, does no more than providing that a transferee is exempt from deducting TDS under section 194J when TDS has already been deducted under section 195 on the payment made in the previous transfer of the same software which the transferee acquires without any modification. In any case, this notification being issued on 13.06.2012, i.e., after explanation 4 was inserted vide the Finance Act 2012, it would not assist the Revenue in asserting that explanation 4 clarifies the legal position as it always stood.81. This question is answered by two latin maxims, lex non cogit ad impossibilia, i.e., the law does not demand the impossible and impotentia excusat legem, i.e., when there is a disability that makes it impossible to obey the law, the alleged disobedience of the law is excused. Recently, in the judgment in Arjun Panditrao Khotkar v. Kailash Kushanrao Gorantyal, (2020) 7 SCC 1 delivered by this Court, this Court applied the said maxims in the context of the requirement of a certificate to produce evidence by way of electronic record under section 65B of the Evidence Act, 1872 and held that having taken all possible steps to obtain the certificate and yet being unable to obtain it for reasons beyond his control, the respondent in the facts of the case, was relieved of the mandatory obligation to furnish a certificate. In so holding, this Court referred to previous judgments dealing with the doctrine of impossibility and concluded as follows:47. However, a caveat must be entered here. The facts of the present case show that despite all efforts made by the respondents, both through the High Court and otherwise, to get the requisite certificate under Section 65-B(4) of the Evidence Act from the authorities concerned, yet the authorities concerned wilfully refused, on some pretext or the other, to give such certificate. In a fact-circumstance where the requisite certificate has been applied for from the person or the authority concerned, and the person or authority either refuses to give such certificate, or does not reply to such demand, the party asking for such certificate can apply to the court for its production under the provisions aforementioned of the Evidence Act, CPC or CrPC. Once such application is made to the court, and the court then orders or directs that the requisite certificate be produced by a person to whom it sends a summons to produce such certificate, the party asking for the certificate has done all that he can possibly do to obtain the requisite certificate. Two Latin maxims become important at this stage. The first is lex non cogit ad impossibilia i.e. the law does not demand the impossible, and impotentia excusat legem i.e. when there is a disability that makes it impossible to obey the law, the alleged disobedience of the law is excused. This was well put by this Court in Presidential Poll, In re [Presidential Poll, In re, (1974) 2 SCC 33] as follows : (SCC pp. 49-50, paras 14-15)14. If the completion of election before the expiration of the term is not possible because of the death of the prospective candidate it is apparent that the election has commenced before the expiration of the term but completion before the expiration of the term is rendered impossible by an act beyond the control of human agency. The necessity for completing the election before the expiration of the term is enjoined by the Constitution in public and State interest to see that the governance of the country is not paralysed by non-compliance with the provision that there shall be a President of India.15. The impossibility of the completion of the election to fill the vacancy in the office of the President before the expiration of the term of office in the case of death of a candidate as may appear from Section 7 of the 1952 Act does not rob Article 62(1) of its mandatory character. The maxim of law impotentia excusat legem is intimately connected with another maxim of law lex non cogit ad impossibilia. Impotentia excusat legem is that when there is a necessary or invincible disability to perform the mandatory part of the law that impotentia excuses. The law does not compel one to do that which one cannot possibly perform. Where the law creates a duty or charge, and the party is disabled to perform it, without any default in him, and has no remedy over it, there the law will in general excuse him. Therefore, when it appears that the performance of the formalities prescribed by a statute has been rendered impossible by circumstances over which the persons interested had no control, like the act of God, the circumstances will be taken as a valid excuse. Where the act of God prevents the compliance with the words of a statute, the statutory provision is not denuded of its mandatory character because of supervening impossibility caused by the act of God. (See Brooms Legal Maxims, 10th Edn. at pp. 162-63 and Craies on Statute Law, 6th Edn. at p. 268.)It is important to note that the provision in question in Presidential Poll, In re [Presidential Poll, In re, (1974) 2 SCC 33] was also mandatory, which could not be satisfied owing to an act of God, in the facts of that case. These maxims have been applied by this Court in different situations in other election cases — See Chandra Kishore Jha v. Mahavir Prasad [Chandra Kishore Jha v. Mahavir Prasad, (1999) 8 SCC 266] (at paras 17 and 21); Special Reference No. 1 of 2002, In re (Gujarat Assembly Election matter) [Special Reference No. 1 of 2002, In re (Gujarat Assembly Election matter), (2002) 8 SCC 237] (at paras 130 and 151) and Raj Kumar Yadav v. Samir Kumar Mahaseth [Raj Kumar Yadav v. Samir Kumar Mahaseth, (2005) 3 SCC 601] (at paras 13 and 14).48. These Latin maxims have also been applied in several other contexts by this Court. In Cochin State Power & Light Corpn. Ltd. v. State of Kerala [Cochin State Power & Light Corpn. Ltd. v. State of Kerala, (1965) 3 SCR 187 : AIR 1965 SC 1688 ] , a question arose as to the exercise of an option of purchasing an undertaking by the State Electricity Board under Section 6(4) of the Electricity Act, 1910. The provision required a notice of at least 18 months before the expiry of the relevant period to be given by such State Electricity Board to the State Government. Since this mandatory provision was impossible of compliance, it was held that the State Electricity Board was excused from giving such notice, as follows : (1965) 3 SCR 187 , at p. 193 : AIR pp. 1691-92, para 88. Sub-section (1) of Section 6 expressly vests in the State Electricity Board the option of purchase on the expiry of the relevant period specified in the licence. But the State Government claims that under sub-section (2) of Section 6 it is now vested with the option. Now, under sub-section (2) of Section 6, the State Government would be vested with the option only where a State Electricity Board has not been constituted, or if constituted, does not elect to purchase the undertaking. It is common case that the State Electricity Board was duly constituted. But the State Government claims that the State Electricity Board did not elect to purchase the undertaking. For this purpose, the State Government relies upon the deeming provisions of sub-section (4) of Section 6, and contends that as the Board did not send to the State Government any intimation in writing of its intention to exercise the option as required by the sub-section, the Board must be deemed to have elected not to purchase the undertaking. Now, the effect of sub- section (4) read with sub-section (2) of Section 6 is that on failure of the Board to give the notice prescribed by sub-section (4), the option vested in the Board under sub-section (1) of Section 6 was liable to be divested. Sub-section (4) of Section 6 imposed upon the Board the duty of giving after the coming into force of Section 6 a notice in writing of its intention to exercise the option at least 18 months before the expiry of the relevant period. Section 6 came into force on 5-9-1959, and the relevant period expired on 3-12-1960. In the circumstances, the giving of the requisite notice of 18 months in respect of the option of purchase on the expiry of 2-12-1960, was impossible from the very commencement of Section 6. The performance of this impossible duty must be excused in accordance with the maxim, lex non cogitia ad impossibilia (the law does not compel the doing of impossibilities), and sub-section (4) of Section 6 must be construed as not being applicable to a case where compliance with it is impossible. We must, therefore, hold that the State Electricity Board was not required to give the notice under sub-section (4) of Section 6 in respect of its option of purchase on the expiry of 25 years. It must follow that the Board cannot be deemed to have elected not to purchase the undertaking under sub-section (4) of Section 6. By the notice served upon the appellant, the Board duly elected to purchase the undertaking on the expiry of 25 years. Consequently, the State Government never became vested with the option of purchasing the undertaking under sub-section (2) of Section 6. The State Government must, therefore, be restrained from taking further action under its notice, Ext. G, dated 20-11-1959.49. In Raj Kumar Dey v. Tarapada Dey [Raj Kumar Dey v. Tarapada Dey, (1987) 4 SCC 398] , the maxim lex non cogit ad impossibilia was applied in the context of the applicability of a mandatory provision of the Registration Act, 1908, as follows : (SCC pp. 402-03, paras 6-7)6. We have to bear in mind two maxims of equity which are well settled, namely, actus curiae neminem gravabit — An act of the court shall prejudice no man. In Brooms Legal Maxims, 10th Edn., 1939 at p. 73 this maxim is explained that this maxim was founded upon justice and good sense; and afforded a safe and certain guide for the administration of the law. The above maxim should, however, be applied with caution. The other maxim is lex non cogit ad impossibilia (Brooms Legal Maxims, p. 162) — The law does not compel a man to do that which he cannot possibly perform. The law itself and the administration of it, said Sir W. Scott, with reference to an alleged infraction of the revenue laws, must yield to that to which everything must bend, to necessity; the law, in its most positive and peremptory injunctions, is understood to disclaim, as it does in its general aphorisms, all intention of compelling impossibilities, and the administration of laws must adopt that general exception in the consideration of all particular cases.7. In this case indisputably during the period from 26-7-1978 to December 1982 there was subsisting injunction preventing the arbitrators from taking any steps. Furthermore, as noted before the award was in the custody of the court, that is to say, 28-1- 1978 till the return of the award to the arbitrators on 24-11-1983, arbitrators or the parties could not have presented the award for its registration during that time. The award as we have noted before was made on 28-11-1977 and before the expiry of the four months from 28-11-1977, the award was filed in the court pursuant to the order of the court. It was argued that the order made by the court directing the arbitrators to keep the award in the custody of the court was wrong and without jurisdiction, but no arbitrator could be compelled to disobey the order of the court and if in compliance or obedience with court of doubtful jurisdiction, he could not take back the award from the custody of the court to take any further steps for its registration then it cannot be said that he has failed to get the award registered as the law required. The aforesaid two legal maxims — the law does not compel a man to do that which he cannot possibly perform and an act of the court shall prejudice no man would, apply with full vigour in the facts of this case and if that is the position then the award as we have noted before was presented before the Sub-Registrar, Arambagh on 25-11-1983 the very next one day of getting possession of the award from the court. The Sub-Registrar pursuant to the order of the High Court on 24-6-1985 found that the award was presented within time as the period during which the judicial proceedings were pending that is to say, from 28-1-1978 to 24-11-1983 should be excluded in view of the principle laid down in Section 15 of the Limitation Act, 1963. The High Court [Tarapada Dey v. District Registrar, Hooghly, 1986 SCC OnLine Cal 101 : AIR 1987 Cal 107] , therefore, in our opinion, was wrong in holding that the only period which should be excluded was from 26-7-1978 till 20-12-1982. We are unable to accept this position. 26-7-1978 was the date of the order of the learned Munsif directing maintenance of status quo and 20-12-1982 was the date when the interim injunction was vacated, but still the award was in the custody of the court and there is ample evidence as it would appear from the narration of events hereinbefore made that the arbitrators had tried to obtain the custody of the award which the court declined to give to them.(emphasis in original)50. These maxims have also been applied to tenancy legislation — see B.P. Khemka (P) Ltd. v. Birendra Kumar Bhowmick [B.P. Khemka (P) Ltd. v. Birendra Kumar Bhowmick, (1987) 2 SCC 407] (at para 12), and have also been applied to relieve authorities of fulfilling their obligation to allot plots when such plots have been found to be unallottable, owing to the contravention of the Central statutes — see Hira Tikkoo v. State (UT of Chandigarh) [Hira Tikkoo v. State (UT of Chandigarh), (2004) 6 SCC 765] (at paras 23 and 24).51. On an application of the aforesaid maxims to the present case, it is clear that though Section 65-B(4) is mandatory, yet, on the facts of this case, the respondents, having done everything possible to obtain the necessary certificate, which was to be given by a third party over whom the respondents had no control, must be relieved of the mandatory obligation contained in the said sub-section.82. As a matter of fact, even under the Income Tax Act, the High Court of Bombay has taken a view, applying the aforestated maxims in the context of the provisions of the relevant DTAAs, to hold that persons are not obligated to do the impossible, i.e., to apply a provision of a statute when it was not actually and factually on the statute book.85. It is thus clear that the person mentioned in section 195 of the Income Tax Act cannot be expected to do the impossible, namely, to apply the expanded definition of royalty inserted by explanation 4 to section 9(1)(vi) of the Income Tax Act, for the assessment years in question, at a time when such explanation was not actually and factually in the statute.87. The first and most comprehensive authority dealing with the question raised in these appeals is by the AAR in its ruling in Dassault Systems, K.K., In Re., (2010) 322 ITR 125 (AAR) [Dassault (AAR)]. In that case, the applicant was a company incorporated under the laws of Japan, which marketed licensed computer software products, through a distribution channel comprising value added resellers [VAR], who were independent third-party resellers in the business of selling software to end-users. The question posed by the AAR to itself was as follows:Whether on the facts and circumstances of the case and in law the payment received by Dassault Systems K.K. (hereinafter referred to as the the applicant) from sale of software products to independent third party resellers will be taxable as business profits under Article 7 of the India-Japan Double Taxation Avoidance Agreement (India-Japan DTAA or Treaty) and will not constitute royalties and fee for technical services as defined in Article 12 of India-Japan DTAA?88. After setting out Article 12 of the India-Japan DTAA, which is in the same terms as Article 12 of the India-Singapore DTAA and the other DTAAs that we are concerned with, and after adverting to the definition of royalty that is contained in explanation 2 to section 9(1)(vi) of the Income Tax Act, the AAR then set out, from the locus classicus on copyright law, the following passage:Before entering into a discussion on the applicability of the royalty definition, it is appropriate to recapitulate certain basic principles concerning the copyright as a legal concept. We may, in this connection, refer to some passages from the classic treatise of Copinger and Skone James on Copyright (1999 Edn): | 1 | 64,422 | 14,901 | ### Instruction:
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108. After taking cognizance of these observations, the Committee considers that the option of withholding tax offers a practical way of allocating partial taxing rights in respect of income from digital economy, which shares attributes that may be similar to royalty or fee for technical services, and which can be complied in respect of B2B transactions by the process of withholding. However, such a tax on income would be feasible only if it is included in the tax treaties, which take precedence over Indian domestic laws, unless it is designed as a tax on the gross payment. (emphasis supplied) 162. These reports also do not carry the matter much further as they are recommendatory reports expressing the views of the committee members, which the Government of India may accept or reject. When it comes to DTAA provisions, even if the position put forth in the aforementioned reports were to be accepted, a DTAA would have to be bilaterally amended before any such recommendation can become law in force for the purposes of the Income Tax Act. 163. The learned Additional Solicitor General also sought to rely on a decision of the Audiencia Nacional (Spanish National Court) in Case No. 207019/1990 dated 28.02.1995 and a decision of the Tribunal Supremo (Spanish Supreme Court) in Case No. 8066/1994 dated 02.10.1999. Quite apart from the fact that he only presented certain extracts and not the entire judgment rendered in these cases, these authorities have no relevance to the appeals before us, having been decided on the basis of the taxation law of Spain. 164. The learned Additional Solicitor General then referred to the judgment of this Court in Commissioner of Customs v. G.M. Exports, (2016) 1 SCC 91, and in particular on the four propositions that were culled out in the context of the levy of an anti-dumping duty in consonance with the General Agreement on Tariffs and Trade (GATT), 1994, as follows: 23. A conspectus of the aforesaid authorities would lead to the following conclusions: (1) Article 51(c) of the Constitution of India is a directive principle of State policy which states that the State shall endeavour to foster respect for international law and treaty obligations. As a result, rules of international law which are not contrary to domestic law are followed by the courts in this country. This is a situation in which there is an international treaty to which India is not a signatory or general rules of international law are made applicable. It is in this situation that if there happens to be a conflict between domestic law and international law, domestic law will prevail. (2) In a situation where India is a signatory nation to an international treaty, and a statute is passed pursuant to the said treaty, it is a legitimate aid to the construction of the provisions of such statute that are vague or ambiguous to have recourse to the terms of the treaty to resolve such ambiguity in favour of a meaning that is consistent with the provisions of the treaty. (3) In a situation where India is a signatory nation to an international treaty, and a statute is made in furtherance of such treaty, a purposive rather than a narrow literal construction of such statute is preferred. The interpretation of such a statute should be construed on broad principles of general acceptance rather than earlier domestic precedents, being intended to carry out treaty obligations, and not to be inconsistent with them. (4) In a situation in which India is a signatory nation to an international treaty, and a statute is made to enforce a treaty obligation, and if there be any difference between the language of such statute and a corresponding provision of the treaty, the statutory language should be construed in the same sense as that of the treaty. This is for the reason that in such cases what is sought to be achieved by the international treaty is a uniform international code of law which is to be applied by the courts of all the signatory nations in a manner that leads to the same result in all the signatory nations. 165. The conclusions in the aforestated paragraph have no direct relevance to the facts at hand as the effect of section 90(2) of the Income Tax Act, read with explanation 4 thereof, is to treat the DTAA provisions as the law that must be followed by Indian courts, notwithstanding what may be contained in the Income Tax Act to the contrary, unless more beneficial to the assessee. For all these reasons therefore, these submissions of the learned Additional Solicitor General are rejected. 166. At this juncture, it is also important to point out that vide Circular No. 10/2002 dated 09.10.2002, the Revenue, after referring to section 195 of the Income Tax Act and deciding that a No Objection Certificate from the Department would not be necessary if the person making the remittance is to submit an undertaking along with the certificate of an accountant to the Reserve Bank of India [RBI], has itself made a distinction in the proforma of the certificate to be issued in Annexure B to the aforesaid Circular, between remittances for royalties (see Row No. 5) and remittances for supply of articles or computer software (see Row No. 7), as follows: ANNEXURE B CERTIFICATE Table (emphasis supplied) 167. The Revenue, therefore, when referring to royalties under the DTAA, makes a distinction between such royalties, no doubt in the context of technical services, and remittances for supply of computer software, which is then treated as business profits, taxable under the relevant DTAA depending upon whether there is a PE through which the assessee operates in India. This is one more circumstance to show that the Revenue has itself appreciated the difference between the payment of royalty and the supply/use of computer software in the form of goods, which is then treated as business income of the assessee taxable in India if it has a PE in India. CONCLUSION
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Furthermore, as noted before the award was in the custody of the court, that is to say, 28-1- 1978 till the return of the award to the arbitrators on 24-11-1983, arbitrators or the parties could not have presented the award for its registration during that time. The award as we have noted before was made on 28-11-1977 and before the expiry of the four months from 28-11-1977, the award was filed in the court pursuant to the order of the court. It was argued that the order made by the court directing the arbitrators to keep the award in the custody of the court was wrong and without jurisdiction, but no arbitrator could be compelled to disobey the order of the court and if in compliance or obedience with court of doubtful jurisdiction, he could not take back the award from the custody of the court to take any further steps for its registration then it cannot be said that he has failed to get the award registered as the law required. The aforesaid two legal maxims — the law does not compel a man to do that which he cannot possibly perform and an act of the court shall prejudice no man would, apply with full vigour in the facts of this case and if that is the position then the award as we have noted before was presented before the Sub-Registrar, Arambagh on 25-11-1983 the very next one day of getting possession of the award from the court. The Sub-Registrar pursuant to the order of the High Court on 24-6-1985 found that the award was presented within time as the period during which the judicial proceedings were pending that is to say, from 28-1-1978 to 24-11-1983 should be excluded in view of the principle laid down in Section 15 of the Limitation Act, 1963. The High Court [Tarapada Dey v. District Registrar, Hooghly, 1986 SCC OnLine Cal 101 : AIR 1987 Cal 107] , therefore, in our opinion, was wrong in holding that the only period which should be excluded was from 26-7-1978 till 20-12-1982. We are unable to accept this position. 26-7-1978 was the date of the order of the learned Munsif directing maintenance of status quo and 20-12-1982 was the date when the interim injunction was vacated, but still the award was in the custody of the court and there is ample evidence as it would appear from the narration of events hereinbefore made that the arbitrators had tried to obtain the custody of the award which the court declined to give to them.(emphasis in original)50. These maxims have also been applied to tenancy legislation — see B.P. Khemka (P) Ltd. v. Birendra Kumar Bhowmick [B.P. Khemka (P) Ltd. v. Birendra Kumar Bhowmick, (1987) 2 SCC 407] (at para 12), and have also been applied to relieve authorities of fulfilling their obligation to allot plots when such plots have been found to be unallottable, owing to the contravention of the Central statutes — see Hira Tikkoo v. State (UT of Chandigarh) [Hira Tikkoo v. State (UT of Chandigarh), (2004) 6 SCC 765] (at paras 23 and 24).51. On an application of the aforesaid maxims to the present case, it is clear that though Section 65-B(4) is mandatory, yet, on the facts of this case, the respondents, having done everything possible to obtain the necessary certificate, which was to be given by a third party over whom the respondents had no control, must be relieved of the mandatory obligation contained in the said sub-section.82. As a matter of fact, even under the Income Tax Act, the High Court of Bombay has taken a view, applying the aforestated maxims in the context of the provisions of the relevant DTAAs, to hold that persons are not obligated to do the impossible, i.e., to apply a provision of a statute when it was not actually and factually on the statute book.85. It is thus clear that the person mentioned in section 195 of the Income Tax Act cannot be expected to do the impossible, namely, to apply the expanded definition of royalty inserted by explanation 4 to section 9(1)(vi) of the Income Tax Act, for the assessment years in question, at a time when such explanation was not actually and factually in the statute.87. The first and most comprehensive authority dealing with the question raised in these appeals is by the AAR in its ruling in Dassault Systems, K.K., In Re., (2010) 322 ITR 125 (AAR) [Dassault (AAR)]. In that case, the applicant was a company incorporated under the laws of Japan, which marketed licensed computer software products, through a distribution channel comprising value added resellers [VAR], who were independent third-party resellers in the business of selling software to end-users. The question posed by the AAR to itself was as follows:Whether on the facts and circumstances of the case and in law the payment received by Dassault Systems K.K. (hereinafter referred to as the the applicant) from sale of software products to independent third party resellers will be taxable as business profits under Article 7 of the India-Japan Double Taxation Avoidance Agreement (India-Japan DTAA or Treaty) and will not constitute royalties and fee for technical services as defined in Article 12 of India-Japan DTAA?88. After setting out Article 12 of the India-Japan DTAA, which is in the same terms as Article 12 of the India-Singapore DTAA and the other DTAAs that we are concerned with, and after adverting to the definition of royalty that is contained in explanation 2 to section 9(1)(vi) of the Income Tax Act, the AAR then set out, from the locus classicus on copyright law, the following passage:Before entering into a discussion on the applicability of the royalty definition, it is appropriate to recapitulate certain basic principles concerning the copyright as a legal concept. We may, in this connection, refer to some passages from the classic treatise of Copinger and Skone James on Copyright (1999 Edn):
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SREI EQUIPMENT FINANCE LIMITED Vs. RAJEEV ANAND & ORS | loans of Rs. 18.86 crores by an agreement dated 01.04.2016, and the second being a loan of Rs.16.80 crores by agreement dated 24.06.2016, with an interest figure of Rs.2.72 crores, the total amount coming to Rs.38.39 crores. 3. To this section 7 application, a counter affidavit was filed by the corporate debtor on 15.05.2017, in which it was stated that though Rs.35.66 crores have become due, yet a section 7 application was premature inasmuch as instalment payments that were agreed upon had not yet matured. It was on this basis that this first application was withdrawn by the appellant on 30.05.2017 with liberty to file a fresh application. 4. A fresh application was filed on 04.08.2017, in which it was claimed that insofar as the 01.04.2016 loan was concerned, the figure of Rs.21.41 crores was still outstanding. The corporate debtor now filed a counter affidavit in which it denied this and stated that, as a matter of fact, from 2008 till date, an amount of Rs.65.60 crores have been repaid by it. A supplementary affidavit was filed by the appellant dated 06.06.2018 which, owing to technical defects, was rejected. A second supplementary affidavit of 03.08.2018 was therefore filed, replacing this affidavit, in which it was explained that, as a matter of fact, the corporate debtor has made payment of Rs.18,86,00,000/- on 13.04.2016 and 16.04.2016, and thereafter of Rs.16,80,62,000/- from 05.07.2016 and 19.07.2016, as would be evident from pages 11 & 12 of the counter affidavit filed on behalf of the corporate debtor. Thus, the sum of Rs.35,66,62,000/- which has been paid by the corporate debtor to the appellant is on account of its previous outstanding of Rs.35,66,61,986/- which was outstanding on the part of the corporate debtor as on 31.03.2016 as was unconditionally and unequivocally admitted by the corporate debtor in its counter affidavit filed by it in the prior proceeding (I.B. No. 54(PB)/2017). A sum of Rs.18,86,00,000/-, disbursed to the corporate debtor by the appellant on 01.04.2016, is still due and payable to it. 5. On this pleading, the NCLT finally held: 21. The Corporate Debtor in the previous round of litigation had candidly admitted the restructuring of the total loan amount of Rs.35,66,61,986 by way of executing two contracts firstly being Agreement bearing No. 105996 dated 01.04.2016 for facility of Rs.18,86,00,000/- and secondly being Agreement bearing No. 111305 dated 24.06.2016 for facility of Rs.19,53,00,000/- as detailed in preceding para 5 of the order. It is also evident from a perusal of supplementary affidavit dated 03.08.2018 read with a copy of confirmation of transaction (Annexure-B) that a sum of Rs.18,86,00,000/- was further disbursed by the Petitioner on 13.04.2016 to the Respondent after the aforesaid candid admission by it and the said amount is an independent transaction and having no relevancy with the previous one. It does not lie in the mouth of the Corporate Debtor to take a contrary stand and principles in the nature of estoppel would come in play. As a result thereof, the NCLT admitted the application and appointed a Resolution Professional. A Committee of Creditors was also thereafter appointed. 6. The impugned judgment referred to the NCLT order and then held as follows: 19. Thus, it is clear that document which was already rejected by the Adjudicating Authority, has been made the basis for passing the Order of Admission, which is not permissible under law. 20. Based on loan Agreement dated 1st April 2016 the amount Rs. 18,86,00,000/- was disbursed. The bank certificate filed by Corporate Debtor shows that while amount has been returned back. But the finding of the Adjudicating Authority that a sum of Rs.18,86,00,000/-was again disbursed to the Corporate Debtor is not supported by any evidence. The Corporate Debtor has filed the document to prove that he has repaid the said amount through RTGS transfer to the account of the Financial Creditor. 21. During the argument, it is admitted by the parties that previous petition filed by the Financial Creditor was withdrawn. The document(s) filed in the earlier petition, which was dismissed as withdrawn, could not have been relied on by the Adjudicating Authority. Therefore, it is clear that finding of the Adjudicating authority that a sum of Rs.18,86,00,000/- was again disbursed to the Corporate Debtor by the Financial Creditor which is still due and payable is erroneous, without any basis and unsustainable. As a result thereof, the NCLAT allowed the appeal and set aside the NCLT order, thereby making it clear that the section 7 application will have to be dismissed. 7. We have heard learned counsel for the parties, including the parties in Civil Appeal No.1911 of 2020 and Civil Appeal No.3112 of 2020. A bare reading of the NCLT order shows that it is only after a perusal of the documents, pleadings, and the supplementary affidavit of 03.08.2018, including the counter affidavit in the earlier section 7 application, that the NCLT came to the conclusion that a loan amount remained outstanding. The NCLAT, when it dealt with the NCLT order, wrongly recorded that documents which were already rejected by the adjudicating authority could not have been the basis of the order of admission. The NCLAT also wrongly recorded that there was no further evidence in support of the fact that any amount was outstanding. Further, the NCLAT also held that a document filed in the earlier petition that was dismissed as withdrawn could not have been relied upon by the adjudicating authority. The NCLAT is wrong on all these counts. As has been stated earlier, documents evidencing an outstanding loan amount were produced; a supplementary affidavit dated 03.08.2018 was also relied upon; and the admission made in the counter affidavit that was made in the first round of litigation, can by no means be described as a document in an earlier petition that could not be relied upon. The document was not a pleading by the appellant - it was a counter affidavit by the corporate debtor in which a clear admission of the debt being outstanding was made. | 1[ds]7. We have heard learned counsel for the parties, including the parties in Civil Appeal No.1911 of 2020 and Civil Appeal No.3112 of 2020. A bare reading of the NCLT order shows that it is only after a perusal of the documents, pleadings, and the supplementary affidavit of 03.08.2018, including the counter affidavit in the earlier section 7 application, that the NCLT came to the conclusion that a loan amount remained outstanding. The NCLAT, when it dealt with the NCLT order, wrongly recorded that documents which were already rejected by the adjudicating authority could not have been the basis of the order of admission. The NCLAT also wrongly recorded that there was no further evidence in support of the fact that any amount was outstanding. Further, the NCLAT also held that a document filed in the earlier petition that was dismissed as withdrawn could not have been relied upon by the adjudicating authority. The NCLAT is wrong on all these counts. As has been stated earlier, documents evidencing an outstanding loan amount were produced; a supplementary affidavit dated 03.08.2018 was also relied upon; and the admission made in the counter affidavit that was made in the first round of litigation, can by no means be described as a document in an earlier petition that could not be relied upon. The document was not a pleading by the appellant - it was a counter affidavit by the corporate debtor in which a clear admission of the debt being outstanding was made. | 1 | 1,193 | 275 | ### Instruction:
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loans of Rs. 18.86 crores by an agreement dated 01.04.2016, and the second being a loan of Rs.16.80 crores by agreement dated 24.06.2016, with an interest figure of Rs.2.72 crores, the total amount coming to Rs.38.39 crores. 3. To this section 7 application, a counter affidavit was filed by the corporate debtor on 15.05.2017, in which it was stated that though Rs.35.66 crores have become due, yet a section 7 application was premature inasmuch as instalment payments that were agreed upon had not yet matured. It was on this basis that this first application was withdrawn by the appellant on 30.05.2017 with liberty to file a fresh application. 4. A fresh application was filed on 04.08.2017, in which it was claimed that insofar as the 01.04.2016 loan was concerned, the figure of Rs.21.41 crores was still outstanding. The corporate debtor now filed a counter affidavit in which it denied this and stated that, as a matter of fact, from 2008 till date, an amount of Rs.65.60 crores have been repaid by it. A supplementary affidavit was filed by the appellant dated 06.06.2018 which, owing to technical defects, was rejected. A second supplementary affidavit of 03.08.2018 was therefore filed, replacing this affidavit, in which it was explained that, as a matter of fact, the corporate debtor has made payment of Rs.18,86,00,000/- on 13.04.2016 and 16.04.2016, and thereafter of Rs.16,80,62,000/- from 05.07.2016 and 19.07.2016, as would be evident from pages 11 & 12 of the counter affidavit filed on behalf of the corporate debtor. Thus, the sum of Rs.35,66,62,000/- which has been paid by the corporate debtor to the appellant is on account of its previous outstanding of Rs.35,66,61,986/- which was outstanding on the part of the corporate debtor as on 31.03.2016 as was unconditionally and unequivocally admitted by the corporate debtor in its counter affidavit filed by it in the prior proceeding (I.B. No. 54(PB)/2017). A sum of Rs.18,86,00,000/-, disbursed to the corporate debtor by the appellant on 01.04.2016, is still due and payable to it. 5. On this pleading, the NCLT finally held: 21. The Corporate Debtor in the previous round of litigation had candidly admitted the restructuring of the total loan amount of Rs.35,66,61,986 by way of executing two contracts firstly being Agreement bearing No. 105996 dated 01.04.2016 for facility of Rs.18,86,00,000/- and secondly being Agreement bearing No. 111305 dated 24.06.2016 for facility of Rs.19,53,00,000/- as detailed in preceding para 5 of the order. It is also evident from a perusal of supplementary affidavit dated 03.08.2018 read with a copy of confirmation of transaction (Annexure-B) that a sum of Rs.18,86,00,000/- was further disbursed by the Petitioner on 13.04.2016 to the Respondent after the aforesaid candid admission by it and the said amount is an independent transaction and having no relevancy with the previous one. It does not lie in the mouth of the Corporate Debtor to take a contrary stand and principles in the nature of estoppel would come in play. As a result thereof, the NCLT admitted the application and appointed a Resolution Professional. A Committee of Creditors was also thereafter appointed. 6. The impugned judgment referred to the NCLT order and then held as follows: 19. Thus, it is clear that document which was already rejected by the Adjudicating Authority, has been made the basis for passing the Order of Admission, which is not permissible under law. 20. Based on loan Agreement dated 1st April 2016 the amount Rs. 18,86,00,000/- was disbursed. The bank certificate filed by Corporate Debtor shows that while amount has been returned back. But the finding of the Adjudicating Authority that a sum of Rs.18,86,00,000/-was again disbursed to the Corporate Debtor is not supported by any evidence. The Corporate Debtor has filed the document to prove that he has repaid the said amount through RTGS transfer to the account of the Financial Creditor. 21. During the argument, it is admitted by the parties that previous petition filed by the Financial Creditor was withdrawn. The document(s) filed in the earlier petition, which was dismissed as withdrawn, could not have been relied on by the Adjudicating Authority. Therefore, it is clear that finding of the Adjudicating authority that a sum of Rs.18,86,00,000/- was again disbursed to the Corporate Debtor by the Financial Creditor which is still due and payable is erroneous, without any basis and unsustainable. As a result thereof, the NCLAT allowed the appeal and set aside the NCLT order, thereby making it clear that the section 7 application will have to be dismissed. 7. We have heard learned counsel for the parties, including the parties in Civil Appeal No.1911 of 2020 and Civil Appeal No.3112 of 2020. A bare reading of the NCLT order shows that it is only after a perusal of the documents, pleadings, and the supplementary affidavit of 03.08.2018, including the counter affidavit in the earlier section 7 application, that the NCLT came to the conclusion that a loan amount remained outstanding. The NCLAT, when it dealt with the NCLT order, wrongly recorded that documents which were already rejected by the adjudicating authority could not have been the basis of the order of admission. The NCLAT also wrongly recorded that there was no further evidence in support of the fact that any amount was outstanding. Further, the NCLAT also held that a document filed in the earlier petition that was dismissed as withdrawn could not have been relied upon by the adjudicating authority. The NCLAT is wrong on all these counts. As has been stated earlier, documents evidencing an outstanding loan amount were produced; a supplementary affidavit dated 03.08.2018 was also relied upon; and the admission made in the counter affidavit that was made in the first round of litigation, can by no means be described as a document in an earlier petition that could not be relied upon. The document was not a pleading by the appellant - it was a counter affidavit by the corporate debtor in which a clear admission of the debt being outstanding was made.
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7. We have heard learned counsel for the parties, including the parties in Civil Appeal No.1911 of 2020 and Civil Appeal No.3112 of 2020. A bare reading of the NCLT order shows that it is only after a perusal of the documents, pleadings, and the supplementary affidavit of 03.08.2018, including the counter affidavit in the earlier section 7 application, that the NCLT came to the conclusion that a loan amount remained outstanding. The NCLAT, when it dealt with the NCLT order, wrongly recorded that documents which were already rejected by the adjudicating authority could not have been the basis of the order of admission. The NCLAT also wrongly recorded that there was no further evidence in support of the fact that any amount was outstanding. Further, the NCLAT also held that a document filed in the earlier petition that was dismissed as withdrawn could not have been relied upon by the adjudicating authority. The NCLAT is wrong on all these counts. As has been stated earlier, documents evidencing an outstanding loan amount were produced; a supplementary affidavit dated 03.08.2018 was also relied upon; and the admission made in the counter affidavit that was made in the first round of litigation, can by no means be described as a document in an earlier petition that could not be relied upon. The document was not a pleading by the appellant - it was a counter affidavit by the corporate debtor in which a clear admission of the debt being outstanding was made.
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National Cement Mines Industries Ltd Vs. The Commissioner of Income Tax, West Bengal, Calcutta | Cas 310: 1920-1 KB 71 or a mineral royalty depending upon the quantity of minerals raised, Kamakshya Narain Singh v. Commr. of Income-tax, B. and O., 70 Ind App 180: (AIR 1943 PC 153 ) or computed on sales of manufactured articles-Commissioners of Inland Revenue v. 36/49 Holdings Ltd., (1944) 25 Tax Cas 173 or a percentage of gross profits made in the exploitation of a secret process - Delage v. Nugget Polish Co., Ltd., (1905) 21 TLR 454 is income and taxable. 13. Counsel for the appellants submited that the receipt under cl. (1) of the terms of the deed dated may 7, 1935, was in the nature of capital payment and relied upon certain decisions in support of that submission.14. In Minister of National Revenue v. Catherine Spooner, 1933 AC 684: (AIR 1933 PC 211 ) decided by the Judicial Committee of the Privy Council in an appeal from the Supreme Court of Canada, the respondent Catherine Spooner had sold her rights, title and interest in land owned by her in freehold to a company in consideration of a certain sum in cash, besides shares of the company, and an agreement to deliver 10% of oil produced from the land on which the company covenanted to carry out drilling and, if oil was found, pumping operations. These were described as royalties. Oil was struck in the lands and the respondent was paid 10% of the gross proceeds of the oil produced in lieu of oil. The Supreme Court of Canada held that the sum so received was not an annual profit or gain within the meaning of S. 3 of the Income War Tax Act, but, a receipt of a capital nature and therefore not chargeable to tax. According to the Judicial committee, there was between the respondent and the company no relation of lessor or lessee: the transaction was one of sale and purchase, and the transaction had taken the form which it did because of the uncertainty whether oil would be found by the purchaser. As the value of the land depended on this contingency, the price, not unnaturally was made to depend in part on the event of oil being struck. The judgment lays down no new principle; it proceeded merely upon interpretation of the document in the light of the circumstances. 15. In Trustees of Earl Haig v. Commrs. of Inland Revenue, (1939) 22 Tax Cas 725, the question which fell to be determined was whether a share of the royalties received in consideration of allowing the use of the diaries of the late Earl Haig for writing his biography were, in the hands of the trustees under the will of Earl Haig, capital receipts. That was undoubtedly a case in which payments received by the trustees were dependent upon the professional activities of the author and the proceeds derived from the sales of the biography he wrote. By the agreement, the author was authorised to extract and publish from the diaries what he though fit. The diaries were undoubtedly an asset, and after they were used by the author for publication of the biography, their value as an asset was, if not wholly, largely exhausted and their future value was negligible. The agreement was, therefore, regarded as conveying as asset in its entirety to the author in consideration of a share in the royalties and the receipt of this share was regarded as receipt of capital. That decision proceeded upon the special character of the agreement and the receipt of this share was regarded as receipt of capital. That decision proceeded upon the special character of the agreement and the nature of the asset transferred and did not seek to lay down any general principle. 16. In Nethersole v. Withers, (1948) 28 Tax Cas 501, N who had acquired under an agreement the exclusive right to dramatise a novel of Rudyard Kipling received under an agreement with the widow of the author, a third share of a lump sum for which the sound and film rights were granted exclusively to a film company for a period of ten years. The film right of a comprehensive character having been granted by the legal representative of the author against payment of the sum stipulated, the question arose whether the payment received by N was taxable under the Income-tax Act under Case II of Schedule D or under Case VI of Schedule D. It was held that N having ceased to be the owner of the portion of the copyright she had assigned, the proceeds were not annual profits or gains within the meaning of Schedule D Case VI. That was a case in which N had wholly sold and disposed of the part of the property and the amount received by her was the price paid in lump and was not in the nature of income. That case also proceeded upon the special character of the transaction. 17. The case of Commrs. of Inland Revenue v. Marine Steam Turbine Co., Ltd., (1920) 12 Tax Cas 174 on which reliance was sought to be placed by counsel for the appellants needs no detailed consideration. In that case, a company which was on the facts found not carrying on a trade or business was held not assessable to Excess Profits Duty, because the condition of liability was the carrying on of trade or business. 18. The appellants had, however, not sold the entirety of the rights acquired by them from the Karanpura Company. The conveyance was subject to several restrictions and the appellants retained in part rights in the land conveyed. The transaction was substantially a commercial transaction for sharing the profits of the commercial activities of the Associated Cement Ltd. The High Court was, therefore, right in holding that the transaction dated May 7, 1935 was a commercial transaction and the payment under cl. (1) thereof at the rate of 0.13 As per ton of cement sold was of the nature of income and not capital. | 0[ds]It a difficult to categorise a transaction of this character. It is not a conveyance of all the rights of the appellants nor can it be regarded as a sale even of the rights which were conveyed. Numerous restrictions were imposed by the deed upon the rights of the transferee which were inconsistent in their very nature with the character of a sale, and the covenant authorising termination of the deed in the event of the limestone being exhausted removes all doubt in that behalf. Nor is it a lease: it is not a transfer of a right to enjoy property for a certain time in consideration of periodical payments. It also does not evidence a transaction in the nature of a joint venture between the appellants and the Associated Cement Ltd. Cement was to be manufactured by the Associated Cement Ltd. out of limestone to be won from the lands and in consideration of the rights conveyed, payments at specified rates were agreed to be made out of the price to be obtained by sale of cement. Fluxstone and limestone. The appellants had no control over the production of limestone and manufacture of cement or on the sale of fluxstone and limestone. But in assessing the true character of the receipt for the purpose of the Income-tax Act, inabliity to ascribe to the transaction of definite category is of little consequence. It is not the nature of the receipt under the general law but in commerce that is materialThe judgment lays down no new principle; it proceeded merely upon interpretation of the document in the light of the circumstances18. The appellants had, however, not sold the entirety of the rights acquired by them from the Karanpura Company. The conveyance was subject to several restrictions and the appellants retained in part rights in the land conveyed. The transaction was substantially a commercial transaction for sharing the profits of the commercial activities of the Associated Cement Ltd. The High Court was, therefore, right in holding that the transaction dated May 7, 1935 was a commercial transaction and the payment under cl. (1) thereof at the rate of 0.13 As per ton of cement sold was of the nature of income and not capital9. There was also the covenant authorising the Associated Cement Ltd. to terminate the deed in the event of limestone in the land comprised in the leases being exhausted. The appellants undoubtedly did not part with all their rights in favour of the Associated Cement Ltd. by this deed dated May 7, 1935. The consideration under the deed consisted of a fixed component and annual payments fluctuating with the business activity of the Associated Cement Ltd. A fixed amount of Rs. 25,000 was paid for trouble and expenses in obtaining the leases and agreements and additional payments were to be made under cls. (1), (3) and (4) subject to the minimum prescribed by cl. (5).It a difficult to categorise a transaction of this character. It is not a conveyance of all the rights of the appellants nor can it be regarded as a sale even of the rights which were conveyed. Numerous restrictions were imposed by the deed upon the rights of the transferee which were inconsistent in their very nature with the character of a sale, and the covenant authorising termination of the deed in the event of the limestone being exhausted removes all doubt in that behalf. Nor is it a lease: it is not a transfer of a right to enjoy property for a certain time in consideration of periodical payments. It also does not evidence a transaction in the nature of a joint venture between the appellants and the Associated Cement Ltd. Cement was to be manufactured by the Associated Cement Ltd. out of limestone to be won from the lands and in consideration of the rights conveyed, payments at specified rates were agreed to be made out of the price to be obtained by sale of cement. Fluxstone and limestone. The appellants had no control over the production of limestone and manufacture of cement or on the sale of fluxstone and limestone. But in assessing the true character of the receipt for the purpose of thex Act, inabliity to ascribe to the transaction of definite category is of little consequence. It is not the nature of the receipt under the general law but in commerce that is. It is often difficult to distinguish whether an agreement is for payment of a debt by instalments or for making annual payments in the nature of income. The court has, on an appraisal of all the facts, to assess whether a transaction is commercial incharacter yielding income or is one in consideration of parting with property for repayment of capital in instalments. No single test of universal application can be discovered for solution of the problem. The name which the parties may give to the transaction which is the source of the receipt and the characterization of the receipt by them are of little moment, and the true nature and character of the transaction have to be ascertained from the covenants of the contract in the light of the surrounding circumstances. The decision of the question is however not left to the application of any arbitrary standards. There are certain broad principles which guide the determination of the character of the receipt. The distinction between a capital receipt and revenue receipt though fine is real. The dividing line may be thin, and often at first sight imperceptible10. Where capital is repaid in instalments, it is not liable to; for instance when a person sells his property and agrees to receive the price stipulated in instalments, by whatever name such instalments are called, they are not liable tov. Fletcher, (1858) 3N. 769, Secy. of State in Council of India v. Scoble, 1903 ACd v. Kirkcaldy Magistrates, 1919 SCCommissioners of Inland Revenue11. But where property is conveyed in consideration of what in truth is annuity payable for definite or a definable period, the annuity is not payment on capital account and is taxablesee, State of Bihar v. Sir Kameshwar Singh,1 ITR 382: (AIR 1952 Pat 417 ), Gopal Saran Narain Singh v. Commr. of3 ITR 237: (AIR 1935 PC 143 ), Chadwick v. Pearl Life Assurance Co., (1905) 2 KB 50712. Again, if propety is conveyed in consideration of periodical payments, the payment being a share of profits of a business or profession(1920) 7 Tax Cas 310:71 or a mineral royalty depending upon the quantity of minerals raised, Kamakshya Narain Singh v. Commr. of, B. and O., 70 Ind App 180: (AIR 1943 PC 153 ) or computed on sales of manufactureds of Inland Revenue v. 36/49 Holdings Ltd., (1944) 25 Tax Cas173 or a percentage of gross profits made in the exploitation of a secret processe v. Nugget Polish Co., Ltd., (1905) 21 TLRAs the value of the land depended on this contingency, the price, not unnaturally was made to depend in part on the event of oil being struck.The judgment lays down no new principle; it proceeded merely upon interpretation of the document in the light of the circumstancesThat decision proceeded upon the special character of the agreement and the receipt of this share was regarded as receipt of capital. That decision proceeded upon the special character of the agreement and the nature of the asset transferred and did not seek to lay down any general principleThat was a case in which N had wholly sold and disposed of the part of the property and the amount received by her was the price paid in lump and was not in the nature of income. That case also proceeded upon the special character of the transactionIn that case, a company which was on the facts found not carrying on a trade or business was held not assessable to Excess Profits Duty, because the condition of liability was the carrying on of trade or business. | 0 | 4,373 | 1,450 | ### Instruction:
First, predict whether the appeal in case proceeding will be accepted (1) or not (0), and then explain the decision by identifying crucial sentences from the document.
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Cas 310: 1920-1 KB 71 or a mineral royalty depending upon the quantity of minerals raised, Kamakshya Narain Singh v. Commr. of Income-tax, B. and O., 70 Ind App 180: (AIR 1943 PC 153 ) or computed on sales of manufactured articles-Commissioners of Inland Revenue v. 36/49 Holdings Ltd., (1944) 25 Tax Cas 173 or a percentage of gross profits made in the exploitation of a secret process - Delage v. Nugget Polish Co., Ltd., (1905) 21 TLR 454 is income and taxable. 13. Counsel for the appellants submited that the receipt under cl. (1) of the terms of the deed dated may 7, 1935, was in the nature of capital payment and relied upon certain decisions in support of that submission.14. In Minister of National Revenue v. Catherine Spooner, 1933 AC 684: (AIR 1933 PC 211 ) decided by the Judicial Committee of the Privy Council in an appeal from the Supreme Court of Canada, the respondent Catherine Spooner had sold her rights, title and interest in land owned by her in freehold to a company in consideration of a certain sum in cash, besides shares of the company, and an agreement to deliver 10% of oil produced from the land on which the company covenanted to carry out drilling and, if oil was found, pumping operations. These were described as royalties. Oil was struck in the lands and the respondent was paid 10% of the gross proceeds of the oil produced in lieu of oil. The Supreme Court of Canada held that the sum so received was not an annual profit or gain within the meaning of S. 3 of the Income War Tax Act, but, a receipt of a capital nature and therefore not chargeable to tax. According to the Judicial committee, there was between the respondent and the company no relation of lessor or lessee: the transaction was one of sale and purchase, and the transaction had taken the form which it did because of the uncertainty whether oil would be found by the purchaser. As the value of the land depended on this contingency, the price, not unnaturally was made to depend in part on the event of oil being struck. The judgment lays down no new principle; it proceeded merely upon interpretation of the document in the light of the circumstances. 15. In Trustees of Earl Haig v. Commrs. of Inland Revenue, (1939) 22 Tax Cas 725, the question which fell to be determined was whether a share of the royalties received in consideration of allowing the use of the diaries of the late Earl Haig for writing his biography were, in the hands of the trustees under the will of Earl Haig, capital receipts. That was undoubtedly a case in which payments received by the trustees were dependent upon the professional activities of the author and the proceeds derived from the sales of the biography he wrote. By the agreement, the author was authorised to extract and publish from the diaries what he though fit. The diaries were undoubtedly an asset, and after they were used by the author for publication of the biography, their value as an asset was, if not wholly, largely exhausted and their future value was negligible. The agreement was, therefore, regarded as conveying as asset in its entirety to the author in consideration of a share in the royalties and the receipt of this share was regarded as receipt of capital. That decision proceeded upon the special character of the agreement and the receipt of this share was regarded as receipt of capital. That decision proceeded upon the special character of the agreement and the nature of the asset transferred and did not seek to lay down any general principle. 16. In Nethersole v. Withers, (1948) 28 Tax Cas 501, N who had acquired under an agreement the exclusive right to dramatise a novel of Rudyard Kipling received under an agreement with the widow of the author, a third share of a lump sum for which the sound and film rights were granted exclusively to a film company for a period of ten years. The film right of a comprehensive character having been granted by the legal representative of the author against payment of the sum stipulated, the question arose whether the payment received by N was taxable under the Income-tax Act under Case II of Schedule D or under Case VI of Schedule D. It was held that N having ceased to be the owner of the portion of the copyright she had assigned, the proceeds were not annual profits or gains within the meaning of Schedule D Case VI. That was a case in which N had wholly sold and disposed of the part of the property and the amount received by her was the price paid in lump and was not in the nature of income. That case also proceeded upon the special character of the transaction. 17. The case of Commrs. of Inland Revenue v. Marine Steam Turbine Co., Ltd., (1920) 12 Tax Cas 174 on which reliance was sought to be placed by counsel for the appellants needs no detailed consideration. In that case, a company which was on the facts found not carrying on a trade or business was held not assessable to Excess Profits Duty, because the condition of liability was the carrying on of trade or business. 18. The appellants had, however, not sold the entirety of the rights acquired by them from the Karanpura Company. The conveyance was subject to several restrictions and the appellants retained in part rights in the land conveyed. The transaction was substantially a commercial transaction for sharing the profits of the commercial activities of the Associated Cement Ltd. The High Court was, therefore, right in holding that the transaction dated May 7, 1935 was a commercial transaction and the payment under cl. (1) thereof at the rate of 0.13 As per ton of cement sold was of the nature of income and not capital.
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was, therefore, right in holding that the transaction dated May 7, 1935 was a commercial transaction and the payment under cl. (1) thereof at the rate of 0.13 As per ton of cement sold was of the nature of income and not capital9. There was also the covenant authorising the Associated Cement Ltd. to terminate the deed in the event of limestone in the land comprised in the leases being exhausted. The appellants undoubtedly did not part with all their rights in favour of the Associated Cement Ltd. by this deed dated May 7, 1935. The consideration under the deed consisted of a fixed component and annual payments fluctuating with the business activity of the Associated Cement Ltd. A fixed amount of Rs. 25,000 was paid for trouble and expenses in obtaining the leases and agreements and additional payments were to be made under cls. (1), (3) and (4) subject to the minimum prescribed by cl. (5).It a difficult to categorise a transaction of this character. It is not a conveyance of all the rights of the appellants nor can it be regarded as a sale even of the rights which were conveyed. Numerous restrictions were imposed by the deed upon the rights of the transferee which were inconsistent in their very nature with the character of a sale, and the covenant authorising termination of the deed in the event of the limestone being exhausted removes all doubt in that behalf. Nor is it a lease: it is not a transfer of a right to enjoy property for a certain time in consideration of periodical payments. It also does not evidence a transaction in the nature of a joint venture between the appellants and the Associated Cement Ltd. Cement was to be manufactured by the Associated Cement Ltd. out of limestone to be won from the lands and in consideration of the rights conveyed, payments at specified rates were agreed to be made out of the price to be obtained by sale of cement. Fluxstone and limestone. The appellants had no control over the production of limestone and manufacture of cement or on the sale of fluxstone and limestone. But in assessing the true character of the receipt for the purpose of thex Act, inabliity to ascribe to the transaction of definite category is of little consequence. It is not the nature of the receipt under the general law but in commerce that is. It is often difficult to distinguish whether an agreement is for payment of a debt by instalments or for making annual payments in the nature of income. The court has, on an appraisal of all the facts, to assess whether a transaction is commercial incharacter yielding income or is one in consideration of parting with property for repayment of capital in instalments. No single test of universal application can be discovered for solution of the problem. The name which the parties may give to the transaction which is the source of the receipt and the characterization of the receipt by them are of little moment, and the true nature and character of the transaction have to be ascertained from the covenants of the contract in the light of the surrounding circumstances. The decision of the question is however not left to the application of any arbitrary standards. There are certain broad principles which guide the determination of the character of the receipt. The distinction between a capital receipt and revenue receipt though fine is real. The dividing line may be thin, and often at first sight imperceptible10. Where capital is repaid in instalments, it is not liable to; for instance when a person sells his property and agrees to receive the price stipulated in instalments, by whatever name such instalments are called, they are not liable tov. Fletcher, (1858) 3N. 769, Secy. of State in Council of India v. Scoble, 1903 ACd v. Kirkcaldy Magistrates, 1919 SCCommissioners of Inland Revenue11. But where property is conveyed in consideration of what in truth is annuity payable for definite or a definable period, the annuity is not payment on capital account and is taxablesee, State of Bihar v. Sir Kameshwar Singh,1 ITR 382: (AIR 1952 Pat 417 ), Gopal Saran Narain Singh v. Commr. of3 ITR 237: (AIR 1935 PC 143 ), Chadwick v. Pearl Life Assurance Co., (1905) 2 KB 50712. Again, if propety is conveyed in consideration of periodical payments, the payment being a share of profits of a business or profession(1920) 7 Tax Cas 310:71 or a mineral royalty depending upon the quantity of minerals raised, Kamakshya Narain Singh v. Commr. of, B. and O., 70 Ind App 180: (AIR 1943 PC 153 ) or computed on sales of manufactureds of Inland Revenue v. 36/49 Holdings Ltd., (1944) 25 Tax Cas173 or a percentage of gross profits made in the exploitation of a secret processe v. Nugget Polish Co., Ltd., (1905) 21 TLRAs the value of the land depended on this contingency, the price, not unnaturally was made to depend in part on the event of oil being struck.The judgment lays down no new principle; it proceeded merely upon interpretation of the document in the light of the circumstancesThat decision proceeded upon the special character of the agreement and the receipt of this share was regarded as receipt of capital. That decision proceeded upon the special character of the agreement and the nature of the asset transferred and did not seek to lay down any general principleThat was a case in which N had wholly sold and disposed of the part of the property and the amount received by her was the price paid in lump and was not in the nature of income. That case also proceeded upon the special character of the transactionIn that case, a company which was on the facts found not carrying on a trade or business was held not assessable to Excess Profits Duty, because the condition of liability was the carrying on of trade or business.
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Bhagabandas Agarwalla Vs. Bhagwandas Kanu and Others | shall be terminable, "on the part of either lessor or lessee, by fifteen days notice expiring with the end of a month of the tenancy". The argument of the respondents before the High Court was that the notice to quit did not expire with the end of the month of the tenancy and was hence invalid. This argument found favour with the High Court and it held that the notice to quit was not clear and unambiguous and w as "open to doubt as to the date of determination of the tenancy" and did not terminate the tenancy on the expiration of the month of the tenancy and was, therefore, invalid and in this view it dismissed the suit of the appellant. The appellant thereupon preferred the present appeal with special leave obtained from this Court.The only question which arises for determination in this appeal is whether the notice to quit given by t he appellant to the respondents was invalid as not being in conformity with the requirements of section 106 of the Transfer of Property Act. The notice to quit, so far as material, was in the following terms:"You are hereby informed by this notice that you will vacate the said house for our possession within the month of October 1962 otherwise you will be treated as trespassers from 1st November in respect of the said house."2. The tenancy was admittedly a monthly tenancy and hence the notice to quit could not be said to be valid under section 106 of the Transfer of Property Act unless it expired with the end. of the month of the tenancy. The view taken by the High Court was that since by the notice to quit the appellant called upon the respondents to vacate the premises "within the month of October 1962" and not on the expiration of that month, the notice to quit was not in accordance with law and did not operate to determine the tenancy of the respondents. The quest ion is whether this view taken by the High Court can be sustained.3. Now, it is settled law that a notice to quit must be construed not with a desire to find faults in it, which would render it defective, but it must be construed ut res magis valeat quam pereat. "The validity of a notice to quit", as pointed out by Lord Justice Lindley, L.J. in Sidebotham v. Holland ([1895] 1 Q.B. 378. (2) 45 I.A. 222.), "ought not to turn on the splitting of a straw". It must not be read in a hyper-critical manner, nor must its interpretation be affected by pedagogic pendantism or overrefined subtlety, but it must be construed in a commonsense way. See Harihar Banerji v. Ramsashi Roy(2). The notice to quit in the present case must be judged for its validity in the light of this well recognised principle of interpretation.It is indisputable that under section 106 of the Transfer of Property Act the notice to quit must expire with the end of the month of the tenancy or in other words, it must terminate the tenancy with effect from the expiration of the month of the tenancy. If it terminates the tenancy with effect from an earlier date, it would be clearly invalid. Now, here the notice to quit required the respondents to vacate the premises "within the month of October 1962" and intimated to them that otherwise they would be "treated as trespassers from 1st November" in respect of the premises. The question is: what is the meaning and effect of the words "within the month of October 1962" in the context in which they are used in the notice to quit? Do these words mean that the tenancy of the respondents was sought to be terminated at a date earlier than the expiration of the month of October 1962 and they were re- quired to vacate the premises before such expiration ? We do not think so. When the notice to quit required the respondents to vacate "within the month of October 1962"; what it mean t was that the respondents could vacate at any time within the month of October 1962 but not later than the expiration of that month. The last moment up to which the respondents could, according to the notice to quit, lawfully continue to remain in possession of the premises was the mid-night of 31st October, 1962. We fail to see any differ- ence between a notice asking a tenant to vacate "within the month of October 1962" and a notice requiring a tenant to vacate latest by the mid-night of 3lst October, 1962, because in both cases, the tenant would be entitled to occupy the premises up to the expiration of 31st October, 1962 but not beyond it . This position would seem to follow logically and incontestably, as a matter of plain natural construction, from the use of the words "within the month of October 1962" without any thing more, but here it is placed be yond doubt or controversy by the notice to quit proceeding to add that otherwise the respondents would be treated as trespassers from 1st November, 1962. This makes the intention of the authors of the notice clear that they a re terminating the tenancy only with effect from the end of the month of October 1962 and not with effect from any earlier point of time during the currency of that month. If the respondents do not vacate the premises within the month of October 1962, they would be treated as trespassers from 1st November, 1962 and not from any earlier date, clearly implying that they would lawfully continue as tenants up to the expiration of the month of October 1962. The tenancy was, therefore, sought to be determined on the expiration of the month of October 1962 and not earlier and the notice to quit expired with the end of the month of tenancy as required by section 106 of the Transfer of Property Act. | 1[ds]The tenancy was admittedly a monthly tenancy and hence the notice to quit could not be said to be valid under section 106 of the Transfer of Property Act unless it expired with the end. of the month of the tenancy. The view taken by the High Court was that since by the notice to quit the appellant called upon the respondents to vacate the premises "within the month of October 1962" and not on the expiration of that month, the notice to quit was not in accordance with law and did not operate to determine the tenancy of thenotice to quit in the present case must be judged for its validity in the light of this well recognised principle of interpretation.It is indisputable that under section 106 of the Transfer of Property Act the notice to quit must expire with the end of the month of the tenancy or in other words, it must terminate the tenancy with effect from the expiration of the month of the tenancy. If it terminates the tenancy with effect from an earlier date, it would be clearly invalid. Now, here the notice to quit required the respondents to vacate the premises "within the month of October 1962" and intimated to them that otherwise they would be "treated as trespassers from 1st November" in respect of the premises. The question is: what is the meaning and effect of the words "within the month of October 1962" in the context in which they are used in the notice to quit? Do these words mean that the tenancy of the respondents was sought to be terminated at a date earlier than the expiration of the month of October 1962 and they were re- quired to vacate the premises before such expiration ? We do not think so. When the notice to quit required the respondents to vacate "within the month of October 1962"; what it mean t was that the respondents could vacate at any time within the month of October 1962 but not later than the expiration of that month. The last moment up to which the respondents could, according to the notice to quit, lawfully continue to remain in possession of the premises was the mid-night of 31st October, 1962. We fail to see any differ- ence between a notice asking a tenant to vacate "within the month of October 1962" and a notice requiring a tenant to vacate latest by the mid-night of 3lst October, 1962, because in both cases, the tenant would be entitled to occupy the premises up to the expiration of 31st October, 1962 but not beyond it . This position would seem to follow logically and incontestably, as a matter of plain natural construction, from the use of the words "within the month of October 1962" without any thing more, but here it is placed be yond doubt or controversy by the notice to quit proceeding to add that otherwise the respondents would be treated as trespassers from 1st November, 1962. This makes the intention of the authors of the notice clear that they a re terminating the tenancy only with effect from the end of the month of October 1962 and not with effect from any earlier point of time during the currency of that month. If the respondents do not vacate the premises within the month of October 1962, they would be treated as trespassers from 1st November, 1962 and not from any earlier date, clearly implying that they would lawfully continue as tenants up to the expiration of the month of October 1962. The tenancy was, therefore, sought to be determined on the expiration of the month of October 1962 and not earlier and the notice to quit expired with the end of the month of tenancy as required by section 106 of the Transfer of Property Act. | 1 | 1,319 | 695 | ### Instruction:
Conjecture the end result of the case (acceptance (1) or non-acceptance (0) of the appeal), followed by a detailed explanation using crucial sentences from the case proceeding.
### Input:
shall be terminable, "on the part of either lessor or lessee, by fifteen days notice expiring with the end of a month of the tenancy". The argument of the respondents before the High Court was that the notice to quit did not expire with the end of the month of the tenancy and was hence invalid. This argument found favour with the High Court and it held that the notice to quit was not clear and unambiguous and w as "open to doubt as to the date of determination of the tenancy" and did not terminate the tenancy on the expiration of the month of the tenancy and was, therefore, invalid and in this view it dismissed the suit of the appellant. The appellant thereupon preferred the present appeal with special leave obtained from this Court.The only question which arises for determination in this appeal is whether the notice to quit given by t he appellant to the respondents was invalid as not being in conformity with the requirements of section 106 of the Transfer of Property Act. The notice to quit, so far as material, was in the following terms:"You are hereby informed by this notice that you will vacate the said house for our possession within the month of October 1962 otherwise you will be treated as trespassers from 1st November in respect of the said house."2. The tenancy was admittedly a monthly tenancy and hence the notice to quit could not be said to be valid under section 106 of the Transfer of Property Act unless it expired with the end. of the month of the tenancy. The view taken by the High Court was that since by the notice to quit the appellant called upon the respondents to vacate the premises "within the month of October 1962" and not on the expiration of that month, the notice to quit was not in accordance with law and did not operate to determine the tenancy of the respondents. The quest ion is whether this view taken by the High Court can be sustained.3. Now, it is settled law that a notice to quit must be construed not with a desire to find faults in it, which would render it defective, but it must be construed ut res magis valeat quam pereat. "The validity of a notice to quit", as pointed out by Lord Justice Lindley, L.J. in Sidebotham v. Holland ([1895] 1 Q.B. 378. (2) 45 I.A. 222.), "ought not to turn on the splitting of a straw". It must not be read in a hyper-critical manner, nor must its interpretation be affected by pedagogic pendantism or overrefined subtlety, but it must be construed in a commonsense way. See Harihar Banerji v. Ramsashi Roy(2). The notice to quit in the present case must be judged for its validity in the light of this well recognised principle of interpretation.It is indisputable that under section 106 of the Transfer of Property Act the notice to quit must expire with the end of the month of the tenancy or in other words, it must terminate the tenancy with effect from the expiration of the month of the tenancy. If it terminates the tenancy with effect from an earlier date, it would be clearly invalid. Now, here the notice to quit required the respondents to vacate the premises "within the month of October 1962" and intimated to them that otherwise they would be "treated as trespassers from 1st November" in respect of the premises. The question is: what is the meaning and effect of the words "within the month of October 1962" in the context in which they are used in the notice to quit? Do these words mean that the tenancy of the respondents was sought to be terminated at a date earlier than the expiration of the month of October 1962 and they were re- quired to vacate the premises before such expiration ? We do not think so. When the notice to quit required the respondents to vacate "within the month of October 1962"; what it mean t was that the respondents could vacate at any time within the month of October 1962 but not later than the expiration of that month. The last moment up to which the respondents could, according to the notice to quit, lawfully continue to remain in possession of the premises was the mid-night of 31st October, 1962. We fail to see any differ- ence between a notice asking a tenant to vacate "within the month of October 1962" and a notice requiring a tenant to vacate latest by the mid-night of 3lst October, 1962, because in both cases, the tenant would be entitled to occupy the premises up to the expiration of 31st October, 1962 but not beyond it . This position would seem to follow logically and incontestably, as a matter of plain natural construction, from the use of the words "within the month of October 1962" without any thing more, but here it is placed be yond doubt or controversy by the notice to quit proceeding to add that otherwise the respondents would be treated as trespassers from 1st November, 1962. This makes the intention of the authors of the notice clear that they a re terminating the tenancy only with effect from the end of the month of October 1962 and not with effect from any earlier point of time during the currency of that month. If the respondents do not vacate the premises within the month of October 1962, they would be treated as trespassers from 1st November, 1962 and not from any earlier date, clearly implying that they would lawfully continue as tenants up to the expiration of the month of October 1962. The tenancy was, therefore, sought to be determined on the expiration of the month of October 1962 and not earlier and the notice to quit expired with the end of the month of tenancy as required by section 106 of the Transfer of Property Act.
### Response:
1
### Explanation:
The tenancy was admittedly a monthly tenancy and hence the notice to quit could not be said to be valid under section 106 of the Transfer of Property Act unless it expired with the end. of the month of the tenancy. The view taken by the High Court was that since by the notice to quit the appellant called upon the respondents to vacate the premises "within the month of October 1962" and not on the expiration of that month, the notice to quit was not in accordance with law and did not operate to determine the tenancy of thenotice to quit in the present case must be judged for its validity in the light of this well recognised principle of interpretation.It is indisputable that under section 106 of the Transfer of Property Act the notice to quit must expire with the end of the month of the tenancy or in other words, it must terminate the tenancy with effect from the expiration of the month of the tenancy. If it terminates the tenancy with effect from an earlier date, it would be clearly invalid. Now, here the notice to quit required the respondents to vacate the premises "within the month of October 1962" and intimated to them that otherwise they would be "treated as trespassers from 1st November" in respect of the premises. The question is: what is the meaning and effect of the words "within the month of October 1962" in the context in which they are used in the notice to quit? Do these words mean that the tenancy of the respondents was sought to be terminated at a date earlier than the expiration of the month of October 1962 and they were re- quired to vacate the premises before such expiration ? We do not think so. When the notice to quit required the respondents to vacate "within the month of October 1962"; what it mean t was that the respondents could vacate at any time within the month of October 1962 but not later than the expiration of that month. The last moment up to which the respondents could, according to the notice to quit, lawfully continue to remain in possession of the premises was the mid-night of 31st October, 1962. We fail to see any differ- ence between a notice asking a tenant to vacate "within the month of October 1962" and a notice requiring a tenant to vacate latest by the mid-night of 3lst October, 1962, because in both cases, the tenant would be entitled to occupy the premises up to the expiration of 31st October, 1962 but not beyond it . This position would seem to follow logically and incontestably, as a matter of plain natural construction, from the use of the words "within the month of October 1962" without any thing more, but here it is placed be yond doubt or controversy by the notice to quit proceeding to add that otherwise the respondents would be treated as trespassers from 1st November, 1962. This makes the intention of the authors of the notice clear that they a re terminating the tenancy only with effect from the end of the month of October 1962 and not with effect from any earlier point of time during the currency of that month. If the respondents do not vacate the premises within the month of October 1962, they would be treated as trespassers from 1st November, 1962 and not from any earlier date, clearly implying that they would lawfully continue as tenants up to the expiration of the month of October 1962. The tenancy was, therefore, sought to be determined on the expiration of the month of October 1962 and not earlier and the notice to quit expired with the end of the month of tenancy as required by section 106 of the Transfer of Property Act.
|
Shipping Corporation Of India Ltd Vs. Mare Shipping Inc | made on behalf of the Charterers to convince us that it was really the duty and responsibility of the Owner of the vessel to check whether the vessel could be safely moored at the SBM in Vadinar, we are unable to convince ourselves that such a duty was that of the Owners of the vessel and not the Charterers which had a choice of all the ports in India for discharge of the cargo, as was subsequently done in Mumbai port. As has been held by the Arbitral Tribunal and subsequently affirmed both by the learned Single Judge and the Division Bench of the Bombay High Court, the responsibility for the failure of the ship to moor at the SBM in Vadinar must lie squarely with the Charterers and the receiver as it was they who had nominated the SBM for the safe mooring of the vessel. The lay time must, therefore, be held to have recommenced after the expiry of six hours from the tendering of the Notice of Readiness upon the vessels arrival at the customary anchorage at Vadinar on 15.12.1999 in keeping with the provisions of Clause 6 of the Charter Party. It was not the case of the Charterers that the failure of the vessel to discharge its cargo at the SBM at Vadinar was for reasons beyond their control. It cannot also be said that the owners of the vessel contributed in any way to such failure since the equipment on board the vessel had been made known to the Charterers when the Charter Party was signed. 46. In the face of the specific conditions indicated in Clause 6 of the Charter Party, the theoretical and/or academic exercise of what constitutes an “arrived ship” loses much of its relevance. The terms of the Charter Party were agreed upon by the parties with their eyes wide open. What is also significant and cuts at the root of the submissions advanced on behalf of the Charterers is that even after the vessel was denied mooring at the SBM for safety reasons on 21.12.1999, no steps were taken on behalf of the Petitioners to either arrange for an alternate safe berthing in Vadinar or to give instructions as to where the cargo was to be discharged. In fact, on behalf of the Respondents/Owners a legal notice was addressed to the Petitioners on 24.12.1999 pointing out that the vessel continued to await discharge incurring demurrage. It is only thereafter that Addendum No.I to the Charter Party was drawn up and signed on 28.12.1999 by the Owners and the Charterers, whereby m.t. Prestige was diverted by the Charterers from Vadinar to a Lighterage point at Mumbai port for discharge and it was specifically agreed that the Charterers would bear all the costs of discharge, including freight charges and the expenses of the daughter vessel, m.t. Maharaja Agrasen. It was also agreed that demurrage would be settled as per the terms of the Charter Party. In our view, the various decisions cited on behalf of the Petitioners/Charterers do not help them in the facts of this case. We do not, therefore, think it necessary to consider all the decisions cited on behalf of the respective parties and those referred to hereinbefore are sufficient for our purpose. The decisions relied upon by the parties lay down certain propositions of law which are well-established and with which there cannot be any disagreement, but for the purposes of this case they are basically academic. 47. Once we have affirmed the finding that m.t. Prestige was an arrived ship on reaching the customary anchorage at Vadinar port and once we have also held that it was the Charterers who having the choice of a safe port, had selected the SBM at Vadinar as the discharge point, the suggestion made on behalf of the Charterers that it was the responsibility of the Owners of the vessel to check whether the ship could be safely moored at the SBM, is untenable. The responsibility of the Owners of the vessel ended with the declaration of the equipment available on board for mooring and berthing for the purpose of discharge of its cargo. Consequently, all the other ancillary issues which arise have to be answered in favour of the Respondents herein. As indicated hereinbefore, the fiasco at Vadinar was occasioned by the fact that no prior checking had been done by the Charterers to ascertain as to whether with the mooring equipment on board the vessel she would be able to moor safely at the SBM for discharge of her cargo. Even the subsequent deviation of the vessel from Vadinar to Mumbai was not on account of any laches on the part of the Owners of the vessel who were awaiting instructions once the vessel had been asked to move away from the SBM. In fact, it took a notice from the Owners of the vessel and a week for the Charterers to galvanize themselves into action, which ultimately resulted in the Addendum No.1 dated 28.12.1999. 48. Read with Clause 6 of the Charter Party, the Addendum dated 28.12.1999 makes it abundantly clear that the Charterers had accepted the responsibility for the failure of the vessel to discharge her cargo at Vadinar and had agreed to bear all the expenses for the delay in diversion of the vessel from Vadinar to Mumbai, including the time spent at Vadinar port and the expenses incurred towards pilotage, tugs and other port expenses. 49. Apart from the above, Clause 4(1) of Part II of the Charter Party specifically provides that extra expenses incurred on account of any change in loading or discharging ports, has to be paid by the Charterers, and any time thereby lost to the vessel shall count as used lay time. We are not inclined to accept Mr. Guptas submission that the aforesaid clause has to be read in the context of Clauses 4(a) and 4(b) which refer to ports other than Indian Ports in a different context. 50. | 0[ds]The concept of an arrived ship in shipping terminology requires that a vessel should reach a destination in a port where she could be safely berthed and thereupon be ready to either discharge or load cargo from and on to the vessel. That is a general concept, but the Charterers and the Owners of the vessel could in the Charter Party agree to a specific destination point within the port area for discharging or loading of cargo. Once the vessel arrived at the said spot and was ready to discharge its cargo, it could be described as anth the authority to issue and tender Notice of Readiness. In the instant case, the nominated port for the arrival of the vessel was Vadinar Port, but the destination point was the SBM where the vessel was to be moored and was to discharge its cargo of crude oil. In fact, in the Charter Party dated 9.11.1999, Clause 6 specifically provided for arrival of the vessel at the port of loading or discharge and cast an obligation upon the Master or his Agent to give the Charterer or his Agent Notice of Readiness in relation to discharge of theMaster of the vessel was under an obligation to give Notice of Readiness on arrival at the customary anchorage at the port of discharge. It is a possibility that since no specific port in the Indian coastline had been mentioned in the Charter Party, the Master of the vessel or his Agent was required to give Notice of Readiness upon the vessel arriving at customary anchorage. It is only after the vessel sailed from Ras Sukheir that the receiver, IOC, nominated Vadinar to be the port of discharge with the specific destination point being the SBM within the port. In giving such Notice of Readiness upon arrival at the customary anchorage at Vadinar, the Master of the Vessel duly complied with the conditions of Clause 6 of the Charter Party and in terms of the aforesaid clause irrespective of whether a berth was available or not, lay time commenced upon the expiry of six hours after receipt of such notice. That the vessel could not be moored at the SBM is a different facet of the story. The Charterers had full knowledge of the equipment on board m.t. Prestige through the questionnaire provided by the Respondents/Owners to the Petitioners/Charterers. It could not be denied that despite having such knowledge the IOC nominated the SBM as the destination point for discharge of the cargo. Obviously, the parties to the Charter Party had not made any attempt to verify as to whether the equipment on board the vessel was sufficient for her to be safely moored at the SBM and to discharge her cargo safely. As it turned out later on, the vessel was not so equipped and could not, therefore, be moored at the SBM and had to be requested to move away therefrom. Although, an attempt has been made on behalf of the Charterers to convince us that it was really the duty and responsibility of the Owner of the vessel to check whether the vessel could be safely moored at the SBM in Vadinar, we are unable to convince ourselves that such a duty was that of the Owners of the vessel and not the Charterers which had a choice of all the ports in India for discharge of the cargo, as was subsequently done in Mumbai port. As has been held by the Arbitral Tribunal and subsequently affirmed both by the learned Single Judge and the Division Bench of the Bombay High Court, the responsibility for the failure of the ship to moor at the SBM in Vadinar must lie squarely with the Charterers and the receiver as it was they who had nominated the SBM for the safe mooring of the vessel. The lay time must, therefore, be held to have recommenced after the expiry of six hours from the tendering of the Notice of Readiness upon the vessels arrival at the customary anchorage at Vadinar on 15.12.1999 in keeping with the provisions of Clause 6 of the Charter Party. It was not the case of the Charterers that the failure of the vessel to discharge its cargo at the SBM at Vadinar was for reasons beyond their control. It cannot also be said that the owners of the vessel contributed in any way to such failure since the equipment on board the vessel had been made known to the Charterers when the Charter Party wasthe face of the specific conditions indicated in Clause 6 of the Charter Party, the theoretical and/or academic exercise of what constitutes anes much of its relevance. The terms of the Charter Party were agreed upon by the parties with their eyes wide open. What is also significant and cuts at the root of the submissions advanced on behalf of the Charterers is that even after the vessel was denied mooring at the SBM for safety reasons on 21.12.1999, no steps were taken on behalf of the Petitioners to either arrange for an alternate safe berthing in Vadinar or to give instructions as to where the cargo was to be discharged. In fact, on behalf of the Respondents/Owners a legal notice was addressed to the Petitioners on 24.12.1999 pointing out that the vessel continued to await discharge incurring demurrage. It is only thereafter that Addendum No.I to the Charter Party was drawn up and signed on 28.12.1999 by the Owners and the Charterers, whereby m.t. Prestige was diverted by the Charterers from Vadinar to a Lighterage point at Mumbai port for discharge and it was specifically agreed that the Charterers would bear all the costs of discharge, including freight charges and the expenses of the daughter vessel, m.t. Maharaja Agrasen. It was also agreed that demurrage would be settled as per the terms of the Charter Party. In our view, the various decisions cited on behalf of the Petitioners/Charterers do not help them in the facts of this case. We do not, therefore, think it necessary to consider all the decisions cited on behalf of the respective parties and those referred to hereinbefore are sufficient for our purpose. The decisions relied upon by the parties lay down certain propositions of law which are well-established and with which there cannot be any disagreement, but for the purposes of this case they are basicallywe have affirmed the finding that m.t. Prestige was an arrived ship on reaching the customary anchorage at Vadinar port and once we have also held that it was the Charterers who having the choice of a safe port, had selected the SBM at Vadinar as the discharge point, the suggestion made on behalf of the Charterers that it was the responsibility of the Owners of the vessel to check whether the ship could be safely moored at the SBM, is untenable. The responsibility of the Owners of the vessel ended with the declaration of the equipment available on board for mooring and berthing for the purpose of discharge of its cargo. Consequently, all the other ancillary issues which arise have to be answered in favour of the Respondents herein. As indicated hereinbefore, the fiasco at Vadinar was occasioned by the fact that no prior checking had been done by the Charterers to ascertain as to whether with the mooring equipment on board the vessel she would be able to moor safely at the SBM for discharge of her cargo. Even the subsequent deviation of the vessel from Vadinar to Mumbai was not on account of any laches on the part of the Owners of the vessel who were awaiting instructions once the vessel had been asked to move away from the SBM. In fact, it took a notice from the Owners of the vessel and a week for the Charterers to galvanize themselves into action, which ultimately resulted in the Addendum No.1 dated 28.12.1999. | 0 | 8,207 | 1,398 | ### Instruction:
Hypothesize the court's verdict (affirmation (1) or negation (0) of the appeal), and then clarify this hypothesis by interpreting significant sentences from the case proceeding.
### Input:
made on behalf of the Charterers to convince us that it was really the duty and responsibility of the Owner of the vessel to check whether the vessel could be safely moored at the SBM in Vadinar, we are unable to convince ourselves that such a duty was that of the Owners of the vessel and not the Charterers which had a choice of all the ports in India for discharge of the cargo, as was subsequently done in Mumbai port. As has been held by the Arbitral Tribunal and subsequently affirmed both by the learned Single Judge and the Division Bench of the Bombay High Court, the responsibility for the failure of the ship to moor at the SBM in Vadinar must lie squarely with the Charterers and the receiver as it was they who had nominated the SBM for the safe mooring of the vessel. The lay time must, therefore, be held to have recommenced after the expiry of six hours from the tendering of the Notice of Readiness upon the vessels arrival at the customary anchorage at Vadinar on 15.12.1999 in keeping with the provisions of Clause 6 of the Charter Party. It was not the case of the Charterers that the failure of the vessel to discharge its cargo at the SBM at Vadinar was for reasons beyond their control. It cannot also be said that the owners of the vessel contributed in any way to such failure since the equipment on board the vessel had been made known to the Charterers when the Charter Party was signed. 46. In the face of the specific conditions indicated in Clause 6 of the Charter Party, the theoretical and/or academic exercise of what constitutes an “arrived ship” loses much of its relevance. The terms of the Charter Party were agreed upon by the parties with their eyes wide open. What is also significant and cuts at the root of the submissions advanced on behalf of the Charterers is that even after the vessel was denied mooring at the SBM for safety reasons on 21.12.1999, no steps were taken on behalf of the Petitioners to either arrange for an alternate safe berthing in Vadinar or to give instructions as to where the cargo was to be discharged. In fact, on behalf of the Respondents/Owners a legal notice was addressed to the Petitioners on 24.12.1999 pointing out that the vessel continued to await discharge incurring demurrage. It is only thereafter that Addendum No.I to the Charter Party was drawn up and signed on 28.12.1999 by the Owners and the Charterers, whereby m.t. Prestige was diverted by the Charterers from Vadinar to a Lighterage point at Mumbai port for discharge and it was specifically agreed that the Charterers would bear all the costs of discharge, including freight charges and the expenses of the daughter vessel, m.t. Maharaja Agrasen. It was also agreed that demurrage would be settled as per the terms of the Charter Party. In our view, the various decisions cited on behalf of the Petitioners/Charterers do not help them in the facts of this case. We do not, therefore, think it necessary to consider all the decisions cited on behalf of the respective parties and those referred to hereinbefore are sufficient for our purpose. The decisions relied upon by the parties lay down certain propositions of law which are well-established and with which there cannot be any disagreement, but for the purposes of this case they are basically academic. 47. Once we have affirmed the finding that m.t. Prestige was an arrived ship on reaching the customary anchorage at Vadinar port and once we have also held that it was the Charterers who having the choice of a safe port, had selected the SBM at Vadinar as the discharge point, the suggestion made on behalf of the Charterers that it was the responsibility of the Owners of the vessel to check whether the ship could be safely moored at the SBM, is untenable. The responsibility of the Owners of the vessel ended with the declaration of the equipment available on board for mooring and berthing for the purpose of discharge of its cargo. Consequently, all the other ancillary issues which arise have to be answered in favour of the Respondents herein. As indicated hereinbefore, the fiasco at Vadinar was occasioned by the fact that no prior checking had been done by the Charterers to ascertain as to whether with the mooring equipment on board the vessel she would be able to moor safely at the SBM for discharge of her cargo. Even the subsequent deviation of the vessel from Vadinar to Mumbai was not on account of any laches on the part of the Owners of the vessel who were awaiting instructions once the vessel had been asked to move away from the SBM. In fact, it took a notice from the Owners of the vessel and a week for the Charterers to galvanize themselves into action, which ultimately resulted in the Addendum No.1 dated 28.12.1999. 48. Read with Clause 6 of the Charter Party, the Addendum dated 28.12.1999 makes it abundantly clear that the Charterers had accepted the responsibility for the failure of the vessel to discharge her cargo at Vadinar and had agreed to bear all the expenses for the delay in diversion of the vessel from Vadinar to Mumbai, including the time spent at Vadinar port and the expenses incurred towards pilotage, tugs and other port expenses. 49. Apart from the above, Clause 4(1) of Part II of the Charter Party specifically provides that extra expenses incurred on account of any change in loading or discharging ports, has to be paid by the Charterers, and any time thereby lost to the vessel shall count as used lay time. We are not inclined to accept Mr. Guptas submission that the aforesaid clause has to be read in the context of Clauses 4(a) and 4(b) which refer to ports other than Indian Ports in a different context. 50.
### Response:
0
### Explanation:
Clause 6 of the Charter Party and in terms of the aforesaid clause irrespective of whether a berth was available or not, lay time commenced upon the expiry of six hours after receipt of such notice. That the vessel could not be moored at the SBM is a different facet of the story. The Charterers had full knowledge of the equipment on board m.t. Prestige through the questionnaire provided by the Respondents/Owners to the Petitioners/Charterers. It could not be denied that despite having such knowledge the IOC nominated the SBM as the destination point for discharge of the cargo. Obviously, the parties to the Charter Party had not made any attempt to verify as to whether the equipment on board the vessel was sufficient for her to be safely moored at the SBM and to discharge her cargo safely. As it turned out later on, the vessel was not so equipped and could not, therefore, be moored at the SBM and had to be requested to move away therefrom. Although, an attempt has been made on behalf of the Charterers to convince us that it was really the duty and responsibility of the Owner of the vessel to check whether the vessel could be safely moored at the SBM in Vadinar, we are unable to convince ourselves that such a duty was that of the Owners of the vessel and not the Charterers which had a choice of all the ports in India for discharge of the cargo, as was subsequently done in Mumbai port. As has been held by the Arbitral Tribunal and subsequently affirmed both by the learned Single Judge and the Division Bench of the Bombay High Court, the responsibility for the failure of the ship to moor at the SBM in Vadinar must lie squarely with the Charterers and the receiver as it was they who had nominated the SBM for the safe mooring of the vessel. The lay time must, therefore, be held to have recommenced after the expiry of six hours from the tendering of the Notice of Readiness upon the vessels arrival at the customary anchorage at Vadinar on 15.12.1999 in keeping with the provisions of Clause 6 of the Charter Party. It was not the case of the Charterers that the failure of the vessel to discharge its cargo at the SBM at Vadinar was for reasons beyond their control. It cannot also be said that the owners of the vessel contributed in any way to such failure since the equipment on board the vessel had been made known to the Charterers when the Charter Party wasthe face of the specific conditions indicated in Clause 6 of the Charter Party, the theoretical and/or academic exercise of what constitutes anes much of its relevance. The terms of the Charter Party were agreed upon by the parties with their eyes wide open. What is also significant and cuts at the root of the submissions advanced on behalf of the Charterers is that even after the vessel was denied mooring at the SBM for safety reasons on 21.12.1999, no steps were taken on behalf of the Petitioners to either arrange for an alternate safe berthing in Vadinar or to give instructions as to where the cargo was to be discharged. In fact, on behalf of the Respondents/Owners a legal notice was addressed to the Petitioners on 24.12.1999 pointing out that the vessel continued to await discharge incurring demurrage. It is only thereafter that Addendum No.I to the Charter Party was drawn up and signed on 28.12.1999 by the Owners and the Charterers, whereby m.t. Prestige was diverted by the Charterers from Vadinar to a Lighterage point at Mumbai port for discharge and it was specifically agreed that the Charterers would bear all the costs of discharge, including freight charges and the expenses of the daughter vessel, m.t. Maharaja Agrasen. It was also agreed that demurrage would be settled as per the terms of the Charter Party. In our view, the various decisions cited on behalf of the Petitioners/Charterers do not help them in the facts of this case. We do not, therefore, think it necessary to consider all the decisions cited on behalf of the respective parties and those referred to hereinbefore are sufficient for our purpose. The decisions relied upon by the parties lay down certain propositions of law which are well-established and with which there cannot be any disagreement, but for the purposes of this case they are basicallywe have affirmed the finding that m.t. Prestige was an arrived ship on reaching the customary anchorage at Vadinar port and once we have also held that it was the Charterers who having the choice of a safe port, had selected the SBM at Vadinar as the discharge point, the suggestion made on behalf of the Charterers that it was the responsibility of the Owners of the vessel to check whether the ship could be safely moored at the SBM, is untenable. The responsibility of the Owners of the vessel ended with the declaration of the equipment available on board for mooring and berthing for the purpose of discharge of its cargo. Consequently, all the other ancillary issues which arise have to be answered in favour of the Respondents herein. As indicated hereinbefore, the fiasco at Vadinar was occasioned by the fact that no prior checking had been done by the Charterers to ascertain as to whether with the mooring equipment on board the vessel she would be able to moor safely at the SBM for discharge of her cargo. Even the subsequent deviation of the vessel from Vadinar to Mumbai was not on account of any laches on the part of the Owners of the vessel who were awaiting instructions once the vessel had been asked to move away from the SBM. In fact, it took a notice from the Owners of the vessel and a week for the Charterers to galvanize themselves into action, which ultimately resulted in the Addendum No.1 dated 28.12.1999.
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The Kolhapur Municipal Corporation & Ors Vs. Vasant Mahadev Patil (Dead) Through L.R.s & Ors | reserved area is coming within High Flood Line and every year for a period of fifteen days to one month, the said area gets flooded during rainy season. In that view of the matter, the High Court ought not to have directed the Corporation to still acquire the land and pay the compensation to the original landowners though the land in question is unsuitable and unusable for the public purposes for which it has been reserved. As observed hereinabove, as such at the time when the planning was made and the land in question was put under reservation for public purposes, a duty was cast upon the Planning Officer to consider whether the land, which will have to be acquired and for which the compensation is to be paid is really suitable and/or usable for the public purposes for which it is reserved. Otherwise, every landowner will see to it that though his land is not suitable and/or not very valuable, is put under reservation and the same is acquired by the Corporation and/or the Planning Authority and thereafter he is paid the compensation. No Corporation and/or the Planning Authority and/or the Appropriate Authority can be compelled to acquire the land which according to the Corporation/Planning Authority is not suitable and/or usable for the purposes for which it is reserved. Any other interpretation would lead to colourable and fraudulent exercise of power and cause financial burden on the public exchequer. 16. At this stage, it is required to be noted that in fact there was a valid reason for the Corporation not to go ahead with the acquisition. Under the Act of 2013, the Corporation was required to pay a huge sum of Rs. 77,65,12,000/- by way of compensation under the Act of 2013. According to the Corporation, when the entire annual budget for acquisition was Rs.21 crores, it was beyond their financial position and/or budgetary provision to pay such a huge compensation, that too, for the land which is not suitable and/or useable for the purposes for which it has been reserved. It may be true that under the MRTP Act, in the Development Plan, the Planning Authority and/or the Appropriate Authority has to make the provisions for the public purposes mentioned in Clauses (b) and (c) of Section 22 and sub-section (5) of Section 31 of the MRTP Act and that is also desired for an appropriate planning of a city and therefore the financial constraint cannot be the sole consideration to acquire the land for the purposes for which it has been reserved namely public purposes. However, at the same time, when such a huge amount of compensation is to be paid and there would be a heavy financial burden, which as such is beyond the financial capacity of the Corporation, such a financial constraint can be said to be one of the relevant considerations, though not the sole consideration before embarking upon reservation of a particular extent of land for development. Even otherwise, in the facts and circumstances of this case, when land is found to be unsuitable and unusable for the purposes for which it has been reserved, Corporation cannot be compelled to pay a huge compensation for such a useless and unsuitable land. 17. Now, the submission on behalf of the original landowners that if the Corporation is not in a position to pay the compensation, in that case, they are ready to accept the TDR in lieu of the amount of compensation shall be considered. At one point of time, the aforesaid proposal was under consideration by the Corporation and the Corporation even moved a Civil Application before the High Court to direct the landowners to accept the TDR. Therefore, on the principle of approbate and reprobate, it is contended by the landowners that the Corporation cannot now be permitted to deny TDR to the original landowners, we observe that first of all, it is required to be noted that the said principle of approbate and reprobate would be equally appliable to the landowners also. Before the High Court, the original landowners specifically filed the affidavits dated 01.08.2018 and 07.08.2018, as observed and noted by the High Court in the impugned judgment and order in paragraph 5 that they do not wish to avail of TDR and their only prayer before the High Court was to acquire the land and to pay them the compensation. Therefore, now it is not open for the respondents -original landowners to pray for the TDR in respect of the land in question. 17.1 Even otherwise, a landowner is entitled to TDR in lieu of compensation with respect to the land reserved provided the land to be acquired is suitable and/or usable by the Corporation. Once it is found that the land is not usable and/or suitable for the purposes for which it has been reserved, the Corporation cannot still be compelled and directed to acquire the land and grant TDR in lieu of amount of compensation. Even as per Clause 11.2.2 of the Unified Development Control and Promotion Regulations, 2020 (UDCPR, 2020) for Maharashtra State under which the TDR is claimed, the compensation in terms of TDR shall be permissible for:- xxxxxxxxxxxx ii) lands under any deemed reservations according to any regulations prepared as per the provisions of Maharashtra Regional & Town Planning Act,1966; xxxxxxxxxxxx v) development or construction of the amenity on the reserved or deemed reserved land; xxxxxxxxxxxx Therefore, it can be argued that there cannot be any TDR in lieu of compensation to be paid for the reserved land which reservation is deemed to have lapsed as in the instant case. 17.2 Even Clause 11.2.3 of the above Regulations states that it shall not be permissible to grant TDR for existing nallah, river, natural stream, natural pond, tank, water bodies etc. and reservations which are not developable under the provisions of UDCPR, 2020. Therefore, for the reasons stated hereinabove, the prayer of the respondents to grant them TDR deserves rejection and is hereby rejected. | 1[ds]If that be so, we fail to understand what the reason was for the Planning Authority to designate such a land for a public purpose and/or to reserve the land in question in the Development Plan for a public purpose and thereafter to acquire and pay the compensation if the said land was not at all suitable and/or usable.9.5 As observed hereinabove, at the time of preparing the Development Plan and keeping a particular land reserved for a particular public purpose, an important duty is cast upon the Planning Authority to first satisfy that the land reserved which thereafter has to be acquired on payment of compensation is very much suitable and usable for that public purpose. In the instant case, how the area, which is a flood affected area and through which a rivulet named Jayanti Nala passes can be kept under reservation for a particular public purpose and can be used for public purposes like parking and/or for widening of the road etc.? Therefore, while preparing the Development Plan and reserving and/or designating a particular land for a particular public purpose, great care and caution is to be exercised by the Planning Authority. As per Section 125 of the Act, any land required, reserved or designated in a Development plan or Town Planning Scheme for a public purpose or purposes including plans for any area of comprehensive development or for any new town shall be deemed to be land needed for a public purpose within the meaning of the Land Acquisition Act, 1894. Hence, all the parameters concerning the suitability of the land for the particular public purpose for which the land is to be reserved and acquired for utilization must be borne in mind as a factor of paramount importance.10.3 In the case of Girnar Traders (supra), this Court had occasion to consider the entire scheme of Sections 126 and 127. Insofar as Section 127 is concerned, this Court has observed and held in paragraphs 31 and 32 as under:-31. Section 127 prescribes two-time periods. First, a period of 10 years within which the acquisition of the land reserved, allotted or designated has to be completed by agreement from the date on which a regional plan or development plan comes into force, or the proceedings for acquisition of such land under the MRTP Act or under the LA Act are commenced. Secondly, if the first part of Section 127 is not complied with or no steps are taken, then the second part of Section 127 will come into operation, under which a period of six months is provided from the date on which the notice has been served by the owner within which the land has to be acquired or the steps as aforesaid are to be commenced for its acquisition. The six month period shall commence from the date the owner or any person interested in the land serves a notice on the planning authority, development authority or appropriate authority expressing his intent claiming dereservation of the land. If neither of the things is done, the reservation shall lapse. If there is no notice by the owner or any person interested, there is no question of lapsing reservation, allotment or designation of the land under the development plan. Second part of Section 127 stipulates that the reservation of the land under a development scheme shall lapse if the land is not acquired or no steps are taken for acquisition of the land within the period of six months from the date of service of the purchase notice. The word aforesaid in the collocation of the words no steps as aforesaid are commenced for its acquisition obviously refers to the steps contemplated by Section 126 of the MRTP Act.32. If no proceedings as provided under Section 127 are taken and as a result thereof the reservation of the land lapses, the land shall be released from reservation, allotment or designation and shall be available to the owner for the purpose of development. The availability of the land to the owner for the development would only be for the purpose which is permissible in the case of adjacent land under the relevant plan. Thus, even after the release, the owner cannot utilise the land in whatever manner he deems fit and proper, but its utilisation has to be in conformity with the relevant plan for which the adjacent lands are permitted to be utilised.10.4 On emphasizing the word steps used in Section 127 of the MRTP Act, it is observed and held in paragraphs 56 and 57 as under:-56. The underlying principle envisaged in Section 127 of the MRTP Act is either to utilise the land for the purpose it is reserved in the plan in a given time or let the owner utilise the land for the purpose it is permissible under the town planning scheme. The step taken under the section within the time stipulated should be towards acquisition of land. It is a step of acquisition of land and not step for acquisition of land. It is trite that failure of authorities to take steps which result in actual commencement of acquisition of land cannot be permitted to defeat the purpose and object of the scheme of acquisition under the MRTP Act by merely moving an application requesting the Government to acquire the land, which Government may or may not accept. Any step which may or may not culminate in the step for acquisition cannot be said to be a step towards acquisition.57. It may also be noted that the legislature while enacting Section 127 has deliberately used the word steps (in plural and not in singular) which are required to be taken for acquisition of the land. On construction of Section 126 which provides for acquisition of the land under the MRTP Act, it is apparent that the steps for acquisition of the land would be issuance of the declaration under Section 6 of the LA Act. Clause (c) of Section 126(1) merely provides for a mode by which the State Government can be requested for the acquisition of the land under Section 6 of the LA Act. The making of an application to the State Government for acquisition of the land would not be a step for acquisition of the land under reservation. Sub-section (2) of Section 126 leaves it open to the State Government either to permit the acquisition or not to permit, considering the public purpose for which the acquisition is sought for by the authorities. Thus, the steps towards acquisition would really commence when the State Government permits the acquisition and as a result thereof publishes the declaration under Section 6 of the LA Act.10.5 In Shrirampur Municipal Council, Shrirampur (supra), it was the case on behalf of the Planning Authority that after the purchase notice as per Section 127(1) is served and the Planning Authority and/or the Corporation has passed a resolution to acquire the land and it is communicated to the State Government, it can be said to be taking steps and therefore in such a situation the reservation cannot be said to have lapsed. The aforesaid position came to be negated by this Court in the aforesaid decision after considering the judgment of this Court in the case of Girnar Traders (supra). It is specifically observed and held that the expression no steps as aforesaid used in Section 127 of the Act, 1966 has to be read in the context of the provisions of the Act of 1894 and now the Act of 2013 and a mere passing of a Resolution by the Planning Authority or sending a letter to the Collector or even to the State Government cannot be treated as commencement of the proceedings for the acquisition of the land under the 1966 Act and/or 1894 Act or now the Act of 2013. It is observed and held that publication of a declaration under Section 6(2) of the Act of 1894 can be said to be conclusive evidence that the land is needed for a public purpose and imply taking active steps for the acquisition of the particular piece of land. In paragraphs 42 and 43 of the said judgment, it is observed and held as under:-42. We are further of the view that the majority in Girnar Traders [Girnar Traders v. State of Maharashtra, (2007) 7 SCC 555] had rightly observed that steps towards the acquisition would really commence when the State Government takes active steps for the acquisition of the particular piece of land which leads to publication of the declaration under Section 6 of the 1894 Act. Any other interpretation of the scheme of Sections 126 and 127 of the 1966 Act will make the provisions wholly unworkable and leave the landowner at the mercy of the Planning Authority and the State Government.43. The expression no steps as aforesaid used in Section 127 of the 1966 Act has to be read in the context of the provisions of the 1894 Act and mere passing of a resolution by the Planning Authority or sending of a letter to the Collector or even the State Government cannot be treated as commencement of the proceedings for the acquisition of land under the 1966 Act or the 1894 Act. By enacting Sections 125 to 127 of the 1966 Act, the State Legislature has made a definite departure from the scheme of acquisition enshrined in the 1894 Act. But a holistic reading of these provisions makes it clear that while engrafting the substance of some of the provisions of the 1894 Act in the 1966 Act and leaving out other provisions, the State Legislature has ensured that the landowners/other interested persons, whose land is utilised for execution of the development plan/town planning scheme, etc., are not left high and dry. This is the reason why time-limit of ten years has been prescribed in Section 31(5) and also under Sections 126 and 127 of the 1966 Act for the acquisition of land, with a stipulation that if the land is not acquired within six months of the service of notice under Section 127 or steps are not commenced for acquisition, reservation of the land will be deemed to have lapsed. Shri Naphades interpretation of the scheme of Sections 126 and 127, if accepted, will lead to absurd results and the landowners will be deprived of their right to use the property for an indefinite period without being paid compensation. That would tantamount to depriving the citizens of their property without the sanction of law and would result in violation of Article 300-A of the Constitution.10.6 Subsequently, in the case of Chhabildas (supra), it has been observed and held by this Court after considering the decisions of this Court in the cases of Girnar Traders (supra) and Shrirampur Municipal Council, Shrirampur (supra) that if a period of ten years has elapsed from the date of publication of the plan in question, and no steps for acquiring the land have been taken, then once a purchase notice is served under Section 127, steps to acquire the land must follow within a period of one year from the date of service of such notice, or else the land acquisition proceedings would lapse.11. Thus, as per the law laid down by this Court in the aforesaid three decisions, if the land reserved under the draft Development Plan/Development Plan is not acquired within a period of ten years form the date of final Development Plan and thereafter after expiry of ten years, the landowners serve a purchase notice and thereafter within a period of one year, no steps are taken to acquire the land, the reservation/allocation is deemed to have lapsed and the land stand released from such reservation/allocation. As held above, declaration under Section 6 of the Act of 1894 can be said to be taking steps as contemplated under Section 127 of the MRTP Act. After the enactment of the Act of 2013, the declaration under Section 6 of the Act of 1894 is now to be read and/or is substituted by declaration under Section 19 of the Act of 2013. Therefore, if within a period of one year from the date of receipt of purchase notice as per Section 127, a declaration under Section 19 of the Act, 2013 is not issued and the land is not acquired, the reservation/allocation under the Development Plan is deemed to have lapsed and the land is released from such reservation/allocation.11.1 Applying the law laid down by this Court in the aforesaid decisions to the present case, the first Development Plan under which the original writ petitioners land was reserved for public purposes was in the year 1976. Thereafter the second amended Development Plan was published on 18.12.1999 and came to be implemented from 01.02.2000, under which also the land of the original writ petitioners was reserved for public purposes. But the same had not been acquired for ten years despite the respondents – original writ petitioners having issued a purchase notice dated 02.01.2012 under Section 127 of the MRTP Act for acquisition of the reserved area. A mere Resolution being passed by the General Body of the Corporation to acquire the land and sending a letter to the Collector to acquire the land, without any further steps being taken under the Land Acquisition Act, namely no declaration under section 6 thereof being issued within a period of one year from the receipt of the said purchase notice, would result in the reservation as deemed to have lapsed.12. In the present case, the High Court has issued a writ of Mandamus directing the Corporation to issue a declaration under Section 19 of the Act of 2013 mainly on the ground that the General Body of the Corporation had passed a Resolution dated 18.02.2012 resolving that the land in question is required to be acquired and the same is needed for the purpose for which it has been reserved. However, in our view, mere passing of a Resolution and/or making a budgetary provision for payment of the compensation in the budget cannot be said to be taking steps as contemplated under section 127 of the MRTP Act.Therefore, once the reservation of land under the Development Plan is deemed to have lapsed by operation of law and it is released from reservation, no writ of Mandamus could have been issued by the High Court directing the Corporation to still acquire the land and to issue a declaration under Section 19 of the Act of 2013 (as in the meantime, the Land Acquisition Act, 1894 has been repealed and Act of 2013 has been enacted). Once by operation of law, the reservation is deemed to have lapsed, it is lapsed for all purposes and for all times to come.13. Now, so far as the observation made by the High Court that after the reservation is deemed to have lapsed, it has not been notified in the Official Gazette as required under Section 127(2) of the MRTP Act is concerned, we observe that notification in the Official Gazette is only a consequential act and it has nothing to do with the actual lapsing of reservation by operation of law as the reservation is deemed to have lapsed under Section 127(1). Thereafter issuance of the notification of lapse of the reservation of land is only a procedural act and non- issuance of such a notification in the Official Gazette with respect to lapse of the reservation, allocation or designation would not affect the lapse of the reservation under Section 127(1) of the MRTP Act.14. Therefore, as such once the reservation with respect to the land in question was deemed to have lapsed as observed hereinabove, no further writ of mandamus could have been issued by the High Court to acquire the land and thereafter pay the compensation to the landowners, as on the lapse of the reservation, the land in question is free from reservation and the landowners can use it as if there is no reservation, however, subject to provisions of the MRTP Act.15. Even otherwise, in the facts and circumstances of the case, the High Court had erred and/or the High Court was not justified in directing the Municipal Corporation to acquire the land in question and to issue a declaration under Section 19 of the Act of 2013 and to pay compensation under the Act of 2013. It is to be noted that right from the very beginning it was stated in the counter before the High Court that the land in question was not suitable and/or usable for the purposes for which it has been reserved. It was specifically pointed out that the subject land is flood affected through which a rivulet named Jayanti Nala passes, making it unsuitable for the public purposes for which it was reserved. It was also specifically pointed out that unless and until the substantial development is carried out, the land in question is not usable at all. It was also specifically pointed out that the reserved area is coming within High Flood Line and every year for a period of fifteen days to one month, the said area gets flooded during rainy season. In that view of the matter, the High Court ought not to have directed the Corporation to still acquire the land and pay the compensation to the original landowners though the land in question is unsuitable and unusable for the public purposes for which it has been reserved. As observed hereinabove, as such at the time when the planning was made and the land in question was put under reservation for public purposes, a duty was cast upon the Planning Officer to consider whether the land, which will have to be acquired and for which the compensation is to be paid is really suitable and/or usable for the public purposes for which it is reserved. Otherwise, every landowner will see to it that though his land is not suitable and/or not very valuable, is put under reservation and the same is acquired by the Corporation and/or the Planning Authority and thereafter he is paid the compensation. No Corporation and/or the Planning Authority and/or the Appropriate Authority can be compelled to acquire the land which according to the Corporation/Planning Authority is not suitable and/or usable for the purposes for which it is reserved. Any other interpretation would lead to colourable and fraudulent exercise of power and cause financial burden on the public exchequer.16. At this stage, it is required to be noted that in fact there was a valid reason for the Corporation not to go ahead with the acquisition. Under the Act of 2013, the Corporation was required to pay a huge sum of Rs. 77,65,12,000/- by way of compensation under the Act of 2013. According to the Corporation, when the entire annual budget for acquisition was Rs.21 crores, it was beyond their financial position and/or budgetary provision to pay such a huge compensation, that too, for the land which is not suitable and/or useable for the purposes for which it has been reserved. It may be true that under the MRTP Act, in the Development Plan, the Planning Authority and/or the Appropriate Authority has to make the provisions for the public purposes mentioned in Clauses (b) and (c) of Section 22 and sub-section (5) of Section 31 of the MRTP Act and that is also desired for an appropriate planning of a city and therefore the financial constraint cannot be the sole consideration to acquire the land for the purposes for which it has been reserved namely public purposes. However, at the same time, when such a huge amount of compensation is to be paid and there would be a heavy financial burden, which as such is beyond the financial capacity of the Corporation, such a financial constraint can be said to be one of the relevant considerations, though not the sole consideration before embarking upon reservation of a particular extent of land for development. Even otherwise, in the facts and circumstances of this case, when land is found to be unsuitable and unusable for the purposes for which it has been reserved, Corporation cannot be compelled to pay a huge compensation for such a useless and unsuitable land.At one point of time, the aforesaid proposal was under consideration by the Corporation and the Corporation even moved a Civil Application before the High Court to direct the landowners to accept the TDR. Therefore, on the principle of approbate and reprobate, it is contended by the landowners that the Corporation cannot now be permitted to deny TDR to the original landowners, we observe that first of all, it is required to be noted that the said principle of approbate and reprobate would be equally appliable to the landowners also. Before the High Court, the original landowners specifically filed the affidavits dated 01.08.2018 and 07.08.2018, as observed and noted by the High Court in the impugned judgment and order in paragraph 5 that they do not wish to avail of TDR and their only prayer before the High Court was to acquire the land and to pay them the compensation. Therefore, now it is not open for the respondents -original landowners to pray for the TDR in respect of the land in question.17.1 Even otherwise, a landowner is entitled to TDR in lieu of compensation with respect to the land reserved provided the land to be acquired is suitable and/or usable by the Corporation. Once it is found that the land is not usable and/or suitable for the purposes for which it has been reserved, the Corporation cannot still be compelled and directed to acquire the land and grant TDR in lieu of amount of compensation.Therefore, it can be argued that there cannot be any TDR in lieu of compensation to be paid for the reserved land which reservation is deemed to have lapsed as in the instant case.17.2 Even Clause 11.2.3 of the above Regulations states that it shall not be permissible to grant TDR for existing nallah, river, natural stream, natural pond, tank, water bodies etc. and reservations which are not developable under the provisions of UDCPR, 2020.Therefore, for the reasons stated hereinabove, the prayer of the respondents to grant them TDR deserves rejection and is hereby rejected. | 1 | 13,691 | 3,997 | ### Instruction:
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reserved area is coming within High Flood Line and every year for a period of fifteen days to one month, the said area gets flooded during rainy season. In that view of the matter, the High Court ought not to have directed the Corporation to still acquire the land and pay the compensation to the original landowners though the land in question is unsuitable and unusable for the public purposes for which it has been reserved. As observed hereinabove, as such at the time when the planning was made and the land in question was put under reservation for public purposes, a duty was cast upon the Planning Officer to consider whether the land, which will have to be acquired and for which the compensation is to be paid is really suitable and/or usable for the public purposes for which it is reserved. Otherwise, every landowner will see to it that though his land is not suitable and/or not very valuable, is put under reservation and the same is acquired by the Corporation and/or the Planning Authority and thereafter he is paid the compensation. No Corporation and/or the Planning Authority and/or the Appropriate Authority can be compelled to acquire the land which according to the Corporation/Planning Authority is not suitable and/or usable for the purposes for which it is reserved. Any other interpretation would lead to colourable and fraudulent exercise of power and cause financial burden on the public exchequer. 16. At this stage, it is required to be noted that in fact there was a valid reason for the Corporation not to go ahead with the acquisition. Under the Act of 2013, the Corporation was required to pay a huge sum of Rs. 77,65,12,000/- by way of compensation under the Act of 2013. According to the Corporation, when the entire annual budget for acquisition was Rs.21 crores, it was beyond their financial position and/or budgetary provision to pay such a huge compensation, that too, for the land which is not suitable and/or useable for the purposes for which it has been reserved. It may be true that under the MRTP Act, in the Development Plan, the Planning Authority and/or the Appropriate Authority has to make the provisions for the public purposes mentioned in Clauses (b) and (c) of Section 22 and sub-section (5) of Section 31 of the MRTP Act and that is also desired for an appropriate planning of a city and therefore the financial constraint cannot be the sole consideration to acquire the land for the purposes for which it has been reserved namely public purposes. However, at the same time, when such a huge amount of compensation is to be paid and there would be a heavy financial burden, which as such is beyond the financial capacity of the Corporation, such a financial constraint can be said to be one of the relevant considerations, though not the sole consideration before embarking upon reservation of a particular extent of land for development. Even otherwise, in the facts and circumstances of this case, when land is found to be unsuitable and unusable for the purposes for which it has been reserved, Corporation cannot be compelled to pay a huge compensation for such a useless and unsuitable land. 17. Now, the submission on behalf of the original landowners that if the Corporation is not in a position to pay the compensation, in that case, they are ready to accept the TDR in lieu of the amount of compensation shall be considered. At one point of time, the aforesaid proposal was under consideration by the Corporation and the Corporation even moved a Civil Application before the High Court to direct the landowners to accept the TDR. Therefore, on the principle of approbate and reprobate, it is contended by the landowners that the Corporation cannot now be permitted to deny TDR to the original landowners, we observe that first of all, it is required to be noted that the said principle of approbate and reprobate would be equally appliable to the landowners also. Before the High Court, the original landowners specifically filed the affidavits dated 01.08.2018 and 07.08.2018, as observed and noted by the High Court in the impugned judgment and order in paragraph 5 that they do not wish to avail of TDR and their only prayer before the High Court was to acquire the land and to pay them the compensation. Therefore, now it is not open for the respondents -original landowners to pray for the TDR in respect of the land in question. 17.1 Even otherwise, a landowner is entitled to TDR in lieu of compensation with respect to the land reserved provided the land to be acquired is suitable and/or usable by the Corporation. Once it is found that the land is not usable and/or suitable for the purposes for which it has been reserved, the Corporation cannot still be compelled and directed to acquire the land and grant TDR in lieu of amount of compensation. Even as per Clause 11.2.2 of the Unified Development Control and Promotion Regulations, 2020 (UDCPR, 2020) for Maharashtra State under which the TDR is claimed, the compensation in terms of TDR shall be permissible for:- xxxxxxxxxxxx ii) lands under any deemed reservations according to any regulations prepared as per the provisions of Maharashtra Regional & Town Planning Act,1966; xxxxxxxxxxxx v) development or construction of the amenity on the reserved or deemed reserved land; xxxxxxxxxxxx Therefore, it can be argued that there cannot be any TDR in lieu of compensation to be paid for the reserved land which reservation is deemed to have lapsed as in the instant case. 17.2 Even Clause 11.2.3 of the above Regulations states that it shall not be permissible to grant TDR for existing nallah, river, natural stream, natural pond, tank, water bodies etc. and reservations which are not developable under the provisions of UDCPR, 2020. Therefore, for the reasons stated hereinabove, the prayer of the respondents to grant them TDR deserves rejection and is hereby rejected.
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declaration under Section 19 of the Act of 2013 and to pay compensation under the Act of 2013. It is to be noted that right from the very beginning it was stated in the counter before the High Court that the land in question was not suitable and/or usable for the purposes for which it has been reserved. It was specifically pointed out that the subject land is flood affected through which a rivulet named Jayanti Nala passes, making it unsuitable for the public purposes for which it was reserved. It was also specifically pointed out that unless and until the substantial development is carried out, the land in question is not usable at all. It was also specifically pointed out that the reserved area is coming within High Flood Line and every year for a period of fifteen days to one month, the said area gets flooded during rainy season. In that view of the matter, the High Court ought not to have directed the Corporation to still acquire the land and pay the compensation to the original landowners though the land in question is unsuitable and unusable for the public purposes for which it has been reserved. As observed hereinabove, as such at the time when the planning was made and the land in question was put under reservation for public purposes, a duty was cast upon the Planning Officer to consider whether the land, which will have to be acquired and for which the compensation is to be paid is really suitable and/or usable for the public purposes for which it is reserved. Otherwise, every landowner will see to it that though his land is not suitable and/or not very valuable, is put under reservation and the same is acquired by the Corporation and/or the Planning Authority and thereafter he is paid the compensation. No Corporation and/or the Planning Authority and/or the Appropriate Authority can be compelled to acquire the land which according to the Corporation/Planning Authority is not suitable and/or usable for the purposes for which it is reserved. Any other interpretation would lead to colourable and fraudulent exercise of power and cause financial burden on the public exchequer.16. At this stage, it is required to be noted that in fact there was a valid reason for the Corporation not to go ahead with the acquisition. Under the Act of 2013, the Corporation was required to pay a huge sum of Rs. 77,65,12,000/- by way of compensation under the Act of 2013. According to the Corporation, when the entire annual budget for acquisition was Rs.21 crores, it was beyond their financial position and/or budgetary provision to pay such a huge compensation, that too, for the land which is not suitable and/or useable for the purposes for which it has been reserved. It may be true that under the MRTP Act, in the Development Plan, the Planning Authority and/or the Appropriate Authority has to make the provisions for the public purposes mentioned in Clauses (b) and (c) of Section 22 and sub-section (5) of Section 31 of the MRTP Act and that is also desired for an appropriate planning of a city and therefore the financial constraint cannot be the sole consideration to acquire the land for the purposes for which it has been reserved namely public purposes. However, at the same time, when such a huge amount of compensation is to be paid and there would be a heavy financial burden, which as such is beyond the financial capacity of the Corporation, such a financial constraint can be said to be one of the relevant considerations, though not the sole consideration before embarking upon reservation of a particular extent of land for development. Even otherwise, in the facts and circumstances of this case, when land is found to be unsuitable and unusable for the purposes for which it has been reserved, Corporation cannot be compelled to pay a huge compensation for such a useless and unsuitable land.At one point of time, the aforesaid proposal was under consideration by the Corporation and the Corporation even moved a Civil Application before the High Court to direct the landowners to accept the TDR. Therefore, on the principle of approbate and reprobate, it is contended by the landowners that the Corporation cannot now be permitted to deny TDR to the original landowners, we observe that first of all, it is required to be noted that the said principle of approbate and reprobate would be equally appliable to the landowners also. Before the High Court, the original landowners specifically filed the affidavits dated 01.08.2018 and 07.08.2018, as observed and noted by the High Court in the impugned judgment and order in paragraph 5 that they do not wish to avail of TDR and their only prayer before the High Court was to acquire the land and to pay them the compensation. Therefore, now it is not open for the respondents -original landowners to pray for the TDR in respect of the land in question.17.1 Even otherwise, a landowner is entitled to TDR in lieu of compensation with respect to the land reserved provided the land to be acquired is suitable and/or usable by the Corporation. Once it is found that the land is not usable and/or suitable for the purposes for which it has been reserved, the Corporation cannot still be compelled and directed to acquire the land and grant TDR in lieu of amount of compensation.Therefore, it can be argued that there cannot be any TDR in lieu of compensation to be paid for the reserved land which reservation is deemed to have lapsed as in the instant case.17.2 Even Clause 11.2.3 of the above Regulations states that it shall not be permissible to grant TDR for existing nallah, river, natural stream, natural pond, tank, water bodies etc. and reservations which are not developable under the provisions of UDCPR, 2020.Therefore, for the reasons stated hereinabove, the prayer of the respondents to grant them TDR deserves rejection and is hereby rejected.
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Director General, ESI & Another Vs. T. Abdul Razak | power conferred on the Director General under a rule or a regulation is in the nature of a statutory power that has been conferred independently on the Director General. It cannot be regarded as delegation of powers and functions of the Corporation or the Standing Committee under Section 94-A of the Act. Section 94-A speaks of "powers and functions which may be exercised or performed by the Corporation or the Standing Committee." The said powers and functions are other than the powers that are conferred independently on the Director General under the Rules or the Regulations. 16. On that view of the matter Regulations 12 and 13 must be construed as conferring independent powers on the Director General and it cannot be said to be the powers and functions of the Corporation or the Standing Committee that have been delegated to the Director General by the Corporation or the Standing Committee under Section 94-A. Regulation 12(2) which empowers the Director General to specify by general or special order the authority which can also act as a disciplinary authority and Regulation 13(1) which authorises the Director General to empower by general or special order any other authority to institute disciplinary proceedings against an employee, cannot be regarded as empowering further delegation by the Director General of powers delegated to him. The Tribunal was, therefore, in error in striking down the words "or any other authority specified in this behalf by a General or special order of the Director General" in Regulation 12(2) and the words "or any other authority empowered by him by general or special order may" in Regulation 13(1) on the view that they permit further delegation by the Director General of the powers delegated to him which is impermissible. The decision of the Tribunal in this regard cannot be upheld and the offending words in Regulations 12(2) and 13(1) must be treated as a valid conferment of power on the Director General to delegate his powers under the said Regulations. The orders dated May 10, 1974 and April 9, 1981 were passed by the Director General in exercise of the powers conferred on him under Regulation 12(2). By the said orders the Director General delegated the powers to impose minor penalties specified in clauses (i) to (iv) of Regulation 11 in respect of certain categories of employees and the officers specified in the said orders. Since the offending part of Regulation 12(2) has been found to be valid the said orders dated May 10, 1974 and April 9, 1981 must be held to have been validly issued in exercise of the power of delegation conferred on the Director General under Regulation 12(2).17. Rule 16(2) and the resolution of the Standing Committee dated May 24, 1968 go together. Under Rule 16(2) the Director General has been empowered to delegate any of his powers or duties under the Rules or the Regulations or under any resolution of the Corporation or the Standing Committee, as the case may be, to any person subordinate to him. For the purpose of such delegation it is necessary for the Director General to obtain the approval of the Standing Committee. Resolution of the Standing Committee dated May 24, 1968 accords such approval to the Director General. The power of delegation under Rule 16(2) can be divided into two parts; one relating to delegation of the powers or duties under the rules or the Regulations and the other relating to the powers and duties under any resolution of the Corporation or the Standing Committee. Insofar as the powers or duties under the Rules or the Regulations are concerned, the conferment on the Director General the power to delegate the same is not violative of the principle of sub-delegation as indicated earlier because the said powers and duties are in the nature of independent statutory powers conferred on the Director General under the Rules or the Regulations. No infirmity can, therefore, be found either in Rule 16(2) or in the resolution of the Standing Committee dated May 24, 1968 empowering the Director General to delegate any of this powers or duties under the Rules or the Regulations. The position is, however, different in respect of the powers and duties conferred on the Director General under any resolution of the Corporation or the Standing Committee. The conferment of such powers or duties under a resolution of the Corporation or the Standing Committee could be by way of delegation of the powers of the Corporation or the Standing Committee under Section 94-A of the Act and empowering the Director General to further delegate the said powers or duties would amount to sub-delegation of a power delegated to him which is impermissible in view of the law laid down in Sahni Silk Mills (supra). Rule 16(2) and the resolution of the Standing Committee dated May 24, 1968, to the extent they empower the Director General to further delegate the powers or duties delegated to him by the Corporation or the Standing Committee under a resolution referable to Section 94-A, have to be held to be invalid.18. For the reasons aforementioned, the impugned judgment of the Tribunal is set aside insofar as it strikes down the words "or any other authority specified in this behalf by a general or special order of the Director General" in Regulation 12(2) and the words "or any other authority empowered by him by general or special order may" in Regulation 13(1) of the Regulations and quashes the orders dated May 10, 1974 and April 9, 1981 passed by the Director General, the memoranda dated October 20, 1983, January 21, 1985 and July 18/25, 1986 and the order dated March 18, 1987. Rule 16(2) and the resolution of the Standing Committee, to the extent they empower the Director General to delegate the powers or duties delegated to him under any resolution of the Corporation or the Standing Committee referable to Section 94-A, are invalid but the rest of the said Rule and the resolution are valid. | 0[ds]Therefore, in so far as the validity of the memoranda regarding initiation of disciplinary proceedings against the respondents is concerned the question regarding delegation of powers by the Director General did not arise for consideration and the Tribunal was not required to deal with the question regarding validity of Rule 16(2), Regulations 12(2) and 13(1), the resolution of the Standing Committee dated May 24, 1968 and the orders of the Director General dated May 10, 1974 and April 9, 1981. With regard to initiation of disciplinary proceedings by the Regional Director, we find that the legal position is well settled that it is not necessary that the authority competent to impose the penalty must initiate the disciplinary proceedings and that the proceedings can be initiated by any superior authority who can be held to be the controlling authority who may be an officer subordinate to the appointing authorityRegional Director, being the officer in charge of the region, was the controlling authority in respect of the respondents. He could institute the disciplinary proceedings against the respondents even in the absence of specific conferment of a power in that regard. The memoranda dated October 20, 1983 January 21, 1985 and July 18/25 1986 regarding initiation of disciplinary proceedings against the respondents by the Regional Director, therefore, do not suffer from any legal infirmity and the applications filed by the respondents before the Tribunal are liable to be dismissed. But since the Tribunal has pronounced upon the validity of Rule 16(2), Regulations 12(2) and 13(1) the resolution of the Standing Committee dated May 24, 1968 and orders dated May 10, 1974 and April 9, 1981 passed by the Director General it becomes necessary to examine the correctness of the decision of the Tribunal in that regard.14. The law is well settled that in accordance with the maxim delegatus potest delegare, a statutory power must be exercised only by the body or officer in whom it has been confided, unless sub-delegation of the power is authorised by express words or necessary implication.On that view of the matter Regulations 12 and 13 must be construed as conferring independent powers on the Director General and it cannot be said to be the powers and functions of the Corporation or the Standing Committee that have been delegated to the Director General by the Corporation or the Standing Committee under Section 94-A. Regulation 12(2) which empowers the Director General to specify by general or special order the authority which can also act as a disciplinary authority and Regulation 13(1) which authorises the Director General to empower by general or special order any other authority to institute disciplinary proceedings against an employee, cannot be regarded as empowering further delegation by the Director General of powers delegated to him. The Tribunal was, therefore, in error in striking down the words "or any other authority specified in this behalf by a General or special order of the Director General" in Regulation 12(2) and the words "or any other authority empowered by him by general or special order may" in Regulation 13(1) on the view that they permit further delegation by the Director General of the powers delegated to him which is impermissible. The decision of the Tribunal in this regard cannot be upheld and the offending words in Regulations 12(2) and 13(1) must be treated as a valid conferment of power on the Director General to delegate his powers under the said Regulations. The orders dated May 10, 1974 and April 9, 1981 were passed by the Director General in exercise of the powers conferred on him under Regulation 12(2). By the said orders the Director General delegated the powers to impose minor penalties specified in clauses (i) to (iv) of Regulation 11 in respect of certain categories of employees and the officers specified in the said orders. Since the offending part of Regulation 12(2) has been found to be valid the said orders dated May 10, 1974 and April 9, 1981 must be held to have been validly issued in exercise of the power of delegation conferred on the Director General under Regulation 12(2).17. Rule 16(2) and the resolution of the Standing Committee dated May 24, 1968 go together. Under Rule 16(2) the Director General has been empowered to delegate any of his powers or duties under the Rules or the Regulations or under any resolution of the Corporation or the Standing Committee, as the case may be, to any person subordinate to him. For the purpose of such delegation it is necessary for the Director General to obtain the approval of the Standing Committee. Resolution of the Standing Committee dated May 24, 1968 accords such approval to the Director General. The power of delegation under Rule 16(2) can be divided into two parts; one relating to delegation of the powers or duties under the rules or the Regulations and the other relating to the powers and duties under any resolution of the Corporation or the Standing Committee. Insofar as the powers or duties under the Rules or the Regulations are concerned, the conferment on the Director General the power to delegate the same is not violative of the principle of sub-delegation as indicated earlier because the said powers and duties are in the nature of independent statutory powers conferred on the Director General under the Rules or the Regulations. No infirmity can, therefore, be found either in Rule 16(2) or in the resolution of the Standing Committee dated May 24, 1968 empowering the Director General to delegate any of this powers or duties under the Rules or the Regulations. The position is, however, different in respect of the powers and duties conferred on the Director General under any resolution of the Corporation or the Standing Committee. The conferment of such powers or duties under a resolution of the Corporation or the Standing Committee could be by way of delegation of the powers of the Corporation or the Standing Committee under Section 94-A of the Act and empowering the Director General to further delegate the said powers or duties would amount to sub-delegation of a power delegated to him which is impermissible in view of the law laid down in Sahni Silk Mills (supra). Rule 16(2) and the resolution of the Standing Committee dated May 24, 1968, to the extent they empower the Director General to further delegate the powers or duties delegated to him by the Corporation or the Standing Committee under a resolution referable to Section 94-A, have to be held to be invalid.18. For the reasons aforementioned, the impugned judgment of the Tribunal is set aside insofar as it strikes down the words "or any other authority specified in this behalf by a general or special order of the Director General" in Regulation 12(2) and the words "or any other authority empowered by him by general or special order may" in Regulation 13(1) of the Regulations and quashes the orders dated May 10, 1974 and April 9, 1981 passed by the Director General, the memoranda dated October 20, 1983, January 21, 1985 and July 18/25, 1986 and the order dated March 18, 1987. Rule 16(2) and the resolution of the Standing Committee, to the extent they empower the Director General to delegate the powers or duties delegated to him under any resolution of the Corporation or the Standing Committee referable to Section 94-A, are invalid but the rest of the said Rule and the resolution are valid. | 0 | 4,941 | 1,406 | ### Instruction:
Make a prediction on the court's ruling (acceptance (1) or rejection (0) of the petition), and then dissect the proceeding to provide a detailed explanation using key textual passages.
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power conferred on the Director General under a rule or a regulation is in the nature of a statutory power that has been conferred independently on the Director General. It cannot be regarded as delegation of powers and functions of the Corporation or the Standing Committee under Section 94-A of the Act. Section 94-A speaks of "powers and functions which may be exercised or performed by the Corporation or the Standing Committee." The said powers and functions are other than the powers that are conferred independently on the Director General under the Rules or the Regulations. 16. On that view of the matter Regulations 12 and 13 must be construed as conferring independent powers on the Director General and it cannot be said to be the powers and functions of the Corporation or the Standing Committee that have been delegated to the Director General by the Corporation or the Standing Committee under Section 94-A. Regulation 12(2) which empowers the Director General to specify by general or special order the authority which can also act as a disciplinary authority and Regulation 13(1) which authorises the Director General to empower by general or special order any other authority to institute disciplinary proceedings against an employee, cannot be regarded as empowering further delegation by the Director General of powers delegated to him. The Tribunal was, therefore, in error in striking down the words "or any other authority specified in this behalf by a General or special order of the Director General" in Regulation 12(2) and the words "or any other authority empowered by him by general or special order may" in Regulation 13(1) on the view that they permit further delegation by the Director General of the powers delegated to him which is impermissible. The decision of the Tribunal in this regard cannot be upheld and the offending words in Regulations 12(2) and 13(1) must be treated as a valid conferment of power on the Director General to delegate his powers under the said Regulations. The orders dated May 10, 1974 and April 9, 1981 were passed by the Director General in exercise of the powers conferred on him under Regulation 12(2). By the said orders the Director General delegated the powers to impose minor penalties specified in clauses (i) to (iv) of Regulation 11 in respect of certain categories of employees and the officers specified in the said orders. Since the offending part of Regulation 12(2) has been found to be valid the said orders dated May 10, 1974 and April 9, 1981 must be held to have been validly issued in exercise of the power of delegation conferred on the Director General under Regulation 12(2).17. Rule 16(2) and the resolution of the Standing Committee dated May 24, 1968 go together. Under Rule 16(2) the Director General has been empowered to delegate any of his powers or duties under the Rules or the Regulations or under any resolution of the Corporation or the Standing Committee, as the case may be, to any person subordinate to him. For the purpose of such delegation it is necessary for the Director General to obtain the approval of the Standing Committee. Resolution of the Standing Committee dated May 24, 1968 accords such approval to the Director General. The power of delegation under Rule 16(2) can be divided into two parts; one relating to delegation of the powers or duties under the rules or the Regulations and the other relating to the powers and duties under any resolution of the Corporation or the Standing Committee. Insofar as the powers or duties under the Rules or the Regulations are concerned, the conferment on the Director General the power to delegate the same is not violative of the principle of sub-delegation as indicated earlier because the said powers and duties are in the nature of independent statutory powers conferred on the Director General under the Rules or the Regulations. No infirmity can, therefore, be found either in Rule 16(2) or in the resolution of the Standing Committee dated May 24, 1968 empowering the Director General to delegate any of this powers or duties under the Rules or the Regulations. The position is, however, different in respect of the powers and duties conferred on the Director General under any resolution of the Corporation or the Standing Committee. The conferment of such powers or duties under a resolution of the Corporation or the Standing Committee could be by way of delegation of the powers of the Corporation or the Standing Committee under Section 94-A of the Act and empowering the Director General to further delegate the said powers or duties would amount to sub-delegation of a power delegated to him which is impermissible in view of the law laid down in Sahni Silk Mills (supra). Rule 16(2) and the resolution of the Standing Committee dated May 24, 1968, to the extent they empower the Director General to further delegate the powers or duties delegated to him by the Corporation or the Standing Committee under a resolution referable to Section 94-A, have to be held to be invalid.18. For the reasons aforementioned, the impugned judgment of the Tribunal is set aside insofar as it strikes down the words "or any other authority specified in this behalf by a general or special order of the Director General" in Regulation 12(2) and the words "or any other authority empowered by him by general or special order may" in Regulation 13(1) of the Regulations and quashes the orders dated May 10, 1974 and April 9, 1981 passed by the Director General, the memoranda dated October 20, 1983, January 21, 1985 and July 18/25, 1986 and the order dated March 18, 1987. Rule 16(2) and the resolution of the Standing Committee, to the extent they empower the Director General to delegate the powers or duties delegated to him under any resolution of the Corporation or the Standing Committee referable to Section 94-A, are invalid but the rest of the said Rule and the resolution are valid.
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has pronounced upon the validity of Rule 16(2), Regulations 12(2) and 13(1) the resolution of the Standing Committee dated May 24, 1968 and orders dated May 10, 1974 and April 9, 1981 passed by the Director General it becomes necessary to examine the correctness of the decision of the Tribunal in that regard.14. The law is well settled that in accordance with the maxim delegatus potest delegare, a statutory power must be exercised only by the body or officer in whom it has been confided, unless sub-delegation of the power is authorised by express words or necessary implication.On that view of the matter Regulations 12 and 13 must be construed as conferring independent powers on the Director General and it cannot be said to be the powers and functions of the Corporation or the Standing Committee that have been delegated to the Director General by the Corporation or the Standing Committee under Section 94-A. Regulation 12(2) which empowers the Director General to specify by general or special order the authority which can also act as a disciplinary authority and Regulation 13(1) which authorises the Director General to empower by general or special order any other authority to institute disciplinary proceedings against an employee, cannot be regarded as empowering further delegation by the Director General of powers delegated to him. The Tribunal was, therefore, in error in striking down the words "or any other authority specified in this behalf by a General or special order of the Director General" in Regulation 12(2) and the words "or any other authority empowered by him by general or special order may" in Regulation 13(1) on the view that they permit further delegation by the Director General of the powers delegated to him which is impermissible. The decision of the Tribunal in this regard cannot be upheld and the offending words in Regulations 12(2) and 13(1) must be treated as a valid conferment of power on the Director General to delegate his powers under the said Regulations. The orders dated May 10, 1974 and April 9, 1981 were passed by the Director General in exercise of the powers conferred on him under Regulation 12(2). By the said orders the Director General delegated the powers to impose minor penalties specified in clauses (i) to (iv) of Regulation 11 in respect of certain categories of employees and the officers specified in the said orders. Since the offending part of Regulation 12(2) has been found to be valid the said orders dated May 10, 1974 and April 9, 1981 must be held to have been validly issued in exercise of the power of delegation conferred on the Director General under Regulation 12(2).17. Rule 16(2) and the resolution of the Standing Committee dated May 24, 1968 go together. Under Rule 16(2) the Director General has been empowered to delegate any of his powers or duties under the Rules or the Regulations or under any resolution of the Corporation or the Standing Committee, as the case may be, to any person subordinate to him. For the purpose of such delegation it is necessary for the Director General to obtain the approval of the Standing Committee. Resolution of the Standing Committee dated May 24, 1968 accords such approval to the Director General. The power of delegation under Rule 16(2) can be divided into two parts; one relating to delegation of the powers or duties under the rules or the Regulations and the other relating to the powers and duties under any resolution of the Corporation or the Standing Committee. Insofar as the powers or duties under the Rules or the Regulations are concerned, the conferment on the Director General the power to delegate the same is not violative of the principle of sub-delegation as indicated earlier because the said powers and duties are in the nature of independent statutory powers conferred on the Director General under the Rules or the Regulations. No infirmity can, therefore, be found either in Rule 16(2) or in the resolution of the Standing Committee dated May 24, 1968 empowering the Director General to delegate any of this powers or duties under the Rules or the Regulations. The position is, however, different in respect of the powers and duties conferred on the Director General under any resolution of the Corporation or the Standing Committee. The conferment of such powers or duties under a resolution of the Corporation or the Standing Committee could be by way of delegation of the powers of the Corporation or the Standing Committee under Section 94-A of the Act and empowering the Director General to further delegate the said powers or duties would amount to sub-delegation of a power delegated to him which is impermissible in view of the law laid down in Sahni Silk Mills (supra). Rule 16(2) and the resolution of the Standing Committee dated May 24, 1968, to the extent they empower the Director General to further delegate the powers or duties delegated to him by the Corporation or the Standing Committee under a resolution referable to Section 94-A, have to be held to be invalid.18. For the reasons aforementioned, the impugned judgment of the Tribunal is set aside insofar as it strikes down the words "or any other authority specified in this behalf by a general or special order of the Director General" in Regulation 12(2) and the words "or any other authority empowered by him by general or special order may" in Regulation 13(1) of the Regulations and quashes the orders dated May 10, 1974 and April 9, 1981 passed by the Director General, the memoranda dated October 20, 1983, January 21, 1985 and July 18/25, 1986 and the order dated March 18, 1987. Rule 16(2) and the resolution of the Standing Committee, to the extent they empower the Director General to delegate the powers or duties delegated to him under any resolution of the Corporation or the Standing Committee referable to Section 94-A, are invalid but the rest of the said Rule and the resolution are valid.
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Heckett Engineering Co Vs. Workmen | make the appointment of the workman and it was he who actually made the crucial appointment in that capacity, let us now advert to the question whether Mr. Balan was competent to pass the impugned order of dismissal. 9. Mr. Chatterji has, by reference to Standing Order No. 32 of the aforesaid Standing Orders, stressed that it was only the Company which was competent to pass the order of dismissal of the workman. The relevant portion of the Standing Order on which reliance is place runs thus:-" 32....... A workman shall be liable to be summarily dismissed without notice or pay or wages in lieu of notice if he is found guilty of any misconduct amounting to major misdemeanor. A workman dismissed for misconduct will not be entitled to any past benefits or privilege s of service provided by the Company. The Company may however at its discretion give the workman concerned the following punishments in lieu of dismissal: (i) Discharge from Service with past benefits of service. (ii) Suspension without pay not exceeding fifteen days. (iii)Censure or warning. (iv) Withholding increment for one year. (v) Fine. " 10. The Standing Order extracted above is not helpful to the. workman. It does not put any fetter on the power of the Plant Manager to dismiss a workman whose appointment is made by him if he is guilty of a misconduct. It only confers, in our o pinion, an overall power on the Company to substitute the penalty of discharge from service with past benefits of service or any other lighter penalty specified therein for the penalty of dismissal awarded to a workman and can by no means be interpret ed to imply that the penalty of dismissal can be inflicted only by the Company and not by the Plant Manager. It is a well settled rule of construction that the language of a provision or a rule should not be construed in a manner which would do violence to the phraseology used therein. It is rather strange that the Industrial Tribunal has despite its observation that the above quoted Standing Order does not expressly set out as to who is to pass an order of dismissal held that the impugned order was not passed by a person authorised by the Standing Orders. It may also be mentioned at this stage that appearing as a witness for the Company, Mr. V. K. Balan has unequivocally stated that he was entitled to pass the order of dismissal against the concerned workman under the Standing Orders and that he did not need any delegation of powers for passing such order. We may also in this connection recall the provisions of section 16 of the General Clauses Act, 1897, Whether or not the section in terms applies to the aforesaid Standing Orders of the Company which are certified under section 5(3) of the Industrial Employment Standing Order Act, 1946 may be a moot point but the general doctrine underlying the section can well be made applicable to a case of the present nature for it is now firmly established that the power to terminate service is a necessary adjunct of the power of appointment and is exercised as an incident to or co nsequence of that power (See Lekhraj Satramdas Lalvani v. Deputy Custodian-cum-Managing Officer & Ors.([1966] 1 S.C.R. 120.) and Kutoor Vengayil Rayarappan Nayanar v. Kutoor Vengayil Madhavi Amma &Ors ([1949] F.C.R. 667.). In Kutoor Vengayil Rayarappan Nayanar v. Kutoor Vengayil Valia Madhavi Amma &Ors. (supra) Mahajan, J. (as he then was) speaking for the Federal Court approved the statement of Woodroffe On Receivers, Fourth Edition, that the power to terminate flows naturally and as a necessary sequence from the power to create. In other words, it is a necessary adjunct of the power of appointment and is exercised as an incident to, or consequence of that power; the authority to call such officer into being necessarily implies the authority to terminate his functions.As in the instant case, the appointment of the workman was made by Mr. V. K. Balan as a Plant Manager and not for or on behalf of the General Manager and as the power of appointment implies and carries wit h it the power of dismissal, we are of the opinion that the order of dismissal did not suffer from the infirmity of want of competence or of authority to pass the order. 11. The decision of this Court in Hindustan Brown Boveri Ltd. v. Their Workmen &Anr. ([1968] 1 L.L.J. 571) relied upon by Mr. Chatterji in support of his contention that the Plant Manager was not competent to pass the impugned order of dismissal is clearly distinguishable. In that case, despite the issue raised before the Labour Court as to whether the demotion of one workman and the termination of service of the other was in order, the Company did not at the proper stage inform or contend before the Labour Court that the Works Manager was empowered to recruit and dismiss the workman by virtue of the power of attorney executed in his favour by the Company. The judgment in that case also does not show that the Works Manager was competent to appoint the workman under the standing orders of the Company. 12. In conclusion, we would like to make it clear that as charges Nos. 2 and 3 have been held by the Industrial Tribunal to have been established against the workman and they constitute major misdemeanours falling within the purview of sub-clauses (a) and (m) of clause (ii) of Standing Order 31 of the aforesaid Standing Orders, we think that the order of dismissal could have been passed by the punishing authority which in this case, as already stated, was the Plant Manager. We may also observe that it is not open to us to substitute the order of discharge with benefits of past service for the impugned order of dismissal. The workman may, if so advised, approach the Company in this behalf. | 1[ds]We have gone through the entire record and have given our earnest consideration to the submission made by learned counsel for the parties. While we are of the view that there is no warrant for interfering with the findings of fact arrived at by the Tribunal with regard to the establishment or otherwise of any of the charges against the workman which are based upon the evidence on the record, we think that the other finding arrived at by it viz. that Mr. V. K. Balan, Plant Manager of the Company, had no authority to pass the impugned order of dismissal cannot be sustained. It would, in this connection, be profitable to find out in the first instance as to who would make the permanent appointment of the workman. A plain reading of clause 5 (b) read with clause 7(d) of the Standing Orders shows that it was the Plant Manager of the Company who was competent to make the appointment of the workman. That it was Mr. V. K. Balan who, actually made the appointment in question cannot also admit of any doubt. This is crystal clear from the appointment card, Exhibit 1(MH) which is signed both by Mr. V. K. Balan as well as the workman.Let u s now see whether Mr. V. K. Balan, Plant Manager, acted for or on behalf of General Manager of the Company in making or signing the appointment card of the workman. A glance at the appointment card, Exhibit 1 (MH) is enough to show that Mr. V. K. Balan d id not sign the said card for or on behalf of the General Manager. It is true that the prefix "General" before the word "Manager" on the printed card on which Mr. V. K. Balan put his signatures does no appear to have been struck off at the time of the issue of the card but that by itself is not enough to show that the appointment was made by Mr. V. K. Balan acting for or on behalf of the General Manager of the Company. There is nothing on the, record to indicate that on the relevant date, the General Manager of the Company was away on leave or was otherwise absent and Mr. V. K. Balan had been deputed to officiate or act for or on behalf of the General Manager. On the contrary, in the course of his statement as O.P. witness , Mr. V. K. Balan has categorically affirmed that he has been holding the office of the Plant Manager of the Company for the last ten years. Thus neither the Standing Orders nor the appointment card nor the statement of Mr. V. K. Balan nor any other material on the record supports the observation of the Industrial Tribunal that "the General Manager was the appointing authority and Mr. V. K. Balan only acted on his behalfThe submission made on behalf of the workman that in signing his appointment card, Mr. V. K. Balan acted for and on behalf of the General Manager cannot be accepted for another reason also. If Mr. Balan was competent to make the appointment of the workman as we have, by reference to the Standing Orders, shown that be was, there could be no question of his acting for or on behalf of the General Manager in signing the appointment card. The contention advanced in this respect on behalf of the workman is, therefore, repelled.Having settled that Mr. V. K. Balan, who was the Plant Manager on the relevant date was competent to make the appointment of the workman and it was he who actually made the crucial appointment in that capacity, let us now advert to the question whether Mr. Balan was competent to pass the impugned order of dismissalThe Standing Order extracted above is not helpful to the. workman. It does not put any fetter on the power of the Plant Manager to dismiss a workman whose appointment is made by him if he is guilty of a misconduct. It only confers, in our o pinion, an overall power on the Company to substitute the penalty of discharge from service with past benefits of service or any other lighter penalty specified therein for the penalty of dismissal awarded to a workman and can by no means be interpret ed to imply that the penalty of dismissal can be inflicted only by the Company and not by the Plant Manager. It is a well settled rule of construction that the language of a provision or a rule should not be construed in a manner which would do violence to the phraseology used therein. It is rather strange that the Industrial Tribunal has despite its observation that the above quoted Standing Order does not expressly set out as to who is to pass an order of dismissal held that the impugned order was not passed by a person authorised by the Standing Orders. It may also be mentioned at this stage that appearing as a witness for the Company, Mr. V. K. Balan has unequivocally stated that he was entitled to pass the order of dismissal against the concerned workman under the Standing Orders and that he did not need any delegation of powers for passing such order. We may also in this connection recall the provisions of section 16 ofthe General Clauses Act, 1897, Whether or not the section in terms applies to the aforesaid Standing Orders of the Company which are certified under section 5(3) of the Industrial Employment Standing Order Act, 1946 may be a moot point but the general doctrine underlying the section can well be made applicable to a case of the present nature for it is now firmly established that the power to terminate service is a necessary adjunct of the power of appointment and is exercised as an incident to or co nsequence of that powerAs in the instant case, the appointment of the workman was made by Mr. V. K. Balan as a Plant Manager and not for or on behalf of the General Manager and as the power of appointment implies and carries wit h it the power of dismissal, we are of the opinion that the order of dismissal did not suffer from the infirmity of want of competence or of authority to pass the orderThe decision of this Court in Hindustan Brown Boveri Ltd. v. Their Workmen &Anr. ([1968] 1 L.L.J. 571) relied upon by Mr. Chatterji in support of his contention that the Plant Manager was not competent to pass the impugned order of dismissal is clearly distinguishable. In that case, despite the issue raised before the Labour Court as to whether the demotion of one workman and the termination of service of the other was in order, the Company did not at the proper stage inform or contend before the Labour Court that the Works Manager was empowered to recruit and dismiss the workman by virtue of the power of attorney executed in his favour by the Company. The judgment in that case also does not show that the Works Manager was competent to appoint the workman under the standing orders of the CompanyIn conclusion, we would like to make it clear that as charges Nos. 2 and 3 have been held by the Industrial Tribunal to have been established against the workman and they constitute major misdemeanours falling within the purview of sub-clauses (a) and (m) of clause (ii) of Standing Order 31 of the aforesaid Standing Orders, we think that the order of dismissal could have been passed by the punishing authority which in this case, as already stated, was the Plant Manager. We may also observe that it is not open to us to substitute the order of discharge with benefits of past service for the impugned order of dismissal. The workman may, if so advised, approach the Company in this behalf. | 1 | 3,506 | 1,418 | ### Instruction:
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make the appointment of the workman and it was he who actually made the crucial appointment in that capacity, let us now advert to the question whether Mr. Balan was competent to pass the impugned order of dismissal. 9. Mr. Chatterji has, by reference to Standing Order No. 32 of the aforesaid Standing Orders, stressed that it was only the Company which was competent to pass the order of dismissal of the workman. The relevant portion of the Standing Order on which reliance is place runs thus:-" 32....... A workman shall be liable to be summarily dismissed without notice or pay or wages in lieu of notice if he is found guilty of any misconduct amounting to major misdemeanor. A workman dismissed for misconduct will not be entitled to any past benefits or privilege s of service provided by the Company. The Company may however at its discretion give the workman concerned the following punishments in lieu of dismissal: (i) Discharge from Service with past benefits of service. (ii) Suspension without pay not exceeding fifteen days. (iii)Censure or warning. (iv) Withholding increment for one year. (v) Fine. " 10. The Standing Order extracted above is not helpful to the. workman. It does not put any fetter on the power of the Plant Manager to dismiss a workman whose appointment is made by him if he is guilty of a misconduct. It only confers, in our o pinion, an overall power on the Company to substitute the penalty of discharge from service with past benefits of service or any other lighter penalty specified therein for the penalty of dismissal awarded to a workman and can by no means be interpret ed to imply that the penalty of dismissal can be inflicted only by the Company and not by the Plant Manager. It is a well settled rule of construction that the language of a provision or a rule should not be construed in a manner which would do violence to the phraseology used therein. It is rather strange that the Industrial Tribunal has despite its observation that the above quoted Standing Order does not expressly set out as to who is to pass an order of dismissal held that the impugned order was not passed by a person authorised by the Standing Orders. It may also be mentioned at this stage that appearing as a witness for the Company, Mr. V. K. Balan has unequivocally stated that he was entitled to pass the order of dismissal against the concerned workman under the Standing Orders and that he did not need any delegation of powers for passing such order. We may also in this connection recall the provisions of section 16 of the General Clauses Act, 1897, Whether or not the section in terms applies to the aforesaid Standing Orders of the Company which are certified under section 5(3) of the Industrial Employment Standing Order Act, 1946 may be a moot point but the general doctrine underlying the section can well be made applicable to a case of the present nature for it is now firmly established that the power to terminate service is a necessary adjunct of the power of appointment and is exercised as an incident to or co nsequence of that power (See Lekhraj Satramdas Lalvani v. Deputy Custodian-cum-Managing Officer & Ors.([1966] 1 S.C.R. 120.) and Kutoor Vengayil Rayarappan Nayanar v. Kutoor Vengayil Madhavi Amma &Ors ([1949] F.C.R. 667.). In Kutoor Vengayil Rayarappan Nayanar v. Kutoor Vengayil Valia Madhavi Amma &Ors. (supra) Mahajan, J. (as he then was) speaking for the Federal Court approved the statement of Woodroffe On Receivers, Fourth Edition, that the power to terminate flows naturally and as a necessary sequence from the power to create. In other words, it is a necessary adjunct of the power of appointment and is exercised as an incident to, or consequence of that power; the authority to call such officer into being necessarily implies the authority to terminate his functions.As in the instant case, the appointment of the workman was made by Mr. V. K. Balan as a Plant Manager and not for or on behalf of the General Manager and as the power of appointment implies and carries wit h it the power of dismissal, we are of the opinion that the order of dismissal did not suffer from the infirmity of want of competence or of authority to pass the order. 11. The decision of this Court in Hindustan Brown Boveri Ltd. v. Their Workmen &Anr. ([1968] 1 L.L.J. 571) relied upon by Mr. Chatterji in support of his contention that the Plant Manager was not competent to pass the impugned order of dismissal is clearly distinguishable. In that case, despite the issue raised before the Labour Court as to whether the demotion of one workman and the termination of service of the other was in order, the Company did not at the proper stage inform or contend before the Labour Court that the Works Manager was empowered to recruit and dismiss the workman by virtue of the power of attorney executed in his favour by the Company. The judgment in that case also does not show that the Works Manager was competent to appoint the workman under the standing orders of the Company. 12. In conclusion, we would like to make it clear that as charges Nos. 2 and 3 have been held by the Industrial Tribunal to have been established against the workman and they constitute major misdemeanours falling within the purview of sub-clauses (a) and (m) of clause (ii) of Standing Order 31 of the aforesaid Standing Orders, we think that the order of dismissal could have been passed by the punishing authority which in this case, as already stated, was the Plant Manager. We may also observe that it is not open to us to substitute the order of discharge with benefits of past service for the impugned order of dismissal. The workman may, if so advised, approach the Company in this behalf.
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by itself is not enough to show that the appointment was made by Mr. V. K. Balan acting for or on behalf of the General Manager of the Company. There is nothing on the, record to indicate that on the relevant date, the General Manager of the Company was away on leave or was otherwise absent and Mr. V. K. Balan had been deputed to officiate or act for or on behalf of the General Manager. On the contrary, in the course of his statement as O.P. witness , Mr. V. K. Balan has categorically affirmed that he has been holding the office of the Plant Manager of the Company for the last ten years. Thus neither the Standing Orders nor the appointment card nor the statement of Mr. V. K. Balan nor any other material on the record supports the observation of the Industrial Tribunal that "the General Manager was the appointing authority and Mr. V. K. Balan only acted on his behalfThe submission made on behalf of the workman that in signing his appointment card, Mr. V. K. Balan acted for and on behalf of the General Manager cannot be accepted for another reason also. If Mr. Balan was competent to make the appointment of the workman as we have, by reference to the Standing Orders, shown that be was, there could be no question of his acting for or on behalf of the General Manager in signing the appointment card. The contention advanced in this respect on behalf of the workman is, therefore, repelled.Having settled that Mr. V. K. Balan, who was the Plant Manager on the relevant date was competent to make the appointment of the workman and it was he who actually made the crucial appointment in that capacity, let us now advert to the question whether Mr. Balan was competent to pass the impugned order of dismissalThe Standing Order extracted above is not helpful to the. workman. It does not put any fetter on the power of the Plant Manager to dismiss a workman whose appointment is made by him if he is guilty of a misconduct. It only confers, in our o pinion, an overall power on the Company to substitute the penalty of discharge from service with past benefits of service or any other lighter penalty specified therein for the penalty of dismissal awarded to a workman and can by no means be interpret ed to imply that the penalty of dismissal can be inflicted only by the Company and not by the Plant Manager. It is a well settled rule of construction that the language of a provision or a rule should not be construed in a manner which would do violence to the phraseology used therein. It is rather strange that the Industrial Tribunal has despite its observation that the above quoted Standing Order does not expressly set out as to who is to pass an order of dismissal held that the impugned order was not passed by a person authorised by the Standing Orders. It may also be mentioned at this stage that appearing as a witness for the Company, Mr. V. K. Balan has unequivocally stated that he was entitled to pass the order of dismissal against the concerned workman under the Standing Orders and that he did not need any delegation of powers for passing such order. We may also in this connection recall the provisions of section 16 ofthe General Clauses Act, 1897, Whether or not the section in terms applies to the aforesaid Standing Orders of the Company which are certified under section 5(3) of the Industrial Employment Standing Order Act, 1946 may be a moot point but the general doctrine underlying the section can well be made applicable to a case of the present nature for it is now firmly established that the power to terminate service is a necessary adjunct of the power of appointment and is exercised as an incident to or co nsequence of that powerAs in the instant case, the appointment of the workman was made by Mr. V. K. Balan as a Plant Manager and not for or on behalf of the General Manager and as the power of appointment implies and carries wit h it the power of dismissal, we are of the opinion that the order of dismissal did not suffer from the infirmity of want of competence or of authority to pass the orderThe decision of this Court in Hindustan Brown Boveri Ltd. v. Their Workmen &Anr. ([1968] 1 L.L.J. 571) relied upon by Mr. Chatterji in support of his contention that the Plant Manager was not competent to pass the impugned order of dismissal is clearly distinguishable. In that case, despite the issue raised before the Labour Court as to whether the demotion of one workman and the termination of service of the other was in order, the Company did not at the proper stage inform or contend before the Labour Court that the Works Manager was empowered to recruit and dismiss the workman by virtue of the power of attorney executed in his favour by the Company. The judgment in that case also does not show that the Works Manager was competent to appoint the workman under the standing orders of the CompanyIn conclusion, we would like to make it clear that as charges Nos. 2 and 3 have been held by the Industrial Tribunal to have been established against the workman and they constitute major misdemeanours falling within the purview of sub-clauses (a) and (m) of clause (ii) of Standing Order 31 of the aforesaid Standing Orders, we think that the order of dismissal could have been passed by the punishing authority which in this case, as already stated, was the Plant Manager. We may also observe that it is not open to us to substitute the order of discharge with benefits of past service for the impugned order of dismissal. The workman may, if so advised, approach the Company in this behalf.
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Jasveer Singh Vs. State Of U.P | considering the pros and cons, without entering into serious controversies and making any comment on the merit of the case, we are of the considered opinion that in view of the judgment and order of this Court dated 26th November, 2010, which was passed in presence of the counsel for both the parties, the High Court ought not to have heard the matter at all. Thus, the judgment and order impugned before us has lost its sanctity. Therefore, the same is hereby set aside.However, in order to meet the ends of justice, we remand the case to the High Court to hear the writ petition afresh expeditiously preferably within a period of six months from the date of production of the certified copy of the order before the Honble Chief Justice. The matter may be assigned to any particular Bench by the Honble Chief Justice for final disposal. The parties shall be at liberty to raise all factual and legal issues involved in the case. The High Court is requested to deal with the relevant issues in detail.More so, if the respondents are so aggrieved regarding withdrawal of their appeals, which had been remanded by this Court for determining the entitlement of interest under Section 23-(1A) of the Land Acquisition Act, 1984 and an application is made by the respondent to revive the same, the High Court may consider and decide the said application in accordance with Law. All the matters shall be heard simultaneously by the same Bench if the appeals are restored. "3. Thereafter, the High Court considered the contention of the appellants that the award in respect of compensation was no award in the eye of law and though the possession was taken long back and railway line had been laid out, the acquisition proceedings were liable to be set aside and compensation was liable to be awarded at present market rate. The High Court rejected the said plea vide judgment dated 30th May, 2014 in Writ-C No.77449 of 2005. It was observed that objection of the appellants against the award had already been considered and remand by the Supreme Court on 12th September, 2005 was only in respect of statutory benefits. For the first time plea was sought to be raised in the writ petition against validity of acquisition which was impermissible in view of law laid down by this Court in Aflatoon v. Lt. Governor of Delhi, (1975) 4 SCC 285 , Swaika Properties Pvt. Ltd. v. State of Rajasthan, 2008(2) R.C.R.(Civil) 96 : 2008(2) Recent Apex Judgments (R.A.J.) 82 : (2008) 4 SCC 695 , Sawaran Lata v. State of Haryana, 2010(2) R.C.R.(Civil) 695 : (2010) 4 SCC 532 and Banda Development Authority, Banda v. Moti Lal Agarwal, 2011(3) R.C.R.(Civil) 530 : 2011(3) Recent Apex Judgments (R.A.J.) 435 : (2011) 5 SCC 394. Judgment of this Court in Royal Orchid Hotel v. G. Tayarama Reddy, 2011(4) R.C.R.(Civil) 613 : 2011(5) Recent Apex Judgments (R.A.J.) 354 : (2011) 10 SCC 608 was distinguished as that case related to fraudulent exercise of power of eminent domain. The High Court concluded :"45. Taking into consideration the entire facts and circumstances of the case, we are of the view that the writ petition is highly barred by latches and deserves to be dismissed on the ground of latches alone.46. As has been observed above, the petitioners main grievance is for enhancement of compensation, for which the petitioner has already filed First Appeal No.880 of 1993 and First Appeal No.401 of 1998 which appeals are being allowed by order of the date, we see no reason to entertain the writ petition.47. Although, various submissions on merits challenging the entire acquisition proceedings have been raised by learned counsel for the petitioners, but we having taken the view that the writ petition is highly barred by latches, we do not find it necessary to enter into the submissions raised by learned counsel for the petitioners on merits."4. The appellant thereafter preferred S.L.P. (Civil) No. 27109 of 2014 which was dismissed. However, it was observed that appellants are at liberty to work out their grievance based on the new Land Acquisition Act (2013) by preferring appropriate proceedings. The appellant thereafter filed W.P. No.77449 of 2005 from which these appeals have arisen.5. The High Court dismissed the writ petition with the following observations:"From the facts as noticed herein above, we are of the considered opinion that not only the Award had been made, the petitioners had also filed a Reference Application which was rejected and against the Reference Order, they filed First Appeal, referred to above, which has also been dismissed. There is substance in the allegations made."6. We have heard learned counsel for the parties.7. Learned counsel for the appellants submitted that in the present case the award should be held to have not been validly made and on that ground the proceedings should be held to have lapsed.8. We are unable to accept the above submission. It is seen from the above resume of the proceedings that the appellants were paid compensation and possession was duly taken. The appellants also preferred reference on which higher compensation was awarded and matter attained finality upto this Court. The appellants thereafter filed a writ petition challenging the acquisition proceedings which was held to barred by delay and latches against which SLP was dismissed by this Court. Of course, an observation was made that the appellants could prefer appropriate proceedings based on their grievance under the 2013 Act.9. The grievance of the appellants against acquisition proceedings on the ground that the award was not a valid award was rejected and SLP was dismissed by this Court but permitting a fresh challenge. The fact remains that the challenge of the appellants is barred by laches and the said finding does not suffer from any infirmity. Even if the appellants were permitted to lay a fresh challenge, they are required to overcome this legal bar which in our view the appellants have not been able to overcome. | 0[ds]8. We are unable to accept the above submission. It is seen from the above resume of the proceedings that the appellants were paid compensation and possession was duly taken. The appellants also preferred reference on which higher compensation was awarded and matter attained finality upto this Court. The appellants thereafter filed a writ petition challenging the acquisition proceedings which was held to barred by delay and latches against which SLP was dismissed by this Court. Of course, an observation was made that the appellants could prefer appropriate proceedings based on their grievance under the 2013 Act.9. The grievance of the appellants against acquisition proceedings on the ground that the award was not a valid award was rejected and SLP was dismissed by this Court but permitting a fresh challenge. The fact remains that the challenge of the appellants is barred by laches and the said finding does not suffer from any infirmity. Even if the appellants were permitted to lay a fresh challenge, they are required to overcome this legal bar which in our view the appellants have not been able to overcome. | 0 | 1,409 | 199 | ### Instruction:
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considering the pros and cons, without entering into serious controversies and making any comment on the merit of the case, we are of the considered opinion that in view of the judgment and order of this Court dated 26th November, 2010, which was passed in presence of the counsel for both the parties, the High Court ought not to have heard the matter at all. Thus, the judgment and order impugned before us has lost its sanctity. Therefore, the same is hereby set aside.However, in order to meet the ends of justice, we remand the case to the High Court to hear the writ petition afresh expeditiously preferably within a period of six months from the date of production of the certified copy of the order before the Honble Chief Justice. The matter may be assigned to any particular Bench by the Honble Chief Justice for final disposal. The parties shall be at liberty to raise all factual and legal issues involved in the case. The High Court is requested to deal with the relevant issues in detail.More so, if the respondents are so aggrieved regarding withdrawal of their appeals, which had been remanded by this Court for determining the entitlement of interest under Section 23-(1A) of the Land Acquisition Act, 1984 and an application is made by the respondent to revive the same, the High Court may consider and decide the said application in accordance with Law. All the matters shall be heard simultaneously by the same Bench if the appeals are restored. "3. Thereafter, the High Court considered the contention of the appellants that the award in respect of compensation was no award in the eye of law and though the possession was taken long back and railway line had been laid out, the acquisition proceedings were liable to be set aside and compensation was liable to be awarded at present market rate. The High Court rejected the said plea vide judgment dated 30th May, 2014 in Writ-C No.77449 of 2005. It was observed that objection of the appellants against the award had already been considered and remand by the Supreme Court on 12th September, 2005 was only in respect of statutory benefits. For the first time plea was sought to be raised in the writ petition against validity of acquisition which was impermissible in view of law laid down by this Court in Aflatoon v. Lt. Governor of Delhi, (1975) 4 SCC 285 , Swaika Properties Pvt. Ltd. v. State of Rajasthan, 2008(2) R.C.R.(Civil) 96 : 2008(2) Recent Apex Judgments (R.A.J.) 82 : (2008) 4 SCC 695 , Sawaran Lata v. State of Haryana, 2010(2) R.C.R.(Civil) 695 : (2010) 4 SCC 532 and Banda Development Authority, Banda v. Moti Lal Agarwal, 2011(3) R.C.R.(Civil) 530 : 2011(3) Recent Apex Judgments (R.A.J.) 435 : (2011) 5 SCC 394. Judgment of this Court in Royal Orchid Hotel v. G. Tayarama Reddy, 2011(4) R.C.R.(Civil) 613 : 2011(5) Recent Apex Judgments (R.A.J.) 354 : (2011) 10 SCC 608 was distinguished as that case related to fraudulent exercise of power of eminent domain. The High Court concluded :"45. Taking into consideration the entire facts and circumstances of the case, we are of the view that the writ petition is highly barred by latches and deserves to be dismissed on the ground of latches alone.46. As has been observed above, the petitioners main grievance is for enhancement of compensation, for which the petitioner has already filed First Appeal No.880 of 1993 and First Appeal No.401 of 1998 which appeals are being allowed by order of the date, we see no reason to entertain the writ petition.47. Although, various submissions on merits challenging the entire acquisition proceedings have been raised by learned counsel for the petitioners, but we having taken the view that the writ petition is highly barred by latches, we do not find it necessary to enter into the submissions raised by learned counsel for the petitioners on merits."4. The appellant thereafter preferred S.L.P. (Civil) No. 27109 of 2014 which was dismissed. However, it was observed that appellants are at liberty to work out their grievance based on the new Land Acquisition Act (2013) by preferring appropriate proceedings. The appellant thereafter filed W.P. No.77449 of 2005 from which these appeals have arisen.5. The High Court dismissed the writ petition with the following observations:"From the facts as noticed herein above, we are of the considered opinion that not only the Award had been made, the petitioners had also filed a Reference Application which was rejected and against the Reference Order, they filed First Appeal, referred to above, which has also been dismissed. There is substance in the allegations made."6. We have heard learned counsel for the parties.7. Learned counsel for the appellants submitted that in the present case the award should be held to have not been validly made and on that ground the proceedings should be held to have lapsed.8. We are unable to accept the above submission. It is seen from the above resume of the proceedings that the appellants were paid compensation and possession was duly taken. The appellants also preferred reference on which higher compensation was awarded and matter attained finality upto this Court. The appellants thereafter filed a writ petition challenging the acquisition proceedings which was held to barred by delay and latches against which SLP was dismissed by this Court. Of course, an observation was made that the appellants could prefer appropriate proceedings based on their grievance under the 2013 Act.9. The grievance of the appellants against acquisition proceedings on the ground that the award was not a valid award was rejected and SLP was dismissed by this Court but permitting a fresh challenge. The fact remains that the challenge of the appellants is barred by laches and the said finding does not suffer from any infirmity. Even if the appellants were permitted to lay a fresh challenge, they are required to overcome this legal bar which in our view the appellants have not been able to overcome.
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8. We are unable to accept the above submission. It is seen from the above resume of the proceedings that the appellants were paid compensation and possession was duly taken. The appellants also preferred reference on which higher compensation was awarded and matter attained finality upto this Court. The appellants thereafter filed a writ petition challenging the acquisition proceedings which was held to barred by delay and latches against which SLP was dismissed by this Court. Of course, an observation was made that the appellants could prefer appropriate proceedings based on their grievance under the 2013 Act.9. The grievance of the appellants against acquisition proceedings on the ground that the award was not a valid award was rejected and SLP was dismissed by this Court but permitting a fresh challenge. The fact remains that the challenge of the appellants is barred by laches and the said finding does not suffer from any infirmity. Even if the appellants were permitted to lay a fresh challenge, they are required to overcome this legal bar which in our view the appellants have not been able to overcome.
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Jagjit Singh (D) thr. L.Rs Vs. Amarjit Singh | Deepak Gupta, J.1. Amarjit Singh (since deceased, the Respondent herein) hereinafter referred to as "the Plaintiff, filed a suit for specific performance of contract. He alleged that he had entered into an agreement dated 17.10.2000 with Jagjit Singh (since deceased, the Appellant herein) hereinafter referred to as "the Defendant", for purchase of half share in the shop in dispute for a total sale consideration of Rs. 1,50,000/-. According to the Plaintiff, Rs. 1,30,000/- was paid in cash at the time of execution of the agreement to sell. The balance amount was to be paid on or before 30.03.2003, by which date the sale deed was to be executed and registered. It was further alleged that the date for execution and registration of the sale deed was extended by mutual consent of the parties till 09.10.2003. The Defendant denied the execution of the sale deed itself. According to him, he had not been paid any money.2. The trial court on consideration of the entire evidence came to the conclusion that no agreement to sell had been executed between the parties and accordingly dismissed the suit. Aggrieved, the Plaintiff filed an appeal. The first appellate court set aside the finding of the trial court that the agreement to sell had not been executed. However, the first appellate court came to the conclusion that the so called agreement was, in fact, not an agreement to sell. It further held, that assuming that the said agreement was an agreement to sell, the Plaintiff had failed to prove that he was ready and willing to perform his part of the agreement. It held that the Plaintiff had failed to show what steps he had taken to perform his part of the contract from 17.10.2000 to 09.10.2003. The first appellate court, on perusal of the pleadings and the evidence, came to a finding of fact that it had nowhere been averred and proved that the Plaintiff had ever showed his readiness or willingness to perform his part of the contract. The appeal was consequently dismissed.3. The second appeal filed by the Plaintiff has been allowed by the High Court without framing any question of law much less a substantial question of law. The High Court, without discussing the evidence, held that in its view the finding of the lower appellate court is "not only erroneous, but fallacious and perverse". The only ground for coming to this decision is that the suit had been filed on 09.01.2004 whereas the extended date for execution and registration of the sale deed was 09.10.2003 and thereafter, the Plaintiff had sent a legal notice on 13.10.2003. We fail to understand as to how the issuance of notice on 13.10.2003 or the filing of the suit on 09.01.2004 can lead to the conclusion that the Plaintiff was always ready and willing to perform his part of the contract from the date of agreement to sell till date of filing of suit. Moreover, this is a pure finding of fact which should not have been disturbed in a second appeal that too without giving any cogent reasons.4. It is settled law that a Plaintiff who seeks specific performance of contract is required to plead and prove that he was always ready and willing to perform his part of the contract1. Section 16(c) of the Specific Relief Act mandates that the Plaintiff should plead and prove his readiness and willingness as a condition precedent for obtaining relief of grant of specific performance. As far back as in 1967, this Court in Gomathinayagam Pillai and Ors. v. Pallaniswami Nadar (1967) 1 SCR 227 held that in a suit for specific performance the Plaintiff must plead and prove that he was ready and willing to perform his part of the contract right from the date of the contract up to the date of the filing of the suit. This law continues to hold the field and has been reiterated in the case of J.P. Builders and Anr. v. A. Ramadas Rao and Anr. (2011) 1 SCC 429 and P. Meenakshisundaram v. P. Vijayakumar and Ors.2. It is the duty of the Plaintiff to plead and then lead evidence to show that the Plaintiff from the date he entered into an agreement till the stage of filing of the suit always had the capacity and willingness to perform the contract.5. As far as the present appeal is concerned, the finding of the first appellate court that the Plaintiff had failed to plead or prove his willingness to perform his part of the contract from the date of agreement till filing of the suit is a pure finding of fact based on evidence and law. The High Court has while upsetting the judgment of the District Judge lost sight of the provisions of the Specific Relief Act and the law in this regard. | 1[ds]The only ground for coming to this decision is that the suit had been filed on 09.01.2004 whereas the extended date for execution and registration of the sale deed was 09.10.2003 and thereafter, the Plaintiff had sent a legal notice on 13.10.2003. We fail to understand as to how the issuance of notice on 13.10.2003 or the filing of the suit on 09.01.2004 can lead to the conclusion that the Plaintiff was always ready and willing to perform his part of the contract from the date of agreement to sell till date of filing of suit. Moreover, this is a pure finding of fact which should not have been disturbed in a second appeal that too without giving any cogent reasons4. It is settled law that a Plaintiff who seeks specific performance of contract is required to plead and prove that he was always ready and willing to perform his part of the contract15. As far as the present appeal is concerned, the finding of the first appellate court that the Plaintiff had failed to plead or prove his willingness to perform his part of the contract from the date of agreement till filing of the suit is a pure finding of fact based on evidence and law. The High Court has while upsetting the judgment of the District Judge lost sight of the provisions of the Specific Relief Act and the law in this regard. | 1 | 877 | 249 | ### Instruction:
Judge the probable resolution of the case (approval (1) or disapproval (0)), and elaborate on this forecast by extracting and interpreting significant sentences from the proceeding.
### Input:
Deepak Gupta, J.1. Amarjit Singh (since deceased, the Respondent herein) hereinafter referred to as "the Plaintiff, filed a suit for specific performance of contract. He alleged that he had entered into an agreement dated 17.10.2000 with Jagjit Singh (since deceased, the Appellant herein) hereinafter referred to as "the Defendant", for purchase of half share in the shop in dispute for a total sale consideration of Rs. 1,50,000/-. According to the Plaintiff, Rs. 1,30,000/- was paid in cash at the time of execution of the agreement to sell. The balance amount was to be paid on or before 30.03.2003, by which date the sale deed was to be executed and registered. It was further alleged that the date for execution and registration of the sale deed was extended by mutual consent of the parties till 09.10.2003. The Defendant denied the execution of the sale deed itself. According to him, he had not been paid any money.2. The trial court on consideration of the entire evidence came to the conclusion that no agreement to sell had been executed between the parties and accordingly dismissed the suit. Aggrieved, the Plaintiff filed an appeal. The first appellate court set aside the finding of the trial court that the agreement to sell had not been executed. However, the first appellate court came to the conclusion that the so called agreement was, in fact, not an agreement to sell. It further held, that assuming that the said agreement was an agreement to sell, the Plaintiff had failed to prove that he was ready and willing to perform his part of the agreement. It held that the Plaintiff had failed to show what steps he had taken to perform his part of the contract from 17.10.2000 to 09.10.2003. The first appellate court, on perusal of the pleadings and the evidence, came to a finding of fact that it had nowhere been averred and proved that the Plaintiff had ever showed his readiness or willingness to perform his part of the contract. The appeal was consequently dismissed.3. The second appeal filed by the Plaintiff has been allowed by the High Court without framing any question of law much less a substantial question of law. The High Court, without discussing the evidence, held that in its view the finding of the lower appellate court is "not only erroneous, but fallacious and perverse". The only ground for coming to this decision is that the suit had been filed on 09.01.2004 whereas the extended date for execution and registration of the sale deed was 09.10.2003 and thereafter, the Plaintiff had sent a legal notice on 13.10.2003. We fail to understand as to how the issuance of notice on 13.10.2003 or the filing of the suit on 09.01.2004 can lead to the conclusion that the Plaintiff was always ready and willing to perform his part of the contract from the date of agreement to sell till date of filing of suit. Moreover, this is a pure finding of fact which should not have been disturbed in a second appeal that too without giving any cogent reasons.4. It is settled law that a Plaintiff who seeks specific performance of contract is required to plead and prove that he was always ready and willing to perform his part of the contract1. Section 16(c) of the Specific Relief Act mandates that the Plaintiff should plead and prove his readiness and willingness as a condition precedent for obtaining relief of grant of specific performance. As far back as in 1967, this Court in Gomathinayagam Pillai and Ors. v. Pallaniswami Nadar (1967) 1 SCR 227 held that in a suit for specific performance the Plaintiff must plead and prove that he was ready and willing to perform his part of the contract right from the date of the contract up to the date of the filing of the suit. This law continues to hold the field and has been reiterated in the case of J.P. Builders and Anr. v. A. Ramadas Rao and Anr. (2011) 1 SCC 429 and P. Meenakshisundaram v. P. Vijayakumar and Ors.2. It is the duty of the Plaintiff to plead and then lead evidence to show that the Plaintiff from the date he entered into an agreement till the stage of filing of the suit always had the capacity and willingness to perform the contract.5. As far as the present appeal is concerned, the finding of the first appellate court that the Plaintiff had failed to plead or prove his willingness to perform his part of the contract from the date of agreement till filing of the suit is a pure finding of fact based on evidence and law. The High Court has while upsetting the judgment of the District Judge lost sight of the provisions of the Specific Relief Act and the law in this regard.
### Response:
1
### Explanation:
The only ground for coming to this decision is that the suit had been filed on 09.01.2004 whereas the extended date for execution and registration of the sale deed was 09.10.2003 and thereafter, the Plaintiff had sent a legal notice on 13.10.2003. We fail to understand as to how the issuance of notice on 13.10.2003 or the filing of the suit on 09.01.2004 can lead to the conclusion that the Plaintiff was always ready and willing to perform his part of the contract from the date of agreement to sell till date of filing of suit. Moreover, this is a pure finding of fact which should not have been disturbed in a second appeal that too without giving any cogent reasons4. It is settled law that a Plaintiff who seeks specific performance of contract is required to plead and prove that he was always ready and willing to perform his part of the contract15. As far as the present appeal is concerned, the finding of the first appellate court that the Plaintiff had failed to plead or prove his willingness to perform his part of the contract from the date of agreement till filing of the suit is a pure finding of fact based on evidence and law. The High Court has while upsetting the judgment of the District Judge lost sight of the provisions of the Specific Relief Act and the law in this regard.
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State Of Orissa Vs. Bidyabhujshan Mohapatra | this plea cannot be sustained. The Tribunal Rules and the Police Regulations in so far as they deal with enquiries against police officers are promulgated under S. 7 of the Police Act, and neither the Tribunal Rules nor the Police Regulations provide an appeal against an order of dismissal or reduction in rank which the Governor may pass. The fact that an order made by a police authority is made appealable whereas the order passed by the Governor is not made appealable is not a ground on which the validity of the Tribunal Rules can be challenged. In either case, the final order rests with the Governor who has to decide the matter himself. Equal protection of the laws does not postulate equal treatment of all persons without discrimination to all persons similarly situated. The power of the Legislature to make a distinction between persons or transactions based on a real differentia is not taken away by the equal protection clause. Therefore by providing a right of appeal against the order of police authorities acting under the Police Regulations imposing penalties upon a member of the police force, and by providing no such right of appeal when the order passed is by the Governor, no discrimination inviting the application of Art. 14 is practised."The plea that there was discrimination because there was a right of appeal against an order imposing penalty under one set of rules, and no such right under the other, was rejected in AIR 1961 SC 1245 .It must therefore be held that the existence of a right of appeal against the order of an administrative head imposing penalty and absence of such a right of appeal against the order of the Governor under the Tribunal Rules does not result in discrimination contrary to Art. 14 of the Constitution.9. The High Court has held that there was evidence to support the findings on heads (c) and (d) of Charge (1) and on Charge (2). In respect of charge 1 (b) the respondent was acquitted by the Tribunal and it did not fall to be considered by the Governor. In respect of charges 1(a) and 1(e) in the view of the High Court "the rules of natural justice had not been observed." The recommendation of the Tribunal was undoubtedly founded on its findings on charges 1(a), 1(e), 1(c), 1(d) and Charge (2). The High Court was of the opinion that the findings on two of the heads under Charge (1) could not be sustained, because in arriving at the findings the Tribunal had violated rules of natural justice. The High Court therefore directed that the Government of the State of Orissa should decide whether "on the basis of those charges, the punishment of dismissal should be maintained or else whether a lesser punishment would suffice." It is not necessary for us to consider whether the High Court was right in holding that the findings of the Tribunal on charges 1 (a) and 1 (e) were vitiated for reasons set out by it, because in our judgment the order of the High Court directing the Government to reconsider the question of punishment cannot, for reasons we will presently set out, be sustained. If the order of dismissal was based on the findings on charges 1 (a) and 1(e) alone the Court would have jurisdiction to declare the order of dismissal illegal but when the findings of the Tribunal relating to the two out of five heads of the first charge and the second charge was found not liable to be interfered with by the High Court and those findings established that the respondent was prima facie guilty of grave delinquency, in our view the High Court had no power to direct the Governor of Orissa to reconsider the order of dismissal. The constitutional guarantee afforded to a public servant is that he shall not be dismissed or removed by an authority subordinate to that by which he was appointed, and that he shall not be dismissed or removed or reduced in rank until he has been given a reasonable opportunity of showing cause against the action proposed to be taken in regard to him. The reasonable opportunity contemplated has manifestly to be in accordance with the rules framed under Art. 309 of the Constitution. But the Court in a case in which an order of dismissal of a public servant is impugned, is not concerned to decide whether the sentence imposed, provided it is justified by the rules, is appropriate having regard to the gravity of the misdemeanor established. The reasons which induce the punishing authority, if there has been an enquiry consistent with the prescribed rules, are not justiciable: nor is the penalty open to review by the Court. If the High Court is satisfied that if some but not all of the findings of the Tribunal were "unassailable" the order of the Governor on whose powers by the rules no restrictions in determining the appropriate punishment are placed was final, and the High Court had no jurisdiction to direct the Governor to review the penalty for as we have already observed the order of dismissal passed by a competent authority on a public servant, if the conditions of the constitutional protection have been complied with, is not justiciable. Therefore if the order may be supported on any finding as to substantial misdemeanor for which the punishment can lawfully be imposed, it is not for the Court to consider whether that ground alone would have weighed with the authority in dismissing the public servant. The Court has no jurisdiction of the findings of the enquiry officer or the Tribunal prima facie make out a case of misdemeanor, to direct the authority to reconsider that order because in respect of some of the findings but not all it appears that there had been violation of the rules of natural justice. The High Court was, in our judgment, in error in directing the Governor of Orissa to reconsider the question. | 1[ds]8. Under the Classification Rules there is a right of appeal from an order imposing a penalty passed by a departmental head to the latters superior whereas there is no such right of appeal against the order passed by the Governor imposing penalty upon a public servant. But this also cannot be regarded as a ground sustaining a plea of unlawful discrimination.The High Court has held that there was evidence to support the findings on heads (c) and (d) of Charge (1) and on Charge (2). In respect of charge 1 (b) the respondent was acquitted by the Tribunal and it did not fall to be considered by the Governor. In respect of charges 1(a) and 1(e) in the view of the High Court "the rules of natural justice had not been observed." The recommendation of the Tribunal was undoubtedly founded on its findings on charges 1(a), 1(e), 1(c), 1(d) and Charge (2). The High Court was of the opinion that the findings on two of the heads under Charge (1) could not be sustained, because in arriving at the findings the Tribunal had violated rules of natural justice. The High Court therefore directed that the Government of the State of Orissa should decide whether "on the basis of those charges, the punishment of dismissal should be maintained or else whether a lesser punishment would suffice." It is not necessary for us to consider whether the High Court was right in holding that the findings of the Tribunal on charges 1 (a) and 1 (e) were vitiated for reasons set out by it, because in our judgment the order of the High Court directing the Government to reconsider the question of punishment cannot, for reasons we will presently set out, be sustained. If the order of dismissal was based on the findings on charges 1 (a) and 1(e) alone the Court would have jurisdiction to declare the order of dismissal illegal but when the findings of the Tribunal relating to the two out of five heads of the first charge and the second charge was found not liable to be interfered with by the High Court and those findings established that the respondent was prima facie guilty of grave delinquency, in our view the High Court had no power to direct the Governor of Orissa to reconsider the order of dismissal. The constitutional guarantee afforded to a public servant is that he shall not be dismissed or removed by an authority subordinate to that by which he was appointed, and that he shall not be dismissed or removed or reduced in rank until he has been given a reasonable opportunity of showing cause against the action proposed to be taken in regard to him. The reasonable opportunity contemplated has manifestly to be in accordance with the rules framed under Art. 309 of the Constitution. But the Court in a case in which an order of dismissal of a public servant is impugned, is not concerned to decide whether the sentence imposed, provided it is justified by the rules, is appropriate having regard to the gravity of the misdemeanor established. The reasons which induce the punishing authority, if there has been an enquiry consistent with the prescribed rules, are not justiciable: nor is the penalty open to review by the Court. If the High Court is satisfied that if some but not all of the findings of the Tribunal were "unassailable" the order of the Governor on whose powers by the rules no restrictions in determining the appropriate punishment are placed was final, and the High Court had no jurisdiction to direct the Governor to review the penalty for as we have already observed the order of dismissal passed by a competent authority on a public servant, if the conditions of the constitutional protection have been complied with, is not justiciable. Therefore if the order may be supported on any finding as to substantial misdemeanor for which the punishment can lawfully be imposed, it is not for the Court to consider whether that ground alone would have weighed with the authority in dismissing the public servant. The Court has no jurisdiction of the findings of the enquiry officer or the Tribunal prima facie make out a case of misdemeanor, to direct the authority to reconsider that order because in respect of some of the findings but not all it appears that there had been violation of the rules of natural justice. The High Court was, in our judgment, in error in directing the Governor of Orissa to reconsider the question. | 1 | 6,002 | 854 | ### Instruction:
Predict the outcome of the case proceeding (1 for acceptance, 0 for rejection) and subsequently provide an explanation based on significant sentences in the proceeding.
### Input:
this plea cannot be sustained. The Tribunal Rules and the Police Regulations in so far as they deal with enquiries against police officers are promulgated under S. 7 of the Police Act, and neither the Tribunal Rules nor the Police Regulations provide an appeal against an order of dismissal or reduction in rank which the Governor may pass. The fact that an order made by a police authority is made appealable whereas the order passed by the Governor is not made appealable is not a ground on which the validity of the Tribunal Rules can be challenged. In either case, the final order rests with the Governor who has to decide the matter himself. Equal protection of the laws does not postulate equal treatment of all persons without discrimination to all persons similarly situated. The power of the Legislature to make a distinction between persons or transactions based on a real differentia is not taken away by the equal protection clause. Therefore by providing a right of appeal against the order of police authorities acting under the Police Regulations imposing penalties upon a member of the police force, and by providing no such right of appeal when the order passed is by the Governor, no discrimination inviting the application of Art. 14 is practised."The plea that there was discrimination because there was a right of appeal against an order imposing penalty under one set of rules, and no such right under the other, was rejected in AIR 1961 SC 1245 .It must therefore be held that the existence of a right of appeal against the order of an administrative head imposing penalty and absence of such a right of appeal against the order of the Governor under the Tribunal Rules does not result in discrimination contrary to Art. 14 of the Constitution.9. The High Court has held that there was evidence to support the findings on heads (c) and (d) of Charge (1) and on Charge (2). In respect of charge 1 (b) the respondent was acquitted by the Tribunal and it did not fall to be considered by the Governor. In respect of charges 1(a) and 1(e) in the view of the High Court "the rules of natural justice had not been observed." The recommendation of the Tribunal was undoubtedly founded on its findings on charges 1(a), 1(e), 1(c), 1(d) and Charge (2). The High Court was of the opinion that the findings on two of the heads under Charge (1) could not be sustained, because in arriving at the findings the Tribunal had violated rules of natural justice. The High Court therefore directed that the Government of the State of Orissa should decide whether "on the basis of those charges, the punishment of dismissal should be maintained or else whether a lesser punishment would suffice." It is not necessary for us to consider whether the High Court was right in holding that the findings of the Tribunal on charges 1 (a) and 1 (e) were vitiated for reasons set out by it, because in our judgment the order of the High Court directing the Government to reconsider the question of punishment cannot, for reasons we will presently set out, be sustained. If the order of dismissal was based on the findings on charges 1 (a) and 1(e) alone the Court would have jurisdiction to declare the order of dismissal illegal but when the findings of the Tribunal relating to the two out of five heads of the first charge and the second charge was found not liable to be interfered with by the High Court and those findings established that the respondent was prima facie guilty of grave delinquency, in our view the High Court had no power to direct the Governor of Orissa to reconsider the order of dismissal. The constitutional guarantee afforded to a public servant is that he shall not be dismissed or removed by an authority subordinate to that by which he was appointed, and that he shall not be dismissed or removed or reduced in rank until he has been given a reasonable opportunity of showing cause against the action proposed to be taken in regard to him. The reasonable opportunity contemplated has manifestly to be in accordance with the rules framed under Art. 309 of the Constitution. But the Court in a case in which an order of dismissal of a public servant is impugned, is not concerned to decide whether the sentence imposed, provided it is justified by the rules, is appropriate having regard to the gravity of the misdemeanor established. The reasons which induce the punishing authority, if there has been an enquiry consistent with the prescribed rules, are not justiciable: nor is the penalty open to review by the Court. If the High Court is satisfied that if some but not all of the findings of the Tribunal were "unassailable" the order of the Governor on whose powers by the rules no restrictions in determining the appropriate punishment are placed was final, and the High Court had no jurisdiction to direct the Governor to review the penalty for as we have already observed the order of dismissal passed by a competent authority on a public servant, if the conditions of the constitutional protection have been complied with, is not justiciable. Therefore if the order may be supported on any finding as to substantial misdemeanor for which the punishment can lawfully be imposed, it is not for the Court to consider whether that ground alone would have weighed with the authority in dismissing the public servant. The Court has no jurisdiction of the findings of the enquiry officer or the Tribunal prima facie make out a case of misdemeanor, to direct the authority to reconsider that order because in respect of some of the findings but not all it appears that there had been violation of the rules of natural justice. The High Court was, in our judgment, in error in directing the Governor of Orissa to reconsider the question.
### Response:
1
### Explanation:
8. Under the Classification Rules there is a right of appeal from an order imposing a penalty passed by a departmental head to the latters superior whereas there is no such right of appeal against the order passed by the Governor imposing penalty upon a public servant. But this also cannot be regarded as a ground sustaining a plea of unlawful discrimination.The High Court has held that there was evidence to support the findings on heads (c) and (d) of Charge (1) and on Charge (2). In respect of charge 1 (b) the respondent was acquitted by the Tribunal and it did not fall to be considered by the Governor. In respect of charges 1(a) and 1(e) in the view of the High Court "the rules of natural justice had not been observed." The recommendation of the Tribunal was undoubtedly founded on its findings on charges 1(a), 1(e), 1(c), 1(d) and Charge (2). The High Court was of the opinion that the findings on two of the heads under Charge (1) could not be sustained, because in arriving at the findings the Tribunal had violated rules of natural justice. The High Court therefore directed that the Government of the State of Orissa should decide whether "on the basis of those charges, the punishment of dismissal should be maintained or else whether a lesser punishment would suffice." It is not necessary for us to consider whether the High Court was right in holding that the findings of the Tribunal on charges 1 (a) and 1 (e) were vitiated for reasons set out by it, because in our judgment the order of the High Court directing the Government to reconsider the question of punishment cannot, for reasons we will presently set out, be sustained. If the order of dismissal was based on the findings on charges 1 (a) and 1(e) alone the Court would have jurisdiction to declare the order of dismissal illegal but when the findings of the Tribunal relating to the two out of five heads of the first charge and the second charge was found not liable to be interfered with by the High Court and those findings established that the respondent was prima facie guilty of grave delinquency, in our view the High Court had no power to direct the Governor of Orissa to reconsider the order of dismissal. The constitutional guarantee afforded to a public servant is that he shall not be dismissed or removed by an authority subordinate to that by which he was appointed, and that he shall not be dismissed or removed or reduced in rank until he has been given a reasonable opportunity of showing cause against the action proposed to be taken in regard to him. The reasonable opportunity contemplated has manifestly to be in accordance with the rules framed under Art. 309 of the Constitution. But the Court in a case in which an order of dismissal of a public servant is impugned, is not concerned to decide whether the sentence imposed, provided it is justified by the rules, is appropriate having regard to the gravity of the misdemeanor established. The reasons which induce the punishing authority, if there has been an enquiry consistent with the prescribed rules, are not justiciable: nor is the penalty open to review by the Court. If the High Court is satisfied that if some but not all of the findings of the Tribunal were "unassailable" the order of the Governor on whose powers by the rules no restrictions in determining the appropriate punishment are placed was final, and the High Court had no jurisdiction to direct the Governor to review the penalty for as we have already observed the order of dismissal passed by a competent authority on a public servant, if the conditions of the constitutional protection have been complied with, is not justiciable. Therefore if the order may be supported on any finding as to substantial misdemeanor for which the punishment can lawfully be imposed, it is not for the Court to consider whether that ground alone would have weighed with the authority in dismissing the public servant. The Court has no jurisdiction of the findings of the enquiry officer or the Tribunal prima facie make out a case of misdemeanor, to direct the authority to reconsider that order because in respect of some of the findings but not all it appears that there had been violation of the rules of natural justice. The High Court was, in our judgment, in error in directing the Governor of Orissa to reconsider the question.
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M/S Narne Construction P.Ltd.Etc.Etc Vs. Union Of India & Ors.Etc | The legislative intention is thus clear to protect a consumer against services rendered even by statutory bodies. The test, therefore, is not if a person against whom complaint is made is a statutory body but whether the nature of the duty and function performed by it is service or even facility. (emphasis supplied) 5. In the context of the housing construction and building activities carried on by a private or statutory body and whether such activity tantamounts to service within the meaning of clause (o) of Section 2(1) of the Act, the Court observed: As pointed out earlier the entire purpose of widening the definition is to include in it not only day to day buying and selling activity undertaken by a common man but even such activities which are otherwise not commercial in nature yet they partake of a character in which some benefit is conferred on the consumer. Construction of a house or flat is for the benefit of person for whom it is constructed. He may do it himself or hire services of a builder or contractor. The latter being for consideration is service as defined in the Act. Similarly when a statutory authority develops land or allots a site or constructs a house for the benefit of common man it is as much service as by a builder or contractor. The one is contractual service and other statutory service. If the service is defective or it is not what was represented then it would be unfair trade practice as defined in the Act. Any defect in construction activity would be denial of comfort and service to a consumer. When possession of property is not delivered within stipulated period the delay so caused is denial of service. Such disputes or claims are not in respect of Immovable property as argued but deficiency in rendering of service of particular standard, quality or grade. Such deficiencies or omissions are defined in Sub-clause (ii) of Clause (r) of Section 2 as unfair trade practice. If a builder of a house uses substandard material in construction of a building or makes false or misleading representation about the condition of the house then it is denial of the facility or benefit of which a consumer is entitled to claim value under the Act. When the contractor or builder undertakes to erect a house or flat then it is inherent in it that he shall perform his obligation as agreed to. A flat with a leaking roof, or cracking wall or substandard floor is denial of service. Similarly when a statutory authority undertakes to develop land and frame housing scheme, it, while performing statutory duty renders service to the society in general and individual in particular. (emphasis supplied) 6. This Court further held that when a person applies for allotment of building site or for a flat constructed by development authority and enters into an agreement with the developer or a contractor, the nature of the transaction is covered by the expression service of any description. The housing construction or building activity carried on by a private or statutory body was, therefore, held to be service within the meaning of clause (o) of Section 2(1) of the Act as it stood prior to the inclusion of the expression housing construction in the definition of service by Ordinance No.24 of 1993. 7. In the light of the above pronouncement of this Court the High Court was perfectly justified in holding that the activities of the appellant- company in the present case involving offer of plots for sale to its customers/members with an assurance of development of infrastructure/amenities, lay-out approvals etc. was a service within the meaning of clause (o) of Section 2(1) of the Act and would, therefore, be amenable to the jurisdiction of the fora established under the statute. Having regard to the nature of the transaction between the appellant- company and its customers which involved much more than a simple transfer of a piece of immovable property it is clear that the same constituted service within the meaning of the Act. It was not a case where the appellant-company was selling the given property with all advantages and/or disadvantages on as is where is basis, as was the position in U.T. Chandigarh Administration and Anr. v. Amarjeet Singh and Ors. (2009) 4 SCC 660. It is a case where a clear cut assurance was made to the purchasers as to the nature and the extent of development that would be carried out by the appellant-company as a part of the package under which sale of fully developed plots with assured facilities was to be made in favour of the purchasers for valuable consideration. To the extent the transfer of the site with developments in the manner and to the extent indicated earlier was a part of the transaction, the appellant-company had indeed undertaken to provide a service. Any deficiency or defect in such service would make it accountable before the competent consumer forum at the instance of consumers like the respondents. 8. This Court in Bangalore Development Authority v. Syndicate Bank (2007) 6 SCC 711 , dealt with the nature of the relief that can be claimed by consumers in the event of refusal or delay in the transfer of the title of the property in favour of the allottees/purchasers and observed: Where full payment is made and possession is delivered, but title deed is not executed without any justifiable cause, the allottee may be awarded compensation, for harassment and mental agony, in addition to appropriate direction for execution and delivery of title deed. 9. Suffice it to say that the legal position on the subject is fairly well-settled by the pronouncements of this Court and do not require any reiteration. The High Court has correctly noticed the said pronouncements and applied them to the facts of the case at hand leaving no room for us to interfere with the answer given by it to the solitary question raised by the appellant-company. | 0[ds]was perfectly justified in holding that the activities of the appellant- company in the present case involving offer of plots for sale to its customers/members with an assurance of development of infrastructure/amenities, lay-out approvals etc. was a service within the meaning of clause (o) of Section 2(1) of the Act and would, therefore, be amenable to the jurisdiction of the fora established under the statute. Having regard to the nature of the transaction between the appellant- company and its customers which involved much more than a simple transfer of a piece of immovable property it is clear that the same constituted service within the meaning of the Act. It was not a case where the appellant-company was selling the given property with all advantages and/or disadvantages on as is where is basis, as was the position in U.T. Chandigarh Administration and Anr. v. Amarjeet Singh and Ors. (2009) 4 SCC 660. It is a case where a clear cut assurance was made to the purchasers as to the nature and the extent of development that would be carried out by the appellant-company as a part of the package under which sale of fully developed plots with assured facilities was to be made in favour of the purchasers for valuable consideration. To the extent the transfer of the site with developments in the manner and to the extent indicated earlier was a part of the transaction, the appellant-company had indeed undertaken to provide a service. Any deficiency or defect in such service would make it accountable before the competent consumer forum at the instance of consumers like the respondents8. This Court in Bangalore Development Authority v. Syndicate Bank (2007) 6 SCC 711 , dealt with the nature of the relief that can be claimed by consumers in the event of refusal or delay in the transfer of the title of the property in favour of the allottees/purchasers and observed:Where full payment is made and possession is delivered, but title deed is not executed without any justifiable cause, the allottee may be awarded compensation, for harassment and mental agony, in addition to appropriate direction for execution and delivery of title deed9. Suffice it to say that the legal position on the subject is fairly well-settled by the pronouncements of this Court and do not require any reiteration. The High Court has correctly noticed the said pronouncements and applied them to the facts of the case at hand leaving no room for us to interfere with the answer given by it to the solitary question raised by the appellant-company | 0 | 2,208 | 462 | ### Instruction:
Speculate on the likely judgment (yes (1) or no (0) to the appeal) and then delve into the case proceeding to elucidate your prediction, focusing on critical sentences.
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The legislative intention is thus clear to protect a consumer against services rendered even by statutory bodies. The test, therefore, is not if a person against whom complaint is made is a statutory body but whether the nature of the duty and function performed by it is service or even facility. (emphasis supplied) 5. In the context of the housing construction and building activities carried on by a private or statutory body and whether such activity tantamounts to service within the meaning of clause (o) of Section 2(1) of the Act, the Court observed: As pointed out earlier the entire purpose of widening the definition is to include in it not only day to day buying and selling activity undertaken by a common man but even such activities which are otherwise not commercial in nature yet they partake of a character in which some benefit is conferred on the consumer. Construction of a house or flat is for the benefit of person for whom it is constructed. He may do it himself or hire services of a builder or contractor. The latter being for consideration is service as defined in the Act. Similarly when a statutory authority develops land or allots a site or constructs a house for the benefit of common man it is as much service as by a builder or contractor. The one is contractual service and other statutory service. If the service is defective or it is not what was represented then it would be unfair trade practice as defined in the Act. Any defect in construction activity would be denial of comfort and service to a consumer. When possession of property is not delivered within stipulated period the delay so caused is denial of service. Such disputes or claims are not in respect of Immovable property as argued but deficiency in rendering of service of particular standard, quality or grade. Such deficiencies or omissions are defined in Sub-clause (ii) of Clause (r) of Section 2 as unfair trade practice. If a builder of a house uses substandard material in construction of a building or makes false or misleading representation about the condition of the house then it is denial of the facility or benefit of which a consumer is entitled to claim value under the Act. When the contractor or builder undertakes to erect a house or flat then it is inherent in it that he shall perform his obligation as agreed to. A flat with a leaking roof, or cracking wall or substandard floor is denial of service. Similarly when a statutory authority undertakes to develop land and frame housing scheme, it, while performing statutory duty renders service to the society in general and individual in particular. (emphasis supplied) 6. This Court further held that when a person applies for allotment of building site or for a flat constructed by development authority and enters into an agreement with the developer or a contractor, the nature of the transaction is covered by the expression service of any description. The housing construction or building activity carried on by a private or statutory body was, therefore, held to be service within the meaning of clause (o) of Section 2(1) of the Act as it stood prior to the inclusion of the expression housing construction in the definition of service by Ordinance No.24 of 1993. 7. In the light of the above pronouncement of this Court the High Court was perfectly justified in holding that the activities of the appellant- company in the present case involving offer of plots for sale to its customers/members with an assurance of development of infrastructure/amenities, lay-out approvals etc. was a service within the meaning of clause (o) of Section 2(1) of the Act and would, therefore, be amenable to the jurisdiction of the fora established under the statute. Having regard to the nature of the transaction between the appellant- company and its customers which involved much more than a simple transfer of a piece of immovable property it is clear that the same constituted service within the meaning of the Act. It was not a case where the appellant-company was selling the given property with all advantages and/or disadvantages on as is where is basis, as was the position in U.T. Chandigarh Administration and Anr. v. Amarjeet Singh and Ors. (2009) 4 SCC 660. It is a case where a clear cut assurance was made to the purchasers as to the nature and the extent of development that would be carried out by the appellant-company as a part of the package under which sale of fully developed plots with assured facilities was to be made in favour of the purchasers for valuable consideration. To the extent the transfer of the site with developments in the manner and to the extent indicated earlier was a part of the transaction, the appellant-company had indeed undertaken to provide a service. Any deficiency or defect in such service would make it accountable before the competent consumer forum at the instance of consumers like the respondents. 8. This Court in Bangalore Development Authority v. Syndicate Bank (2007) 6 SCC 711 , dealt with the nature of the relief that can be claimed by consumers in the event of refusal or delay in the transfer of the title of the property in favour of the allottees/purchasers and observed: Where full payment is made and possession is delivered, but title deed is not executed without any justifiable cause, the allottee may be awarded compensation, for harassment and mental agony, in addition to appropriate direction for execution and delivery of title deed. 9. Suffice it to say that the legal position on the subject is fairly well-settled by the pronouncements of this Court and do not require any reiteration. The High Court has correctly noticed the said pronouncements and applied them to the facts of the case at hand leaving no room for us to interfere with the answer given by it to the solitary question raised by the appellant-company.
### Response:
0
### Explanation:
was perfectly justified in holding that the activities of the appellant- company in the present case involving offer of plots for sale to its customers/members with an assurance of development of infrastructure/amenities, lay-out approvals etc. was a service within the meaning of clause (o) of Section 2(1) of the Act and would, therefore, be amenable to the jurisdiction of the fora established under the statute. Having regard to the nature of the transaction between the appellant- company and its customers which involved much more than a simple transfer of a piece of immovable property it is clear that the same constituted service within the meaning of the Act. It was not a case where the appellant-company was selling the given property with all advantages and/or disadvantages on as is where is basis, as was the position in U.T. Chandigarh Administration and Anr. v. Amarjeet Singh and Ors. (2009) 4 SCC 660. It is a case where a clear cut assurance was made to the purchasers as to the nature and the extent of development that would be carried out by the appellant-company as a part of the package under which sale of fully developed plots with assured facilities was to be made in favour of the purchasers for valuable consideration. To the extent the transfer of the site with developments in the manner and to the extent indicated earlier was a part of the transaction, the appellant-company had indeed undertaken to provide a service. Any deficiency or defect in such service would make it accountable before the competent consumer forum at the instance of consumers like the respondents8. This Court in Bangalore Development Authority v. Syndicate Bank (2007) 6 SCC 711 , dealt with the nature of the relief that can be claimed by consumers in the event of refusal or delay in the transfer of the title of the property in favour of the allottees/purchasers and observed:Where full payment is made and possession is delivered, but title deed is not executed without any justifiable cause, the allottee may be awarded compensation, for harassment and mental agony, in addition to appropriate direction for execution and delivery of title deed9. Suffice it to say that the legal position on the subject is fairly well-settled by the pronouncements of this Court and do not require any reiteration. The High Court has correctly noticed the said pronouncements and applied them to the facts of the case at hand leaving no room for us to interfere with the answer given by it to the solitary question raised by the appellant-company
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NITESH KUMAR PANDEY Vs. THE STATE OF MADHYA PRADESH | the appellants while contending that the writ petitioners having participated in the computer efficiency test are estopped from raising any grievance subsequently has placed strong reliance on the decision of the Supreme Court in the case of Ashok Kumar and Another vs. State of Bihar and Others (2017) 4 SCC 357 wherein it is held as hereunder:¬ 13. The law on the subject has been crystallised in several decisions of this Court. In Chandra Prakash Tiwari v. Shakuntala Shukla, this Court laid down the principle that when a candidate appears at an examination without objection and is subsequently found to be not successful, a challenge to the process is precluded. The question of entertaining a petition challenging an examination would not arise where a candidate has appeared and participated. He or she cannot subsequently turn around and contend that the process was unfair or that there was a lacuna therein, merely because the result is not palatable. In Union of India v. S. Vinodh Kumar, this court held that: 18. It is also well settled that those candidates who had taken part in the selection process knowing fully well the procedure laid down therein were not entitled to question the same. (See Munindra Kumar v. Rajiv Govil and Rashmi Mishra v. M.P. Public Service Commision.) In that light it is further contended that the Supreme Court in the case of Subhash Chandra and Another vs. Delhi Subordinate Services Selection Board and Others (2009) 15 SCC 458 has held that a decision rendered in ignorance of a binding precedent will have to be held as a decision rendered per incuriam.14. Having taken note of the decisions cited, we have no doubt in our mind that the well accepted position in law is that the person who has acceded to a position and participated in the process cannot be permitted to approbate and reprobate. It is a norm that if a person/candidate having taken note of a requirement in the notification and even if it is objectionable does not challenge the same but despite having knowledge of the same participates in the said process and takes a chance, on failing in the process such person/candidate cannot turn around and assail the same. Though that is the position in law, the said position of law will not be applicable to the present case as the facts in the case on hand is not the same. In the cited case of Ashok Kumar, it was a situation where the subsequent notification for written examination was issued after nullifying the result of the earlier written examination. The petitioner therein who had appeared for the examination earlier, having knowingly participated in the process by once again appearing for the examination which was notified had thereafter challenged, which was a clear case of approbate and reprobate. On the other hand in the instant case, firstly, the Revised Time Schedule issued by the Collector, Rewa cannot be termed as the recruitment notification indicating all the criteria for selection; but can only be termed as a time schedule prescribed pursuant to the recruitment process as provided under the fresh guidelines dated 02.06.2012. Therefore, a candidate already in selection list who has appeared in the computer efficiency test on the date depicted in the revised time schedule cannot be considered to have appeared after having knowledge that the same will also be a part of the assessment for selection and cannot be put on the same pedestal. This is more so in a circumstance wherein the schedule for 18 th December as prescribed reads….. holding of computer efficiency test of selected candidates and those at the top of merit list. A perusal of the same would indicate that the entire selection would be based on the criteria prescribed and the marks as assigned under the fresh guidelines dated 02.06.2012 and appearance for the computer efficiency test would be treated as a requirement which would enable the authorities to assess a person who has otherwise qualified and has been found fit to be in the selected list or is at the top of the merit list. 15. Therefore, in that circumstance the mere indication of the date for computer efficiency test in the time schedule and the participation therein cannot be considered as if the candidate has acceded to the same so as to estop such candidate from challenging the action of the respondent if the name of such candidate is removed from the select list thereafter treating the same as the basis. Hence in the instant case it cannot be considered as a typical case of approbate and reprobate. In that view since the high court has addressed this issue taking note of the decision which was cited before it and has thereafter arrived at its conclusion, the decision relied on by the learned senior counsel for the appellants, in the case of Ashok Kumar and Another vs. State of Bihar and Others will not be of any assistance. Hence it cannot be held that the decision of the High Court is per incuriam as contended. 16. Further what cannot escape the attention is also that certain other persons who were similarly placed as that of the petitioners have already approached this court in SLP Nos.3239-3242/2017 wherein the relied upon decision in the review petition was assailed but this court has dismissed the special leave petitions. Therefore, taking into consideration all the aspects of the matter we see no reason to interfere with the orders impugned herein. 17. During the course of the argument, the learned senior Advocate for the appellants also referred to certain observations contained in the order dated 17.10.2016 passed by the Division Bench in the review petition where certain protection is provided to the meritorious candidates who have been selected under the policy dated 02.06.2012. In that regard we do not find it appropriate to advert and make any comment since we have already arrived at conclusion that the orders impugned do not call for interference. | 0[ds]11. In the light of the contention, a perusal of the order passed by the learned single judge as also the order passed in the writ appeal and the review petition in the relied upon cases relating to Amit Kumar Mishra and Others would indicate that a detailed discussion has been made by the High Court and we see no reason to differ from the same. In this regard we have noticed the fresh guidelines dated 02.06.2012. Though the said guidelines refer to the requirement of computer knowledge as a Desired qualification, the same also provides for such qualification in computer exam from the institutions depicted therein and the selection process provides for the assignment of marks which has been extracted and taken note by the Learned Single Judge. The said guidelines are applicable to all the Districts in the entire state of Madhya Pradesh as confirmed by the learned Advocate for the State of Madhya Pradesh. The Revised Time Schedule dated 17.06.2014 issued by the Collector, Rewa, Madhya Pradesh is only in respect of one District namely District Rewa12. Therefore, at the outset when the scheme applicable to the entire State is made under a common guideline, the alteration of the requirement by prescribing an additional criteria only in respect of one District without such authority do so will not be sustainable. Furthermore, the application for the post of Gram Rojgar Sahayak was to be made in terms of the revised guidelines dated 02.06.2012. By the Revised Time Schedule dated 17.06.2014 what is provided for essentially is the time frame for carrying out each of the requirement relating to the initiation of the recruitment till the selected candidate joins the post. It is under the said time schedule, a date has been fixed for holding the computer efficiency test. Therefore, it would indicate that the additional criteria has been introduced after the selection process has commenced and when such requirement was not indicated in the fresh guidelines dated 02.06.2012 issued in respect of the entire State. Therefore, the conclusion reached by the High Court that the requirement has been altered after the commencement of the selection process is justified and unassailable14. Having taken note of the decisions cited, we have no doubt in our mind that the well accepted position in law is that the person who has acceded to a position and participated in the process cannot be permitted to approbate and reprobate. It is a norm that if a person/candidate having taken note of a requirement in the notification and even if it is objectionable does not challenge the same but despite having knowledge of the same participates in the said process and takes a chance, on failing in the process such person/candidate cannot turn around and assail the same. Though that is the position in law, the said position of law will not be applicable to the present case as the facts in the case on hand is not the same. In the cited case of Ashok Kumar, it was a situation where the subsequent notification for written examination was issued after nullifying the result of the earlier written examination. The petitioner therein who had appeared for the examination earlier, having knowingly participated in the process by once again appearing for the examination which was notified had thereafter challenged, which was a clear case of approbate and reprobate. On the other hand in the instant case, firstly, the Revised Time Schedule issued by the Collector, Rewa cannot be termed as the recruitment notification indicating all the criteria for selection; but can only be termed as a time schedule prescribed pursuant to the recruitment process as provided under the fresh guidelines dated 02.06.2012. Therefore, a candidate already in selection list who has appeared in the computer efficiency test on the date depicted in the revised time schedule cannot be considered to have appeared after having knowledge that the same will also be a part of the assessment for selection and cannot be put on the same pedestal. This is more so in a circumstance wherein the schedule for 18 th December as prescribed reads….. holding of computer efficiency test of selected candidates and those at the top of merit list. A perusal of the same would indicate that the entire selection would be based on the criteria prescribed and the marks as assigned under the fresh guidelines dated 02.06.2012 and appearance for the computer efficiency test would be treated as a requirement which would enable the authorities to assess a person who has otherwise qualified and has been found fit to be in the selected list or is at the top of the merit list15. Therefore, in that circumstance the mere indication of the date for computer efficiency test in the time schedule and the participation therein cannot be considered as if the candidate has acceded to the same so as to estop such candidate from challenging the action of the respondent if the name of such candidate is removed from the select list thereafter treating the same as the basis. Hence in the instant case it cannot be considered as a typical case of approbate and reprobate. In that view since the high court has addressed this issue taking note of the decision which was cited before it and has thereafter arrived at its conclusion, the decision relied on by the learned senior counsel for the appellants, in the case of Ashok Kumar and Another vs. State of Bihar and Others will not be of any assistance. Hence it cannot be held that the decision of the High Court is per incuriam as contended16. Further what cannot escape the attention is also that certain other persons who were similarly placed as that of the petitioners have already approached this court in SLP Nos.3239-3242/2017 wherein the relied upon decision in the review petition was assailed but this court has dismissed the special leave petitions. Therefore, taking into consideration all the aspects of the matter we see no reason to interfere with the orders impugned hereinIn that regard we do not find it appropriate to advert and make any comment since we have already arrived at conclusion that the orders impugned do not call for interference. | 0 | 3,371 | 1,104 | ### Instruction:
Estimate the outcome of the case (positive (1) or negative (0) for the appellant) and then give a reasoned explanation by examining important sentences within the case documentation.
### Input:
the appellants while contending that the writ petitioners having participated in the computer efficiency test are estopped from raising any grievance subsequently has placed strong reliance on the decision of the Supreme Court in the case of Ashok Kumar and Another vs. State of Bihar and Others (2017) 4 SCC 357 wherein it is held as hereunder:¬ 13. The law on the subject has been crystallised in several decisions of this Court. In Chandra Prakash Tiwari v. Shakuntala Shukla, this Court laid down the principle that when a candidate appears at an examination without objection and is subsequently found to be not successful, a challenge to the process is precluded. The question of entertaining a petition challenging an examination would not arise where a candidate has appeared and participated. He or she cannot subsequently turn around and contend that the process was unfair or that there was a lacuna therein, merely because the result is not palatable. In Union of India v. S. Vinodh Kumar, this court held that: 18. It is also well settled that those candidates who had taken part in the selection process knowing fully well the procedure laid down therein were not entitled to question the same. (See Munindra Kumar v. Rajiv Govil and Rashmi Mishra v. M.P. Public Service Commision.) In that light it is further contended that the Supreme Court in the case of Subhash Chandra and Another vs. Delhi Subordinate Services Selection Board and Others (2009) 15 SCC 458 has held that a decision rendered in ignorance of a binding precedent will have to be held as a decision rendered per incuriam.14. Having taken note of the decisions cited, we have no doubt in our mind that the well accepted position in law is that the person who has acceded to a position and participated in the process cannot be permitted to approbate and reprobate. It is a norm that if a person/candidate having taken note of a requirement in the notification and even if it is objectionable does not challenge the same but despite having knowledge of the same participates in the said process and takes a chance, on failing in the process such person/candidate cannot turn around and assail the same. Though that is the position in law, the said position of law will not be applicable to the present case as the facts in the case on hand is not the same. In the cited case of Ashok Kumar, it was a situation where the subsequent notification for written examination was issued after nullifying the result of the earlier written examination. The petitioner therein who had appeared for the examination earlier, having knowingly participated in the process by once again appearing for the examination which was notified had thereafter challenged, which was a clear case of approbate and reprobate. On the other hand in the instant case, firstly, the Revised Time Schedule issued by the Collector, Rewa cannot be termed as the recruitment notification indicating all the criteria for selection; but can only be termed as a time schedule prescribed pursuant to the recruitment process as provided under the fresh guidelines dated 02.06.2012. Therefore, a candidate already in selection list who has appeared in the computer efficiency test on the date depicted in the revised time schedule cannot be considered to have appeared after having knowledge that the same will also be a part of the assessment for selection and cannot be put on the same pedestal. This is more so in a circumstance wherein the schedule for 18 th December as prescribed reads….. holding of computer efficiency test of selected candidates and those at the top of merit list. A perusal of the same would indicate that the entire selection would be based on the criteria prescribed and the marks as assigned under the fresh guidelines dated 02.06.2012 and appearance for the computer efficiency test would be treated as a requirement which would enable the authorities to assess a person who has otherwise qualified and has been found fit to be in the selected list or is at the top of the merit list. 15. Therefore, in that circumstance the mere indication of the date for computer efficiency test in the time schedule and the participation therein cannot be considered as if the candidate has acceded to the same so as to estop such candidate from challenging the action of the respondent if the name of such candidate is removed from the select list thereafter treating the same as the basis. Hence in the instant case it cannot be considered as a typical case of approbate and reprobate. In that view since the high court has addressed this issue taking note of the decision which was cited before it and has thereafter arrived at its conclusion, the decision relied on by the learned senior counsel for the appellants, in the case of Ashok Kumar and Another vs. State of Bihar and Others will not be of any assistance. Hence it cannot be held that the decision of the High Court is per incuriam as contended. 16. Further what cannot escape the attention is also that certain other persons who were similarly placed as that of the petitioners have already approached this court in SLP Nos.3239-3242/2017 wherein the relied upon decision in the review petition was assailed but this court has dismissed the special leave petitions. Therefore, taking into consideration all the aspects of the matter we see no reason to interfere with the orders impugned herein. 17. During the course of the argument, the learned senior Advocate for the appellants also referred to certain observations contained in the order dated 17.10.2016 passed by the Division Bench in the review petition where certain protection is provided to the meritorious candidates who have been selected under the policy dated 02.06.2012. In that regard we do not find it appropriate to advert and make any comment since we have already arrived at conclusion that the orders impugned do not call for interference.
### Response:
0
### Explanation:
Amit Kumar Mishra and Others would indicate that a detailed discussion has been made by the High Court and we see no reason to differ from the same. In this regard we have noticed the fresh guidelines dated 02.06.2012. Though the said guidelines refer to the requirement of computer knowledge as a Desired qualification, the same also provides for such qualification in computer exam from the institutions depicted therein and the selection process provides for the assignment of marks which has been extracted and taken note by the Learned Single Judge. The said guidelines are applicable to all the Districts in the entire state of Madhya Pradesh as confirmed by the learned Advocate for the State of Madhya Pradesh. The Revised Time Schedule dated 17.06.2014 issued by the Collector, Rewa, Madhya Pradesh is only in respect of one District namely District Rewa12. Therefore, at the outset when the scheme applicable to the entire State is made under a common guideline, the alteration of the requirement by prescribing an additional criteria only in respect of one District without such authority do so will not be sustainable. Furthermore, the application for the post of Gram Rojgar Sahayak was to be made in terms of the revised guidelines dated 02.06.2012. By the Revised Time Schedule dated 17.06.2014 what is provided for essentially is the time frame for carrying out each of the requirement relating to the initiation of the recruitment till the selected candidate joins the post. It is under the said time schedule, a date has been fixed for holding the computer efficiency test. Therefore, it would indicate that the additional criteria has been introduced after the selection process has commenced and when such requirement was not indicated in the fresh guidelines dated 02.06.2012 issued in respect of the entire State. Therefore, the conclusion reached by the High Court that the requirement has been altered after the commencement of the selection process is justified and unassailable14. Having taken note of the decisions cited, we have no doubt in our mind that the well accepted position in law is that the person who has acceded to a position and participated in the process cannot be permitted to approbate and reprobate. It is a norm that if a person/candidate having taken note of a requirement in the notification and even if it is objectionable does not challenge the same but despite having knowledge of the same participates in the said process and takes a chance, on failing in the process such person/candidate cannot turn around and assail the same. Though that is the position in law, the said position of law will not be applicable to the present case as the facts in the case on hand is not the same. In the cited case of Ashok Kumar, it was a situation where the subsequent notification for written examination was issued after nullifying the result of the earlier written examination. The petitioner therein who had appeared for the examination earlier, having knowingly participated in the process by once again appearing for the examination which was notified had thereafter challenged, which was a clear case of approbate and reprobate. On the other hand in the instant case, firstly, the Revised Time Schedule issued by the Collector, Rewa cannot be termed as the recruitment notification indicating all the criteria for selection; but can only be termed as a time schedule prescribed pursuant to the recruitment process as provided under the fresh guidelines dated 02.06.2012. Therefore, a candidate already in selection list who has appeared in the computer efficiency test on the date depicted in the revised time schedule cannot be considered to have appeared after having knowledge that the same will also be a part of the assessment for selection and cannot be put on the same pedestal. This is more so in a circumstance wherein the schedule for 18 th December as prescribed reads….. holding of computer efficiency test of selected candidates and those at the top of merit list. A perusal of the same would indicate that the entire selection would be based on the criteria prescribed and the marks as assigned under the fresh guidelines dated 02.06.2012 and appearance for the computer efficiency test would be treated as a requirement which would enable the authorities to assess a person who has otherwise qualified and has been found fit to be in the selected list or is at the top of the merit list15. Therefore, in that circumstance the mere indication of the date for computer efficiency test in the time schedule and the participation therein cannot be considered as if the candidate has acceded to the same so as to estop such candidate from challenging the action of the respondent if the name of such candidate is removed from the select list thereafter treating the same as the basis. Hence in the instant case it cannot be considered as a typical case of approbate and reprobate. In that view since the high court has addressed this issue taking note of the decision which was cited before it and has thereafter arrived at its conclusion, the decision relied on by the learned senior counsel for the appellants, in the case of Ashok Kumar and Another vs. State of Bihar and Others will not be of any assistance. Hence it cannot be held that the decision of the High Court is per incuriam as contended16. Further what cannot escape the attention is also that certain other persons who were similarly placed as that of the petitioners have already approached this court in SLP Nos.3239-3242/2017 wherein the relied upon decision in the review petition was assailed but this court has dismissed the special leave petitions. Therefore, taking into consideration all the aspects of the matter we see no reason to interfere with the orders impugned hereinIn that regard we do not find it appropriate to advert and make any comment since we have already arrived at conclusion that the orders impugned do not call for interference.
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Tara Chandkhatri Vs. Municipal Corporation of Delhi and Others | decision, it is not permissible to infer on that ground alone that its reasons for that decision were bad in law. Even if it gives reasons, which are ex facie insufficient in law to support its decision, the court will not necessarily assume that these are the sole reasons on which the tribunal has based its decision. (See Cf. Davies v. Price [1958] 1 Y.L.R. 434 at 440 and R.v. Minister of Housing and Local Government, ex. P. Chichester R.D.C. [1960] 1 W.L.R. 587). 14. Before concluding the discussion in regard to the third contention, we may point out that none of the decisions viz. Sardar Govindrao &Ors. v. State of Madhya Pradesh ([1965] 1 S.C.R.678.) Bhagat Raja v. The Union of India &Ors. ([1967] 3 S.C.R. 302.) Travancore Rayon Ltd. v. Union of India([1970] 3 S.C.R. 40.) Mahabir Prasad Santosh Kumar v. State of U.P. &Ors.([1971] 1 S.C.R. 201.)Rangnath v. Daulat Rao &Ors. ([1975] 1 S.C.C. 686.) and Siemens Engineering &Manufacturing Company of India Ltd. v. The Union of India([1976] 2 S.C.C 981.) on which Mr. Ramamurthi has heavily leaned has anything to do with disciplinary proceedings. At such, they have little bearing on the point with which we are at present concerned.We would also like to point out that the observations in Travancore Rayon Ltd. v. Union of India (supra) that in Bhagat Raja v. The Union of India &Ors. (supra)., this Court in effect overruled the judgment of the majority in Madhya Pradesh Industries Ltd. v. Union of India &Ors. (supra) seem to have crept therein through some oversight. A careful perusal of the decision in Bhagat Raja v. The Union of India &Ors. (supra) would show that this Court did not make any observations therein which can be interpreted as overruling the. majority judgment in Madhya Pradesh Industries Ltd. v. Union of1 India &Ors. (supra). It is also worthy of note that in Bhagat Rajas case (Supra), the amendment of rule 55 of the Mineral Concession Rules, 1960 introduced in July, 1965 laid down a special procedure in regard to revisions. It required the Central Government to send copies of the application for revision to all the impleaded parties including the person to whom a lease had been granted calling upon them to make such comments as they might like to make within three months from the date of t he issue of the communication and on receipt of the comments from any party to send copies thereof to the other parties calling upon them to make further comments as they might like to make within one month from the date of the issue of the communication. It also provided that the revision application, the communications containing comments and counter comments referred to above would constitute the record of the case. Thus under the amended rule, the party whose application was rejected got an ample opportunity of showing to the Central Government by reference not only to the record which was before the State Government but by reference to the fresh material as well that the State Government was misled in its consideration of the matter or that its decision was based on irrelevant considerations. This is evident from the following observations made in Bhagat Raja v. The Union of India &Ors. (supra):The old rule 55 was replaced by a new rule which came into force on 19th July, 1965. Whereas the old rule directed the Central Government to consider comments on the petition of review by the State Government or other authority only, the new rule is aimed at calling upon all the parties including the State Government to make their comments in the matter and the parties are given the right to make further comments on those made by the other or others. In effect, the parties are given a right to bring forth material which was not before the State Government. It is easy to see that an unsuccessful party ma y challenge the gram of a lease in favour of another by pointing out defects or demerits which did not come to the knowledge of the State Government. The order in this case does not even purport to show that the comments and counter comments which were before the Central Government in this case, had been considered. 17. The above observations leave no manner of doubt that it was in view of the amendment in rule 55 of the Mineral Concession Rules, 1960 that the decision in Bhagat Raja v. The Union of India &Ors. (supra) was different from Madhya Pradesh Industries Ltd. v. Union of India &Ors. (supra) which had been rendered on the unamended rule 55 of the said Rules. In our opinion, therefore, the observations made in Madhya Pradesh Industries Ltd. v. Union of India &Ors. (supra) contain a correct statement of law. 18. In view of the foregoing, we do not find any merit in the third contention raised on behalf of the appellant.19. This brings us to the last contention raised by Mr. Ramamurthi that the writ petition should not have been dismissed by the High Court in limine in view of the fact that it contained allegations of mala fides against the respondents. We are unable to accept this contention. It has been held time and again by this Court that the High Court would be justified in refusing to carry on investigation into the allegation s of mala fides if necessary particulars of the charge making out a prima facie case are not given in the writ petition. Keeping in view the well established rule that the burden of establishing mala fides lies very heavily on the person who alleges it and considering all the allegations made by the appellant in regard thereto, we do not think that they could be considered as sufficient to establish malus animus. The High Court was, therefore, not wrong in dismissing the petition in limine on seeing that a prima facie case requiring investigation had not been made out. | 0[ds]6. The omission to make the aforesaid averments in the writ petition regarding the incompetence of the Deputy Commissioner to pass the impugned order of dismissal from service and invalidity. of regulation 7 of the Regulations appears to be due to the. fact that the appellant fully realised that none of these pleas could be tenable in view of the aforesaid order No. (1) 58 Law Corp. 1 dated April 7, 1958 made by the Commissioner delegating all his powers to the Deputy Commissioner his actual appointment as an Assistant Teacher by the Deputy Commissioner and regulation 7 of the Regulations which far from being repugnant to section, , 95 of the Act is perfectly consistent with it as sub-section (1) of that section itself makes a municipal employee liable to be compulsorily retired, removed or dismissed etc. by such authority as may be prescribed by the Regulation. The prohibition contained in the first proviso to this Sub-section is confined in its operation only to a case where an officer or employee of the Corporation is retired, removed or dismissed by an authority subordinate to that by which he was appointed. In the instant case, the appellants appointment having been made by the Deputy Commissioner, who possessed plenary powers in., that behalf by virtue of the aforesaid delegation order, there was; neither any legal bar to the appellants dismissal from service by that very authority nor a breach of the first proviso to sub-section (1 ) of section 95 of the Act.The decision of this Court in The Management of D.T.U. v. Shri B.B.L. Halelay] 2 S.C.R. 114.) sought to be relied upon by Mr. Ramamurthi related to an appointment which rested on a deeming provision and is not at all helpful to the appellant. Respondent No. 2 in that case was Originally employed as a driver in the Delhi Road Transport Authority which had been constituted under the Delhi Road Transport Authority Act, 1950. By section 516(1)(a) ofthe Delhi Municipal Corporation Act, 1957 which came into force in January , 1958, the Delhi Road Transport Authority Act, 1950, was repealed and the functions of the Delhi Road Transport Authority were taken over by the Corporation by virtue of several other provisions of the Act. Under section 511 of that Act i.e.the Delhi Municipal Corporation Act, 1957, every officer and employee of the Transport Authority including respondent No, . 2 stood transferred and become an officer and employee of the Corp oration and under section 92(1) (b) read with section 516(2) (a) of the Act, the said respondent was to be deemed to have been appointed by the General Manager (Transport). The respondent in that case thus being required by fiction of law to be taken to have been appointed by the General Manager, he could not have been removed from service in May, 1963 by the Assistant General Manageran authority subordinate to the General Managerin view of the first proviso to sub-section (1) of section 95 of the Act despite the fact that the functions of the General Manager had been delegated to the Assistant General Manager in May, 1961. In that case, it was made clear by this Court that the only consequence of the delegation order was that if after 1961, the Assistant General Manager had made the appointment of respondent No. 2, he would have no doubt been entitled to remove him from service but the position had to be deter- mined with reference to the time, when he was absorbed in the Corporation which was in January, 1958.The judgment of this Court in Municipal Corporation of Delhi v. Ram Pratap Singh(C.A. No. 2249 (N.) of 1969 decided on 8-1-1976.) is also not helpful to the appellant as in that case, the appointment was in fact made by the Commissioner white the dismissal was by the Deputy Commissioner7. In view of the foregoing discussion, the first two contentions raised on behalf of the appellant which are totally misconceived are repelled.8. The third contention advanced by Mr. Ramamurthi that the impugned order of the appellants dismissal from service is vitiated as the disciplinary authority has neither recorded its findings with respect to the charge drawn up against the appellant as required by regulation 8(9) o f the Regulations nor has it given its reasons for passing the order cannot also, be countenanced as. it overlooks the decisions of this Court, which fully cover the case.9. Regarding the first limb of the contention, it may be stated that although it may be necessary for the disciplinary authority to record. its provisional conclusions in the notice calling upto the delinquent officer to, show cause why the. proposed punishment be not imposed upon him if it differs from the findings arrived at by the enquiring officer with regard to the charge, it is not obligatory to do so in case the disciplinary authority concurs with the findings of the enquiring officer. We are supported in this view by two decisions of this Court in State of Orissa v. Govinddas Panda(C.A. No. 412 of 1958 decided on 10-12-1962.)-and State of Assam. v. Bimal Kumar Pandit(A.I.R. 1963 S.C. 1612.).Govinddas Pandas case (supra) where the notice issued under Article 311(2) did not expressly state. that the State Government had accepted the findings recorded by the enquiring officer against the Government servant in question and where even the nature of the punishment which was proposed to be inflicted on. him was not specifically and clearly indicated, this Court while reversing the conclusions of the Orissa, High Court that the notice was defective an d so that provisions of Article 311(2) had been contravened observed:In the context, it must have been obvious to the respondent that the punishment proposed was removal from service and the respondent was called upon to show cause against that punishment. On a reasonable reading of the notice, the only conclusion at which one can arrive is that the appellant (the State) accepted the recommendation of the Administrative Tribunal and asked the respondent to show cause against the proposed punishment, namely, that of removal from service10. In Bimal Kumar Pandits case (supra) while, reversing the judgment and order of the High Court allowing the writ petition filed by the respondent against his reduction in rank on the ground that the notice served upon him under Article 311 (2) of the Constitution was void as it did not expressly and specifically indicate either the conclusions of the dismissing authority or the findings recorded by the enquiring officer or that the dismissing authority accepted the findings of the enquiring officer and unless that course was adopted, it would not be clear that the dismissing authority had applied its mind and had provisionally come to some conclusion both in regard to the guilt of the public officer and the punishment which his misconduct deserved the Constitution Bench of this Court observed:It may be conceded that it is desirable that the dismissing authority should indicate in the second notice its concurrence with the conclusions of the enquiring officer before it issues the said notice under Article 311(2). But the question which calls for our decision is it the dismissing authority does not expressly say that it has accepted the findings of the enquiring officer against the delinquent officer, does that introduce such an infirmity in the proceedings as to make the final order invalid ? We are not prepared to answer this question in the affirmative. It seems to us that it would be plain to the delinquent officer that the issuance of the notice indicating the provisional conclusions of the dismissing authority as to the punishment that should be imposed on him obviously and clearly implies that the findings recorded against him by the enquiring officer have been accepted by the dismissing authority; otherwise there would be no sense or purpose in issuing the notice under Article 311(2).At another place, the Court observed:We ought, however, to all that if, the dismissing authority differs from the findings recorded in the enquiry report, it is necessary that its provisional conclusions in that behalf should be specified in the second notice. It may be that the report makes findings in favour of the delinquent officer, but the dismissing authority disagrees with the said findings and proceeds to issue the notice under Article 311 (2). In such a case, it would obviously be necessary that the dismissing authority should expressly state that it differs from the findings recorded in the enquiry report and then indicate the nature of the action proposed to be taken against the delinquent officer. Without such an express statement in the notice, it would be impossible to issue the notice at all. There may also be cases in which the enquiry report may make findings in favour of the delinquent officer on some issues and against him on other issues. That is precisely what has happened in the present case. If the dismissing authority accepts all the said findings in their entirety, it is another matter; but if the dismissing authority accepts the findings recorded against the delinquent officer and differs from some or all of those recorded in his favour and proceeds to specify the nature of the action proposed to be taken on its own conclusions, it would be necessary that the said conclusions should be briefly indicated in the notice. In this category of cases, the action proposed to be taken would be based not only on the findings record ed against the delinquent officer in the enquiry report, but also on the view of the dismissing authority that the other charges not held proved by the enquiring officer are according to the dismissing authority, proved. In order to give the delinquent officer a reasonable opportunity to show cause under Art. 311(2), it is essential that the conclusions provisionally reached by the dismissing authority must, in such cases, be specified in the. notice. But where the dismissing authority purports to proceed to issue the notice against the delinquent officer after accepting the enquiry report in its entirety, it cannot be said that the dismissing authority must say that it has so accepted the report. As we have already indicated, it is desirable that even in such. cases a statement to that effect should be made. But we do not think that the words in Art. 311 (2) justify the view that the failure to make such a statement amounts to. contravention of Art. 311(2) ....... There is no doubt that after the report is received, appropriate authority must apply its mind to the report and must provisionally decide whether the findings recorded in the report should be accepted or not. It is only if the findings recorded in the report against the Government servant are accepted by the appropriate authority that it has to provisionally decide what action should be taken against him. But this does not mean that in every case, the appropriate authority is under a constitutional obligation to state in the notice that it has accepted the adverse findings recorded by the enquiring officer before it indicates the nature of the action proposed to be taken against the delinquent officer.n the instant case, the incorrectness of the first limb of the contention is apparent from a bare reading of the aforesaid order passed by the Deputy Commissioner on May 20, 1969 which clearly states that he agrees with the findings of the enquiring officer. Reading the order as a whole, it becomes crystal clear that the disciplinary authority held the charge drawn up against the appellant as proved.11. The second limb of the third contention raised on behalf of the appellant which also overlooks the decisions of the Constitution Bench this Court does not commend itself to us. In this connection, we would like to make it clear that while it may be necessary for a disciplinary or administrative authority exercising quasi-judicial functions to state the reasons in support of its order if it differs from the conclusions arrived at and the recommendations made by the enquiring officer in view of the scheme of a particular enactment or the rules made thereunder, it would be laying down the proposition a little too broadly to say that even an order of concurrence must be supported by reasons. It cannot also, in our opinion, be laid down as a general rule that an order is a non-speaking order simply because it is brief and not daborate. Every case, we think, has to be judged in the light of its own facts and circumstances.12. We are not prepared to accept the argument. In dealing with the question as to whether it is obligatory on the State Government to give reasons in support of the order imposing a penalty on the delinquent officer, we cannot overlook the fact that the disciplinary proceedings against such a delinquent officer begin with an enquiry conducted by an officer appointed in that behalf. That enquiry is followed by a report and the Public Service Commission is consulted where necessary. Having regard to the material which is thus made available to the State Government and which is made available to the delinquent officer also, it seems to us somewhat unreasonable to suggest that the State Government must record its reasons why it accepts the findings of the Tribunal. It is conceivable that if the State Government does not accept the findings of the Tribunal which may be in favour of the delinquent officer and proposes to impose a penalty on the delinquent officer, it should give reasons why it differs from the conclusions of the Tribunal, though even in such a case, it is not necessary that the reasons should be detailed or elaborate. But where the State Government agrees with the findings of the Tribunal which are against the delinquent officer, we do not think as a matter of law, it could be said that the State Government cannot impose the penalty against the delinquent officer in accordance with the findings of the Tribunal unless it gives reasons to show why the said findings were accepted by it. The proceedings are, no doubt, quasi-judicial, but having regard to the manner in which these enquiries are conducted, we do not think an obligation can be imposed on the State Government to record reasons in every case.14. Before concluding the discussion in regard to the third contention, we may point out that none of the decisions viz. Sardar Govindrao. v. State of Madhya Pradesh ([1965] 1 S.C.R.678.) Bhagat Raja v. The Union of India. ([1967] 3 S.C.R. 302.) Travancore Rayon Ltd. v. Union of India([1970] 3 S.C.R. 40.) Mahabir Prasad Santosh Kumar v. State of U.P.] 1 S.C.R. 201.)Rangnath v. Daulat Rao. ([1975] 1 S.C.C. 686.) and Siemens Engineeringg Company of India Ltd. v. The Union of India([1976] 2 S.C.C 981.) on which Mr. Ramamurthi has heavily leaned has anything to do with disciplinary proceedings. At such, they have little bearing on the point with which we are at present concerned.We would also like to point out that the observations in Travancore Rayon Ltd. v. Union of India (supra) that in Bhagat Raja v. The Union of India. (supra)., this Court in effect overruled the judgment of the majority in Madhya Pradesh Industries Ltd. v. Union of India. (supra) seem to have crept therein through some oversight. A careful perusal of the decision in Bhagat Raja v. The Union of India. (supra) would show that this Court did not make any observations therein which can be interpreted as overruling the. majority judgment in Madhya Pradesh Industries Ltd. v. Union of1 India. (supra). It is also worthy of note that in Bhagat Rajas case (Supra), the amendment of rule 55 of the Mineral Concession Rules, 1960 introduced in July, 1965 laid down a special procedure in regard to revisions. It required the Central Government to send copies of the application for revision to all the impleaded parties including the person to whom a lease had been granted calling upon them to make such comments as they might like to make within three months from the date of t he issue of the communication and on receipt of the comments from any party to send copies thereof to the other parties calling upon them to make further comments as they might like to make within one month from the date of the issue of the communication. It also provided that the revision application, the communications containing comments and counter comments referred to above would constitute the record of the case. Thus under the amended rule, the party whose application was rejected got an ample opportunity of showing to the Central Government by reference not only to the record which was before the State Government but by reference to the fresh material as well that the State Government was misled in its consideration of the matter or that its decision was based on irrelevant considerations. This is evident from the following observations made in Bhagat Raja v. The Union of IndiaThe old rule 55 was replaced by a new rule which came into force on 19th July, 1965. Whereas the old rule directed the Central Government to consider comments on the petition of review by the State Government or other authority only, the new rule is aimed at calling upon all the parties including the State Government to make their comments in the matter and the parties are given the right to make further comments on those made by the other or others. In effect, the parties are given a right to bring forth material which was not before the State Government. It is easy to see that an unsuccessful party ma y challenge the gram of a lease in favour of another by pointing out defects or demerits which did not come to the knowledge of the State Government. The order in this case does not even purport to show that the comments and counter comments which were before the Central Government in this case, had been considered.. The above observations leave no manner of doubt that it was in view of the amendment in rule 55 of the Mineral Concession Rules, 1960 that the decision in Bhagat Raja v. The Union of India. (supra) was different from Madhya Pradesh Industries Ltd. v. Union of India. (supra) which had been rendered on the unamended rule 55 of the said Rules. In our opinion, therefore, the observations made in Madhya Pradesh Industries Ltd. v. Union of India. (supra) contain a correct statement of law18. In view of the foregoing, we do not find any merit in the third contention raised on behalf of the appellant.19. This brings us to the last contention raised by Mr. Ramamurthi that the writ petition should not have been dismissed by the High Court in limine in view of the fact that it contained allegations of mala fides against the respondents.We are unable to accept this contention. It has been held time and again by this Court that the High Court would be justified in refusing to carry on investigation into the allegation s of mala fides if necessary particulars of the charge making out a prima facie case are not given in the writ petition. Keeping in view the well established rule that the burden of establishing mala fides lies very heavily on the person who alleges it and considering all the allegations made by the appellant in regard thereto, we do not think that they could be considered as sufficient to establish malus animus. The High Court was, therefore, not wrong in dismissing the petition in limine on seeing that a prima facie case requiring investigation had not been made out. | 0 | 7,033 | 3,638 | ### Instruction:
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decision, it is not permissible to infer on that ground alone that its reasons for that decision were bad in law. Even if it gives reasons, which are ex facie insufficient in law to support its decision, the court will not necessarily assume that these are the sole reasons on which the tribunal has based its decision. (See Cf. Davies v. Price [1958] 1 Y.L.R. 434 at 440 and R.v. Minister of Housing and Local Government, ex. P. Chichester R.D.C. [1960] 1 W.L.R. 587). 14. Before concluding the discussion in regard to the third contention, we may point out that none of the decisions viz. Sardar Govindrao &Ors. v. State of Madhya Pradesh ([1965] 1 S.C.R.678.) Bhagat Raja v. The Union of India &Ors. ([1967] 3 S.C.R. 302.) Travancore Rayon Ltd. v. Union of India([1970] 3 S.C.R. 40.) Mahabir Prasad Santosh Kumar v. State of U.P. &Ors.([1971] 1 S.C.R. 201.)Rangnath v. Daulat Rao &Ors. ([1975] 1 S.C.C. 686.) and Siemens Engineering &Manufacturing Company of India Ltd. v. The Union of India([1976] 2 S.C.C 981.) on which Mr. Ramamurthi has heavily leaned has anything to do with disciplinary proceedings. At such, they have little bearing on the point with which we are at present concerned.We would also like to point out that the observations in Travancore Rayon Ltd. v. Union of India (supra) that in Bhagat Raja v. The Union of India &Ors. (supra)., this Court in effect overruled the judgment of the majority in Madhya Pradesh Industries Ltd. v. Union of India &Ors. (supra) seem to have crept therein through some oversight. A careful perusal of the decision in Bhagat Raja v. The Union of India &Ors. (supra) would show that this Court did not make any observations therein which can be interpreted as overruling the. majority judgment in Madhya Pradesh Industries Ltd. v. Union of1 India &Ors. (supra). It is also worthy of note that in Bhagat Rajas case (Supra), the amendment of rule 55 of the Mineral Concession Rules, 1960 introduced in July, 1965 laid down a special procedure in regard to revisions. It required the Central Government to send copies of the application for revision to all the impleaded parties including the person to whom a lease had been granted calling upon them to make such comments as they might like to make within three months from the date of t he issue of the communication and on receipt of the comments from any party to send copies thereof to the other parties calling upon them to make further comments as they might like to make within one month from the date of the issue of the communication. It also provided that the revision application, the communications containing comments and counter comments referred to above would constitute the record of the case. Thus under the amended rule, the party whose application was rejected got an ample opportunity of showing to the Central Government by reference not only to the record which was before the State Government but by reference to the fresh material as well that the State Government was misled in its consideration of the matter or that its decision was based on irrelevant considerations. This is evident from the following observations made in Bhagat Raja v. The Union of India &Ors. (supra):The old rule 55 was replaced by a new rule which came into force on 19th July, 1965. Whereas the old rule directed the Central Government to consider comments on the petition of review by the State Government or other authority only, the new rule is aimed at calling upon all the parties including the State Government to make their comments in the matter and the parties are given the right to make further comments on those made by the other or others. In effect, the parties are given a right to bring forth material which was not before the State Government. It is easy to see that an unsuccessful party ma y challenge the gram of a lease in favour of another by pointing out defects or demerits which did not come to the knowledge of the State Government. The order in this case does not even purport to show that the comments and counter comments which were before the Central Government in this case, had been considered. 17. The above observations leave no manner of doubt that it was in view of the amendment in rule 55 of the Mineral Concession Rules, 1960 that the decision in Bhagat Raja v. The Union of India &Ors. (supra) was different from Madhya Pradesh Industries Ltd. v. Union of India &Ors. (supra) which had been rendered on the unamended rule 55 of the said Rules. In our opinion, therefore, the observations made in Madhya Pradesh Industries Ltd. v. Union of India &Ors. (supra) contain a correct statement of law. 18. In view of the foregoing, we do not find any merit in the third contention raised on behalf of the appellant.19. This brings us to the last contention raised by Mr. Ramamurthi that the writ petition should not have been dismissed by the High Court in limine in view of the fact that it contained allegations of mala fides against the respondents. We are unable to accept this contention. It has been held time and again by this Court that the High Court would be justified in refusing to carry on investigation into the allegation s of mala fides if necessary particulars of the charge making out a prima facie case are not given in the writ petition. Keeping in view the well established rule that the burden of establishing mala fides lies very heavily on the person who alleges it and considering all the allegations made by the appellant in regard thereto, we do not think that they could be considered as sufficient to establish malus animus. The High Court was, therefore, not wrong in dismissing the petition in limine on seeing that a prima facie case requiring investigation had not been made out.
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But where the State Government agrees with the findings of the Tribunal which are against the delinquent officer, we do not think as a matter of law, it could be said that the State Government cannot impose the penalty against the delinquent officer in accordance with the findings of the Tribunal unless it gives reasons to show why the said findings were accepted by it. The proceedings are, no doubt, quasi-judicial, but having regard to the manner in which these enquiries are conducted, we do not think an obligation can be imposed on the State Government to record reasons in every case.14. Before concluding the discussion in regard to the third contention, we may point out that none of the decisions viz. Sardar Govindrao. v. State of Madhya Pradesh ([1965] 1 S.C.R.678.) Bhagat Raja v. The Union of India. ([1967] 3 S.C.R. 302.) Travancore Rayon Ltd. v. Union of India([1970] 3 S.C.R. 40.) Mahabir Prasad Santosh Kumar v. State of U.P.] 1 S.C.R. 201.)Rangnath v. Daulat Rao. ([1975] 1 S.C.C. 686.) and Siemens Engineeringg Company of India Ltd. v. The Union of India([1976] 2 S.C.C 981.) on which Mr. Ramamurthi has heavily leaned has anything to do with disciplinary proceedings. At such, they have little bearing on the point with which we are at present concerned.We would also like to point out that the observations in Travancore Rayon Ltd. v. Union of India (supra) that in Bhagat Raja v. The Union of India. (supra)., this Court in effect overruled the judgment of the majority in Madhya Pradesh Industries Ltd. v. Union of India. (supra) seem to have crept therein through some oversight. A careful perusal of the decision in Bhagat Raja v. The Union of India. (supra) would show that this Court did not make any observations therein which can be interpreted as overruling the. majority judgment in Madhya Pradesh Industries Ltd. v. Union of1 India. (supra). It is also worthy of note that in Bhagat Rajas case (Supra), the amendment of rule 55 of the Mineral Concession Rules, 1960 introduced in July, 1965 laid down a special procedure in regard to revisions. It required the Central Government to send copies of the application for revision to all the impleaded parties including the person to whom a lease had been granted calling upon them to make such comments as they might like to make within three months from the date of t he issue of the communication and on receipt of the comments from any party to send copies thereof to the other parties calling upon them to make further comments as they might like to make within one month from the date of the issue of the communication. It also provided that the revision application, the communications containing comments and counter comments referred to above would constitute the record of the case. Thus under the amended rule, the party whose application was rejected got an ample opportunity of showing to the Central Government by reference not only to the record which was before the State Government but by reference to the fresh material as well that the State Government was misled in its consideration of the matter or that its decision was based on irrelevant considerations. This is evident from the following observations made in Bhagat Raja v. The Union of IndiaThe old rule 55 was replaced by a new rule which came into force on 19th July, 1965. Whereas the old rule directed the Central Government to consider comments on the petition of review by the State Government or other authority only, the new rule is aimed at calling upon all the parties including the State Government to make their comments in the matter and the parties are given the right to make further comments on those made by the other or others. In effect, the parties are given a right to bring forth material which was not before the State Government. It is easy to see that an unsuccessful party ma y challenge the gram of a lease in favour of another by pointing out defects or demerits which did not come to the knowledge of the State Government. The order in this case does not even purport to show that the comments and counter comments which were before the Central Government in this case, had been considered.. The above observations leave no manner of doubt that it was in view of the amendment in rule 55 of the Mineral Concession Rules, 1960 that the decision in Bhagat Raja v. The Union of India. (supra) was different from Madhya Pradesh Industries Ltd. v. Union of India. (supra) which had been rendered on the unamended rule 55 of the said Rules. In our opinion, therefore, the observations made in Madhya Pradesh Industries Ltd. v. Union of India. (supra) contain a correct statement of law18. In view of the foregoing, we do not find any merit in the third contention raised on behalf of the appellant.19. This brings us to the last contention raised by Mr. Ramamurthi that the writ petition should not have been dismissed by the High Court in limine in view of the fact that it contained allegations of mala fides against the respondents.We are unable to accept this contention. It has been held time and again by this Court that the High Court would be justified in refusing to carry on investigation into the allegation s of mala fides if necessary particulars of the charge making out a prima facie case are not given in the writ petition. Keeping in view the well established rule that the burden of establishing mala fides lies very heavily on the person who alleges it and considering all the allegations made by the appellant in regard thereto, we do not think that they could be considered as sufficient to establish malus animus. The High Court was, therefore, not wrong in dismissing the petition in limine on seeing that a prima facie case requiring investigation had not been made out.
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Allana Cold Storage Limited Vs. Goa Meat Complex Limited | in the State and, therefore, the processing industry should be set up in the State. The contracts were awarded by negotiations, since earlier attempts to award it by auction did not materialise as offers were not forthcoming. The Supreme Court upheld such contracts for the simple reason that the court should not interfere in the economic policy. It expressly ruled that securing the highest revenue was the prime consideration for awarding the contract.42. We again find a similar proposition laid down in the case of State of Madhya Pradesh v. Nandlal Jaiswal . The production and distribution of liquor was entirely controlled by the State of Madhya Pradesh. Even the distilleries were owned by the State but run by entrepreneurs under licences awarded in auction. Over the course of time the distillery had become dilapidated, the machineries therein were replaced by entrepreneurs there being pollution problem. Therefore, the State decided to shift the distilleries and businessmen be invited to set up and run the distilleries. Only to those businessmen who were prepared to incur expenses to establish distilleries the licences for sale and distribution were to be given. The respondents in those cases showed interest. By the time the writ petitions were filed each distiller had invested huge sums extending up to rupees two crores. The Supreme Court relying upon the ratio laid down in Kasturi Lal Lakshmi Reddy v. State of Jammu and Kashmir, , at length discussed the pernicious nature of the trade and reiterated that in economic policy the courts should not interfere.43. Many more cases were cited at the Bar on the point, but we do not feel it necessary to refer to them since the law laid down is almost the same. There are cases even approving contracts given to private individuals by negotiations but those were cases where the circumstances were different and the situation so demanded. As for instance the grant of the very right of spare capacity by GMC Ltd. to ACS Ltd. under the original agreement when there were no takers and ACS Ltd. were induced to take over and also incur expenses for upgrading the machinery and spend for new ones. There was, however, no justification for the first respondent/GMC Ltd. to enter into the disputed agreement with ACS Ltd. without giving opportunity to others to compete with ACS Ltd. and also deprive the State of higher revenue which they are entitled to get. Clearly enough the agreement of December 1, 1992, is contrary to the mandate of article 14 of the Constitution and is, therefore, void.44. The defence of article 14 was also sought to be rebutted on behalf of the petitioners by pointing out the following averments made in affidavit-in-rejoinder to the affidavits filed by the second respondent. The relevant part reads as under :"I say that in the year 1991, pursuant to the request of respondent No. 1, the all India Meat and Livestock Exporters Association had called upon all its members to utilise the facilities of respondent No. 1. However, there was no response to the said appeal even though everyone in the industry has an opportunity to come forward with the offers. I deny that the said agreement dated December 1, 1992, is opposed to public interest."45. We make it clear that the circular in question was not filed along with this affidavit. An attempt was made to show a xerox copy of the same at the last stage while making winding up submissions. We have declined to look into it. In any event, the submissions made have no force whatsoever and deserve rejection for reasons stated below :(1) the membership list is not filed by the petitioners in order to show that each and every member received the circular;(2) it is doubtful that MacDonald Halal Frozen Foods, a partnership firm which came into being much later did receive the communication alleged to have been circulated by the association. It may be relevant to observe that the firm of MacDonald Halal Frozen Foods was registered only for the purpose of making an offer to the first respondent at the time when the first agreement with ACS Ltd. was about to expire; and (3) admittedly, the alleged opportunity was given in the year 1991 when the utilisation of spare capacity of the abattoir was with ACS Ltd. and the production was in progress. No offer can be expected from any one knowing the subsistence of the agreement between the GMC Ltd. and ACS Ltd. which was to last for about two years more.46. Therefore, there is no substance in the contention that the disputed agreement is not opposed to public interest.47. One more contention is raised on behalf of the petitioners that they have a vested right under the agreement and those civil rights were sought to be violated without complying with the principles of natural justice. The unilateral termination was in contravention of clause 21 of the agreement which prohibits either party from terminating the agreement ex parte. We are unable to persuade ourselves to accept the contention because the agreement in question is void at the threshold since it offends article 14 of the Constitution. No useful purpose would be served by giving opportunity to the petitioners. We may also usefully refer to the decision of Radhakrishna Agarwal v. State of Bihar, , where it is laid down that Rules of natural justice are attached to the performance of certain functions regulated by statutes or rules made thereunder involving decisions affecting rights of parties. For these reasons we hold that the petitioners do not deserve any opportunity.48. Several other contentions were raised like violation of the provisions of the Companies Act, the maintainability of the petition and the grant of relief under article 226 of the Constitution, besides others, but we do not propose to decide those points since the petition is liable to be rejected in view of the findings given above. Deciding the remaining points would only be an exercise in futility. | 0[ds]15. It is clear that GMC Ltd. were on the look out for a person who could upgrade the abattoir by making investment and simultaneously use its spare capacity and pay GMC Ltd. a specific guaranteed minimum amount. Though at the time the GMC Ltd. approached ACS Ltd. they had shown their willingness to provide necessary infrastructure by installing some of the machinery which was not there but it appears that they could not do so for want of finances. This would be clear from the letter written by GMC Ltd. to APEDA as late as on July 13, 1989, where it is stated that the most acute problem is of finance which GMC Ltd. is facing. The financial liabilities of the company do not permit GMC Ltd. to go in for improvement at additional cost. Only for this reason GMC Ltd. had to enter into an agreement with ACS Ltd. It may be appropriate to observe here that it took nearly five years for GMC Ltd. to find out a person who could invest and at the same time pay a guaranteed sum to them. It is in these circumstances that ACS Ltd. was given facility to utilise the spare capacity of the abattoir and the agreement dated April 8, 1988, came to be executed. It cannot be denied that ACS Ltd. was induced to enter into the agreement dated April 8, 1988.Soon after the agreement was signed the second respondent received a letter from Mac Donald Halal Frozen Foods dated December 3, 1992, wherein they showed their willingness to take the complex on lease for a period of five years and also stipulated some of the conditions therein. In a subsequent letter dated December 5, 1992, the same party offered a minimum guaranteed amount of Rs. 26 lakhs per annum for five years. It appears from the Government files produced before this court that the comments of the managing director were called for as the second respondent found that the offer of Mac Donald Halal Frozen Foods was very lucrative. This is clear from the note sheet dated December 18, 1988, and the cover sheet where it is written "Leasing of Meat Complex/Slaughter to Mac DonaldProposal reg." The managing director of GMC Ltd. emphatically opined that it is not advisable to enter into any sort of arrangement/agreement with Mac Donald Halal Frozen Foods for various reasons mentioned in the note. After the note was received that file was ordered to be closed because the matter was being processed simultaneously in another file bearing the same number. It appears from the second file that the opinion of the Law Department was sought. According to that opinion also it was advised that it may not be possible for GMC Ltd. to rescind the agreement unilaterally. However, the opinion clarifies the need for taking the approval of the State Government before the meat complex was leased out to ACS Ltd. Reliance for this purpose was placed on article 26 of the articles of association. However, a decision was taken by the then Chief Minister, Shri Ravi Naik, to invite tenders since the agreement with ACS Ltd. was not in conformity with the articles of association of the company. It is in this background that a letter dated February 2, 1993, came to be addressed to the managing director of GMC Ltd. by the second respondent to take steps for rescinding the contract with ACS Ltd. Since it was not in conformity with the articles of association. GMC Ltd. was also directed that short notice tenders be invited immediately giving wide publicity in the local as well as national newspapers for leasing out the spare capacity of theBefore entering into the controversy it is interesting to note that what has been given to petitioners is a right to use thewhilst it is idle because slaughtering of animals for local consumption within the State of Goa is also carried out at the same place by the licensed meat traders of the municipalities. This right in the agreement dated April 8, 1988, is described as "the use of facilities" at GMC Ltd. Even in the subsequent agreement dated December 1, 1992, the same words are used. The word "lease" was never in the picture till Mac Donald Halal Frozen Foods steps in the picture. In their letter dated December 3, 1992, the word "lease" has been used and since then the words "use of facilities" were converted to "lease" because that would facilitate the respondents in bringing their defence under article 26. By no stretch of imagination could a right of partial user of the facilities be described as a "lease". There is no transfer of interest in the property and that too exclusively. The attempt on the part of the respondents to describe the use of facilities as "lease" is totally misconceived.22. At the stage of arguments, it was suggested that the petitioners were given the right to run the whole of the undertaking. Even this is incorrect inasmuch as the petitioners are using the idle capacity of the slaughterhouse to carry on their own business and for such use of the abattoir, payment as agreed was being made. Such a user can never come within the sweep of sale, lease or disposal otherwise as sought to be contended. These words only envisage a complete and exclusive transfer of an undertaking by GMC Ltd. to a third party and the transferee derives the right to hold, possess and control that undertaking. A mere user of facilities and that too partially, would not attract the provisions of article 26(2) of the articles of association.e next question that arises is whether GMC Ltd. ever sought the approval of the second respondent and it wasrefused. In this connection it would be worthwhile to peruse the minutes of the meeting of the board of directors held on February 5, 1992. In that meeting, the disputed agreement was deliberated upon. It is stated there that a letter has been received from the second respondent declining its approval or consent. Even the resolution that was adopted on the point clearly stipulates that the agreement is not to be acted upon since the State Government has declined its approval/consent. We have not come across any such letter on record. No attempt was also made on behalf of the respondents to point out such a letter. The only communication received by GMC Ltd. from the second respondent was a letter dated February 18, 1993, which also does not speak about the approval/consent. The minutes of the meeting are clearly misleading because they purport to convey that approval was applied for and it was declined by the second respondent. As a matter of fact, no approval or consent was sought by GMC Ltd. either before or after the signing of the agreement. We may venture to observe that in the absence of any letter declining the approval/consent, the mention of it in the minutes is either false or the letter in question has been suppressed by the respondents.25. It is now a settled proposition that in contractual matters the State Government is bound by the rule of fairness and arbitrariness. It was urged on behalf of the petitioners that the action of the respondents is pregnant with mala fides, unfairness and arbitrariness. The contention is based on the two files produced by the State Government at the instance of the petitioners. The records do reveal that in one of the files which was opened earlier on receipt of the letter from MacDonald Frozen Foods dated December 3, it is written on the cover sheet "Leasing of Goa Meat Complex to MacDonaldProposal reg.". The order sheet reveals that the comments of the managing director were called for on the letter of MacDonald addressed to the Chief Minister directly. The managing director submitted his notes pointing out various reasons including the efforts made by ACS Ltd. in upgrading the complex and inviting foreign agencies for procuring export of the products manufactured there and as to why it was not advisable to enter into any sort of arrangement/agreement with this MacDonald Halal Frozen Foods. In other words, the managing director desired that the existing arrangement/agreement with ACS Ltd. should be continued. This file, however, came to be closed since the matter is being examined in another file which was simultaneously opened. The heading on the second file was "lease of spare capacity ofof the Goa Meat Complex Ltd. (GMCL) at Usgaon". This file indicates that the opinion from Legal Department was sought. In that opinion a doubt was thrown that the first respondent by signing an agreement of lease with ACS Ltd. had acted contrary to article 26(2) of the articles of association. Despite such observations, the Minister for Agriculture endorsed on the file that it would not be proper to deal with MacDonald Halal Frozen Foods at this stage and the decision of the company should be ratified. The Chief Minister, however, did not agree and came to the conclusion that the transaction suffered from legal infirmity and therefore, it should not be given effect to. Instead tenders be invited for leasing the house to the highest bidder.26. It appears that the second respondent was much impressed by the high offer made by MacDonald Halal Frozen Foods and naturally so because the respondents would receive a substantial amount which could not be anticipated earlier. With this impression, it may have been the initial intention of the State Government to see that the complex is leased out to MacDonald Halal Frozen Foods, if circumstances permit. This explains the title on the cover sheet of the first file. We find nothing unusual in the intention of the State Government because it is always the endeavour of the State to increase its income through all available sources. However, this enthusiasm did not last long in face of the subsisting agreement with ACS Ltd. The possibility of challenge to such an action also could not be overruled. This led the State Government to find out the legality and validity of the disputed agreement. On finding out that the agreement suffers from an infirmity inasmuch as it does not conform to the articles of association, it directed GMC Ltd. not to act upon the agreement and invite tenders for leasing out the complex and thereby procure the maximum amount. We do not find any reason to hold that the State Government acted in a manner which could be described as mala fide, unfair or arbitrary. At that time they were led to believe that the agreement with ACS Ltd. was non est for a particular reason. May be that the said reason was not ultimately found to be correct. It is hence difficult for us to accept that the agreement stands vitiated on thischallenge of the second respondent on the ground that agreement infringes article 14 can only be available if the agreement dated December 1, 1992, is held to be a new one. Otherwise, delay and laches may come in their way.Reading the aforesaid clause it is quite obvious that no option is given to either of the parties. It also does not provide for any procedure for exercising any such alleged option and it does not even stipulate that the agreement has to be renewed. It simply mentions the possibility that it could be renewed. The clause is nothing but a pious hope because all agreements can be renewed, if the parties so desire and agree. Apart from this aspect, the terms and conditions of renewal are not even vaguely indicated. Such a clause is nothing more than "an agreement to agree".32. It is a settled proposition of law that no agreement is a contract and, therefore, enforceable unless the terms of such agreement are certain and capable of being certain. The clause as extracted above discloses that the renewal, if any, would be "subject to such modifications as mutually agreed in the terms and conditions". Therefore, it is not certain what modifications are anticipated or which of the terms would be changed. Such an agreement would be void under section 29 of the Contract Act.It is, therefore, clear that the agreement sued upon in this petition is not a mere continuation of the old agreement by virtue of an exercise of an option contained in the original agreement, but it is a new agreement or better still, a fresh agreement.36. There is no doubt that article 14 of the Constitution is in the nature of a command to the State and normally it is the actions of the State which are open to challenge on the ground of infringement of article 14. In the case before us, it is the State who questions the legality and the validity of the agreement which is signed by GMC Ltd. with ACS Ltd., on the ground of infringement of article 14. It is not in dispute that GMC Ltd. is also a State within the meaning of article 12 of the Constitution. It is also not in dispute that the second respondentthe State Government isa major shareholder of the company, and therefore, vitally interested in its administration and the affairs. The second respondent in its capacity as a shareholder of the company has every right to interfere, where interference is necessary, because whatever it does, it should be in the interest of the public at large. It is the public interest which is of paramount importance to the State Government. It can question any of the acts of the company ifthe State Government isof opinion that the company has strayed away on the wrong path and that includes even a challenge to the agreement in question. We see no bar for the State Government to raise the defence of violation of article 14 upon coming to the conclusion that the agreement in question is void right at the threshold. The situation would have been different had the second respondent raised a contention that the contract discriminates against the respondents and thereby the agreement is vitiated under article 14. The State cannot plead discrimination against itself. The contention as raised is that the contract is contrary to thenorms laid down by the Supreme Court inasmuch as it is a nullity and the second respondent can set up such a plea of nullity as a shield to the petitioners action which, in essence, is nothing but an action for specific performance. In such an action, it is open for this court to determine whether the action is valid at law and also enforceable. In these circumstances, the second respondent is not precluded from raising a defence that the agreement is violative of article 14.We make it clear that the circular in question was not filed along with this affidavit. An attempt was made to show a xerox copy of the same at the last stage while making winding up submissions. We have declined to look into it. In any event, the submissions made have no force whatsoever and deserve rejection for reasons stated below :(1) the membership list is not filed by the petitioners in order to show that each and every member received the circular;(2) it is doubtful that MacDonald Halal Frozen Foods, a partnership firm which came into being much later did receive the communication alleged to have been circulated by the association. It may be relevant to observe that the firm of MacDonald Halal Frozen Foods was registered only for the purpose of making an offer to the first respondent at the time when the first agreement with ACS Ltd. was about to expire; and (3) admittedly, the alleged opportunity was given in the year 1991 when the utilisation of spare capacity of the abattoir was with ACS Ltd. and the production was in progress. No offer can be expected from any one knowing the subsistence of the agreement between the GMC Ltd. and ACS Ltd. which was to last for about two years more.46. Therefore, there is no substance in the contention that the disputed agreement is not opposed to publicunilateral termination was in contravention of clause 21 of the agreement which prohibits either party from terminating the agreement ex parte. We are unable to persuade ourselves to accept the contention because the agreement in question is void at the threshold since it offends article 14 of the Constitution. No useful purpose would be served by giving opportunity to the petitioners. We may also usefully refer to the decision of Radhakrishna Agarwal v. State of Bihar, , where it is laid down that Rules of natural justice are attached to the performance of certain functions regulated by statutes or rules made thereunder involving decisions affecting rights of parties. For these reasons we hold that the petitioners do not deserve any opportunity.48. Several other contentions were raised like violation of the provisions of the Companies Act, the maintainability of the petition and the grant of relief under article 226 of the Constitution, besides others, but we do not propose to decide those points since the petition is liable to be rejected in view of the findings given above. Deciding the remaining points would only be an exercise in futility. | 0 | 9,652 | 3,106 | ### Instruction:
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in the State and, therefore, the processing industry should be set up in the State. The contracts were awarded by negotiations, since earlier attempts to award it by auction did not materialise as offers were not forthcoming. The Supreme Court upheld such contracts for the simple reason that the court should not interfere in the economic policy. It expressly ruled that securing the highest revenue was the prime consideration for awarding the contract.42. We again find a similar proposition laid down in the case of State of Madhya Pradesh v. Nandlal Jaiswal . The production and distribution of liquor was entirely controlled by the State of Madhya Pradesh. Even the distilleries were owned by the State but run by entrepreneurs under licences awarded in auction. Over the course of time the distillery had become dilapidated, the machineries therein were replaced by entrepreneurs there being pollution problem. Therefore, the State decided to shift the distilleries and businessmen be invited to set up and run the distilleries. Only to those businessmen who were prepared to incur expenses to establish distilleries the licences for sale and distribution were to be given. The respondents in those cases showed interest. By the time the writ petitions were filed each distiller had invested huge sums extending up to rupees two crores. The Supreme Court relying upon the ratio laid down in Kasturi Lal Lakshmi Reddy v. State of Jammu and Kashmir, , at length discussed the pernicious nature of the trade and reiterated that in economic policy the courts should not interfere.43. Many more cases were cited at the Bar on the point, but we do not feel it necessary to refer to them since the law laid down is almost the same. There are cases even approving contracts given to private individuals by negotiations but those were cases where the circumstances were different and the situation so demanded. As for instance the grant of the very right of spare capacity by GMC Ltd. to ACS Ltd. under the original agreement when there were no takers and ACS Ltd. were induced to take over and also incur expenses for upgrading the machinery and spend for new ones. There was, however, no justification for the first respondent/GMC Ltd. to enter into the disputed agreement with ACS Ltd. without giving opportunity to others to compete with ACS Ltd. and also deprive the State of higher revenue which they are entitled to get. Clearly enough the agreement of December 1, 1992, is contrary to the mandate of article 14 of the Constitution and is, therefore, void.44. The defence of article 14 was also sought to be rebutted on behalf of the petitioners by pointing out the following averments made in affidavit-in-rejoinder to the affidavits filed by the second respondent. The relevant part reads as under :"I say that in the year 1991, pursuant to the request of respondent No. 1, the all India Meat and Livestock Exporters Association had called upon all its members to utilise the facilities of respondent No. 1. However, there was no response to the said appeal even though everyone in the industry has an opportunity to come forward with the offers. I deny that the said agreement dated December 1, 1992, is opposed to public interest."45. We make it clear that the circular in question was not filed along with this affidavit. An attempt was made to show a xerox copy of the same at the last stage while making winding up submissions. We have declined to look into it. In any event, the submissions made have no force whatsoever and deserve rejection for reasons stated below :(1) the membership list is not filed by the petitioners in order to show that each and every member received the circular;(2) it is doubtful that MacDonald Halal Frozen Foods, a partnership firm which came into being much later did receive the communication alleged to have been circulated by the association. It may be relevant to observe that the firm of MacDonald Halal Frozen Foods was registered only for the purpose of making an offer to the first respondent at the time when the first agreement with ACS Ltd. was about to expire; and (3) admittedly, the alleged opportunity was given in the year 1991 when the utilisation of spare capacity of the abattoir was with ACS Ltd. and the production was in progress. No offer can be expected from any one knowing the subsistence of the agreement between the GMC Ltd. and ACS Ltd. which was to last for about two years more.46. Therefore, there is no substance in the contention that the disputed agreement is not opposed to public interest.47. One more contention is raised on behalf of the petitioners that they have a vested right under the agreement and those civil rights were sought to be violated without complying with the principles of natural justice. The unilateral termination was in contravention of clause 21 of the agreement which prohibits either party from terminating the agreement ex parte. We are unable to persuade ourselves to accept the contention because the agreement in question is void at the threshold since it offends article 14 of the Constitution. No useful purpose would be served by giving opportunity to the petitioners. We may also usefully refer to the decision of Radhakrishna Agarwal v. State of Bihar, , where it is laid down that Rules of natural justice are attached to the performance of certain functions regulated by statutes or rules made thereunder involving decisions affecting rights of parties. For these reasons we hold that the petitioners do not deserve any opportunity.48. Several other contentions were raised like violation of the provisions of the Companies Act, the maintainability of the petition and the grant of relief under article 226 of the Constitution, besides others, but we do not propose to decide those points since the petition is liable to be rejected in view of the findings given above. Deciding the remaining points would only be an exercise in futility.
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any such alleged option and it does not even stipulate that the agreement has to be renewed. It simply mentions the possibility that it could be renewed. The clause is nothing but a pious hope because all agreements can be renewed, if the parties so desire and agree. Apart from this aspect, the terms and conditions of renewal are not even vaguely indicated. Such a clause is nothing more than "an agreement to agree".32. It is a settled proposition of law that no agreement is a contract and, therefore, enforceable unless the terms of such agreement are certain and capable of being certain. The clause as extracted above discloses that the renewal, if any, would be "subject to such modifications as mutually agreed in the terms and conditions". Therefore, it is not certain what modifications are anticipated or which of the terms would be changed. Such an agreement would be void under section 29 of the Contract Act.It is, therefore, clear that the agreement sued upon in this petition is not a mere continuation of the old agreement by virtue of an exercise of an option contained in the original agreement, but it is a new agreement or better still, a fresh agreement.36. There is no doubt that article 14 of the Constitution is in the nature of a command to the State and normally it is the actions of the State which are open to challenge on the ground of infringement of article 14. In the case before us, it is the State who questions the legality and the validity of the agreement which is signed by GMC Ltd. with ACS Ltd., on the ground of infringement of article 14. It is not in dispute that GMC Ltd. is also a State within the meaning of article 12 of the Constitution. It is also not in dispute that the second respondentthe State Government isa major shareholder of the company, and therefore, vitally interested in its administration and the affairs. The second respondent in its capacity as a shareholder of the company has every right to interfere, where interference is necessary, because whatever it does, it should be in the interest of the public at large. It is the public interest which is of paramount importance to the State Government. It can question any of the acts of the company ifthe State Government isof opinion that the company has strayed away on the wrong path and that includes even a challenge to the agreement in question. We see no bar for the State Government to raise the defence of violation of article 14 upon coming to the conclusion that the agreement in question is void right at the threshold. The situation would have been different had the second respondent raised a contention that the contract discriminates against the respondents and thereby the agreement is vitiated under article 14. The State cannot plead discrimination against itself. The contention as raised is that the contract is contrary to thenorms laid down by the Supreme Court inasmuch as it is a nullity and the second respondent can set up such a plea of nullity as a shield to the petitioners action which, in essence, is nothing but an action for specific performance. In such an action, it is open for this court to determine whether the action is valid at law and also enforceable. In these circumstances, the second respondent is not precluded from raising a defence that the agreement is violative of article 14.We make it clear that the circular in question was not filed along with this affidavit. An attempt was made to show a xerox copy of the same at the last stage while making winding up submissions. We have declined to look into it. In any event, the submissions made have no force whatsoever and deserve rejection for reasons stated below :(1) the membership list is not filed by the petitioners in order to show that each and every member received the circular;(2) it is doubtful that MacDonald Halal Frozen Foods, a partnership firm which came into being much later did receive the communication alleged to have been circulated by the association. It may be relevant to observe that the firm of MacDonald Halal Frozen Foods was registered only for the purpose of making an offer to the first respondent at the time when the first agreement with ACS Ltd. was about to expire; and (3) admittedly, the alleged opportunity was given in the year 1991 when the utilisation of spare capacity of the abattoir was with ACS Ltd. and the production was in progress. No offer can be expected from any one knowing the subsistence of the agreement between the GMC Ltd. and ACS Ltd. which was to last for about two years more.46. Therefore, there is no substance in the contention that the disputed agreement is not opposed to publicunilateral termination was in contravention of clause 21 of the agreement which prohibits either party from terminating the agreement ex parte. We are unable to persuade ourselves to accept the contention because the agreement in question is void at the threshold since it offends article 14 of the Constitution. No useful purpose would be served by giving opportunity to the petitioners. We may also usefully refer to the decision of Radhakrishna Agarwal v. State of Bihar, , where it is laid down that Rules of natural justice are attached to the performance of certain functions regulated by statutes or rules made thereunder involving decisions affecting rights of parties. For these reasons we hold that the petitioners do not deserve any opportunity.48. Several other contentions were raised like violation of the provisions of the Companies Act, the maintainability of the petition and the grant of relief under article 226 of the Constitution, besides others, but we do not propose to decide those points since the petition is liable to be rejected in view of the findings given above. Deciding the remaining points would only be an exercise in futility.
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State Of Haryana Vs. Rubber Reclaim Co.Of India (P) Ltd.&Anr | under the provision of Central Sales Tax Act. Accordingly has set aside the orders passed by the assessing authority. However, the High Court has not gone into the vires of Rule 28-A of the Rules, 1975. 9. Rule 28-A of the Rules, 1975 is framed under Sections 13B and 25-A of the Act. Rule 28-A deals with computation of the quantum of tax incentive available to a dealer in view of eligibility certificate is issued by the department. In order to regulate the exemption scheme the concept of “Notional Sales Tax Liability” is incorporated vide Clause (n) of Rule 28-A (2)(n) of the Rules,1975. The said clause reads: “(i) amount of tax payable on the sales of finished products of the eligible industrial unit under the local sales tax law but for an exemption computed at the maximum rates specified under the local sales tax law as applicable from time to time; andExplanation- The sales made on consignment basis within the State of Haryana or branch transfer within the State of Haryana shall also be deemed to be sales made within the State and liable to tax;(ii) amount of tax payable under the Central Sales Tax Act, 1956, on the sales of finished products of the eligible industrial unit made in the course of inter-State trade or commerce computed at the rate of tax applicable to such sales as if these were made against certificate in form C on the basis that the sales are eligible to tax under the said Act.Explanation- The branch transfers or consignment sales outside the State of Haryana shall be deemed to the sale in the course of inter- State trade or commerce.Note – The expression and terms, if any appearing in this rule not defined above shall unless the context otherwise requires carry the same meaning as assigned to them under the Act and the rules mad thereunder.” 10. Rule 28-A(2)(n) includes within its ambit the sales which were otherwise exigible to sales tax, namely, local sales and inter-State sales and secondly, the Rule also includes branch transfers or consignment sales outside the State and sales made on consignment basis or branch transfers within the State by treating them as deemed sales, which two transactions were otherwise not exigible to sales tax for any other unit not availing exemption. Alternatively, it can be stated that Notional Sales Tax Liability as defined in Rule 28(A)(2)(n), as a condition for grant of exemption. 11. The benefit of tax exemption/ deferment under Rule 28A of the Rules, 1975 shall be subject to condition prescribed under Sub-rule 11(a) of the Rules, 1975. The said rule reads: “(a) The benefit of tax-exemption/deferment under this rule shall be subject to the condition that the beneficiary industrial unit after having availed of the benefit -(i) shall continue its production atleast for the next five years not below the level of average production for the preceding five year; and(ii) shall not make sales outside the State for next five years by way of transfer of consignment of goods manufactured by it.(b) In case the unit violates any of the conditions laid down in clause (a), it shall be liable to make, in addition to the full amount of tax-benefit availed of by it during the period of exemption/deferment, payment of interest chargeable under the Act as if no tax exemption/ deferment was ever available to it;Provided that the provisions of this clause shall not come into play if the loss in production is explained to the satisfaction of the Deputy Excise and Taxation Commissioner concerned as being due to the reasons beyond the control of the units:Provided further that a unit shall not be called upon to pay sum under this clause without having been given reasonable opportunity of being heard.” 12. If there is a violation of anyone of the conditions stipulated in Sub Rule 11(i) and (ii), the sales tax authorities are at liberty to cancel the exemption certificate issued under the scheme and call upon the assessee to make payment of the exemption availed with interest thereon. 13. Having noticed the relevant rules, we will revert back to the facts in the present case. The assessee-company had availed benefit of the sales tax exemption under the Exemption Scheme issued by the State Government. The Eligibility Certificate for sales tax exemption provides for certain conditions which requires to be complied by the assessee-company to take benefit of exemption under the Scheme. The Condition No. 7 of the Eligibility Certificate provides that the certificate can be cancelled if there is contravention of any condition mentioned in the certificate or Rule 28-A, after affording an opportunity to the party of being heard. In the show cause notice it is specifically alleged that the assessee had dispatched good on consignment basis during the assessment period 1995-1996, 1996-1997 and 1997-1998 and therefore the assessee has breached Rule 28-A of the Rules, 1975 and in particular Sub-rule 11(a)(ii) of the Rules, 1975, which prescribes that the benefit of tax exemption shall be subject to the condition that the assessee having availed the benefit of tax exemption shall not make sales outside the State for next five years by way of transfer or consignment of goods manufactured by it. Since the assessee did not dispute the specific contravention pointed out by the assessing authority after cancelling the exemption certificate issued has quantified the tax liability and the interest payable thereon. The order so passed, in our view, is in consonance with the scheme of exemption notified by the State Government and also in accordance with the rules prescribed under Section 13B of the Act.14. The High Court while allowing the petition filed by the assessee has proceeded on a wrong assumption, that, the assessing authority has levied tax on inter-state sales and on consignment transfer and accordingly has quashed the assessment order passed by the assessing authority. In view of our conclusion stated earlier, we cannot sustain the judgment and order passed by the High Court. | 1[ds]13. Having noticed the relevant rules, we will revert back to the facts in the present case. Thehad availed benefit of the sales tax exemption under the Exemption Scheme issued by the State Government. The Eligibility Certificate for sales tax exemption provides for certain conditions which requires to be complied by theto take benefit of exemption under the Scheme. The Condition No. 7 of the Eligibility Certificate provides that the certificate can be cancelled if there is contravention of any condition mentioned in the certificate or Ruleafter affording an opportunity to the party of being heard. In the show cause notice it is specifically alleged that the assessee had dispatched good on consignment basis during the assessment period98 and therefore the assessee has breached Rule28A of the Rules,1975 and in particular11(a)(ii) of the Rules, 1975, which prescribes that the benefit of tax exemption shall be subject to the condition that the assessee having availed the benefit of tax exemption shall not make sales outside the State for next five years by way of transfer or consignment of goods manufactured by it. Since the assessee did not dispute the specific contravention pointed out by the assessing authority after cancelling the exemption certificate issued has quantified the tax liability and the interest payable thereon. The order so passed, in our view, is in consonance with the scheme of exemption notified by the State Government and also in accordance with the rules prescribed under Section 13B of the Act.14. The High Court while allowing the petition filed by the assessee has proceeded on a wrong assumption, that, the assessing authority has levied tax onsales and on consignment transfer and accordingly has quashed the assessment order passed by the assessing authority. In view of our conclusion stated earlier, we cannot sustain the judgment and order passed by the High Court. | 1 | 1,664 | 336 | ### Instruction:
Determine the likely decision of the case (acceptance (1) or rejection (0)) and follow up with an explanation highlighting key sentences that support this prediction.
### Input:
under the provision of Central Sales Tax Act. Accordingly has set aside the orders passed by the assessing authority. However, the High Court has not gone into the vires of Rule 28-A of the Rules, 1975. 9. Rule 28-A of the Rules, 1975 is framed under Sections 13B and 25-A of the Act. Rule 28-A deals with computation of the quantum of tax incentive available to a dealer in view of eligibility certificate is issued by the department. In order to regulate the exemption scheme the concept of “Notional Sales Tax Liability” is incorporated vide Clause (n) of Rule 28-A (2)(n) of the Rules,1975. The said clause reads: “(i) amount of tax payable on the sales of finished products of the eligible industrial unit under the local sales tax law but for an exemption computed at the maximum rates specified under the local sales tax law as applicable from time to time; andExplanation- The sales made on consignment basis within the State of Haryana or branch transfer within the State of Haryana shall also be deemed to be sales made within the State and liable to tax;(ii) amount of tax payable under the Central Sales Tax Act, 1956, on the sales of finished products of the eligible industrial unit made in the course of inter-State trade or commerce computed at the rate of tax applicable to such sales as if these were made against certificate in form C on the basis that the sales are eligible to tax under the said Act.Explanation- The branch transfers or consignment sales outside the State of Haryana shall be deemed to the sale in the course of inter- State trade or commerce.Note – The expression and terms, if any appearing in this rule not defined above shall unless the context otherwise requires carry the same meaning as assigned to them under the Act and the rules mad thereunder.” 10. Rule 28-A(2)(n) includes within its ambit the sales which were otherwise exigible to sales tax, namely, local sales and inter-State sales and secondly, the Rule also includes branch transfers or consignment sales outside the State and sales made on consignment basis or branch transfers within the State by treating them as deemed sales, which two transactions were otherwise not exigible to sales tax for any other unit not availing exemption. Alternatively, it can be stated that Notional Sales Tax Liability as defined in Rule 28(A)(2)(n), as a condition for grant of exemption. 11. The benefit of tax exemption/ deferment under Rule 28A of the Rules, 1975 shall be subject to condition prescribed under Sub-rule 11(a) of the Rules, 1975. The said rule reads: “(a) The benefit of tax-exemption/deferment under this rule shall be subject to the condition that the beneficiary industrial unit after having availed of the benefit -(i) shall continue its production atleast for the next five years not below the level of average production for the preceding five year; and(ii) shall not make sales outside the State for next five years by way of transfer of consignment of goods manufactured by it.(b) In case the unit violates any of the conditions laid down in clause (a), it shall be liable to make, in addition to the full amount of tax-benefit availed of by it during the period of exemption/deferment, payment of interest chargeable under the Act as if no tax exemption/ deferment was ever available to it;Provided that the provisions of this clause shall not come into play if the loss in production is explained to the satisfaction of the Deputy Excise and Taxation Commissioner concerned as being due to the reasons beyond the control of the units:Provided further that a unit shall not be called upon to pay sum under this clause without having been given reasonable opportunity of being heard.” 12. If there is a violation of anyone of the conditions stipulated in Sub Rule 11(i) and (ii), the sales tax authorities are at liberty to cancel the exemption certificate issued under the scheme and call upon the assessee to make payment of the exemption availed with interest thereon. 13. Having noticed the relevant rules, we will revert back to the facts in the present case. The assessee-company had availed benefit of the sales tax exemption under the Exemption Scheme issued by the State Government. The Eligibility Certificate for sales tax exemption provides for certain conditions which requires to be complied by the assessee-company to take benefit of exemption under the Scheme. The Condition No. 7 of the Eligibility Certificate provides that the certificate can be cancelled if there is contravention of any condition mentioned in the certificate or Rule 28-A, after affording an opportunity to the party of being heard. In the show cause notice it is specifically alleged that the assessee had dispatched good on consignment basis during the assessment period 1995-1996, 1996-1997 and 1997-1998 and therefore the assessee has breached Rule 28-A of the Rules, 1975 and in particular Sub-rule 11(a)(ii) of the Rules, 1975, which prescribes that the benefit of tax exemption shall be subject to the condition that the assessee having availed the benefit of tax exemption shall not make sales outside the State for next five years by way of transfer or consignment of goods manufactured by it. Since the assessee did not dispute the specific contravention pointed out by the assessing authority after cancelling the exemption certificate issued has quantified the tax liability and the interest payable thereon. The order so passed, in our view, is in consonance with the scheme of exemption notified by the State Government and also in accordance with the rules prescribed under Section 13B of the Act.14. The High Court while allowing the petition filed by the assessee has proceeded on a wrong assumption, that, the assessing authority has levied tax on inter-state sales and on consignment transfer and accordingly has quashed the assessment order passed by the assessing authority. In view of our conclusion stated earlier, we cannot sustain the judgment and order passed by the High Court.
### Response:
1
### Explanation:
13. Having noticed the relevant rules, we will revert back to the facts in the present case. Thehad availed benefit of the sales tax exemption under the Exemption Scheme issued by the State Government. The Eligibility Certificate for sales tax exemption provides for certain conditions which requires to be complied by theto take benefit of exemption under the Scheme. The Condition No. 7 of the Eligibility Certificate provides that the certificate can be cancelled if there is contravention of any condition mentioned in the certificate or Ruleafter affording an opportunity to the party of being heard. In the show cause notice it is specifically alleged that the assessee had dispatched good on consignment basis during the assessment period98 and therefore the assessee has breached Rule28A of the Rules,1975 and in particular11(a)(ii) of the Rules, 1975, which prescribes that the benefit of tax exemption shall be subject to the condition that the assessee having availed the benefit of tax exemption shall not make sales outside the State for next five years by way of transfer or consignment of goods manufactured by it. Since the assessee did not dispute the specific contravention pointed out by the assessing authority after cancelling the exemption certificate issued has quantified the tax liability and the interest payable thereon. The order so passed, in our view, is in consonance with the scheme of exemption notified by the State Government and also in accordance with the rules prescribed under Section 13B of the Act.14. The High Court while allowing the petition filed by the assessee has proceeded on a wrong assumption, that, the assessing authority has levied tax onsales and on consignment transfer and accordingly has quashed the assessment order passed by the assessing authority. In view of our conclusion stated earlier, we cannot sustain the judgment and order passed by the High Court.
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Western India Match Company Ltd Vs. Workmen | It plainly follows From Sections 4, 10 and 13 (2) that the inconsistent part of the special agreement cannot prevail over the Standing Order. As long as the Standing Order is in force, it is binding on the Company as well as the workmen. To uphold, the special agreement would mean giving a go-by to the Acts principle of three-party participation in the settlement of terms of employment. So we are of opinion that the inconsistent part of the special agreement is ineffective and unenforceable. 10. It is pointed out on behalf of the Company that S. 18 of the Industrial Disputes Act provides that any settlement between the employer and the workman is binding on them. It is said that accordingly the special agreement in the present case would be binding on Prem Singh. It is not necessary to construe Section 18 in this case because it is governed by die provisions of the Uttar Pradesh Industrial Disputes Act. Section 6-B (1) of this Act deals with a settlement arrived at by agreement between the employer and workmen otherwise than in the course of conciliation proceeding. Sub-section (2) thereof provides that after the settlement is arrived at, the parties to the settlement or any one of them may apply to the Conciliation Officer of the area concerned for the registration of the settlement. Sub-section (3) is important. It provides that while considering the question of the registration of a settlement, the Conciliation Officer shall examine whether it is inexpedient to do so on public ground affecting social justice or whether the settlement has been brought about as a result of collusion, fraud or misrepresentation. We think that the word may in sub-section (2) should be read as shall in the context of sub-section (3). If social justice is to be ensured and if collusion, fraud or misrepresentation is to be eliminated it is necessary that every privately negotiated settlement should be submitted for registration to the Conciliation Officer. It may be observed that the U. P. Act also insists on the three party participation in the settlement of terms of employment. In the result, the Company cannot enforce the special agreement on the pretext that Prem Singh had voluntarily agreed to it. The conciliation Officer having had no say in the making this agreement, the consent of Prem Singh is meaningless. 11. It is then said that the Standing Order can be modified in a suitable case by the Labour Court. In this connection reliance is placed on the Management of Bangalore Woollen, Cotton and Silk Mills Co. Ltd. v. The Workmen. (1968) 1 SCR 581 = (AIR 1968 SC 585 ). It is true that the Labour Court may determine terms and conditions of employment which may be inconsistent with the Standing Order. But in the present case the reference did not give jurisdiction to the Labour Court to determine terms and conditions of employment of Prem Singh. The reference directed the Labour Court to decide whether the discharge of Prem Singh from service was legal or justifiable. 12. Shri Agarwala has argued that the Standing Order is a law and accordingly the special agreement in contravention of it is void. In support of his argument he has relied on a number of decisions of this Court. Shri Daphtary has argued to the contrary and has relied on some other decisions. In the view that we have taken earlier, it is not necessary to consider this question. Accordingly, we do not refer to the authorities cited before us. 13. Another contention of Shri Daphtary is that in the circumstances of this case the Labour Court should not have made an order for reinstatement of Prem Singh. Stress is laid on the assertion in the order of discharge that his work during the entire probationary period was not satisfactory. In support of his argument Shri Daphtary has relied on the Hindustan Steels Ltd. Rourkela v. Roy (A. K. and others) (l970) 1 Lab LJ 228 = (AIR 1970 SC 1401 ). This decision does not assist him for in the case before us the Company did not plead in its written statement filed before the Labour Court that the work of Prem Singh was unsatisfactory during the probationary Period, nor did it lead any evidence in proof of his unsatisfactory work.The argument does not appear to have beer raised in the special Leave petition also.Accordingly, it is not possible to permit this argument to be raised now. (See Binny Ltd. v. Their Work men, (1972) 1 Lab LJ 478 = (AIR 1972 SC 1975 ) and the Management of Panitole Tea Estate v. The Workmen (1971) 3 SCR 774 = (AIR 1971 SC 2171 ). 14. In the end, Shri Daphtary has urged that as the Labour Court has found that the discharge of Prem Singh from service was neither mala fide nor a measure of victimisation, he should not have been reinstated to service. Reliance is placed on the Tata Oil Mills Co. Ltd. v. Its Workmen (1963) 2 Lab LJ 78 (SC), M/s. Francis Klein and Co. (P) Ltd. v. The Workmen AIR 1971 SC 2414 and the Air-India Corpn. Bombay v. V. A. Rebellow (1972) 1 Lab LJ 501 = (AIR l972 SC 1343). It is settled law now that the Labour Court may interfere with the order of discharge where it is satisfied that it was made mala fide or was a measure of victimization or unfair labour practice. It has also been held by this Court that the Labour Court may interfere with the order of discharge if it finds that the order is arbitrary or capricious or so unreasonable as to lead to the inference that it is not made bona fide. As there was no plea and no evidence to show that the work of Prem Singh was unsatisfactory, the conclusion is obvious that the order of discharge is arbitrary. Accordingly, the Labour Court could interfere and make an order of reinstatement. | 0[ds]According to the Standing Order, a workman shall not be kept on probation for more than two months. If he has worked during these two months to the satisfaction of the (company, he becomes permanent. But as a result of special agreement, even though he has worked during these two months to the satisfaction of the Company, he will not be a permanent workman. While the Standing Order says "Confirm him on the expiry of two months, the special agreement says: "No, wait till the expiry of six months." There is thus a conflict between them. They cannot co-exist. So we are of opinion that the special agreement is inconsistent with the Standing Order to the extent of the additional four months probation9. The special agreement, in so fat as it provides for additional four months of probation, is an act in contravention of the Standing Order. We have already held that. It plainly follows From Sections 4, 10 and 13 (2) that the inconsistent part of the special agreement cannot prevail over the Standing Order. As long as the Standing Order is in force, it is binding on the Company as well as the workmen. To uphold, the special agreement would mean giving a go-by to the Acts principle of three-party participation in the settlement of terms of employment. So we are of opinion that the inconsistent part of the special agreement is ineffective and unenforceableWe think that the word may in sub-section (2) should be read as shall in the context of sub-section (3). If social justice is to be ensured and if collusion, fraud or misrepresentation is to be eliminated it is necessary that every privately negotiated settlement should be submitted for registration to the Conciliation Officer. It may be observed that the U. P. Act also insists on the three party participation in the settlement of terms of employment. In the result, the Company cannot enforce the special agreement on the pretext that Prem Singh had voluntarily agreed to it. The conciliation Officer having had no say in the making this agreement, the consent of Prem Singh is meaninglessThis decision does not assist him for in the case before us the Company did not plead in its written statement filed before the Labour Court that the work of Prem Singh was unsatisfactory during the probationary Period, nor did it lead any evidence in proof of his unsatisfactory work.The argument does not appear to have beer raised in the special Leave petition also.Accordingly, it is not possible to permit this argument to be raised nowIt is settled law now that the Labour Court may interfere with the order of discharge where it is satisfied that it was made mala fide or was a measure of victimization or unfair labour practice. It has also been held by this Court that the Labour Court may interfere with the order of discharge if it finds that the order is arbitrary or capricious or so unreasonable as to lead to the inference that it is not made bona fide. As there was no plea and no evidence to show that the work of Prem Singh was unsatisfactory, the conclusion is obvious that the order of discharge is arbitrary. Accordingly, the Labour Court could interfere and make an order of reinstatement. | 0 | 2,939 | 605 | ### Instruction:
First, predict whether the appeal in case proceeding will be accepted (1) or not (0), and then explain the decision by identifying crucial sentences from the document.
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It plainly follows From Sections 4, 10 and 13 (2) that the inconsistent part of the special agreement cannot prevail over the Standing Order. As long as the Standing Order is in force, it is binding on the Company as well as the workmen. To uphold, the special agreement would mean giving a go-by to the Acts principle of three-party participation in the settlement of terms of employment. So we are of opinion that the inconsistent part of the special agreement is ineffective and unenforceable. 10. It is pointed out on behalf of the Company that S. 18 of the Industrial Disputes Act provides that any settlement between the employer and the workman is binding on them. It is said that accordingly the special agreement in the present case would be binding on Prem Singh. It is not necessary to construe Section 18 in this case because it is governed by die provisions of the Uttar Pradesh Industrial Disputes Act. Section 6-B (1) of this Act deals with a settlement arrived at by agreement between the employer and workmen otherwise than in the course of conciliation proceeding. Sub-section (2) thereof provides that after the settlement is arrived at, the parties to the settlement or any one of them may apply to the Conciliation Officer of the area concerned for the registration of the settlement. Sub-section (3) is important. It provides that while considering the question of the registration of a settlement, the Conciliation Officer shall examine whether it is inexpedient to do so on public ground affecting social justice or whether the settlement has been brought about as a result of collusion, fraud or misrepresentation. We think that the word may in sub-section (2) should be read as shall in the context of sub-section (3). If social justice is to be ensured and if collusion, fraud or misrepresentation is to be eliminated it is necessary that every privately negotiated settlement should be submitted for registration to the Conciliation Officer. It may be observed that the U. P. Act also insists on the three party participation in the settlement of terms of employment. In the result, the Company cannot enforce the special agreement on the pretext that Prem Singh had voluntarily agreed to it. The conciliation Officer having had no say in the making this agreement, the consent of Prem Singh is meaningless. 11. It is then said that the Standing Order can be modified in a suitable case by the Labour Court. In this connection reliance is placed on the Management of Bangalore Woollen, Cotton and Silk Mills Co. Ltd. v. The Workmen. (1968) 1 SCR 581 = (AIR 1968 SC 585 ). It is true that the Labour Court may determine terms and conditions of employment which may be inconsistent with the Standing Order. But in the present case the reference did not give jurisdiction to the Labour Court to determine terms and conditions of employment of Prem Singh. The reference directed the Labour Court to decide whether the discharge of Prem Singh from service was legal or justifiable. 12. Shri Agarwala has argued that the Standing Order is a law and accordingly the special agreement in contravention of it is void. In support of his argument he has relied on a number of decisions of this Court. Shri Daphtary has argued to the contrary and has relied on some other decisions. In the view that we have taken earlier, it is not necessary to consider this question. Accordingly, we do not refer to the authorities cited before us. 13. Another contention of Shri Daphtary is that in the circumstances of this case the Labour Court should not have made an order for reinstatement of Prem Singh. Stress is laid on the assertion in the order of discharge that his work during the entire probationary period was not satisfactory. In support of his argument Shri Daphtary has relied on the Hindustan Steels Ltd. Rourkela v. Roy (A. K. and others) (l970) 1 Lab LJ 228 = (AIR 1970 SC 1401 ). This decision does not assist him for in the case before us the Company did not plead in its written statement filed before the Labour Court that the work of Prem Singh was unsatisfactory during the probationary Period, nor did it lead any evidence in proof of his unsatisfactory work.The argument does not appear to have beer raised in the special Leave petition also.Accordingly, it is not possible to permit this argument to be raised now. (See Binny Ltd. v. Their Work men, (1972) 1 Lab LJ 478 = (AIR 1972 SC 1975 ) and the Management of Panitole Tea Estate v. The Workmen (1971) 3 SCR 774 = (AIR 1971 SC 2171 ). 14. In the end, Shri Daphtary has urged that as the Labour Court has found that the discharge of Prem Singh from service was neither mala fide nor a measure of victimisation, he should not have been reinstated to service. Reliance is placed on the Tata Oil Mills Co. Ltd. v. Its Workmen (1963) 2 Lab LJ 78 (SC), M/s. Francis Klein and Co. (P) Ltd. v. The Workmen AIR 1971 SC 2414 and the Air-India Corpn. Bombay v. V. A. Rebellow (1972) 1 Lab LJ 501 = (AIR l972 SC 1343). It is settled law now that the Labour Court may interfere with the order of discharge where it is satisfied that it was made mala fide or was a measure of victimization or unfair labour practice. It has also been held by this Court that the Labour Court may interfere with the order of discharge if it finds that the order is arbitrary or capricious or so unreasonable as to lead to the inference that it is not made bona fide. As there was no plea and no evidence to show that the work of Prem Singh was unsatisfactory, the conclusion is obvious that the order of discharge is arbitrary. Accordingly, the Labour Court could interfere and make an order of reinstatement.
### Response:
0
### Explanation:
According to the Standing Order, a workman shall not be kept on probation for more than two months. If he has worked during these two months to the satisfaction of the (company, he becomes permanent. But as a result of special agreement, even though he has worked during these two months to the satisfaction of the Company, he will not be a permanent workman. While the Standing Order says "Confirm him on the expiry of two months, the special agreement says: "No, wait till the expiry of six months." There is thus a conflict between them. They cannot co-exist. So we are of opinion that the special agreement is inconsistent with the Standing Order to the extent of the additional four months probation9. The special agreement, in so fat as it provides for additional four months of probation, is an act in contravention of the Standing Order. We have already held that. It plainly follows From Sections 4, 10 and 13 (2) that the inconsistent part of the special agreement cannot prevail over the Standing Order. As long as the Standing Order is in force, it is binding on the Company as well as the workmen. To uphold, the special agreement would mean giving a go-by to the Acts principle of three-party participation in the settlement of terms of employment. So we are of opinion that the inconsistent part of the special agreement is ineffective and unenforceableWe think that the word may in sub-section (2) should be read as shall in the context of sub-section (3). If social justice is to be ensured and if collusion, fraud or misrepresentation is to be eliminated it is necessary that every privately negotiated settlement should be submitted for registration to the Conciliation Officer. It may be observed that the U. P. Act also insists on the three party participation in the settlement of terms of employment. In the result, the Company cannot enforce the special agreement on the pretext that Prem Singh had voluntarily agreed to it. The conciliation Officer having had no say in the making this agreement, the consent of Prem Singh is meaninglessThis decision does not assist him for in the case before us the Company did not plead in its written statement filed before the Labour Court that the work of Prem Singh was unsatisfactory during the probationary Period, nor did it lead any evidence in proof of his unsatisfactory work.The argument does not appear to have beer raised in the special Leave petition also.Accordingly, it is not possible to permit this argument to be raised nowIt is settled law now that the Labour Court may interfere with the order of discharge where it is satisfied that it was made mala fide or was a measure of victimization or unfair labour practice. It has also been held by this Court that the Labour Court may interfere with the order of discharge if it finds that the order is arbitrary or capricious or so unreasonable as to lead to the inference that it is not made bona fide. As there was no plea and no evidence to show that the work of Prem Singh was unsatisfactory, the conclusion is obvious that the order of discharge is arbitrary. Accordingly, the Labour Court could interfere and make an order of reinstatement.
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Commissioner Of Income-Tax, Punjab Vs. M/S. Chander Bhan Harbhajan Lal | 1817, Subba Rao, J. observed:"A partner of a firm can certainly secure his capital from any source or surrender his profits to his sub-partner or any other person. Those facts cannot conceivably convert a valid partnership into a bogus one."8. The statements of Harbhajan Lal and other partners of the assessee firm do not carry the matter any further. In the statement dated January 30, 1954, Harbhajan Lal clearly stated that the assessee firm consisted of 14 partners as mentioned in the deed of partnership, dated December 5, 1952. It is true that he stated also that Gosain Chander Bhan was a partner not in his individual capacity but on behalf of the Ferozepore firm, but this statement must be read in the background of the clause in the partnership deed constituting the Ferozepore firm, under which the partners of the Ferozepore firm were entitled to the profits and liable for the losses in the share of Gosain Chander Bhan in the assessee firm. The statement fairly read shows that only the 14 persons mentioned in the deed, dated December 5, 1952, were the partners in the assessee firm. If the 8 partners of the Ferozepore firm were partners in the assessee firm, Harbhajan Lal could not have stated that the number of the partners of the assessee firm was 14 only.9. Counsel for the appellant pointed out that the High Court erroneously assumed that the partnership deed constituting the Ferozepore firm was, dated June 14, 1954, whereas, in fact, this partnership was, dated June 14, 1952. Counsel for the appellant rightly pointed out that on the erroneous assumption that the partnership deed constituting the Ferozepore firm was executed after December 5, 1952, when the assessee firm was constituted, the High Court held that there was a sub-partnership between Goasin Chander Bhan and the other partners in the Ferozepore firm in respect of the share of Gosain Chander bhan in the assessee firm. Counsel then contended that, in law a sub-partnership can be entered only after the partnership is constituted, and, therefore, there, was no sub-partnership between the members of the Ferozepore firm in respect of the share of Gosain Chander Bhan in the assessee firm. In support of this contention, counsel relied on the following passage in Lindley on Partnership, 12th Edn., pp. 99-100:"A sub-partnership is, as it were, a partnership within a partnership; it presupposes the existence of a partnership to which it is itself subordinate."We need not enquire into the correctness of counsels assumption that this passage is an authority for the proposition that there cannot be an agreement of sub-partnership in anticipation of the head partnership coming into existence. But the question whether the relevant clause in the deed, dated June 14, 1952, created a sub-partnership in respect of the share of Chander Bhan in the assessee firm having regard to the fact that this deed was executed before the assessee firm came to be constituted is not material for the purpose of the case, and need not be decided. The clause regulated the relationship of the partners of the Ferozepore firm inter se, and created a partnership between them in respect of the share of Gosain Chander Bhan in the assessee firm. Assuming, without deciding, that this partnership was not, strictly speaking, a sub-partnership, it does not follow that the partners of the Ferozepre firm became partners in the assessee firm. By reason of this clause vis-a-vis the partners of the Ferozepore firm, Gosain Chander Bhan could be regarded as their representative in the assessee firm; nevertheless, they were strangers to the contract of partnership constituting the assessee firm, and did not become partners therein. In Commissioner of Income-tax v. Bagyalakshmi and Co., 1965-55 ITR 660 at p. 664: (AIR 1965 SC 1708 at p. 1710), Subha Rao J. observed:"A contract of partnership has no concern with the obligation of the partners to others in respect of their shares of profit in the partnership. It only regulates the rights and liabilities of the partners. A partner may be the karta of a joint Hindu family; he may be a trustee; he may enter into a sub-partnership with others; he may, under an agreement, express or implied, be the representative of a group of persons, he may be a benamidar for another. In all such cases he occupies a dual position. Qua the partnership, he functions in his personal capacity, qua the third parties, in his representative capacity. The third parties, whom one of the partners represents, cannot enforce their rights against the other partners nor the other partners can do so against the said third parties. Their right is only to a share in the profits of their partner-representative in accordance with the terms of the agreement, as the case may be."10. Quite plainly, the relevant clause in the deed, dated June 14, 1952 was not part of the agreement of partnership, dated December 5, 1952, constituting the assessee firm, and did not affect the right of the partners of the assessee firm, to claim registration of the assessee firm under S. 26-A. It is not possible to say that there are no materials on the record to support the finding that Gosain Chander Bhan was a partner of the assessee firm in his individual capacity and not as representing the Ferozepore firm. The question whether there was a sub-partnership between the members of the Ferozepore firm in respect of the share of Gosain Chander Bhan is not material because assuming that there was no sub-partnership, the members of the Ferozepore firm did not become partners in the assessee firm by virtue of the relevant clause in the deed, dated June 14, 1952 or otherwise. We are, therefore, satisfied that no substantial question of law arises out of the order of the Appellate Tribunal.11. Counsel for the appellant submitted that as a question of law arose out of the order of the Tribunal, the High court was bound to call for a statement of case. | 1[ds]The deed, dated December5, 1952 clearly stated that Gosain Chander Bhan and 18 other parties to the deed were the partners of the assessee firm. On the face of the deed, it does not appear that Gosain Chander Bhan was a partner in a representative capacity on behalf of the Ferozepore firm, or that the Ferozepore firm was the partner in the assessee firm. On the material on the record, the Appellate Tribunal was entitled to come to the conclusion that Gosain Chander Bhan and not the Ferozepore firm was the partner in the assessee firm.8. The statements of Harbhajan Lal and other partners of the assessee firm do not carry the matter any further. In the statement dated January 30, 1954, Harbhajan Lal clearly stated that the assessee firm consisted of 14 partners as mentioned in the deed of partnership, dated December 5, 1952. It is true that he stated also that Gosain Chander Bhan was a partner not in his individual capacity but on behalf of the Ferozepore firm, but this statement must be read in the background of the clause in the partnership deed constituting the Ferozepore firm, under which the partners of the Ferozepore firm were entitled to the profits and liable for the losses in the share of Gosain Chander Bhan in the assessee firm. The statement fairly read shows that only the 14 persons mentioned in the deed, dated December 5, 1952, were the partners in the assessee firm. If the 8 partners of the Ferozepore firm were partners in the assessee firm, Harbhajan Lal could not have stated that the number of the partners of the assessee firm was 14for the appellant rightly pointed out that on the erroneous assumption that the partnership deed constituting the Ferozepore firm was executed after December 5, 1952, when the assessee firm was constituted, the High Court held that there was a sub-partnership between Goasin Chander Bhan and the other partners in the Ferozepore firm in respect of the share of Gosain Chander bhan in the assessee firm. Counsel then contended that, in law a sub-partnership can be entered only after the partnership is constituted, and, therefore, there, was no sub-partnership between the members of the Ferozepore firm in respect of the share of Gosain Chander Bhan in the assessee firm. In support of this contention, counsel relied on the following passage in Lindley on Partnership, 12thclause regulated the relationship of the partners of the Ferozepore firm inter se, and created a partnership between them in respect of the share of Gosain Chander Bhan in the assessee firm. Assuming, without deciding, that this partnership was not, strictly speaking, a sub-partnership, it does not follow that the partners of the Ferozepre firm became partners in the assessee firm. By reason of this clause vis-a-vis the partners of the Ferozepore firm, Gosain Chander Bhan could be regarded as their representative in the assessee firm; nevertheless, they were strangers to the contract of partnership constituting the assessee firm, and did not become partnerse need not enquire into the correctness of counsels assumption that this passage is an authority for the proposition that there cannot be an agreement ofin anticipation of the head partnership coming into existence. But the question whether the relevant clause in the deed, dated June 14, 1952, created ain respect of the share of Chander Bhan in the assessee firm having regard to the fact that this deed was executed before the assessee firm came to be constituted is not material for the purpose of the case, and need not beQuite plainly, the relevant clause in the deed, dated June 14, 1952 was not part of the agreement of partnership, dated December 5, 1952, constituting the assessee firm, and did not affect the right of the partners of the assessee firm, to claim registration of the assessee firm under S.It is not possible to say that there are no materials on the record to support the finding that Gosain Chander Bhan was a partner of the assessee firm in his individual capacity and not as representing the Ferozepore firm. The question whether there was abetween the members of the Ferozepore firm in respect of the share of Gosain Chander Bhan is not material because assuming that there was nothe members of the Ferozepore firm did not become partners in the assessee firm by virtue of the relevant clause in the deed, dated June 14, 1952 or otherwise. We are, therefore, satisfied that no substantial question of law arises out of the order of the Appellate Tribunal. | 1 | 2,982 | 830 | ### Instruction:
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1817, Subba Rao, J. observed:"A partner of a firm can certainly secure his capital from any source or surrender his profits to his sub-partner or any other person. Those facts cannot conceivably convert a valid partnership into a bogus one."8. The statements of Harbhajan Lal and other partners of the assessee firm do not carry the matter any further. In the statement dated January 30, 1954, Harbhajan Lal clearly stated that the assessee firm consisted of 14 partners as mentioned in the deed of partnership, dated December 5, 1952. It is true that he stated also that Gosain Chander Bhan was a partner not in his individual capacity but on behalf of the Ferozepore firm, but this statement must be read in the background of the clause in the partnership deed constituting the Ferozepore firm, under which the partners of the Ferozepore firm were entitled to the profits and liable for the losses in the share of Gosain Chander Bhan in the assessee firm. The statement fairly read shows that only the 14 persons mentioned in the deed, dated December 5, 1952, were the partners in the assessee firm. If the 8 partners of the Ferozepore firm were partners in the assessee firm, Harbhajan Lal could not have stated that the number of the partners of the assessee firm was 14 only.9. Counsel for the appellant pointed out that the High Court erroneously assumed that the partnership deed constituting the Ferozepore firm was, dated June 14, 1954, whereas, in fact, this partnership was, dated June 14, 1952. Counsel for the appellant rightly pointed out that on the erroneous assumption that the partnership deed constituting the Ferozepore firm was executed after December 5, 1952, when the assessee firm was constituted, the High Court held that there was a sub-partnership between Goasin Chander Bhan and the other partners in the Ferozepore firm in respect of the share of Gosain Chander bhan in the assessee firm. Counsel then contended that, in law a sub-partnership can be entered only after the partnership is constituted, and, therefore, there, was no sub-partnership between the members of the Ferozepore firm in respect of the share of Gosain Chander Bhan in the assessee firm. In support of this contention, counsel relied on the following passage in Lindley on Partnership, 12th Edn., pp. 99-100:"A sub-partnership is, as it were, a partnership within a partnership; it presupposes the existence of a partnership to which it is itself subordinate."We need not enquire into the correctness of counsels assumption that this passage is an authority for the proposition that there cannot be an agreement of sub-partnership in anticipation of the head partnership coming into existence. But the question whether the relevant clause in the deed, dated June 14, 1952, created a sub-partnership in respect of the share of Chander Bhan in the assessee firm having regard to the fact that this deed was executed before the assessee firm came to be constituted is not material for the purpose of the case, and need not be decided. The clause regulated the relationship of the partners of the Ferozepore firm inter se, and created a partnership between them in respect of the share of Gosain Chander Bhan in the assessee firm. Assuming, without deciding, that this partnership was not, strictly speaking, a sub-partnership, it does not follow that the partners of the Ferozepre firm became partners in the assessee firm. By reason of this clause vis-a-vis the partners of the Ferozepore firm, Gosain Chander Bhan could be regarded as their representative in the assessee firm; nevertheless, they were strangers to the contract of partnership constituting the assessee firm, and did not become partners therein. In Commissioner of Income-tax v. Bagyalakshmi and Co., 1965-55 ITR 660 at p. 664: (AIR 1965 SC 1708 at p. 1710), Subha Rao J. observed:"A contract of partnership has no concern with the obligation of the partners to others in respect of their shares of profit in the partnership. It only regulates the rights and liabilities of the partners. A partner may be the karta of a joint Hindu family; he may be a trustee; he may enter into a sub-partnership with others; he may, under an agreement, express or implied, be the representative of a group of persons, he may be a benamidar for another. In all such cases he occupies a dual position. Qua the partnership, he functions in his personal capacity, qua the third parties, in his representative capacity. The third parties, whom one of the partners represents, cannot enforce their rights against the other partners nor the other partners can do so against the said third parties. Their right is only to a share in the profits of their partner-representative in accordance with the terms of the agreement, as the case may be."10. Quite plainly, the relevant clause in the deed, dated June 14, 1952 was not part of the agreement of partnership, dated December 5, 1952, constituting the assessee firm, and did not affect the right of the partners of the assessee firm, to claim registration of the assessee firm under S. 26-A. It is not possible to say that there are no materials on the record to support the finding that Gosain Chander Bhan was a partner of the assessee firm in his individual capacity and not as representing the Ferozepore firm. The question whether there was a sub-partnership between the members of the Ferozepore firm in respect of the share of Gosain Chander Bhan is not material because assuming that there was no sub-partnership, the members of the Ferozepore firm did not become partners in the assessee firm by virtue of the relevant clause in the deed, dated June 14, 1952 or otherwise. We are, therefore, satisfied that no substantial question of law arises out of the order of the Appellate Tribunal.11. Counsel for the appellant submitted that as a question of law arose out of the order of the Tribunal, the High court was bound to call for a statement of case.
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### Explanation:
The deed, dated December5, 1952 clearly stated that Gosain Chander Bhan and 18 other parties to the deed were the partners of the assessee firm. On the face of the deed, it does not appear that Gosain Chander Bhan was a partner in a representative capacity on behalf of the Ferozepore firm, or that the Ferozepore firm was the partner in the assessee firm. On the material on the record, the Appellate Tribunal was entitled to come to the conclusion that Gosain Chander Bhan and not the Ferozepore firm was the partner in the assessee firm.8. The statements of Harbhajan Lal and other partners of the assessee firm do not carry the matter any further. In the statement dated January 30, 1954, Harbhajan Lal clearly stated that the assessee firm consisted of 14 partners as mentioned in the deed of partnership, dated December 5, 1952. It is true that he stated also that Gosain Chander Bhan was a partner not in his individual capacity but on behalf of the Ferozepore firm, but this statement must be read in the background of the clause in the partnership deed constituting the Ferozepore firm, under which the partners of the Ferozepore firm were entitled to the profits and liable for the losses in the share of Gosain Chander Bhan in the assessee firm. The statement fairly read shows that only the 14 persons mentioned in the deed, dated December 5, 1952, were the partners in the assessee firm. If the 8 partners of the Ferozepore firm were partners in the assessee firm, Harbhajan Lal could not have stated that the number of the partners of the assessee firm was 14for the appellant rightly pointed out that on the erroneous assumption that the partnership deed constituting the Ferozepore firm was executed after December 5, 1952, when the assessee firm was constituted, the High Court held that there was a sub-partnership between Goasin Chander Bhan and the other partners in the Ferozepore firm in respect of the share of Gosain Chander bhan in the assessee firm. Counsel then contended that, in law a sub-partnership can be entered only after the partnership is constituted, and, therefore, there, was no sub-partnership between the members of the Ferozepore firm in respect of the share of Gosain Chander Bhan in the assessee firm. In support of this contention, counsel relied on the following passage in Lindley on Partnership, 12thclause regulated the relationship of the partners of the Ferozepore firm inter se, and created a partnership between them in respect of the share of Gosain Chander Bhan in the assessee firm. Assuming, without deciding, that this partnership was not, strictly speaking, a sub-partnership, it does not follow that the partners of the Ferozepre firm became partners in the assessee firm. By reason of this clause vis-a-vis the partners of the Ferozepore firm, Gosain Chander Bhan could be regarded as their representative in the assessee firm; nevertheless, they were strangers to the contract of partnership constituting the assessee firm, and did not become partnerse need not enquire into the correctness of counsels assumption that this passage is an authority for the proposition that there cannot be an agreement ofin anticipation of the head partnership coming into existence. But the question whether the relevant clause in the deed, dated June 14, 1952, created ain respect of the share of Chander Bhan in the assessee firm having regard to the fact that this deed was executed before the assessee firm came to be constituted is not material for the purpose of the case, and need not beQuite plainly, the relevant clause in the deed, dated June 14, 1952 was not part of the agreement of partnership, dated December 5, 1952, constituting the assessee firm, and did not affect the right of the partners of the assessee firm, to claim registration of the assessee firm under S.It is not possible to say that there are no materials on the record to support the finding that Gosain Chander Bhan was a partner of the assessee firm in his individual capacity and not as representing the Ferozepore firm. The question whether there was abetween the members of the Ferozepore firm in respect of the share of Gosain Chander Bhan is not material because assuming that there was nothe members of the Ferozepore firm did not become partners in the assessee firm by virtue of the relevant clause in the deed, dated June 14, 1952 or otherwise. We are, therefore, satisfied that no substantial question of law arises out of the order of the Appellate Tribunal.
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JYPD Scheme Welfare Trust Vs. The Chief Officer, M.H.A.D. and Ors | claimed the allotment are required to be considered as per the fresh directives and guidelines which would govern the exercise of powers of Regulation 16. It is submitted that, therefore, the appellant (original writ petitioner) cannot claim any right of allotment under the original Regulation 16. It is submitted that, therefore, there are changed circumstances in view of the subsequent decision of the High Court in Writ Petition No. 75 of 2004. 5.2 It is further submitted by Shri Shyam Divan, learned Counsel appearing on behalf of the Respondent No. 4 that in fact thereafter there is a lease in favour of Respondent No. 4 initially for a period of 15 years and thereafter the same has been extended for a further period of 15 years. It is submitted that under the lease in favour of Respondent No. 4, Respondent No. 4 has deposited Rs. Rs. 1,38,61,046/-. It is submitted that not only that thereafter Respondent No. 4 has fully made improvements in the land and the plot in question and the same is being used by the school children of the locality and even by the other people of the locality. It is submitted that Respondent No. 4 has strictly complied with the consent terms submitted before the High Court in the aforesaid three writ petitions and has strictly complied with the terms and conditions of the lease and nobody has raised any grievance. It is submitted, in the present case, the lease in favour of Respondent No. 4 is not under challenge. It is submitted that the appellant (the original writ petitioner) was very much aware of the earlier allotment in favour of Respondent No. 4 and the subsequent lease in Respondent No. 4 from the very beginning, still the lease in favour of Respondent No. 4 has not been challenged. Therefore, it is prayed to dismiss the present appeal. 6. Heard learned Counsel appearing on behalf of the respective parties at length. At the very outset, it is required to be noted that the appellant herein applied for allotment of plot in issue under Regulation 16 of 1982 Regulation. It is required to be noted that at the time when the appellant (the original writ petitioner) applied and in fact was allotted the plot in issue in the month of February, 2004 there were different guidelines and the directives in force. However, Regulation 16 itself was under challenge before the High Court in Writ Petition No. 75 of 2004 on the ground that Regulation 16 confers uncontrolled, arbitrary as well as sweeping powers on the Government to allot the plots which are part of housing schemes implemented by MHADA, to outsiders and third parties. That, in between, the State as well as MHADA came out with the fresh directives and guidelines which would govern exercise of powers under Regulation 16. Therefore, the High Court by judgment and order dated 15.09.2004 did not set aside Regulation 16, however, the High Court approved the guidelines. Therefore, thereafter the powers under Regulation 16 are to be exercised as per the fresh directives and guidelines which came to be approved by the High Court. Therefore, the guidelines under which the powers were exercised under Regulation 16, at the time when the appellant applied and claimed the right of allotment is not in existence. A fresh directives and guidelines would govern the exercise of powers under Regulation 16, which came to be approved by the High Court, are to be applied. 7. It is true that when the order of cancellation dated 24.08.2004 was passed, the same was solely on the ground that the appellant- Trust did not submit the relevant documents to prove its eligibility and on no other ground. The High Court considered the grounds stated in the counter affidavit and did not interfere with the order of cancellation dated 24.08.2004. The appellant would be justified in making the grievance that the High Court was not justified in considering the grounds stated in the counter affidavit which were not the basis for passing the original order of cancellation. However, at the same time, subsequent development and grant of the lease in favour of Respondent No. 4 initially for a period of 15 years and thereafter for a further period of 15 years and the lease in favour of Respondent No. 4 is not challenged, we do not propose to interfere with the impugned judgment and order passed by the High Court. It is required to be noted that there is a lease in favour of Respondent No. 4 since 2004-2005. That Respondent No. 4 had deposited/paid Rs. 1,38,61,046/-. It is also required to be noted that the consent terms recorded by the High Court in Writ Petition Nos. 9164 of 2005, 1978 of 2007 and 1489 of 2005, on the basis of which the High Court disposed of the aforesaid three writ petitions in terms of the consent terms and on the basis of which the lease of plot in issue in favour of Respondent No.4, the lease in favour of Respondent No. 4 has not been challenged. The lease granted to Respondent No. 4 was pursuant to the order passed by the High Court in the aforesaid three writ petitions. It is true that the appellant- Trust was not a party to the said writ petitions. However, still, either the order passed by the High Court in the aforesaid three writ petitions and even the lease granted in favour of Respondent No. 4 was/is required to be challenged before the competent Court of Law. 8. The submission on behalf of the appellant that as per the order passed by this Court dated 10.05.2005, the arrangement, if any, with Respondent No. 4 would be subject to the result of present writ petition and, therefore, the appellant is not required to challenge the lease in favour of Respondent No. 4, cannot be accepted. In the present appeal, there is no specific challenge to the lease in favour of Respondent No. 4. | 1[ds]6. Heard learned Counsel appearing on behalf of the respective parties at length. At the very outset, it is required to be noted that the appellant herein applied for allotment of plot in issue under Regulation 16 of 1982 Regulation. It is required to be noted that at the time when the appellant (the original writ petitioner) applied and in fact was allotted the plot in issue in the month of February, 2004 there were different guidelines and the directives in force. However, Regulation 16 itself was under challenge before the High Court in Writ Petition No. 75 of 2004 on the ground that Regulation 16 confers uncontrolled, arbitrary as well as sweeping powers on the Government to allot the plots which are part of housing schemes implemented by MHADA, to outsiders and third parties. That, in between, the State as well as MHADA came out with the fresh directives and guidelines which would govern exercise of powers under Regulation 16. Therefore, the High Court by judgment and order dated 15.09.2004 did not set aside Regulation 16, however, the High Court approved the guidelines. Therefore, thereafter the powers under Regulation 16 are to be exercised as per the fresh directives and guidelines which came to be approved by the High Court. Therefore, the guidelines under which the powers were exercised under Regulation 16, at the time when the appellant applied and claimed the right of allotment is not in existence. A fresh directives and guidelines would govern the exercise of powers under Regulation 16, which came to be approved by the High Court, are to be applied.It is true that when the order of cancellation dated 24.08.2004 was passed, the same was solely on the ground that the appellant- Trust did not submit the relevant documents to prove its eligibility and on no other ground. The High Court considered the grounds stated in the counter affidavit and did not interfere with the order of cancellation dated 24.08.2004. The appellant would be justified in making the grievance that the High Court was not justified in considering the grounds stated in the counter affidavit which were not the basis for passing the original order of cancellation. However, at the same time, subsequent development and grant of the lease in favour of Respondent No. 4 initially for a period of 15 years and thereafter for a further period of 15 years and the lease in favour of Respondent No. 4 is not challenged, we do not propose to interfere with the impugned judgment and order passed by the High Court. It is required to be noted that there is a lease in favour of Respondent No. 4 since 2004-2005. That Respondent No. 4 had deposited/paid Rs. 1,38,61,046/-. It is also required to be noted that the consent terms recorded by the High Court in Writ Petition Nos. 9164 of 2005, 1978 of 2007 and 1489 of 2005, on the basis of which the High Court disposed of the aforesaid three writ petitions in terms of the consent terms and on the basis of which the lease of plot in issue in favour of Respondent No.4, the lease in favour of Respondent No. 4 has not been challenged. The lease granted to Respondent No. 4 was pursuant to the order passed by the High Court in the aforesaid three writ petitions. It is true that the appellant- Trust was not a party to the said writ petitions. However, still, either the order passed by the High Court in the aforesaid three writ petitions and even the lease granted in favour of Respondent No. 4 was/is required to be challenged before the competent Court of Law.The submission on behalf of the appellant that as per the order passed by this Court dated 10.05.2005, the arrangement, if any, with Respondent No. 4 would be subject to the result of present writ petition and, therefore, the appellant is not required to challenge the lease in favour of Respondent No. 4, cannot be accepted. In the present appeal, there is no specific challenge to the lease in favour of Respondent No. 4. | 1 | 4,446 | 755 | ### Instruction:
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claimed the allotment are required to be considered as per the fresh directives and guidelines which would govern the exercise of powers of Regulation 16. It is submitted that, therefore, the appellant (original writ petitioner) cannot claim any right of allotment under the original Regulation 16. It is submitted that, therefore, there are changed circumstances in view of the subsequent decision of the High Court in Writ Petition No. 75 of 2004. 5.2 It is further submitted by Shri Shyam Divan, learned Counsel appearing on behalf of the Respondent No. 4 that in fact thereafter there is a lease in favour of Respondent No. 4 initially for a period of 15 years and thereafter the same has been extended for a further period of 15 years. It is submitted that under the lease in favour of Respondent No. 4, Respondent No. 4 has deposited Rs. Rs. 1,38,61,046/-. It is submitted that not only that thereafter Respondent No. 4 has fully made improvements in the land and the plot in question and the same is being used by the school children of the locality and even by the other people of the locality. It is submitted that Respondent No. 4 has strictly complied with the consent terms submitted before the High Court in the aforesaid three writ petitions and has strictly complied with the terms and conditions of the lease and nobody has raised any grievance. It is submitted, in the present case, the lease in favour of Respondent No. 4 is not under challenge. It is submitted that the appellant (the original writ petitioner) was very much aware of the earlier allotment in favour of Respondent No. 4 and the subsequent lease in Respondent No. 4 from the very beginning, still the lease in favour of Respondent No. 4 has not been challenged. Therefore, it is prayed to dismiss the present appeal. 6. Heard learned Counsel appearing on behalf of the respective parties at length. At the very outset, it is required to be noted that the appellant herein applied for allotment of plot in issue under Regulation 16 of 1982 Regulation. It is required to be noted that at the time when the appellant (the original writ petitioner) applied and in fact was allotted the plot in issue in the month of February, 2004 there were different guidelines and the directives in force. However, Regulation 16 itself was under challenge before the High Court in Writ Petition No. 75 of 2004 on the ground that Regulation 16 confers uncontrolled, arbitrary as well as sweeping powers on the Government to allot the plots which are part of housing schemes implemented by MHADA, to outsiders and third parties. That, in between, the State as well as MHADA came out with the fresh directives and guidelines which would govern exercise of powers under Regulation 16. Therefore, the High Court by judgment and order dated 15.09.2004 did not set aside Regulation 16, however, the High Court approved the guidelines. Therefore, thereafter the powers under Regulation 16 are to be exercised as per the fresh directives and guidelines which came to be approved by the High Court. Therefore, the guidelines under which the powers were exercised under Regulation 16, at the time when the appellant applied and claimed the right of allotment is not in existence. A fresh directives and guidelines would govern the exercise of powers under Regulation 16, which came to be approved by the High Court, are to be applied. 7. It is true that when the order of cancellation dated 24.08.2004 was passed, the same was solely on the ground that the appellant- Trust did not submit the relevant documents to prove its eligibility and on no other ground. The High Court considered the grounds stated in the counter affidavit and did not interfere with the order of cancellation dated 24.08.2004. The appellant would be justified in making the grievance that the High Court was not justified in considering the grounds stated in the counter affidavit which were not the basis for passing the original order of cancellation. However, at the same time, subsequent development and grant of the lease in favour of Respondent No. 4 initially for a period of 15 years and thereafter for a further period of 15 years and the lease in favour of Respondent No. 4 is not challenged, we do not propose to interfere with the impugned judgment and order passed by the High Court. It is required to be noted that there is a lease in favour of Respondent No. 4 since 2004-2005. That Respondent No. 4 had deposited/paid Rs. 1,38,61,046/-. It is also required to be noted that the consent terms recorded by the High Court in Writ Petition Nos. 9164 of 2005, 1978 of 2007 and 1489 of 2005, on the basis of which the High Court disposed of the aforesaid three writ petitions in terms of the consent terms and on the basis of which the lease of plot in issue in favour of Respondent No.4, the lease in favour of Respondent No. 4 has not been challenged. The lease granted to Respondent No. 4 was pursuant to the order passed by the High Court in the aforesaid three writ petitions. It is true that the appellant- Trust was not a party to the said writ petitions. However, still, either the order passed by the High Court in the aforesaid three writ petitions and even the lease granted in favour of Respondent No. 4 was/is required to be challenged before the competent Court of Law. 8. The submission on behalf of the appellant that as per the order passed by this Court dated 10.05.2005, the arrangement, if any, with Respondent No. 4 would be subject to the result of present writ petition and, therefore, the appellant is not required to challenge the lease in favour of Respondent No. 4, cannot be accepted. In the present appeal, there is no specific challenge to the lease in favour of Respondent No. 4.
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### Explanation:
6. Heard learned Counsel appearing on behalf of the respective parties at length. At the very outset, it is required to be noted that the appellant herein applied for allotment of plot in issue under Regulation 16 of 1982 Regulation. It is required to be noted that at the time when the appellant (the original writ petitioner) applied and in fact was allotted the plot in issue in the month of February, 2004 there were different guidelines and the directives in force. However, Regulation 16 itself was under challenge before the High Court in Writ Petition No. 75 of 2004 on the ground that Regulation 16 confers uncontrolled, arbitrary as well as sweeping powers on the Government to allot the plots which are part of housing schemes implemented by MHADA, to outsiders and third parties. That, in between, the State as well as MHADA came out with the fresh directives and guidelines which would govern exercise of powers under Regulation 16. Therefore, the High Court by judgment and order dated 15.09.2004 did not set aside Regulation 16, however, the High Court approved the guidelines. Therefore, thereafter the powers under Regulation 16 are to be exercised as per the fresh directives and guidelines which came to be approved by the High Court. Therefore, the guidelines under which the powers were exercised under Regulation 16, at the time when the appellant applied and claimed the right of allotment is not in existence. A fresh directives and guidelines would govern the exercise of powers under Regulation 16, which came to be approved by the High Court, are to be applied.It is true that when the order of cancellation dated 24.08.2004 was passed, the same was solely on the ground that the appellant- Trust did not submit the relevant documents to prove its eligibility and on no other ground. The High Court considered the grounds stated in the counter affidavit and did not interfere with the order of cancellation dated 24.08.2004. The appellant would be justified in making the grievance that the High Court was not justified in considering the grounds stated in the counter affidavit which were not the basis for passing the original order of cancellation. However, at the same time, subsequent development and grant of the lease in favour of Respondent No. 4 initially for a period of 15 years and thereafter for a further period of 15 years and the lease in favour of Respondent No. 4 is not challenged, we do not propose to interfere with the impugned judgment and order passed by the High Court. It is required to be noted that there is a lease in favour of Respondent No. 4 since 2004-2005. That Respondent No. 4 had deposited/paid Rs. 1,38,61,046/-. It is also required to be noted that the consent terms recorded by the High Court in Writ Petition Nos. 9164 of 2005, 1978 of 2007 and 1489 of 2005, on the basis of which the High Court disposed of the aforesaid three writ petitions in terms of the consent terms and on the basis of which the lease of plot in issue in favour of Respondent No.4, the lease in favour of Respondent No. 4 has not been challenged. The lease granted to Respondent No. 4 was pursuant to the order passed by the High Court in the aforesaid three writ petitions. It is true that the appellant- Trust was not a party to the said writ petitions. However, still, either the order passed by the High Court in the aforesaid three writ petitions and even the lease granted in favour of Respondent No. 4 was/is required to be challenged before the competent Court of Law.The submission on behalf of the appellant that as per the order passed by this Court dated 10.05.2005, the arrangement, if any, with Respondent No. 4 would be subject to the result of present writ petition and, therefore, the appellant is not required to challenge the lease in favour of Respondent No. 4, cannot be accepted. In the present appeal, there is no specific challenge to the lease in favour of Respondent No. 4.
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Sockieting Tea Company Private Limited Vs. Under Secretary To The Government of Assam & Others | Grover, J. 1. This is an appeal by Special Leave from the Judgment of the Assam and Nagaland High Court. 2. The appellant is an incorporated company. It has a tea garden by the name of Dukhinhongra Tea Estate. This tea estate established a market on its own private land. This market is stated to have been functioning for about 100 years. When the market was under the administrative control of the Local Board, the appellant used to pay Rs. 1,000/- per year as licence fee. In 1959, The Assam Panchayat Act, 1959 came into force. The administration of this market vested in what is called Anchalik Panchayat constituted under the provisions of the Act. The Golghat East Anchalik Panchayat in a meeting held on the May 23, 1966 proposed an increase of the tax and the licence fee and decided that the licence fee should be raised to Rs. 7,000/- per annum. That proposal was accepted by the Government w.e.f. the financial year 1967. In the order itself, it was stated that the revised rate of licence fee shall be Rs. 7,000/-. 3. The appellant filed a petition under Article 226 of the Constitution in the High Court. In the Writ Petition the main point which appears to have been raised is that the licence fee of Rs. 7,000/- per annum was not related to the services rendered by the local authority. The authority of the Panchayat to levy tax or fee in respect of a market was also challenged. 4. From the judgment of the High Court it seems that the only point that was argued was that the imposition of licence fee could not be made without publication under Section 78 (4) of the Act. The High Court found no merit in that submission. 5. Before us, Mr. Mukherjee, Learned Counsel for the appellant, has sought to raise certain points which were not raised either in the Writ Petition or in the High Court or even in the petition for Special Leave to this Court. He has invited our attention to the statutory provisions under which the tax could be levied by the Anchalik Panchayat. Firstly, S. 75 may be referred to. It gives powers of taxation to the Gaon Panchayat and the Gaon Panchayat could levy a tax on a house, supply of water, etc. a cess or fee on registration of cattle etc. on licence for starting tea stalls, hotels, etc. and for private hats as prescribed. Section 79 provides : "In the areas which do not fall within the jurisdiction of any Gaon Panchayat, the Anchalik Panchayat shall exercise the powers given to the Gaon Panchayat in S. 78". Section 78, the marginal heading of which is "Powers of Gaon Panchayat to prohibit use of unlicensed markets" provides in sub-section (2) that "on the issue of order under sub-section (1) the Gaon Panchayat may grant within the local limits of its jurisdiction a licence for the use of any land as a market and impose an annual tax thereon and such conditions as may be prescribed by rules." Section 76 gives the powers of taxation of Anchalik Panchayat but there is no mention about levying a tax on a hat or market in that section. In exercise of the powers conferred by Section 160 of the Act, the Assam Panchayat (Financial) Rules, 1960 were promulgated. Rule 15 says that the maximum rates for the following taxes, cess, rate, fees, etc., under Section 76 of the Act shall be as follows : (1) x x x x (2) x x x x (3) x x x x (4) x x x x (5) x x x x "(6) Tax on Private Market falling in areas directly administered at an annual rate not exceeding Rs. 7,000/- per annum." 6. The points, which Mr. Mukherjee has now sought to raise, are : (1) That rule 15 only gives rates and provides for the levy of taxes which are authorised by Section 76. In the present case, the Anchalik Panchayat could not have levied any tax under Section 76 because no such power is conferred on it by that section in respect of a Panchayat. It is only under the provisions of Ss. 78 and 79 that any tax can be levied if at all on a market. It is contended, therefore, that the entire levy was misconceived and the maximum rate of Rs. 7,000/- per annum could be imposed only under Rule 15 (6) which on the face of it is not applicable to the present case. (2) If the amount of Rs. 7,000/- is levied by way of licence fee, there is no correlation between the services rendered by the Anchalik Panchayat and the amount of Rs. 7,000/-. 7.Now none of these points was raised at any stage before as has already been observed and it is not possible in this petition under Art. 136 of the Constitution to allow new points to be raised for which no foundation was laid even in the Writ Petition. The only point which was argued has already been mentioned about non-publication as required by S. 78 (4) of the Act. Mr. Mukherjee has not been able to persuade us that there is any merit in that point. | 0[ds]6. The points, which Mr. Mukherjee has now sought to raise, are :(1) That rule 15 only gives rates and provides for the levy of taxes which are authorised by Section 76. In the present case, the Anchalik Panchayat could not have levied any tax under Section 76 because no such power is conferred on it by that section in respect of a Panchayat. It is only under the provisions of Ss. 78 and 79 that any tax can be levied if at all on a market. It is contended, therefore, that the entire levy was misconceived and the maximum rate of Rs. 7,000/per annum could be imposed only under Rule 15 (6) which on the face of it is not applicable to the present case(2) If the amount of Rs. 7,000/7.Now none of these points was raised at any stage before as has already been observed and it is not possible in this petition under Art. 136 of the Constitution to allow new points to be raised for which no foundation was laid even in the Writ Petition. The only point which was argued has already been mentioned aboutn as required by S. 78 (4) of the Act. Mr. Mukherjee has not been able to persuade us that there is any merit in that point. | 0 | 997 | 246 | ### Instruction:
Evaluate the case proceeding to forecast the court's decision (1 for yes, 0 for no), and elucidate the reasoning behind this prediction with important textual evidence from the case.
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Grover, J. 1. This is an appeal by Special Leave from the Judgment of the Assam and Nagaland High Court. 2. The appellant is an incorporated company. It has a tea garden by the name of Dukhinhongra Tea Estate. This tea estate established a market on its own private land. This market is stated to have been functioning for about 100 years. When the market was under the administrative control of the Local Board, the appellant used to pay Rs. 1,000/- per year as licence fee. In 1959, The Assam Panchayat Act, 1959 came into force. The administration of this market vested in what is called Anchalik Panchayat constituted under the provisions of the Act. The Golghat East Anchalik Panchayat in a meeting held on the May 23, 1966 proposed an increase of the tax and the licence fee and decided that the licence fee should be raised to Rs. 7,000/- per annum. That proposal was accepted by the Government w.e.f. the financial year 1967. In the order itself, it was stated that the revised rate of licence fee shall be Rs. 7,000/-. 3. The appellant filed a petition under Article 226 of the Constitution in the High Court. In the Writ Petition the main point which appears to have been raised is that the licence fee of Rs. 7,000/- per annum was not related to the services rendered by the local authority. The authority of the Panchayat to levy tax or fee in respect of a market was also challenged. 4. From the judgment of the High Court it seems that the only point that was argued was that the imposition of licence fee could not be made without publication under Section 78 (4) of the Act. The High Court found no merit in that submission. 5. Before us, Mr. Mukherjee, Learned Counsel for the appellant, has sought to raise certain points which were not raised either in the Writ Petition or in the High Court or even in the petition for Special Leave to this Court. He has invited our attention to the statutory provisions under which the tax could be levied by the Anchalik Panchayat. Firstly, S. 75 may be referred to. It gives powers of taxation to the Gaon Panchayat and the Gaon Panchayat could levy a tax on a house, supply of water, etc. a cess or fee on registration of cattle etc. on licence for starting tea stalls, hotels, etc. and for private hats as prescribed. Section 79 provides : "In the areas which do not fall within the jurisdiction of any Gaon Panchayat, the Anchalik Panchayat shall exercise the powers given to the Gaon Panchayat in S. 78". Section 78, the marginal heading of which is "Powers of Gaon Panchayat to prohibit use of unlicensed markets" provides in sub-section (2) that "on the issue of order under sub-section (1) the Gaon Panchayat may grant within the local limits of its jurisdiction a licence for the use of any land as a market and impose an annual tax thereon and such conditions as may be prescribed by rules." Section 76 gives the powers of taxation of Anchalik Panchayat but there is no mention about levying a tax on a hat or market in that section. In exercise of the powers conferred by Section 160 of the Act, the Assam Panchayat (Financial) Rules, 1960 were promulgated. Rule 15 says that the maximum rates for the following taxes, cess, rate, fees, etc., under Section 76 of the Act shall be as follows : (1) x x x x (2) x x x x (3) x x x x (4) x x x x (5) x x x x "(6) Tax on Private Market falling in areas directly administered at an annual rate not exceeding Rs. 7,000/- per annum." 6. The points, which Mr. Mukherjee has now sought to raise, are : (1) That rule 15 only gives rates and provides for the levy of taxes which are authorised by Section 76. In the present case, the Anchalik Panchayat could not have levied any tax under Section 76 because no such power is conferred on it by that section in respect of a Panchayat. It is only under the provisions of Ss. 78 and 79 that any tax can be levied if at all on a market. It is contended, therefore, that the entire levy was misconceived and the maximum rate of Rs. 7,000/- per annum could be imposed only under Rule 15 (6) which on the face of it is not applicable to the present case. (2) If the amount of Rs. 7,000/- is levied by way of licence fee, there is no correlation between the services rendered by the Anchalik Panchayat and the amount of Rs. 7,000/-. 7.Now none of these points was raised at any stage before as has already been observed and it is not possible in this petition under Art. 136 of the Constitution to allow new points to be raised for which no foundation was laid even in the Writ Petition. The only point which was argued has already been mentioned about non-publication as required by S. 78 (4) of the Act. Mr. Mukherjee has not been able to persuade us that there is any merit in that point.
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6. The points, which Mr. Mukherjee has now sought to raise, are :(1) That rule 15 only gives rates and provides for the levy of taxes which are authorised by Section 76. In the present case, the Anchalik Panchayat could not have levied any tax under Section 76 because no such power is conferred on it by that section in respect of a Panchayat. It is only under the provisions of Ss. 78 and 79 that any tax can be levied if at all on a market. It is contended, therefore, that the entire levy was misconceived and the maximum rate of Rs. 7,000/per annum could be imposed only under Rule 15 (6) which on the face of it is not applicable to the present case(2) If the amount of Rs. 7,000/7.Now none of these points was raised at any stage before as has already been observed and it is not possible in this petition under Art. 136 of the Constitution to allow new points to be raised for which no foundation was laid even in the Writ Petition. The only point which was argued has already been mentioned aboutn as required by S. 78 (4) of the Act. Mr. Mukherjee has not been able to persuade us that there is any merit in that point.
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Man Mohan Tuli Vs. Municipal Corporation Of Delhi & Ors | to be intended for immediate export. In view of the interpretation we have placed on Section 178 it is obvious that the word ‘immediately? appearing in Rules 26 has to be libe-rally construed so as to imply a reasonable period and if the export is delayed the rules may apply if a reasonable explanation has been given. So far as rules regarding taking of passes, etc., at the barrier are concerned they would, of course, apply but subject to the conditions under which terminal tax can be imposed under Section 178 of the Act which is the main charging section. 23. The High Court appears to have placed some reliance on Amrit Banaspati Co. Ltd.v.The Union of India ILR 1973 (1) Delhi 237 in coming to the conclusion that in the instant case the Corporation was legally entitled to levy terminal tax. With due respect to the Judges of the High Court who decided the appeals, we would like to point out that the case just above referred to is clearly distinguishable from the present appeals. The most crucial fact in the Delhi decision was that the goods were being carried into the Union Territory of Delhi for the purpose of sale at Delhi. Thus, the case proceeded on the admitted position that the goods were carried from Ghaziabad into the Delhi territory for sale at Delhi. The final destination of the goods being Delhi, there can be no doubt that the Corporation was fully entitled to levy terminal tax on such goods. In this connection, the High Court observed as follows:?The petitioner-company was incorporated under the Companies Act, 1956, and it had its registered office at G.T. Road, Ghaziabad in the State of Uttar Pradesh....It has a factory, inter alia, at Ghaziabad for manufacturing the said Vanaspati products. In the course of its business, the company carried and still carries its products by railway and/or road into the Union Territory of Delhi from Ghaziabad for the purpose of sale at Delhi. The words ?shall be levied on all goods carried by railway or road? in Sub-section (1) shows clearly that the section imposes terminal tax on the carriage or movement of goods from outside the Union Territory of Delhi into the said Territory. In other words, the tax-able event is the carriage or movement of goods into the Union Terri-tory of Delhi.? 24. The observations last extracted must be understood in the light of the admitted facts in Amrit Banaspati Company?s case (supra). We are unable to accept that case as an authority for the proposition that even if the final destination of the goods was not Delhi but as the goods were carried through the territory of Delhi, they would still be eligible to terminal tax. In the impugned judgment the High Court, however, seems to have laid undue emphasis and special stress on the fact that the goods were carried into the Union territory of Delhi, the moment they passed through it even though the destination of the goods may be some other area. This appeared, accor-ding to the High Court, the real purport and intention of Section 178. We are, however, unable to agree with this view which is patently wrong and does not at all flow from the plain and unambiguous language of Section 178 of the Act nor does Section 178 warrant such and interpretation. Thus, our conclusions are as follows: (1) The High Court was wrong in interpreting Section 178 of the Act so as to justify imposition of terminal tax even on goods which merely passed through the territory of Delhi, although their destination is not Delhi but places beyond Delhi. (2) The High Court was wrong in holding that merely because the goods after having been unloaded in the godown of appel-lant Tuli are sorted, reloaded in different trucks and there-after pass through the territory of Delhi, they become exigible to terminal tax. (3) The High Court was wrong in interpretating Rule 26 literally and holding that exemption could be granted only if the goods are exported immediately which means within a very short time irrespective of any other consideration. In view of our interpretation of Section 178. Rule 26 must be interpreted in the light of the object of Section 178 and terminal tax can be leviable only if it is proved that the goods remained at the godown for an indefinite and unexplained period which could not be said to be reasonable as discussed by us in the circum-stances. (4) Where the goods are carried by trucks into the territory of Delhi and unloaded there and are also meant for Delhi and soon thereafter may be rebooked by the receiver of the goods to some other place, terminal tax would be levi-able because in this case there are two separate transactions. (1) by which the goods are meant for Delhi, and (2) by which after having reached and having been unloaded at Delhi they are rebooked and reloaded for some other place and which, therefore, is a fresh and different transaction. In such a case, terminal tax would be leviable at the entry point in the territory of Delhi 25. We might mention that the High Court while holding that termi-nal tax is exigible has construed the word ‘immediately? in Rule 26 literally and directed the Terminal Tax Officer to fix a reasonable time for unloading, sorting and reloading the goods which are meant for different destinations taking into consideration the quantity of the goods, the time for unloading, etc., and has further directed that reloading or transhipment should be done within a time to be fixed by the Terminal Tax Officer. Though the direc-tions given are correct but they will have to be construed in the light of the various factors which we have referred to. Rule 26 will have to be interpre-ted on the footing that Section 178 of the Act does not contemplate levy of termi-nal tax for goods meant for destinations other than Delhi. 26. | 1[ds]6. The crucial words which have to be interpreted are: ‘goods carried by railway or road into the Union Territory of Delhi from any place outside Delhi?. The contention of the appellant is that the words ‘goods carried into the Union Territory clearly indicate that the final destination of the goods must be Delhi and by virtue of this fact, the natural consequence would be that the goods should be carried from other places either by rail or by road into the territory of Delhi. This argument was reinforced by the words ‘terminal tax? used in Section 178 which imply that the terminus of the journey of the goods must be Delhi and only in that event the Corporation would be competent to levy a terminal tax. This argument was sought to be rebutted by the respon-dents on the ground that the words ‘carried into the Union Territory of Delhi? should be interpreted independently and literally so as to indicate that even if the goods passed through Delhi, the moment they entered into the territory of Delhi terminal tax became eligible. So far as this aspect of the argument is concerned, we are unable to accept the same because it is well settled that taxing statutes must be strictly interpreted giving every benefit of doubt to the tax payerThus, from a consideration of the cases cited above, the following propositions emerge:(1) Terminal tax and octroi are similar kinds of levies which are closely interlinked with (1) destination of the goods, (2) the user in the local area on arrival of the goods. Where the goods merely pass through a local area without being consumed therein the mere fact that the transport carrying the goods halt within the local area for transhipment or allied purposes would not justify the levy of either the terminal tax or octroi duty. This is because the halting of the goods is only for an incidental purpose to effectuate the journey of the goods to the final destination by unloading, sorting and reloading them at a particular place(2) There is a very thin margin of difference between a terminal tax and octroi. In the case of the former (terminal tax) the goods reach their final destination and their entry into the area of destination immediately attracts payment of terminal tax irres-pective of their user. In the case of octroi, however, the tax is levied on goods for their use and consumption(3) But at the same time, the goods while halting at a local area should leave for their destination within a reasonable time which may depend on circumstances of each case and if the goods are kept within the area for such a long and indefinite period that the purpose of reaching the final destination lying in a different area is frustrated or defeated, they may be exigible to terminal tax(4) Where the goods enter into a local area which is also the destination of the goods either temporarily or otherwise, the terminal tax would be leviable. For instance, if A consigns goods from Patna in Bihar to Delhi in the name of X and X after having received the goods at Delhi rebooks or reloads the same on a transport for Chandigarh in the name of Y, terminal tax would be leviable by the Corporation at Delhi because the destination of the goods in the first instance was Delhi and that by itself would attract the imposition of terminal tax. The fact that X rebooks them to Chandigarh would not make any difference because the act of rebooking by X at Delhi would constitute a fresh transaction by which the goods after having been carried into Delhi are further exported to Chandigarh. On the other hand, when there is one continuous journey of the goods from Patna to Chandigarh without any break, the final destination would be Chandigarh even though the goods may have to be halted in Delhi for the purpose of unloading, sorting and reloading and may have to be kept in Delhi for a reasonable time. In such a case terminal tax would not be exigibleWe have laid special stress on the circumstances under which the terminal tax becomes leviable if the halt or interruption of the goods at an intermediate point is for an indefinite and unexplained period. The answer to the question as to what would be a reasonable time for interruption of the goods or halting in the instant case at the godown of Tuli, will naturally depend on the special features or circumstances of each case, viz., the nature of the goods, the time taken in loading, sorting and unloading, the obstacles or difficulties which may be faced by the transporters and similar other factors. Normally, a time of two to three days or even a week should be sufficient to clear the goods for its journey to the ultimate destination. It may sometimes happen that goods may have to be kept in the godowns in the territory of Delhi for circumstances beyond the control of the consignee of the consignor,e.g., while the goods are lying in a godown at Delhi a dispute occurs between the concerned parties as a result of which an injunction is issued by a Court restraining the transporters from moving the goods. In considering what is reasonable time these circumstances would have to be taken into considerationIt was, however, argued before us that according to the Terminal Tax Rules framed under the Act, Rule 26 exempts goods from terminal tax if the same are exported immediately and are declared to be intended for immediate export. In view of the interpretation we have placed on Section 178 it is obvious that the word ‘immediately? appearing in Rules 26 has to be libe-rally construed so as to imply a reasonable period and if the export is delayed the rules may apply if a reasonable explanation has been given. So far as rules regarding taking of passes, etc., at the barrier are concerned they would, of course, apply but subject to the conditions under which terminal tax can be imposed under Section 178 of the Act which is the main charging sectionThe High Court appears to have placed some reliance on Amrit Banaspati Co. Ltd.v.The Union of India ILR 1973 (1) Delhi 237 in coming to the conclusion that in the instant case the Corporation was legally entitled to levy terminal tax. With due respect to the Judges of the High Court who decided the appeals, we would like to point out that the case just above referred to is clearly distinguishable from the present appeals. The most crucial fact in the Delhi decision was that the goods were being carried into the Union Territory of Delhi for the purpose of sale at Delhi. Thus, the case proceeded on the admitted position that the goods were carried from Ghaziabad into the Delhi territory for sale at DelhiWe might mention that the High Court while holding that termi-nal tax is exigible has construed the word ‘immediately? in Rule 26 literally and directed the Terminal Tax Officer to fix a reasonable time for unloading, sorting and reloading the goods which are meant for different destinations taking into consideration the quantity of the goods, the time for unloading, etc., and has further directed that reloading or transhipment should be done within a time to be fixed by the Terminal Tax Officer. Though the direc-tions given are correct but they will have to be construed in the light of the various factors which we have referred to. Rule 26 will have to be interpre-ted on the footing that Section 178 of the Act does not contemplate levy of termi-nal tax for goods meant for destinations other than Delhi. | 1 | 5,589 | 1,390 | ### Instruction:
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to be intended for immediate export. In view of the interpretation we have placed on Section 178 it is obvious that the word ‘immediately? appearing in Rules 26 has to be libe-rally construed so as to imply a reasonable period and if the export is delayed the rules may apply if a reasonable explanation has been given. So far as rules regarding taking of passes, etc., at the barrier are concerned they would, of course, apply but subject to the conditions under which terminal tax can be imposed under Section 178 of the Act which is the main charging section. 23. The High Court appears to have placed some reliance on Amrit Banaspati Co. Ltd.v.The Union of India ILR 1973 (1) Delhi 237 in coming to the conclusion that in the instant case the Corporation was legally entitled to levy terminal tax. With due respect to the Judges of the High Court who decided the appeals, we would like to point out that the case just above referred to is clearly distinguishable from the present appeals. The most crucial fact in the Delhi decision was that the goods were being carried into the Union Territory of Delhi for the purpose of sale at Delhi. Thus, the case proceeded on the admitted position that the goods were carried from Ghaziabad into the Delhi territory for sale at Delhi. The final destination of the goods being Delhi, there can be no doubt that the Corporation was fully entitled to levy terminal tax on such goods. In this connection, the High Court observed as follows:?The petitioner-company was incorporated under the Companies Act, 1956, and it had its registered office at G.T. Road, Ghaziabad in the State of Uttar Pradesh....It has a factory, inter alia, at Ghaziabad for manufacturing the said Vanaspati products. In the course of its business, the company carried and still carries its products by railway and/or road into the Union Territory of Delhi from Ghaziabad for the purpose of sale at Delhi. The words ?shall be levied on all goods carried by railway or road? in Sub-section (1) shows clearly that the section imposes terminal tax on the carriage or movement of goods from outside the Union Territory of Delhi into the said Territory. In other words, the tax-able event is the carriage or movement of goods into the Union Terri-tory of Delhi.? 24. The observations last extracted must be understood in the light of the admitted facts in Amrit Banaspati Company?s case (supra). We are unable to accept that case as an authority for the proposition that even if the final destination of the goods was not Delhi but as the goods were carried through the territory of Delhi, they would still be eligible to terminal tax. In the impugned judgment the High Court, however, seems to have laid undue emphasis and special stress on the fact that the goods were carried into the Union territory of Delhi, the moment they passed through it even though the destination of the goods may be some other area. This appeared, accor-ding to the High Court, the real purport and intention of Section 178. We are, however, unable to agree with this view which is patently wrong and does not at all flow from the plain and unambiguous language of Section 178 of the Act nor does Section 178 warrant such and interpretation. Thus, our conclusions are as follows: (1) The High Court was wrong in interpreting Section 178 of the Act so as to justify imposition of terminal tax even on goods which merely passed through the territory of Delhi, although their destination is not Delhi but places beyond Delhi. (2) The High Court was wrong in holding that merely because the goods after having been unloaded in the godown of appel-lant Tuli are sorted, reloaded in different trucks and there-after pass through the territory of Delhi, they become exigible to terminal tax. (3) The High Court was wrong in interpretating Rule 26 literally and holding that exemption could be granted only if the goods are exported immediately which means within a very short time irrespective of any other consideration. In view of our interpretation of Section 178. Rule 26 must be interpreted in the light of the object of Section 178 and terminal tax can be leviable only if it is proved that the goods remained at the godown for an indefinite and unexplained period which could not be said to be reasonable as discussed by us in the circum-stances. (4) Where the goods are carried by trucks into the territory of Delhi and unloaded there and are also meant for Delhi and soon thereafter may be rebooked by the receiver of the goods to some other place, terminal tax would be levi-able because in this case there are two separate transactions. (1) by which the goods are meant for Delhi, and (2) by which after having reached and having been unloaded at Delhi they are rebooked and reloaded for some other place and which, therefore, is a fresh and different transaction. In such a case, terminal tax would be leviable at the entry point in the territory of Delhi 25. We might mention that the High Court while holding that termi-nal tax is exigible has construed the word ‘immediately? in Rule 26 literally and directed the Terminal Tax Officer to fix a reasonable time for unloading, sorting and reloading the goods which are meant for different destinations taking into consideration the quantity of the goods, the time for unloading, etc., and has further directed that reloading or transhipment should be done within a time to be fixed by the Terminal Tax Officer. Though the direc-tions given are correct but they will have to be construed in the light of the various factors which we have referred to. Rule 26 will have to be interpre-ted on the footing that Section 178 of the Act does not contemplate levy of termi-nal tax for goods meant for destinations other than Delhi. 26.
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### Explanation:
area for transhipment or allied purposes would not justify the levy of either the terminal tax or octroi duty. This is because the halting of the goods is only for an incidental purpose to effectuate the journey of the goods to the final destination by unloading, sorting and reloading them at a particular place(2) There is a very thin margin of difference between a terminal tax and octroi. In the case of the former (terminal tax) the goods reach their final destination and their entry into the area of destination immediately attracts payment of terminal tax irres-pective of their user. In the case of octroi, however, the tax is levied on goods for their use and consumption(3) But at the same time, the goods while halting at a local area should leave for their destination within a reasonable time which may depend on circumstances of each case and if the goods are kept within the area for such a long and indefinite period that the purpose of reaching the final destination lying in a different area is frustrated or defeated, they may be exigible to terminal tax(4) Where the goods enter into a local area which is also the destination of the goods either temporarily or otherwise, the terminal tax would be leviable. For instance, if A consigns goods from Patna in Bihar to Delhi in the name of X and X after having received the goods at Delhi rebooks or reloads the same on a transport for Chandigarh in the name of Y, terminal tax would be leviable by the Corporation at Delhi because the destination of the goods in the first instance was Delhi and that by itself would attract the imposition of terminal tax. The fact that X rebooks them to Chandigarh would not make any difference because the act of rebooking by X at Delhi would constitute a fresh transaction by which the goods after having been carried into Delhi are further exported to Chandigarh. On the other hand, when there is one continuous journey of the goods from Patna to Chandigarh without any break, the final destination would be Chandigarh even though the goods may have to be halted in Delhi for the purpose of unloading, sorting and reloading and may have to be kept in Delhi for a reasonable time. In such a case terminal tax would not be exigibleWe have laid special stress on the circumstances under which the terminal tax becomes leviable if the halt or interruption of the goods at an intermediate point is for an indefinite and unexplained period. The answer to the question as to what would be a reasonable time for interruption of the goods or halting in the instant case at the godown of Tuli, will naturally depend on the special features or circumstances of each case, viz., the nature of the goods, the time taken in loading, sorting and unloading, the obstacles or difficulties which may be faced by the transporters and similar other factors. Normally, a time of two to three days or even a week should be sufficient to clear the goods for its journey to the ultimate destination. It may sometimes happen that goods may have to be kept in the godowns in the territory of Delhi for circumstances beyond the control of the consignee of the consignor,e.g., while the goods are lying in a godown at Delhi a dispute occurs between the concerned parties as a result of which an injunction is issued by a Court restraining the transporters from moving the goods. In considering what is reasonable time these circumstances would have to be taken into considerationIt was, however, argued before us that according to the Terminal Tax Rules framed under the Act, Rule 26 exempts goods from terminal tax if the same are exported immediately and are declared to be intended for immediate export. In view of the interpretation we have placed on Section 178 it is obvious that the word ‘immediately? appearing in Rules 26 has to be libe-rally construed so as to imply a reasonable period and if the export is delayed the rules may apply if a reasonable explanation has been given. So far as rules regarding taking of passes, etc., at the barrier are concerned they would, of course, apply but subject to the conditions under which terminal tax can be imposed under Section 178 of the Act which is the main charging sectionThe High Court appears to have placed some reliance on Amrit Banaspati Co. Ltd.v.The Union of India ILR 1973 (1) Delhi 237 in coming to the conclusion that in the instant case the Corporation was legally entitled to levy terminal tax. With due respect to the Judges of the High Court who decided the appeals, we would like to point out that the case just above referred to is clearly distinguishable from the present appeals. The most crucial fact in the Delhi decision was that the goods were being carried into the Union Territory of Delhi for the purpose of sale at Delhi. Thus, the case proceeded on the admitted position that the goods were carried from Ghaziabad into the Delhi territory for sale at DelhiWe might mention that the High Court while holding that termi-nal tax is exigible has construed the word ‘immediately? in Rule 26 literally and directed the Terminal Tax Officer to fix a reasonable time for unloading, sorting and reloading the goods which are meant for different destinations taking into consideration the quantity of the goods, the time for unloading, etc., and has further directed that reloading or transhipment should be done within a time to be fixed by the Terminal Tax Officer. Though the direc-tions given are correct but they will have to be construed in the light of the various factors which we have referred to. Rule 26 will have to be interpre-ted on the footing that Section 178 of the Act does not contemplate levy of termi-nal tax for goods meant for destinations other than Delhi.
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New India Assurance Co.Ltd Vs. Rula | but the contract of insurance relating to motor vehicles has to be understood in the light of the various provisions contained in the Motor Vehicles Act, 1988. Chapter 11 of the Motor Vehicles act deals with insurance of motor vehicles against third party risks. Section 146(1), inter alia, provides as under : "146. Necessity for insurance against third party risk. (1) No person shall use, except as a passenger, or cause or allow any other person to use, a motor vehicle in a public place, unless there is in force in relation to the use of the vehicle by that person or that other person, as the case may be, a policy of insurance complying with the requirements of this Chapter." Section 147(5) provides as under : "(5) Notwithstanding anything contained in any law for the time being in force, an insurer issuing a policy of insurance under this section shall be liable to indemnify the person or classes of persons specified in the policy in respect of any liability which the policy purports to cover in the case of that person or those classes of persons." 6. Section 149 casts a duty on the insurer to satisfy judgments and awards against persons insured in respect of third party risks. Sub-section (1) of Section 149 is quoted below : "149. Duty of insurers to satisfy judgments and awards against person insured in respect of third party risks - (1) If, after a certificate of insurance has been issued under sub-section (3) of Section 147 in favour of the person by whom a policy has been effected, judgment or award in respect of any such liability as is required to be covered by a policy under clause (b) of sub-section (1) of section 147 (being a liability covered by the terms of the policy) [or under the provisions of section 163A] is obtained against any person insured by the policy then, notwithstanding that the insurer may be entitled to avoid or cancel or may have avoided or cancelled the policy, the insurer shall, subject to the provisions of this section, pay to the person entitled to the benefit of the decree any sum not exceeding the sum assured payable thereunder, as if he were the judgment-debtor, in respect of the liability, together with any amount payable in respect of costs and any sum payable in respect of interest on that sum by virtue of any enactment relating to interest on judgments." 7. The contract of insurance in respect of motor vehicles has, therefore, to be construed in the light of the above provisions. Section 146(1) contains a prohibition on the use of the motor vehicles without an insurance policy having been taken in accordance with Chapter 11 of the Motor Vehicles Act. The manifest object of this provision is to ensure that third party, who suffers injuries due to the use of the motor vehicle, may be able to get damages from the owner of the vehicle and recoverability of the damages may not depend on the financial condition or solvency of the driver of the vehicle who had caused the injuries. 8. Thus, any contract of insurance under Chapter 11 of the Motor Vehicles Act, 1988 contemplates a third party who is not a signatory or a party to the contract of insurance but is, nevertheless, protected by such contract. As pointed cut by this Court in New Asiatic Insurance Co. Ltd. v. Pessumal Dhanamal Aswani & Ors., AIR 1964 SC 1736 , the rights of the third party to get indemnified can be exercised only against the insurer of the vehicle. It is thus clear that the third party is not concerned and does not come into the picture at all in the matter of payment of premium. Whether the premium has been paid or not is not the concern of the third party who is concerned with the fact that there was a policy issued in respect of the vehicle involved in the accident and it is on the basis of this policy that the claim can be maintained by the third party against the insurer. 9. It was in the background of the above statutory provisions that the provisions of Section 64-VB, upon which reliance has been placed by learned counsel for the appellant, were considered by this Court in Oriental Insurance Co. Ltd. v. Inderjit Kaur & Ors., (1998)1 SCC 371 : 1998(1) RCR (Civil) 227 (SC), in which it was laid down as under : "We have, therefore, this position. Despite the bar created by Section 64-VB of the Insurance Act, the appellant, an authorised insurer, issued a policy of insurance to cover the bus without receiving the premium therefor. By reason of the provisions of Sections 147(5) and 149(1) of the Motor Vehicles Act, the appellant became liable to indemnify third parties in respect of the liability which that policy covered and to satisfy awards of compensation in respect thereof notwithstanding its entitlement (upon which we do not express any opinion) to avoid or cancel the policy for the reason that the cheque issued in payment of the premium thereon has not been honoured." 10. This decision, which is a 3-Judge Bench decision, squarely covers the present case also. The subsequent cancellation of the Insurance Policy in the instant case on the ground that the cheque through which premium was paid was dishonoured, would not affect the rights of the third party which had accrued on the issuance of the Policy on the date on which the accident took place. If, on the date of accident, there was a Policy of Insurance in respect of the vehicle in question, the third party would have a claim against the Insurance Company and the owner of the vehicle would have to be indemnified in respect of the claim of that party. Subsequent cancellation of Insurance Policy on the ground of non-payment of premium would not affect the rights already accrued in favour of the third party. | 0[ds]7. The contract of insurance in respect of motor vehicles has, therefore, to be construed in the light of the above provisions. Section 146(1) contains a prohibition on the use of the motor vehicles without an insurance policy having been taken in accordance with Chapter 11 of the Motor Vehicles Act. The manifest object of this provision is to ensure that third party, who suffers injuries due to the use of the motor vehicle, may be able to get damages from the owner of the vehicle and recoverability of the damages may not depend on the financial condition or solvency of the driver of the vehicle who had caused the injuries8. Thus, any contract of insurance under Chapter 11 of the Motor Vehicles Act, 1988 contemplates a third party who is not a signatory or a party to the contract of insurance but is, nevertheless, protected by such contract. As pointed cut by this Court in New Asiatic Insurance Co. Ltd. v. Pessumal Dhanamal Aswani & Ors., AIR 1964 SC 1736 , the rights of the third party to get indemnified can be exercised only against the insurer of the vehicle. It is thus clear that the third party is not concerned and does not come into the picture at all in the matter of payment of premium. Whether the premium has been paid or not is not the concern of the third party who is concerned with the fact that there was a policy issued in respect of the vehicle involved in the accident and it is on the basis of this policy that the claim can be maintained by the third party against the insurer10. This decision, which is ae Bench decision, squarely covers the present case also. The subsequent cancellation of the Insurance Policy in the instant case on the ground that the cheque through which premium was paid was dishonoured, would not affect the rights of the third party which had accrued on the issuance of the Policy on the date on which the accident took place. If, on the date of accident, there was a Policy of Insurance in respect of the vehicle in question, the third party would have a claim against the Insurance Company and the owner of the vehicle would have to be indemnified in respect of the claim of that party. Subsequent cancellation of Insurance Policy on the ground oft of premium would not affect the rights already accrued in favour of the third party. | 0 | 1,926 | 448 | ### Instruction:
Conjecture the end result of the case (acceptance (1) or non-acceptance (0) of the appeal), followed by a detailed explanation using crucial sentences from the case proceeding.
### Input:
but the contract of insurance relating to motor vehicles has to be understood in the light of the various provisions contained in the Motor Vehicles Act, 1988. Chapter 11 of the Motor Vehicles act deals with insurance of motor vehicles against third party risks. Section 146(1), inter alia, provides as under : "146. Necessity for insurance against third party risk. (1) No person shall use, except as a passenger, or cause or allow any other person to use, a motor vehicle in a public place, unless there is in force in relation to the use of the vehicle by that person or that other person, as the case may be, a policy of insurance complying with the requirements of this Chapter." Section 147(5) provides as under : "(5) Notwithstanding anything contained in any law for the time being in force, an insurer issuing a policy of insurance under this section shall be liable to indemnify the person or classes of persons specified in the policy in respect of any liability which the policy purports to cover in the case of that person or those classes of persons." 6. Section 149 casts a duty on the insurer to satisfy judgments and awards against persons insured in respect of third party risks. Sub-section (1) of Section 149 is quoted below : "149. Duty of insurers to satisfy judgments and awards against person insured in respect of third party risks - (1) If, after a certificate of insurance has been issued under sub-section (3) of Section 147 in favour of the person by whom a policy has been effected, judgment or award in respect of any such liability as is required to be covered by a policy under clause (b) of sub-section (1) of section 147 (being a liability covered by the terms of the policy) [or under the provisions of section 163A] is obtained against any person insured by the policy then, notwithstanding that the insurer may be entitled to avoid or cancel or may have avoided or cancelled the policy, the insurer shall, subject to the provisions of this section, pay to the person entitled to the benefit of the decree any sum not exceeding the sum assured payable thereunder, as if he were the judgment-debtor, in respect of the liability, together with any amount payable in respect of costs and any sum payable in respect of interest on that sum by virtue of any enactment relating to interest on judgments." 7. The contract of insurance in respect of motor vehicles has, therefore, to be construed in the light of the above provisions. Section 146(1) contains a prohibition on the use of the motor vehicles without an insurance policy having been taken in accordance with Chapter 11 of the Motor Vehicles Act. The manifest object of this provision is to ensure that third party, who suffers injuries due to the use of the motor vehicle, may be able to get damages from the owner of the vehicle and recoverability of the damages may not depend on the financial condition or solvency of the driver of the vehicle who had caused the injuries. 8. Thus, any contract of insurance under Chapter 11 of the Motor Vehicles Act, 1988 contemplates a third party who is not a signatory or a party to the contract of insurance but is, nevertheless, protected by such contract. As pointed cut by this Court in New Asiatic Insurance Co. Ltd. v. Pessumal Dhanamal Aswani & Ors., AIR 1964 SC 1736 , the rights of the third party to get indemnified can be exercised only against the insurer of the vehicle. It is thus clear that the third party is not concerned and does not come into the picture at all in the matter of payment of premium. Whether the premium has been paid or not is not the concern of the third party who is concerned with the fact that there was a policy issued in respect of the vehicle involved in the accident and it is on the basis of this policy that the claim can be maintained by the third party against the insurer. 9. It was in the background of the above statutory provisions that the provisions of Section 64-VB, upon which reliance has been placed by learned counsel for the appellant, were considered by this Court in Oriental Insurance Co. Ltd. v. Inderjit Kaur & Ors., (1998)1 SCC 371 : 1998(1) RCR (Civil) 227 (SC), in which it was laid down as under : "We have, therefore, this position. Despite the bar created by Section 64-VB of the Insurance Act, the appellant, an authorised insurer, issued a policy of insurance to cover the bus without receiving the premium therefor. By reason of the provisions of Sections 147(5) and 149(1) of the Motor Vehicles Act, the appellant became liable to indemnify third parties in respect of the liability which that policy covered and to satisfy awards of compensation in respect thereof notwithstanding its entitlement (upon which we do not express any opinion) to avoid or cancel the policy for the reason that the cheque issued in payment of the premium thereon has not been honoured." 10. This decision, which is a 3-Judge Bench decision, squarely covers the present case also. The subsequent cancellation of the Insurance Policy in the instant case on the ground that the cheque through which premium was paid was dishonoured, would not affect the rights of the third party which had accrued on the issuance of the Policy on the date on which the accident took place. If, on the date of accident, there was a Policy of Insurance in respect of the vehicle in question, the third party would have a claim against the Insurance Company and the owner of the vehicle would have to be indemnified in respect of the claim of that party. Subsequent cancellation of Insurance Policy on the ground of non-payment of premium would not affect the rights already accrued in favour of the third party.
### Response:
0
### Explanation:
7. The contract of insurance in respect of motor vehicles has, therefore, to be construed in the light of the above provisions. Section 146(1) contains a prohibition on the use of the motor vehicles without an insurance policy having been taken in accordance with Chapter 11 of the Motor Vehicles Act. The manifest object of this provision is to ensure that third party, who suffers injuries due to the use of the motor vehicle, may be able to get damages from the owner of the vehicle and recoverability of the damages may not depend on the financial condition or solvency of the driver of the vehicle who had caused the injuries8. Thus, any contract of insurance under Chapter 11 of the Motor Vehicles Act, 1988 contemplates a third party who is not a signatory or a party to the contract of insurance but is, nevertheless, protected by such contract. As pointed cut by this Court in New Asiatic Insurance Co. Ltd. v. Pessumal Dhanamal Aswani & Ors., AIR 1964 SC 1736 , the rights of the third party to get indemnified can be exercised only against the insurer of the vehicle. It is thus clear that the third party is not concerned and does not come into the picture at all in the matter of payment of premium. Whether the premium has been paid or not is not the concern of the third party who is concerned with the fact that there was a policy issued in respect of the vehicle involved in the accident and it is on the basis of this policy that the claim can be maintained by the third party against the insurer10. This decision, which is ae Bench decision, squarely covers the present case also. The subsequent cancellation of the Insurance Policy in the instant case on the ground that the cheque through which premium was paid was dishonoured, would not affect the rights of the third party which had accrued on the issuance of the Policy on the date on which the accident took place. If, on the date of accident, there was a Policy of Insurance in respect of the vehicle in question, the third party would have a claim against the Insurance Company and the owner of the vehicle would have to be indemnified in respect of the claim of that party. Subsequent cancellation of Insurance Policy on the ground oft of premium would not affect the rights already accrued in favour of the third party.
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Securities and Exchange Board of India Vs. Udayant Malhoutra | 1. These statutory appeals have been instituted by the Securities and Exchange Board of India(SEBI) under Section 15Z of the Securities and Exchange Board of India Act 1992(SEBI Act) . The appeals arise out of the orders passed by the Securities Appellate Tribunal(Tribunal) on 27 June 2020 and 23 July 2020. The Tribunal set aside an interim order dated 15 June 2020 passed by the Whole Time Member of SEBI under Section 19 read with Sections 11(1), 11(4)(d), 11(4A), 11(5) and 11B of the SEBI Act read with Regulation 10 of the SEBI (Prohibition of Insider Trading) Regulations 2015. 2. By the interim order, the Whole Time Member quantified an amount of Rs 3,83,16,230.73, being the notional loss sought to be avoided on account of trades carried out by the respondent in the scrips of Dynamatic Technologies Ltd over unpublished price sensitive information. The respondent was directed by the Whole Time Member to credit the amount into an Escrow Account. 3. For the purpose of the present appeals, the facts lie in a narrow compass. The respondent is the Chief Executive Officer and Managing Director of the Company in question. It was alleged that he had sold 51,000 shares of the Company on 24 October 2016 having inside knowledge of price sensitive information, namely, the unaudited financial results of the quarter ending on 30 September 2016. It was alleged that the financial results were approved by the Board of Directors on 11 November 2016, upon which the price of the scrips of the Company sustained a drastic reduction. The allegation against the respondent was that being in possession of price sensitive information and being a connected person, he had sold the shares and had, thus, made a notional gain or averted a notional loss. The sales made by the respondent were the subject matter of an investigation in 2017. It appears from the record that the investigating team called for information from the respondent on 28 November 2019. The Whole Time Member passed an ex parte order on 15 June 2020. 4. Before the Tribunal, it was urged by the respondent that there was no urgency in passing an ex-parte order against the respondent, regarding a trade done about three years ago and that the ex-parte action of the appellant in requiring a deposit during the pandemic is arbitrary. Opposing this, the appellant alleged that the reason for passing an ex-parte order was that there was a possibility of a diversion of the notional gain made by the respondent. In arriving at its conclusion in the impugned order, the Tribunal placed reliance on its earlier decision in North End Foods Marketing Pvt Ltd v Securities and Exchange Board of India(Appeal 80 of 2019 decided on 12 March 2019) . In paragraph 11 of the decision, the Tribunal held as follows: 11. As held in North End Foods Marketing Pvt. Ltd. (supra) there is no real urgency in the matter to pass an ex-parte interim order especially during the pandemic period. There is no doubt that SEBI has the power to pass an interim order and that in extreme urgent cases SEBI can pass an ex-parte interim order but such powers can only be exercised sparingly and only in extreme urgent matters. In the instant case, we do not find any case of extreme urgency which warranted the respondent to pass an ex-parte interim order only on arriving at the primafacie case that the appellant was an insider as defined in the SEBI (Prohibition of Insider Trading) Regulations, 2015 (PIT Regulations for short) without considering the balance of convenience or irreparable injury. 5. On the facts before it, the Tribunal, in our view, was correct in coming to the conclusion that since the investigation was pending since 2017 and information had been supplied on 28 November 2019, there was no urgency for passing an ex-parte interim order of the nature that was issued by the Whole Time Member. It was, in this background, that the Tribunal, while affirming the power of SEBI to pass an ex parte interim order in appropriate cases, observed that this should be exercised only in extreme urgent matters. 6. On the facts, as they have emerged before this Court, we do not find any reason to take a view at variance with the conclusion of the Tribunal on the facts of the case. By way of abundant caution, we clarify that we are affirming the view on the facts which have emerged from the record before the Tribunal. 7. Mr Tushar Mehta, learned Solicitor General, however, submitted that the reason why SEBI has been constrained to file the appeals is because of certain observations contained in the impugned order, on question of law bearing on the statutory powers of SEBI. In particular, the attention of the Court was drawn to the following paragraph: 9. ...We are of the opinion that no amount towards disgorgement can be directed to be deposited in advance unless it is adjudicated and quantified unless there is some evidence to show and justify the action taken. An order of the like nature can only be passed during the pendency of the proceedings and such orders cannot be passed at the time of initiation of the proceedings. 8. Section 11(4) of the SEBI Act confers power on SEBI in the following terms: 11. Functions of Board: *** *** *** (4) Without prejudice to the provisions contained in sub-sections (1), (2), (2A) and (3) and section 11B, the Board may, by an order, for reasons to be recorded in writing, in the interests of investors or securities market, take any of the following measures, either pending investigation or inquiry or on completion of such investigation or inquiry, namely:— (a) *** (b) *** (c) *** (d) impound and retain the proceeds or securities in respect of any transaction which is under investigation; | 1[ds]5. On the facts before it, the Tribunal, in our view, was correct in coming to the conclusion that since the investigation was pending since 2017 and information had been supplied on 28 November 2019, there was no urgency for passing an ex-parte interim order of the nature that was issued by the Whole Time Member. It was, in this background, that the Tribunal, while affirming the power of SEBI to pass an ex parte interim order in appropriate cases, observed that this should be exercised only in extreme urgent matters.6. On the facts, as they have emerged before this Court, we do not find any reason to take a view at variance with the conclusion of the Tribunal on the facts of the case. By way of abundant caution, we clarify that we are affirming the view on the facts which have emerged from the record before the Tribunal. | 1 | 1,134 | 170 | ### Instruction:
Project the court's decision (favor (1) or against (0) the appeal) based on the case proceeding, and subsequently give an in-depth explanation by analyzing relevant sentences from the document.
### Input:
1. These statutory appeals have been instituted by the Securities and Exchange Board of India(SEBI) under Section 15Z of the Securities and Exchange Board of India Act 1992(SEBI Act) . The appeals arise out of the orders passed by the Securities Appellate Tribunal(Tribunal) on 27 June 2020 and 23 July 2020. The Tribunal set aside an interim order dated 15 June 2020 passed by the Whole Time Member of SEBI under Section 19 read with Sections 11(1), 11(4)(d), 11(4A), 11(5) and 11B of the SEBI Act read with Regulation 10 of the SEBI (Prohibition of Insider Trading) Regulations 2015. 2. By the interim order, the Whole Time Member quantified an amount of Rs 3,83,16,230.73, being the notional loss sought to be avoided on account of trades carried out by the respondent in the scrips of Dynamatic Technologies Ltd over unpublished price sensitive information. The respondent was directed by the Whole Time Member to credit the amount into an Escrow Account. 3. For the purpose of the present appeals, the facts lie in a narrow compass. The respondent is the Chief Executive Officer and Managing Director of the Company in question. It was alleged that he had sold 51,000 shares of the Company on 24 October 2016 having inside knowledge of price sensitive information, namely, the unaudited financial results of the quarter ending on 30 September 2016. It was alleged that the financial results were approved by the Board of Directors on 11 November 2016, upon which the price of the scrips of the Company sustained a drastic reduction. The allegation against the respondent was that being in possession of price sensitive information and being a connected person, he had sold the shares and had, thus, made a notional gain or averted a notional loss. The sales made by the respondent were the subject matter of an investigation in 2017. It appears from the record that the investigating team called for information from the respondent on 28 November 2019. The Whole Time Member passed an ex parte order on 15 June 2020. 4. Before the Tribunal, it was urged by the respondent that there was no urgency in passing an ex-parte order against the respondent, regarding a trade done about three years ago and that the ex-parte action of the appellant in requiring a deposit during the pandemic is arbitrary. Opposing this, the appellant alleged that the reason for passing an ex-parte order was that there was a possibility of a diversion of the notional gain made by the respondent. In arriving at its conclusion in the impugned order, the Tribunal placed reliance on its earlier decision in North End Foods Marketing Pvt Ltd v Securities and Exchange Board of India(Appeal 80 of 2019 decided on 12 March 2019) . In paragraph 11 of the decision, the Tribunal held as follows: 11. As held in North End Foods Marketing Pvt. Ltd. (supra) there is no real urgency in the matter to pass an ex-parte interim order especially during the pandemic period. There is no doubt that SEBI has the power to pass an interim order and that in extreme urgent cases SEBI can pass an ex-parte interim order but such powers can only be exercised sparingly and only in extreme urgent matters. In the instant case, we do not find any case of extreme urgency which warranted the respondent to pass an ex-parte interim order only on arriving at the primafacie case that the appellant was an insider as defined in the SEBI (Prohibition of Insider Trading) Regulations, 2015 (PIT Regulations for short) without considering the balance of convenience or irreparable injury. 5. On the facts before it, the Tribunal, in our view, was correct in coming to the conclusion that since the investigation was pending since 2017 and information had been supplied on 28 November 2019, there was no urgency for passing an ex-parte interim order of the nature that was issued by the Whole Time Member. It was, in this background, that the Tribunal, while affirming the power of SEBI to pass an ex parte interim order in appropriate cases, observed that this should be exercised only in extreme urgent matters. 6. On the facts, as they have emerged before this Court, we do not find any reason to take a view at variance with the conclusion of the Tribunal on the facts of the case. By way of abundant caution, we clarify that we are affirming the view on the facts which have emerged from the record before the Tribunal. 7. Mr Tushar Mehta, learned Solicitor General, however, submitted that the reason why SEBI has been constrained to file the appeals is because of certain observations contained in the impugned order, on question of law bearing on the statutory powers of SEBI. In particular, the attention of the Court was drawn to the following paragraph: 9. ...We are of the opinion that no amount towards disgorgement can be directed to be deposited in advance unless it is adjudicated and quantified unless there is some evidence to show and justify the action taken. An order of the like nature can only be passed during the pendency of the proceedings and such orders cannot be passed at the time of initiation of the proceedings. 8. Section 11(4) of the SEBI Act confers power on SEBI in the following terms: 11. Functions of Board: *** *** *** (4) Without prejudice to the provisions contained in sub-sections (1), (2), (2A) and (3) and section 11B, the Board may, by an order, for reasons to be recorded in writing, in the interests of investors or securities market, take any of the following measures, either pending investigation or inquiry or on completion of such investigation or inquiry, namely:— (a) *** (b) *** (c) *** (d) impound and retain the proceeds or securities in respect of any transaction which is under investigation;
### Response:
1
### Explanation:
5. On the facts before it, the Tribunal, in our view, was correct in coming to the conclusion that since the investigation was pending since 2017 and information had been supplied on 28 November 2019, there was no urgency for passing an ex-parte interim order of the nature that was issued by the Whole Time Member. It was, in this background, that the Tribunal, while affirming the power of SEBI to pass an ex parte interim order in appropriate cases, observed that this should be exercised only in extreme urgent matters.6. On the facts, as they have emerged before this Court, we do not find any reason to take a view at variance with the conclusion of the Tribunal on the facts of the case. By way of abundant caution, we clarify that we are affirming the view on the facts which have emerged from the record before the Tribunal.
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Manoj H.Mishra Vs. Union Of India | issues raised by the respondent. Therefore, it is not possible to hold the respondent guilty of violating the undertaking given to this Court.” 32. This Court upon meticulously taking note of the entire fact situation observed that the editorial written by the respondent was not intended to demean CESTAT as an institution or to scandalize its functioning. Rather, the object of the editorial was to highlight the irregularities in appointment, posting and transfer of members of CESTAT and instances of abuse of the quasi judicial powers. It was further observed that the editorial highlighted the unsatisfactory nature of the orders passed by the particular bench of Mr. T.K. Jayaraman was a member. The orders had been set aside by the High Courts of Karnataka and Kerala as well as by this Court. In these circumstances, this Court observed:- “38. It is not the appellants case that the facts narrated in the editorial regarding transfer and posting of the members of CESTAT are incorrect or that the respondent had highlighted the same with an oblique motive or that the orders passed by the Karnataka and Kerala High Courts to which reference has been made in the editorial were reversed by this Court. Therefore, it is not possible to record a finding that by writing the editorial in question, the respondent has tried to scandalise the functioning of CESTAT or made an attempt to interfere with the administration of justice.41. One of the most interesting questions with respect to internal whistleblowers is why and under what circumstances people will either act on the spot to stop illegal and otherwise unacceptable behaviour or report it. There is some reason to believe that people are more likely to take action with respect to unacceptable behaviour, within an organisation, if there are complaint systems that offer not just options dictated by the planning and controlling organisation, but a choice of options for individuals, including an option that offers near absolute confidentiality. However, external whistleblowers report misconduct on outside persons or entities. In these cases, depending on the informations severity and nature, whistleblowers may report the misconduct to lawyers, the media, law enforcement or watchdog agencies, or other local, State, or federal agencies.42. In our view, a person like the respondent can appropriately be described as a whistleblower for the system who has tried to highlight the malfunctioning of an important institution established for dealing with cases involving revenue of the State and there is no reason to silence such a person by invoking Articles 129 or 215 of the Constitution or the provisions of the Act.” 33. In our opinion, the aforesaid observations are of no avail to the appellant. It is a matter of record that the appellant is educated only upto 12th standard. He is neither an engineer, nor an expert on the functioning of the Atomic Energy Plants. Apart from being an insider, the appellant did not fulfill the criteria for being granted the status of a “whistle blower”. One of the basic requirements of a person being accepted as a “whistle blower” is that his primary motive for the activity should be in furtherance of public good. In other words, the activity has to be undertaken in public interest, exposing illegal activities of a public organization or authority. The conduct of the appellant, in our opinion, does not fall within the high moral and ethical standard that would be required of a bona fide “whistle blower”. 34. In our opinion, the appellant without any justification assumed the role of vigilante. We do not find that the submissions made on behalf of the respondents to the effect that the appellant was merely seeking publicity are without any substance. The newspaper reports as well as the other publicity undoubtedly created a great deal of panic among the local population as well as throughout the State of Gujarat. Every informer can not automatically be said to be a bonafide “whistle blower”. A “whistle blower” would be a person who possesses the qualities of a crusader. His honesty, integrity and motivation should leave little or no room for doubt. It is not enough that such person is from the same organization and privy to some information, not available to the general public. The primary motivation for the action of a person to be called a “whistle blower” should be to cleanse an organization. It should not be incidental or byproduct for an action taken for some ulterior or selfish motive. 35. We are of the considered opinion that the action of the appellant herein was not merely to highlight the shortcomings in the organization. The appellant had indulged in making scandalous remarks by alleging that there was widespread corruption within the organization. Such allegations would clearly have a deleterious effect throughout the organization apart from casting shadows of doubts on the integrity of the entire project. It is for this reason that employees working within the highly sensitive atomic organization are sworn to secrecy and have to enter into a confidentiality agreement. In our opinion, the appellant had failed to maintain the standard of confidentiality and discretion which was required to be maintained. In the facts of this case, it is apparent that the appellant can take no advantage of the observations made by this Court in the case of Indirect Tax Practitioners’ Association (supra). This now brings us to the reliance placed by the appellant on the judgment in the case of Gujarat Steel Tubes Case (supra). In our opinion, the ratio in the aforesaid judgment would have no relevance in the case of the appellant. We are not satisfied that this is a case of ‘glaring injustice’. 36. In our opinion, the punishment imposed on the appellant is not ‘so disproportionate to the offence as to shock the conscience’ of this Court. The observations of this Court in Ranjit Thakur (supra) are also of no avail to the appellant. No injustice much less any grave injustice has been done to the appellant. 37. | 0[ds]In our opinion, the learned Single Judge and the Division Bench have not committed any error in rejecting the submissions made by the learned counsel for the appellant. We are not inclined to examine the issue that the actions of the appellant would not constitute a misconduct under the Rules. In view of the admissions made by the appellant, no evidence was adduced before the Enquiry Officer by either of the parties. Once the Enquiry Officer had declined to accept the conditional admissions made by the appellant, it was open to him to deny the charges. But he chose to make an unequivocal admission, instead of reiterating his earlier denial as recorded in preliminary hearing held on 26th December, 1994. The appellant cannot now be permitted to resile from the admission made before the Enquiry Officer. The plea to re-open the enquiry has been rejected by the Appellate as well as the Revisional Authority. Thereafter, it was not even argued before the learned Single Judge. Learned counsel had confined the submission to the quantum of punishment. In LPA, the Division Bench declined to reopen the issue. In such circumstances, we are not inclined to exercise our extraordinary jurisdiction under Article 136 for reopening the entire issue at this stage. Such power is reserved to enable this Court to prevent grave miscarriage of justice. It is normally not exercised when the High Court has taken a view that is reasonably possible. The appellant has failed to demonstrate any perversity in the decisions rendered by the Single Judge or the Division Bench of the Highexamined the entire fact situation, we are unable to accept the submission of Mr. Bhushan that the appellant was acting as a. This Court in the case of Indirect TaxAssociation (supra) has observed asof the most interesting questions with respect to internal whistleblowers is why and under what circumstances people will either act on the spot to stop illegal and otherwise unacceptable behaviour or report it. There is some reason to believe that people are more likely to take action with respect to unacceptable behaviour, within an organisation, if there are complaint systems that offer not just options dictated by the planning and controlling organisation, but a choice of options for individuals, including an option that offers near absolute confidentiality. However, external whistleblowers report misconduct on outside persons or entities. In these cases, depending on the informations severity and nature, whistleblowers may report the misconduct to lawyers, the media, law enforcement or watchdog agencies, or other local, State, or federalour view, a person like the respondent can appropriately be described as a whistleblower for the system who has tried to highlight the malfunctioning of an important institution established for dealing with cases involving revenue of the State and there is no reason to silence such a person by invoking Articles 129 or 215 of the Constitution or the provisions of theour opinion, the aforesaid observations are of no avail to the appellant. It is a matter of record that the appellant is educated only upto 12th standard. He is neither an engineer, nor an expert on the functioning of the Atomic Energy Plants. Apart from being an insider, the appellant did not fulfill the criteria for being granted the status of a. One of the basic requirements of a person being accepted as ais that his primary motive for the activity should be in furtherance of public good. In other words, the activity has to be undertaken in public interest, exposing illegal activities of a public organization or authority. The conduct of the appellant, in our opinion, does not fall within the high moral and ethical standard that would be required of a bona fiden our opinion, the appellant without any justification assumed the role of vigilante. We do not find that the submissions made on behalf of the respondents to the effect that the appellant was merely seeking publicity are without any substance. The newspaper reports as well as the other publicity undoubtedly created a great deal of panic among the local population as well as throughout the State of Gujarat. Every informer can not automatically be said to be a bonafidewould be a person who possesses the qualities of a crusader. His honesty, integrity and motivation should leave little or no room for doubt. It is not enough that such person is from the same organization and privy to some information, not available to the general public. The primary motivation for the action of a person to be called ald be to cleanse an organization. It should not be incidental or byproduct for an action taken for some ulterior or selfishare of the considered opinion that the action of the appellant herein was not merely to highlight the shortcomings in the organization. The appellant had indulged in making scandalous remarks by alleging that there was widespread corruption within the organization. Such allegations would clearly have a deleterious effect throughout the organization apart from casting shadows of doubts on the integrity of the entire project. It is for this reason that employees working within the highly sensitive atomic organization are sworn to secrecy and have to enter into a confidentiality agreement. In our opinion, the appellant had failed to maintain the standard of confidentiality and discretion which was required to be maintained. In the facts of this case, it is apparent that the appellant can take no advantage of the observations made by this Court in the case of Indirect TaxAssociation (supra). This now brings us to the reliance placed by the appellant on the judgment in the case of Gujarat Steel Tubes Case (supra). In our opinion, the ratio in the aforesaid judgment would have no relevance in the case of the appellant. We are not satisfied that this is a case of ‘glaringour opinion, the punishment imposed on the appellant is not ‘so disproportionate to the offence as to shock theof this Court. The observations of this Court in Ranjit Thakur (supra) are also of no avail to the appellant. No injustice much less any grave injustice has been done to the appellant. | 0 | 8,293 | 1,110 | ### Instruction:
Hypothesize the court's verdict (affirmation (1) or negation (0) of the appeal), and then clarify this hypothesis by interpreting significant sentences from the case proceeding.
### Input:
issues raised by the respondent. Therefore, it is not possible to hold the respondent guilty of violating the undertaking given to this Court.” 32. This Court upon meticulously taking note of the entire fact situation observed that the editorial written by the respondent was not intended to demean CESTAT as an institution or to scandalize its functioning. Rather, the object of the editorial was to highlight the irregularities in appointment, posting and transfer of members of CESTAT and instances of abuse of the quasi judicial powers. It was further observed that the editorial highlighted the unsatisfactory nature of the orders passed by the particular bench of Mr. T.K. Jayaraman was a member. The orders had been set aside by the High Courts of Karnataka and Kerala as well as by this Court. In these circumstances, this Court observed:- “38. It is not the appellants case that the facts narrated in the editorial regarding transfer and posting of the members of CESTAT are incorrect or that the respondent had highlighted the same with an oblique motive or that the orders passed by the Karnataka and Kerala High Courts to which reference has been made in the editorial were reversed by this Court. Therefore, it is not possible to record a finding that by writing the editorial in question, the respondent has tried to scandalise the functioning of CESTAT or made an attempt to interfere with the administration of justice.41. One of the most interesting questions with respect to internal whistleblowers is why and under what circumstances people will either act on the spot to stop illegal and otherwise unacceptable behaviour or report it. There is some reason to believe that people are more likely to take action with respect to unacceptable behaviour, within an organisation, if there are complaint systems that offer not just options dictated by the planning and controlling organisation, but a choice of options for individuals, including an option that offers near absolute confidentiality. However, external whistleblowers report misconduct on outside persons or entities. In these cases, depending on the informations severity and nature, whistleblowers may report the misconduct to lawyers, the media, law enforcement or watchdog agencies, or other local, State, or federal agencies.42. In our view, a person like the respondent can appropriately be described as a whistleblower for the system who has tried to highlight the malfunctioning of an important institution established for dealing with cases involving revenue of the State and there is no reason to silence such a person by invoking Articles 129 or 215 of the Constitution or the provisions of the Act.” 33. In our opinion, the aforesaid observations are of no avail to the appellant. It is a matter of record that the appellant is educated only upto 12th standard. He is neither an engineer, nor an expert on the functioning of the Atomic Energy Plants. Apart from being an insider, the appellant did not fulfill the criteria for being granted the status of a “whistle blower”. One of the basic requirements of a person being accepted as a “whistle blower” is that his primary motive for the activity should be in furtherance of public good. In other words, the activity has to be undertaken in public interest, exposing illegal activities of a public organization or authority. The conduct of the appellant, in our opinion, does not fall within the high moral and ethical standard that would be required of a bona fide “whistle blower”. 34. In our opinion, the appellant without any justification assumed the role of vigilante. We do not find that the submissions made on behalf of the respondents to the effect that the appellant was merely seeking publicity are without any substance. The newspaper reports as well as the other publicity undoubtedly created a great deal of panic among the local population as well as throughout the State of Gujarat. Every informer can not automatically be said to be a bonafide “whistle blower”. A “whistle blower” would be a person who possesses the qualities of a crusader. His honesty, integrity and motivation should leave little or no room for doubt. It is not enough that such person is from the same organization and privy to some information, not available to the general public. The primary motivation for the action of a person to be called a “whistle blower” should be to cleanse an organization. It should not be incidental or byproduct for an action taken for some ulterior or selfish motive. 35. We are of the considered opinion that the action of the appellant herein was not merely to highlight the shortcomings in the organization. The appellant had indulged in making scandalous remarks by alleging that there was widespread corruption within the organization. Such allegations would clearly have a deleterious effect throughout the organization apart from casting shadows of doubts on the integrity of the entire project. It is for this reason that employees working within the highly sensitive atomic organization are sworn to secrecy and have to enter into a confidentiality agreement. In our opinion, the appellant had failed to maintain the standard of confidentiality and discretion which was required to be maintained. In the facts of this case, it is apparent that the appellant can take no advantage of the observations made by this Court in the case of Indirect Tax Practitioners’ Association (supra). This now brings us to the reliance placed by the appellant on the judgment in the case of Gujarat Steel Tubes Case (supra). In our opinion, the ratio in the aforesaid judgment would have no relevance in the case of the appellant. We are not satisfied that this is a case of ‘glaring injustice’. 36. In our opinion, the punishment imposed on the appellant is not ‘so disproportionate to the offence as to shock the conscience’ of this Court. The observations of this Court in Ranjit Thakur (supra) are also of no avail to the appellant. No injustice much less any grave injustice has been done to the appellant. 37.
### Response:
0
### Explanation:
the submissions made by the learned counsel for the appellant. We are not inclined to examine the issue that the actions of the appellant would not constitute a misconduct under the Rules. In view of the admissions made by the appellant, no evidence was adduced before the Enquiry Officer by either of the parties. Once the Enquiry Officer had declined to accept the conditional admissions made by the appellant, it was open to him to deny the charges. But he chose to make an unequivocal admission, instead of reiterating his earlier denial as recorded in preliminary hearing held on 26th December, 1994. The appellant cannot now be permitted to resile from the admission made before the Enquiry Officer. The plea to re-open the enquiry has been rejected by the Appellate as well as the Revisional Authority. Thereafter, it was not even argued before the learned Single Judge. Learned counsel had confined the submission to the quantum of punishment. In LPA, the Division Bench declined to reopen the issue. In such circumstances, we are not inclined to exercise our extraordinary jurisdiction under Article 136 for reopening the entire issue at this stage. Such power is reserved to enable this Court to prevent grave miscarriage of justice. It is normally not exercised when the High Court has taken a view that is reasonably possible. The appellant has failed to demonstrate any perversity in the decisions rendered by the Single Judge or the Division Bench of the Highexamined the entire fact situation, we are unable to accept the submission of Mr. Bhushan that the appellant was acting as a. This Court in the case of Indirect TaxAssociation (supra) has observed asof the most interesting questions with respect to internal whistleblowers is why and under what circumstances people will either act on the spot to stop illegal and otherwise unacceptable behaviour or report it. There is some reason to believe that people are more likely to take action with respect to unacceptable behaviour, within an organisation, if there are complaint systems that offer not just options dictated by the planning and controlling organisation, but a choice of options for individuals, including an option that offers near absolute confidentiality. However, external whistleblowers report misconduct on outside persons or entities. In these cases, depending on the informations severity and nature, whistleblowers may report the misconduct to lawyers, the media, law enforcement or watchdog agencies, or other local, State, or federalour view, a person like the respondent can appropriately be described as a whistleblower for the system who has tried to highlight the malfunctioning of an important institution established for dealing with cases involving revenue of the State and there is no reason to silence such a person by invoking Articles 129 or 215 of the Constitution or the provisions of theour opinion, the aforesaid observations are of no avail to the appellant. It is a matter of record that the appellant is educated only upto 12th standard. He is neither an engineer, nor an expert on the functioning of the Atomic Energy Plants. Apart from being an insider, the appellant did not fulfill the criteria for being granted the status of a. One of the basic requirements of a person being accepted as ais that his primary motive for the activity should be in furtherance of public good. In other words, the activity has to be undertaken in public interest, exposing illegal activities of a public organization or authority. The conduct of the appellant, in our opinion, does not fall within the high moral and ethical standard that would be required of a bona fiden our opinion, the appellant without any justification assumed the role of vigilante. We do not find that the submissions made on behalf of the respondents to the effect that the appellant was merely seeking publicity are without any substance. The newspaper reports as well as the other publicity undoubtedly created a great deal of panic among the local population as well as throughout the State of Gujarat. Every informer can not automatically be said to be a bonafidewould be a person who possesses the qualities of a crusader. His honesty, integrity and motivation should leave little or no room for doubt. It is not enough that such person is from the same organization and privy to some information, not available to the general public. The primary motivation for the action of a person to be called ald be to cleanse an organization. It should not be incidental or byproduct for an action taken for some ulterior or selfishare of the considered opinion that the action of the appellant herein was not merely to highlight the shortcomings in the organization. The appellant had indulged in making scandalous remarks by alleging that there was widespread corruption within the organization. Such allegations would clearly have a deleterious effect throughout the organization apart from casting shadows of doubts on the integrity of the entire project. It is for this reason that employees working within the highly sensitive atomic organization are sworn to secrecy and have to enter into a confidentiality agreement. In our opinion, the appellant had failed to maintain the standard of confidentiality and discretion which was required to be maintained. In the facts of this case, it is apparent that the appellant can take no advantage of the observations made by this Court in the case of Indirect TaxAssociation (supra). This now brings us to the reliance placed by the appellant on the judgment in the case of Gujarat Steel Tubes Case (supra). In our opinion, the ratio in the aforesaid judgment would have no relevance in the case of the appellant. We are not satisfied that this is a case of ‘glaringour opinion, the punishment imposed on the appellant is not ‘so disproportionate to the offence as to shock theof this Court. The observations of this Court in Ranjit Thakur (supra) are also of no avail to the appellant. No injustice much less any grave injustice has been done to the appellant.
|
Titaghur Paper Mills Company, Limited Vs. Ram Naresh Kumar and Another | disobedience of orders under the relevant standing orders. He submitted an explanation, which was followed by an enquiry on 3 October, 1953 at which he did not cross-examine the witnesses. Thereafter, he was suspended with effect from 5 October, 1953; but as some industrial dispute was under adjudication before a tribunal the appellant applied for permission to dismiss him under S.33 of the Industrial Disputes Act. Before, however, the application could be disposed of, the industrial dispute was decided by the tribunal and, in consequence, there was no necessity for any order on the application under S. 33. Thereafter, the appellant dismissed Ram Naresh Kumar on 17 December, 1953. On this a dispute was rased by the union and reference was made by the Government of West Bengal on 31 March, 1954 with respect to Ram Naresh Kumar and some other employees. In the present appeal we are only concerned with Ram Naresh Kumar, and the matter referred to the industrial tribunal was whether the termination of the service of Ram Naresh Kumar was justified and whether he was entitled to any relief.The tribunal has held that there was dereliction of duty by Ram Naresh Kumar. It has also held that there was a proper enquiry which was followed by suspension and dismissal of Ram Naresh Kumar. It is also not in dispute that the punishment of dismissal could be meted out under the relevant standing order for such dereliction of duty. The tribunal, however, set aside the order of dismissal on two grounds. It said that it was usual for the labour office, where there was delay in submitting the attendance report, to send a reminder to the workman at fault, but this was not done in the present case, and it thought that this was done designedly in order to take advantage of Ram Naresh Kumars lapses. Secondly, the tribunal was of the view that as Ram Naresh Kumar was the vice-president of the union and certain disputes were going on between the union and the appellant which resulted in the withdrawal of the recognition of the union on 5 October, 1953, Ram Naresh Kumar was more or less of the nature of an eyesore to the management and there was, therefore, ample room for suspicion that the management wanted somehow or other to get rid of this man. Though the tribunal did not say so in so may words, it seems to have thought that this was a case of victimization and in consequence ordered the reinstatement of Ram Naresh Kumar. It may be mentioned that the explanation given by Ram Naresh Kumar for his failure to perform his duties was so unsatisfactory and absurd that even the learned counsel appearing on behalf of the union before the tribunal had to admit that it was a childish explanation.2. We are of opinion that on the findings of the tribunal itself there was no case for interference with the order of dismissal. The scope of the power of an industrial tribunal to interfere in the matter of dismissal of workmen by the management was considered by this Court in Indian Iron and Steel Company, Ltd., and another v. Their workmen [1958 - I L.L.J. 260], and it was laid down that the powers of an industrial tribunal in this matter were not unlimited and the tribunal did not act as a court of appeal and substitute its own judgment for that of the management. It was also held that the tribunal would interfere when:(i) there is want of good faith;(ii) there is victimization or unfair labour practice;(iii) the management has been guilty of a basic error or violation of a principle of natural justice; or(iv) on the materials the finding is completely baseless or perverse.We are of opinion that the present case is not covered by any of the four grounds on which a tribunal can interfere with the order of dismissal by the management. Dereliction of duty was clearly established in this case; the management had the right of dismissal under the relevant standing orders; proper enquiry was held and the explanation of the workman was found to be childish. In these circumstances, there was no ground for the tribunal to substitute its own judgment for the judgment of the management in the matter of punishment to be meted out. The two reasons given by the tribunal for interfering with the order of management do not, in our opinion, come within any of the four principles mentioned above. It was not the duty of the management to remind the workman who was failing to perform his duties properly, even if the management sometimes did so. Nor can this be said to be a case of victimization, for the dereliction of duty was clearly established. All that the tribunal has said is that there was room for suspicion that the management wanted somehow or other to get rid of this man. But considering the nature of the dereliction of duty in this case it cannot possibly be said that the management had any hand in the failure of the workman to perform his duty properly. The fact that the recognition of the union was withdrawn about that very time is also not a material consideration, for the withdrawal of the recognition was undoubtedly due to short illegal strikes fomented by the union in the months of July, August and September 1953. The tribunal itself had to concede that the reason for the dismissal was sound but it said that it was designed. This is something which we cannot understand, for the management could not design that the workman should fail to perform his duties. In the circumstances, the appeal must be allowed. We may, however, note that the learned Solicitor-General appearing on behalf of the appellant has stated that the management will pay ex gratia a sum of Rs. 500 to Ram Naresh Kumar taking into account his past services and we trust that this will be done.3. | 1[ds]We are of opinion that on the findings of the tribunal itself there was no case for interference with the order of dismissal. The scope of the power of an industrial tribunal to interfere in the matter of dismissal of workmen by the management was considered by this Court in Indian Iron and Steel Company, Ltd., and another v. Their workmen [1958I L.L.J. 260], and it was laid down that the powers of an industrial tribunal in this matter were not unlimited and the tribunal did not act as a court of appeal and substitute its own judgment for that of theare of opinion that the present case is not covered by any of the four grounds on which a tribunal can interfere with the order of dismissal by the management. Dereliction of duty was clearly established in this case; the management had the right of dismissal under the relevant standing orders; proper enquiry was held and the explanation of the workman was found to be childish. In these circumstances, there was no ground for the tribunal to substitute its own judgment for the judgment of the management in the matter of punishment to be meted out. The two reasons given by the tribunal for interfering with the order of management do not, in our opinion, come within any of the four principles mentioned above. It was not the duty of the management to remind the workman who was failing to perform his duties properly, even if the management sometimes did so. Nor can this be said to be a case of victimization, for the dereliction of duty was clearly established. All that the tribunal has said is that there was room for suspicion that the management wanted somehow or other to get rid of this man. But considering the nature of the dereliction of duty in this case it cannot possibly be said that the management had any hand in the failure of the workman to perform his duty properly. The fact that the recognition of the union was withdrawn about that very time is also not a material consideration, for the withdrawal of the recognition was undoubtedly due to short illegal strikes fomented by the union in the months of July, August and September 1953. The tribunal itself had to concede that the reason for the dismissal was sound but it said that it was designed. This is something which we cannot understand, for the management could not design that the workman should fail to perform his duties. In the circumstances, the appeal must be allowed. We may, however, note that the learnedappearing on behalf of the appellant has stated that the management will pay ex gratia a sum of Rs. 500 to Ram Naresh Kumar taking into account his past services and we trust that this will be done. | 1 | 1,262 | 512 | ### Instruction:
Speculate on the likely judgment (yes (1) or no (0) to the appeal) and then delve into the case proceeding to elucidate your prediction, focusing on critical sentences.
### Input:
disobedience of orders under the relevant standing orders. He submitted an explanation, which was followed by an enquiry on 3 October, 1953 at which he did not cross-examine the witnesses. Thereafter, he was suspended with effect from 5 October, 1953; but as some industrial dispute was under adjudication before a tribunal the appellant applied for permission to dismiss him under S.33 of the Industrial Disputes Act. Before, however, the application could be disposed of, the industrial dispute was decided by the tribunal and, in consequence, there was no necessity for any order on the application under S. 33. Thereafter, the appellant dismissed Ram Naresh Kumar on 17 December, 1953. On this a dispute was rased by the union and reference was made by the Government of West Bengal on 31 March, 1954 with respect to Ram Naresh Kumar and some other employees. In the present appeal we are only concerned with Ram Naresh Kumar, and the matter referred to the industrial tribunal was whether the termination of the service of Ram Naresh Kumar was justified and whether he was entitled to any relief.The tribunal has held that there was dereliction of duty by Ram Naresh Kumar. It has also held that there was a proper enquiry which was followed by suspension and dismissal of Ram Naresh Kumar. It is also not in dispute that the punishment of dismissal could be meted out under the relevant standing order for such dereliction of duty. The tribunal, however, set aside the order of dismissal on two grounds. It said that it was usual for the labour office, where there was delay in submitting the attendance report, to send a reminder to the workman at fault, but this was not done in the present case, and it thought that this was done designedly in order to take advantage of Ram Naresh Kumars lapses. Secondly, the tribunal was of the view that as Ram Naresh Kumar was the vice-president of the union and certain disputes were going on between the union and the appellant which resulted in the withdrawal of the recognition of the union on 5 October, 1953, Ram Naresh Kumar was more or less of the nature of an eyesore to the management and there was, therefore, ample room for suspicion that the management wanted somehow or other to get rid of this man. Though the tribunal did not say so in so may words, it seems to have thought that this was a case of victimization and in consequence ordered the reinstatement of Ram Naresh Kumar. It may be mentioned that the explanation given by Ram Naresh Kumar for his failure to perform his duties was so unsatisfactory and absurd that even the learned counsel appearing on behalf of the union before the tribunal had to admit that it was a childish explanation.2. We are of opinion that on the findings of the tribunal itself there was no case for interference with the order of dismissal. The scope of the power of an industrial tribunal to interfere in the matter of dismissal of workmen by the management was considered by this Court in Indian Iron and Steel Company, Ltd., and another v. Their workmen [1958 - I L.L.J. 260], and it was laid down that the powers of an industrial tribunal in this matter were not unlimited and the tribunal did not act as a court of appeal and substitute its own judgment for that of the management. It was also held that the tribunal would interfere when:(i) there is want of good faith;(ii) there is victimization or unfair labour practice;(iii) the management has been guilty of a basic error or violation of a principle of natural justice; or(iv) on the materials the finding is completely baseless or perverse.We are of opinion that the present case is not covered by any of the four grounds on which a tribunal can interfere with the order of dismissal by the management. Dereliction of duty was clearly established in this case; the management had the right of dismissal under the relevant standing orders; proper enquiry was held and the explanation of the workman was found to be childish. In these circumstances, there was no ground for the tribunal to substitute its own judgment for the judgment of the management in the matter of punishment to be meted out. The two reasons given by the tribunal for interfering with the order of management do not, in our opinion, come within any of the four principles mentioned above. It was not the duty of the management to remind the workman who was failing to perform his duties properly, even if the management sometimes did so. Nor can this be said to be a case of victimization, for the dereliction of duty was clearly established. All that the tribunal has said is that there was room for suspicion that the management wanted somehow or other to get rid of this man. But considering the nature of the dereliction of duty in this case it cannot possibly be said that the management had any hand in the failure of the workman to perform his duty properly. The fact that the recognition of the union was withdrawn about that very time is also not a material consideration, for the withdrawal of the recognition was undoubtedly due to short illegal strikes fomented by the union in the months of July, August and September 1953. The tribunal itself had to concede that the reason for the dismissal was sound but it said that it was designed. This is something which we cannot understand, for the management could not design that the workman should fail to perform his duties. In the circumstances, the appeal must be allowed. We may, however, note that the learned Solicitor-General appearing on behalf of the appellant has stated that the management will pay ex gratia a sum of Rs. 500 to Ram Naresh Kumar taking into account his past services and we trust that this will be done.3.
### Response:
1
### Explanation:
We are of opinion that on the findings of the tribunal itself there was no case for interference with the order of dismissal. The scope of the power of an industrial tribunal to interfere in the matter of dismissal of workmen by the management was considered by this Court in Indian Iron and Steel Company, Ltd., and another v. Their workmen [1958I L.L.J. 260], and it was laid down that the powers of an industrial tribunal in this matter were not unlimited and the tribunal did not act as a court of appeal and substitute its own judgment for that of theare of opinion that the present case is not covered by any of the four grounds on which a tribunal can interfere with the order of dismissal by the management. Dereliction of duty was clearly established in this case; the management had the right of dismissal under the relevant standing orders; proper enquiry was held and the explanation of the workman was found to be childish. In these circumstances, there was no ground for the tribunal to substitute its own judgment for the judgment of the management in the matter of punishment to be meted out. The two reasons given by the tribunal for interfering with the order of management do not, in our opinion, come within any of the four principles mentioned above. It was not the duty of the management to remind the workman who was failing to perform his duties properly, even if the management sometimes did so. Nor can this be said to be a case of victimization, for the dereliction of duty was clearly established. All that the tribunal has said is that there was room for suspicion that the management wanted somehow or other to get rid of this man. But considering the nature of the dereliction of duty in this case it cannot possibly be said that the management had any hand in the failure of the workman to perform his duty properly. The fact that the recognition of the union was withdrawn about that very time is also not a material consideration, for the withdrawal of the recognition was undoubtedly due to short illegal strikes fomented by the union in the months of July, August and September 1953. The tribunal itself had to concede that the reason for the dismissal was sound but it said that it was designed. This is something which we cannot understand, for the management could not design that the workman should fail to perform his duties. In the circumstances, the appeal must be allowed. We may, however, note that the learnedappearing on behalf of the appellant has stated that the management will pay ex gratia a sum of Rs. 500 to Ram Naresh Kumar taking into account his past services and we trust that this will be done.
|
Liyakat Vs. State of Uttaranchal | para 21) "21. In a case based on circumstantial evidence, the settled law is that the circumstances from which the conclusion of guilt is drawn should be fully proved and such circumstances must be conclusive in nature. Moreover, all the circumstances should be complete and there should be no gap left in the chain of evidence. Further, the proved circumstances must be consistent only with the hypothesis of the guilt of the accused and totally inconsistent with his innocence." 16. In Padala Veera Reddy v. State of A.P. [AIR 1990 SC 79 ] it was laid down that when a case rests upon circumstantial evidence, such evidence must satisfy the following tests: (SCC pp. 710-11, para 10) "(1) the circumstances from which an inference of guilt is sought to be drawn, must be cogently and firmly established;(2) those circumstances should be of a definite tendency unerringly pointing towards guilt of the accused;(3) the circumstances, taken cumulatively, should form a chain so complete that there is no escape from the conclusion that within all human probability the crime was committed by the accused and none else; and(4) the circumstantial evidence in order to sustain conviction must be complete and incapable of explanation of any other hypothesis than that of the guilt of the accused and such evidence should not only be consistent with the guilt of the accused but should be inconsistent with his innocence." 17. In State of U.P. v. Ashok Kumar Srivastavaii [1992(2) SCC 86] it was pointed out that great care must be taken in evaluating circumstantial evidence and if the evidence relied on is reasonably capable of two inferences, the one in favour of the accused must be accepted. It was also pointed out that the circumstances relied upon must be found to have been fully established and the cumulative effect of all the facts so established must be consistent only with the hypothesis of guilt. 18. Sir Alfred Wills in his admirable book Wills Circumstantial Evidence (Chapter VI) lays down the following rules specially to be observed in the case of circumstantial evidence: "(1) the facts alleged as the basis of any legal inference must be clearly proved and beyond reasonable doubt connected with the factum probandum; (2) the burden of proof is always on the party who asserts the existence of any fact, which infers legal accountability; (3) in all cases, whether of direct or circumstantial evidence the best evidence must be adduced which the nature of the case admits; (4) in order to justify the inference of guilt, the inculpatory facts must be incompatible with the innocence of the accused and incapable of explanation, upon any other reasonable hypothesis than that of his guilt; and (5) if there be any reasonable doubt of the guilt of the accused, he is entitled as of right to be acquitted." 19. There is no doubt that conviction can be based solely on circumstantial evidence but it should be tested on the touchstone of law relating to circumstantial evidence laid down by this Court as far back as in 1952. 20. In Hanumant Govind Nargundkar v. State of M.P. [AIR 1952 SC 343 ] it was observed thus: (AIR pp. 345-46, para 10) "It is well to remember that in cases where the evidence is of a circumstantial nature, the circumstances from which the conclusion of guilt is to be drawn should in the first instance be fully established, and all the facts so established should be consistent only with the hypothesis of the guilt of the accused. Again, the circumstances should be of a conclusive nature and tendency and they should be such as to exclude every hypothesis but the one proposed to be proved. In other words, there must be a chain of evidence so far complete as not to leave any reasonable ground for a conclusion consistent with the innocence of the accused and it must be such as to show that within all human probability the act must have been done by the accused." 21. A reference may be made to a later decision in Sharad Birdhichand Sarda v. State of Maharashtra [AIR 1984 SC 1622 ]. Therein, while dealing with circumstantial evidence, it has been held that the onus was on the prosecution to prove that the chain is complete and the infirmity of lacuna in prosecution cannot be cured by false defence or plea. The conditions precedent in the words of this Court, before conviction could be based on circumstantial evidence, must be fully established. They are: (SCC p. 185, para 153) (1) the circumstances from which the conclusion of guilt is to be drawn should be fully established. The circumstances concerned must or should and not may be established; (2) the facts so established should be consistent only with the hypothesis of the guilt of the accused, that is to say, they should not be explainable on any other hypothesis except that the accused is guilty; (3) the circumstances should be of a conclusive nature and tendency; (4) they should exclude every possible hypothesis except the one to be proved; and (5) there must be a chain of evidence so complete as not to leave any reasonable ground for the conclusion consistent with the innocence of the accused and must show that in all human probability the act must have been done by the accused. 22. The above position was highlighted in State of Rajasthan v. Raja Ram [2003(8) SCC 180]. 23. It has been rightly noted by the trial court and the High Court that the accused persons were absolutely silent and no explanation was offered as to how the body came to be buried in their hut which was in their exclusive user.24. Similarly the non-explanation of this vital circumstance adds to the chain of circumstances. It is now settled law that if the deceased was in the custody or in the company of the accused, then the accused must supply some explanation regarding the disappearance of the deceased. | 0[ds]13. Before analysing the factual aspects it may be stated that for a crime to be proved it is not necessary that the crime must be seen to have been committed and must, in all circumstances be proved by direct ocular evidence by examining before the court those persons who had seen its commission. The offence can be proved by circumstantial evidence also. The principal fact or factum probandum may be proved indirectly by means of certain inferences drawn from factum probans, that is, the evidentiary facts. To put it differently, circumstantial evidence is not direct to the point in issue but consists of evidence of various other facts which are so closely associated with the fact in issue that taken together they form a chain of circumstances from which the existence of the principal fact can be legally inferred or presumed.14. It has been consistently laid down by this Court that where a case rests squarely on circumstantial evidence, the inference of guilt can be justified only when all the incriminating facts and circumstances are found to be incompatible with the innocence of the accused or the guilt of any other person.There is no doubt that conviction can be based solely on circumstantial evidence but it should be tested on the touchstone of law relating to circumstantial evidence laid down by this Court as far back as in 1952.It has been rightly noted by the trial court and the High Court that the accused persons were absolutely silent and no explanation was offered as to how the body came to be buried in their hut which was in their exclusive user.24. Similarly the non-explanation of this vital circumstance adds to the chain of circumstances. It is now settled law that if the deceased was in the custody or in the company of the accused, then the accused must supply some explanation regarding the disappearance of the deceased. | 0 | 2,797 | 336 | ### Instruction:
Estimate the outcome of the case (positive (1) or negative (0) for the appellant) and then give a reasoned explanation by examining important sentences within the case documentation.
### Input:
para 21) "21. In a case based on circumstantial evidence, the settled law is that the circumstances from which the conclusion of guilt is drawn should be fully proved and such circumstances must be conclusive in nature. Moreover, all the circumstances should be complete and there should be no gap left in the chain of evidence. Further, the proved circumstances must be consistent only with the hypothesis of the guilt of the accused and totally inconsistent with his innocence." 16. In Padala Veera Reddy v. State of A.P. [AIR 1990 SC 79 ] it was laid down that when a case rests upon circumstantial evidence, such evidence must satisfy the following tests: (SCC pp. 710-11, para 10) "(1) the circumstances from which an inference of guilt is sought to be drawn, must be cogently and firmly established;(2) those circumstances should be of a definite tendency unerringly pointing towards guilt of the accused;(3) the circumstances, taken cumulatively, should form a chain so complete that there is no escape from the conclusion that within all human probability the crime was committed by the accused and none else; and(4) the circumstantial evidence in order to sustain conviction must be complete and incapable of explanation of any other hypothesis than that of the guilt of the accused and such evidence should not only be consistent with the guilt of the accused but should be inconsistent with his innocence." 17. In State of U.P. v. Ashok Kumar Srivastavaii [1992(2) SCC 86] it was pointed out that great care must be taken in evaluating circumstantial evidence and if the evidence relied on is reasonably capable of two inferences, the one in favour of the accused must be accepted. It was also pointed out that the circumstances relied upon must be found to have been fully established and the cumulative effect of all the facts so established must be consistent only with the hypothesis of guilt. 18. Sir Alfred Wills in his admirable book Wills Circumstantial Evidence (Chapter VI) lays down the following rules specially to be observed in the case of circumstantial evidence: "(1) the facts alleged as the basis of any legal inference must be clearly proved and beyond reasonable doubt connected with the factum probandum; (2) the burden of proof is always on the party who asserts the existence of any fact, which infers legal accountability; (3) in all cases, whether of direct or circumstantial evidence the best evidence must be adduced which the nature of the case admits; (4) in order to justify the inference of guilt, the inculpatory facts must be incompatible with the innocence of the accused and incapable of explanation, upon any other reasonable hypothesis than that of his guilt; and (5) if there be any reasonable doubt of the guilt of the accused, he is entitled as of right to be acquitted." 19. There is no doubt that conviction can be based solely on circumstantial evidence but it should be tested on the touchstone of law relating to circumstantial evidence laid down by this Court as far back as in 1952. 20. In Hanumant Govind Nargundkar v. State of M.P. [AIR 1952 SC 343 ] it was observed thus: (AIR pp. 345-46, para 10) "It is well to remember that in cases where the evidence is of a circumstantial nature, the circumstances from which the conclusion of guilt is to be drawn should in the first instance be fully established, and all the facts so established should be consistent only with the hypothesis of the guilt of the accused. Again, the circumstances should be of a conclusive nature and tendency and they should be such as to exclude every hypothesis but the one proposed to be proved. In other words, there must be a chain of evidence so far complete as not to leave any reasonable ground for a conclusion consistent with the innocence of the accused and it must be such as to show that within all human probability the act must have been done by the accused." 21. A reference may be made to a later decision in Sharad Birdhichand Sarda v. State of Maharashtra [AIR 1984 SC 1622 ]. Therein, while dealing with circumstantial evidence, it has been held that the onus was on the prosecution to prove that the chain is complete and the infirmity of lacuna in prosecution cannot be cured by false defence or plea. The conditions precedent in the words of this Court, before conviction could be based on circumstantial evidence, must be fully established. They are: (SCC p. 185, para 153) (1) the circumstances from which the conclusion of guilt is to be drawn should be fully established. The circumstances concerned must or should and not may be established; (2) the facts so established should be consistent only with the hypothesis of the guilt of the accused, that is to say, they should not be explainable on any other hypothesis except that the accused is guilty; (3) the circumstances should be of a conclusive nature and tendency; (4) they should exclude every possible hypothesis except the one to be proved; and (5) there must be a chain of evidence so complete as not to leave any reasonable ground for the conclusion consistent with the innocence of the accused and must show that in all human probability the act must have been done by the accused. 22. The above position was highlighted in State of Rajasthan v. Raja Ram [2003(8) SCC 180]. 23. It has been rightly noted by the trial court and the High Court that the accused persons were absolutely silent and no explanation was offered as to how the body came to be buried in their hut which was in their exclusive user.24. Similarly the non-explanation of this vital circumstance adds to the chain of circumstances. It is now settled law that if the deceased was in the custody or in the company of the accused, then the accused must supply some explanation regarding the disappearance of the deceased.
### Response:
0
### Explanation:
13. Before analysing the factual aspects it may be stated that for a crime to be proved it is not necessary that the crime must be seen to have been committed and must, in all circumstances be proved by direct ocular evidence by examining before the court those persons who had seen its commission. The offence can be proved by circumstantial evidence also. The principal fact or factum probandum may be proved indirectly by means of certain inferences drawn from factum probans, that is, the evidentiary facts. To put it differently, circumstantial evidence is not direct to the point in issue but consists of evidence of various other facts which are so closely associated with the fact in issue that taken together they form a chain of circumstances from which the existence of the principal fact can be legally inferred or presumed.14. It has been consistently laid down by this Court that where a case rests squarely on circumstantial evidence, the inference of guilt can be justified only when all the incriminating facts and circumstances are found to be incompatible with the innocence of the accused or the guilt of any other person.There is no doubt that conviction can be based solely on circumstantial evidence but it should be tested on the touchstone of law relating to circumstantial evidence laid down by this Court as far back as in 1952.It has been rightly noted by the trial court and the High Court that the accused persons were absolutely silent and no explanation was offered as to how the body came to be buried in their hut which was in their exclusive user.24. Similarly the non-explanation of this vital circumstance adds to the chain of circumstances. It is now settled law that if the deceased was in the custody or in the company of the accused, then the accused must supply some explanation regarding the disappearance of the deceased.
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