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Appeal No. 1359 of 1993.
From the Judgment and Order dated 16.1.192 of the Patna High Court in C.W.J.C. No. 446 of 1992.
K.N. Chaubey, K. Pandeya and Mohan Pandey for the Appellant.
523 Gobinda Mukhoty, N.N. Goswami, S.K. Bhattacharya, C.V.S. Rao Ms. K.K. Manglam, L. R. Singh, Vikas Singh, Yunus Malik, B.B. Singh Ms. Vimal Sinha and Ms Kumud L. Das for the Respondents.
The Judgment of the Court was delivered by SAWANT, J.
Leave granted.
The appellant is a member of the Bar.
He had field a petition in the nature of a public interest litigation under Article 226 of the Constitution of India before the High Court of Patna praying for a writ of quo warranto challenging the appointment of respondent No. 6, Dr. Shiva Jatan Thakur as a Member of the Bihar, State Public Service Commission.
The High Court dismissed the writ petition.
Hence the present appeal.
The attack against the appointment of respondent No. 6 is based on, two grounds: [a] on the date of his appointment i.e., 4th March, 1991 respond No. 6 was the seventh non service member.
The total strength of the Public Service Commission being eleven [uncluding the Chairman] the appointment of the seventh member from the ' non service category, was violative of the proviso to article 316[1] of the Constitution which requires that as nearly as may be one half of the members shall be persons who have held office for at least ten years either under the Government of India or under a Government of the State.
[b] respondent no.6 was totally blind even from a date prior to his appointment and was unfit to be appointed by reason of the said physical infirmity.
We are, accordingly, required to consider whether these two grounds were sufficient to disqualify respondent No. 6 from being appointed as a member of the, commission.
In his counter affidavit, respondent No. 6 has stated among other or things, that he happens to be the son of a peon retired form the Railway We are informed by Shri Mukhoty, the learned counsel appearing for him 524 that he belongs to the backward community of barbers.
He has been blind since the age of eight years.
In spite of his blindness, he was able to pursue his educational career successfully, and he earned degrees and diplomas.
He is a Ph.D. in English of the Patna University.
He has been a University college teacher in English and he was promoted to the post of Reader in English on the completion of bare eight years of service.
He was the first teacher of the Patna University who was unanimously recommended for the award of D. Litt.
on account of the excellence of his thesis written for Ph.D. As a scholar in English, he has submitted papers to national and international conferences.
He is a life member of the organisations who sponsor these conferences.
The Government of Bihar vide its D.O. letter No. 2740 dated 22nd October, 1991 sent to the Union Ministry of Home Affairs, had recommended him for the prestigious national award of 'Padmashree ' for his services as a Member of the Public Service Commission.
The President of India on 15th March, 1992 conferred on him National Award which reads: "this national award is given to Dr. Shiva Jatan Thakur in public recognition of his outstanding performance as the most efficient employee".
He has also referred to the circumstances under which his present appointment came to be challenged nearly 9 1/2 months after it was made.
While he was appointed on 4th March, 1991, the writ petition was filed in the High Court on 14th January, 1992.
According to him, he had made a representation to the President of India, the Governor of Bihar and others, against the serious misconduct, gross malpractice and wilful violation of the constitutional mandate by the Chairman of the Commission.
The present writ petition was filed in the High Court 18 days after a copy of the representation was received by the Chairman, among others.
It is his dispute with the Chairman who according to him is backed by the Chief Minister of the State which has led to the present writ petition.
He has also stated that the Chief Minister in his press interview given to the local Urdu daily, viz., Qaumi Tanzeem and published on 27th March, 1992, had made his intentions public to move this Court against his ap pointment.
Those averments are not controverted.
According to him further, it was on account of his academic distinctions, and with the full knowledge that he was totally blind from childhood, that he was appointed as a Member of the Public Service Commission.
He has also stated that his blindness never came in his way either in the pursuit of his studies or in his service as a teacher.
His experience in the public Commission also showed that the said defect did not come in his way of 525 discharging his duties effectively.
In this connection, he points out that the only thing he cannot do is to assess the individual 's external personality on the basis of the candidates external appearance which is not a material requirement for the candidates for many posts.
He has further added that the Commission sits in Committees or interview boards and every Committee usually consists of four or five persons including members of the Commission and experts from the respective departments.
The marks awarded to the candidates are agreed upon after due discussions and deliberations in the interview board.
The advice of the experts is a determinative factor in such decisions.
When the members of the interview board with non technical and non professional qualifications interview candidates for technical and professional posts, they do so with the aid and advice of the experts from the concerned departments.
Hence, if he is required to depend upon the opinion of the other members of the interview board for the external appearance of the candidates, that is not a dependence of a kind which vitiates the assessment of the interview board as a whole.
In any case, the dependence is not worse than the dependence of the members of the board on the opinion of the experts when they are not qualified to adjudge the candidates for posts requiring the relevant expertise.
The State Government has lent a tragicomic touch to the controversy by filing its affidavit, the relevant contents of which deserve reproduction here for reasons more than one.
The pathos is made poignant by the fact that the affiant Shri R.C. Vaish, Resident Commissioner of the State at New Delhi in his letter, which is placed on record, has stated that the draft affidavit was approved by Hon 'ble the Chief Minister of the State.
He has also stated that he has been authorised by the Secretary of the concerned department to swear the affidavit.
The relevant portion of the affidavit reads as follows: "That the respondent State upon reconsideration of the entire matter under controversy feels that the words of the Constitution have to be interpreted in letter and spirit and any departure from the express words of the Constitution wherever such departure seems to be permissible under the Constitution should be done only for sound and good reasons.
In the instant case, the departure with regard to appointment of members of the Bihar Public 526 Service Commission was made only because the proviso to Article 316 (1) of the Constitution is not mandatory.
Accordingly, while appointment the respondent No. 6 as the seventh non government member of the B.P.S.C. the mandate of proviso to Article '316 (1) was not followed.
it is felt that the fact that proviso to Article 316(1) not being mandatory is by itself not a good ground for departing from the suggestion of the Constitution and accordingly, the appointment of respondent No. 6 as member of the State Public Service Commission cannot be justified.
, At the time of appointment of respondent No. 6 as 'a member of the Bihar Public Service Commission he was the seventh nongovernment member when ' at that time there were only four government members in a 'total strength of eleven members in the B.P.S.C. That with ragard to the infirmity of the respondent No. 6, it is submitted that at the time of appointment of respondent No. 6,the aspect about his blindness was not specifically considered the same was stated in the Bio data of the respondent No. 6 in a very casual way and in such a manner that in had escaped the attention of the Constitutional authorities at the time of recommending the respondent No.6 for appointment to the post of member the B.P.S.C.
In this regard, it is submitted that the respondent No. 6 in his Bio data while praising his achievements had only stated that he is the first blind person to have been awarded Ph.D. ' There was no mention whether such blindness was subsequent to birth or whether such blindness was congenial There was also no details in the Bio data stating whether such blindness was complete or the some was partial, temporary, curable or not curable.
In these,facts, the aspect about the blindness of.
the respondent No. 6 was not specifically considered by any of the Constitutional Authorities who are involved in the appointment of a member to the State Public Service Commission.
That in this regard it is further submitted that the nature of duty of a member of a Public Service Commis 527 sion is primarily to make selections for appointments the various Govt.
jobs of the State and accordinly while making such recommendations the member of the State Public Service Commission has to interview the eligible candidates.
While conducting such interview, the member of the State Public Commission is to visually interview each candidate to determine his suitable.
After the appointment of the respondent of the respondent No. 6 it has come to the notice of the respondent No. 6, it has come to the respondent No. 6 is clearly hampering the effective discharge of official duties by the respondent No. 6".
[Emphasis supplied] To appreciate the first attack against the appointment it is necessary to reproduce the provisions of Article 316[1] and [2] of the Constitution which relate to the appointment and the term of office of the members of the Public Service Commissions, "316.
Appointment and term of office of members.
[1] The Chairman 'and other members.
of a Public Service Commission shall be appointed in the case of the Union Commission or a Joint Commission, by the President and in the case of a State Commission by the Government of the State: Provided that as nearly as may be one half of the members of every Public Service Commission shall be persons who at the dates, of their respective appointments have held, office for at least ten years, either under the igovernnient of India or under the Government of a State, and in, computing the said period of ten years any period before the commencement of this Constitution during which a person has held office under the Crown in India or under the Government of an Indian State shall be included.
[1 A] x x x x x [2] A member of a Public Service Commission shall hold 528 office for a term of six years from the date on which he enters upon his office or until he attains, in the case of the Union Commission, the age of sixty five years, and in the case of State Commission or a Joint Commission, the age of sixty two years, whichever is earlier: Provided that [a] a member of a Public Service Commission may, by writing under his hand addressed, in 'he case of the Union Commission or a Joint Commission, to the President, and in the case of a State Commission, to the Governor of the State, resign his office; [b] a member of a Public Service Commission may, be removed from his office in the manner provided in clause (1) or clause (3) of Article 317.
[3] x x x x XI It is apparent from these provisions that the Chairman and other members of the State Public Service Commission are appointed by the Governor of the State.
The appointments are obviously made on the advice of the Council of Ministers of the State.
The proviso to Clause 11 of the Article requires that "as nearly as may be", one half of the members of the Commission shall be persons who on the dates of their respective appointments have held office for at least ten years either under the Government of India or under the Government of a State.
For brevity 's sake we may refer to this category of members as service members.
The expression "as nearly as may be" itself suggest that the proportion of 50% of the service members is not exact but approximate and is meant not to be mandatory but directory.
The said proviso does not, in terms, say that in no case and at no point of time, the said proportion should either go above, or fall below 50%.
In the very nature of things, a strict adherence to the said direction is not practicable at any particular point of time.
In the first instance, the superannauation age of the member of the Commission is 62 years and his total tenure as a member cannot exceed six years.
He has to vacate his office either when his tenure comes to an end or when he attains the age of 62 years whichever is earlier.
When the members are appointed, they are bound to differ in age, whether they belong to the service category 529 or the non service category.
In the normal course, they would retire at different points of time.
If it is insisted, as is done on behalf of the appellant, that the said requirement must be followed strictly at all times, it would be well nigh impossible to do so.
Every time a member, whether belonging to the service or the non service category, retires, there should be available a suitable person from the same category to be appointed in his place.
It is not always possible to make an advance list of persons of either category who are suitable for such appointments.
Hence, the total strength of the Commission as well as the number from each of the categories, are bound to vary from time to time.
At any given point of time, therefore, it may not be possible to maintain the proportion between the two categories strictly in accordance with the direction given in the Constitution.
It appears that it is for this reason that the words "at least half ' used in the proviso to Section 265 [1] of the Government of India Act, 1935, corresponding to the present proviso to Article 316 [11, have been substituted by the words "as nearly as may be one half '.
The learned counsel appearing for the appellant, however, submitted that the expression "as nearly as may be one half ' has been used to convey that a fraction may be ignored if the total number of members cannot be exactly halved between service and non service categories.
We are afraid that this argument is too simplistic.
The fraction is and ran be taken care of without the aid of such expression and a document like the Constitution does not have to incorporate the normal rules of interpretation.
It is clear that the framers of the Constitution realised that to make the provision rigid was both inadvisable and unnecessary.
We have already demonstrated its impracticability.
It can further hardly be suggested that the need to have 50% from the service category is of such paramount importance to the composition of the Commission that the breach of it at any particular point of time would defeat the very object of constituting the Commission.
The purpose for which the said provision is made is obvious.
It was realised by the framers of the Constitution that the democratic system can be maintain only if civil servants are appointed solely on the basis of their merit adjudged by open competition, and only if they can carry of the administration according to law independently, instead of under pressure of their political superiors.
Hence they provided for Public Service Commissions as both the Union and the State level as autonomous bodies to enable then to carry on their functions independently, fairly and impartially.
Since the Commission 's main task was to recruit administrative personnel it was 530 necessary to have on the Commission members with sufficient administrative experience.
To induct persons of experience, it was imperative to provide that a certain proportion of the members of the Commission should have had an actual experience of running the administration so that the Commission is better able to adjudge the fairness of firness of persons to be recruited in the administration.
However the very fact that the Service Commission was not proposed to be constituted of the members from the service category exclusively also shows that the framers of the Constitution did not desire that the outlook of the service members alone should prevail while recruiting the personnel.
The view of the persons from outside the administration was also considered to be equally imperative in selecting the personnel.
A balance was therefore sought to be struck by providing the e, in Detecting the proportion between the two categories of members.
It would, however, be naive to suggest on that account that the framers of the Constitution presumed to ensure that on all occasions there shall be an exact balance of views.
It is unrealistic to believe that individuals with different backgrounds always insist on the acceptance of the outlook dictated by their background alone and refuse to share the view point of others.
It is certainly not expected of the members of such high ranking Constitutional body as the Public Service Commission.
We cannot also lose sight of the fact that the Service Commissions mostly sit in Committees and are aided and assisted by the experts from the concerned faculties, disciplines and departments.
The Committees take their decision collectively after due deliberations and discussions.
It is, therefore, the composition of these Committees and not so much the composition of the Commission at any particular point of time that matters.
Hence, we are unable to subscribe to the view that the proviso to Article 316 [1] requiring that as nearly as may be one half of the members of the Public Service Commission shall be from service category leaves no option to the Appointing Authority under any circumstance whatever, to allow reduction of representation from that category and a breach of the said requirement by reason of appointment of a member from non service category vitiates such appointment or the duties performed by such appointee as a member of the Public Service Commission.
The learned counsel for the appellant went so far as to contend that the said requirement constituted a qualification of the member to be appointed every time a vacancy is to be filled.
According to him depending 531 upon the shortfall in the representation of the respective category the member to be appointed has to be either form the service or non service category as the case may be and that is an essential qualification for his appointment.
The argument was that is an essential as in the present case, the representation of the service members of the Commission fell short of 50% then all persons to the appointed on the Commission till the said proposition was made up had to be from the service ctegory that being their necessary qualification.
It is not possible to accept this contention for the simple reason that as pointed out earlier, it may be possible to get a suitable person either from service or non service category over a period of time and for want of suitable candidates from the concerned category, the vacancies on the Commission may remain unfilled during that period.
The persons from the other category are available during that period.
The reasonable interpretation of the said proviso therefore is to treat it not as a strict rule to be enforced but as a binding gudeline to be followed in practice in spirit as far as possible and without deliberately flouting it, Hence it is not possible to hold that merely because at the time of appointment of respondent No. 6 there were four service members and six non service members he was disqualified for being appointed as the 7th member from the non service category.
The, second attack which is based upon the blindness of respondent No.6 is equally myopic.
As has been pointed out earlier respondent no.6 been blind from his childhood.
In spite of his blindness he acquired high educational qualifications and in fact at the time of his appointment he was an Associate Professor in the Patna University.
He is an acknowledged scholar of English Although the Government has now come forward to disown any knowledge about his complete blindness from the childhood, with which we will deal instantly they must be presumed to have known the said infirmity and should be deemed to have formed the opinion that in spite of his blindness, he was fit to be a member of thel Commission.
We see no reason to hold otherwise in the circimstances pointed out by respondent No. 6 in his affidavit to which we have already referred.
Nothing concrete has also been brought on record to show that he has failed ot perform his duties as a member of the Commission efficiently because of his blindness.
On the other hand as has been pointed out earlier the State Government itself had recommended him for 'Padmashree ' for his efficient discharge of the work as a member of the Commission and that too over a short span of few months.
We are also in agreement with the contentin advanced on his behalf that 532 except the external appearance of the candidates appearing before him, he is able to ascertain the required merits or demerits of the Candidates, as do the other members of the Commission.
The Commission, as it normally should, operates through Committees, and as regards the external appearance, the other members of the Committees give him the required information on the basis of which he is able to assess the overall merit of the candidates.
The external appearance of the candidates is also not of importance in all ap pointments.
What is futher necessary to note is that for selecting the candidates for almost all disciplines and departments, the experts from the concerned departments do sit in the Committees and the opinion of the experts ordinarily prevails in such appointments since the members of the Committees, who are the members of the Commission, do not have the expertise.
in the relevant fields.
This shows that all members of the Commission sitting on the interview Committees have also to be guided in their opinion by the experts.
If respondent No. 6 has to take guidance only in the matter of external appearance of the candidates, all members of the Commission have to be guided by the experts with regard to the most vital equipment of the candidates, viz., the intellectual calibre and the proficiency of the candidates in the relevant subjects.
There is, therefore, nothing wrong if only for external appearance, for which only a small percentage of the total marks is reserved, respondent No. 6 has to depend on the advice, opinion or guidance of the other members of the Committees and the Commission.
The decision of the interview board is always a collective one and is taken after deliberation on the merits and demerits of the candidates which are evaluated on the basis of various factors.
We are, therefore, unable to see as to how, in the circumstances, respondent No. 6 is unfit to carry on his duties as a member of the Commission because of his blindness.
The attack, however, was sought to be strengthened by relying on the provisions of sub clause [c] of Clause [3] of Article 317 of the Constitution which provides for removal of a member of the Public Service Commission on the ground that he is, in the opinion of the President, unfit to continue in office by reason of infirmity of mind or body.
The argument was that the blindness was infirmity of body and if it is a ground for removal from office, it is much more a disqualification for appointment and hence respondent No. 6 should be prevented from continuing in his office.
We are afraid that the first premise on which this limb of the argument is based misses the obvious fact, viz., that by "infirmity of body" 533 what is spoken of in the sub clause in question, is an infirmity which disables the Member from discharging his functions as such member effectively.
It is not every infirmity of body or every loss of use of any limb of the body.
The defect or deficiency must be such as would disable the Member from carrying out his duties satisfactorily and consistent with the trust reposed in him.
We have already pointed out that not only the blandness of respondent No. 6 does not prevent him from discharging his duties expected of him, but in fact the services rendered by him as such member have been eulogised and commended for a National Award by no other than the State Government itself and the Chairman of the Commission who had the first hand knowledge of his functioning.
This is apart from the fact that the Governor who appointed him on the advice of the Council of Ministers is presumed to have done so after satisfying himself that the loss of eye sight was not an infirmity which would impede him in the discharge of his duties.
The infirmity of body or mind which is referred to in the sub clause, further must necessarily be such as has arisen after the appointment and not the one which existed at the time of the appointment unless of course, the Government was unaware of the same at the time of the appointment.
We may now turn to the affidavit filed on behalf of the State Government.
A reading of the said affidavit leaves no doubt in our mind that it has been filed only to prejudice the case of respondent No. 6 before us because, for some reasons, he has fallen foul some persons in power.
As is evident from the portions of the affidavit reproduced above, firstly, a case is sought to be made out there that respondent No.6 was appointed as the 'non Government member ' of the Commission only because the proviso of Article 316 11 is not mandatory.
That may be so.
But the affidavit then proceeds to state almost in relenting terms that although the said proviso is not mandatory, that by itself is not a good ground for departing from the "suggestion of the Constitution" and hence the appointment of respondent No. 6 "as the 7th non Government member" was not justified.
It is not clear as to when this wisdom dawned on the Government for the first time.
The record further does not show as to who had suggested his name to the Governor and whether the decision was taken by the Council of Ministers as a whole or by the Chief Minister or any of his colleagues alone and what advice was received or obtained by them, if at all, while making the appointment.
We are however, happy to know that 534 the State Government "upon reconsideration of the entire matter under controversy feels that the words of the Constitution have to be interpreted in letter and spirit and any departure from the express words of Constitu tion. . should be done only for sound and good reasons".
We only hope that the State Government keeps that solemn declaration in mind for all purpose and for all times to come and does not forget it the moment the ink in the present proceedings dries.
But more breast beating of the Government is on the second issue viz, the blindness of respondent no.6 The affidavit states that at the time of the appointment "the aspect about his blindness was not specifically considered as the same was stated in the Bio data of the respondent No. 6 in a very casual way and in such a manner that it had escaped the attention of the Constitutional authorities at the time of recommending the respondent no.6 for appointment . . ".
not to be outdone by this ludicrous averment, the affidavit proceeds to state "that respondent No. 6 in his bio data while praising his achievements, had only stated that he is the first blind person to have been awarded Ph.D.
There was no mention whether such blindness was subsequent to birth or whether such blindness was congenital. .
There was [sic] also no details in the Bio data stating whether such blindness was complete, or the same was partial, temporary, curable or not curable.
It is then the case of the State Government that in the view of these facts the aspect above the blindness of the respondent No. 6 was not specifically considered by any of the Constituitonal authorities who are involved in the appointment of a member to state Public Service Commission".
Since the affiant himself has brought into picture the "Constitutional Authorities who are involved in the appointment the aspect of the blindness of respondent no.6 was not specifically of a member to the State Public Service Commission and has Stated that considered by them, we cannot help observing that the affiant by making such statement as made the Constitution authorities look ridiculous and their functioning a mockery in the eyes of the public.
We are anguished more on account of the that state Government should have considered it compulsive to allow such blatantly rabid statement s to be made on the oath with impunity.
No responsible public authority could have aware the that respondent No.6 was totally blindly from his childhood, when that made the client that none of the constitutional functionaries concerned was fact must have been widely known in the State and in all probability the extra ordinary abilities exhibited by him despite his blindness must have 535 been the main reason for his appointment as a member of the Public Service Commission.
Any statement seems to be good enough, whether true or untrue, so long as it is considered serviceable for thee immediate purpose in hand.
We refrain from making more comments which certainly such affidavits deserve, in ample measure, and let the affidavit speak for itself.
The affidavit further states that while conducting the interviews, members of the Commission have to visually interview each of the candidates to determine his suitability and after the appointment of respondent No. 6 "it has come to the notice of the respondent State that the blindness of the respondent No. 6 is clearly hampering the effective discharge of official duties by him.
It is necessary to remember in this ' connection that this affidavit has been filled on 23rd January 1993.
Respondent No.6 had filed his affidavit on 7th October, 1992.In that affidavit, respondent No. 6 has, among other things referred to,the certificate given by respondent No.5, Dr. Ram Ashray, Yadav, Chairma of the Public Service Commission on 11th September 1991 where he has stated that respondent No. 6 "has been performing his duties with exceptional excel lence without letting his blindness hinder his work.
I strongly recommend that Dr. Thakur be awarded National Award in recognition of his excellence despite his blindness." He has also referred in his affidavit to the letter of 22nd October, 1991 of the State Government to the Union Home Ministry recommending him for,the award of "Padmashree" for his services as a Member of the Public Service Commission.
Neither the certificate nor the letter has been controverted by the Chairman and.
the Government.
In the face of the certificate and the Said recommendatory letter, it is difficult to understand the basis on which it is now stated in the affidavit that the blindness of respondent No.6 is hampering his work.
There is, therefore, no doubt in our mind that the affidavit has been filed for the only purpose of seeking somehow the removal of respondent no.6 .Respondent No. 6 in his affidavit has alleged that he has since fallen 'but the respondent No. 5, the Chairman of the Commission and the Chairman is bent upon ousting him from the Commission.
To shows the animosity of the Chairman towards him he has given a list of events alongwith his affidavit.
These events have not been in controverted.
The High Court has referred to some of these events in paragraph 6 of its judgment.
Since they have a bearing On the Governments comments on his performance, we may reproduce the events catalogued by the High Court.
536 "1.
His P.A. has been replaced; 2.
His chamber, which contains two almirahs containing documents, has been locked up; 3.
The service of the reader, who is to read to him documents and journals and other papers is not being provided to him and his services have been terminated; 4.
The use of staff car by him has been stopped; 5.
His orderly has been transferred; 6.
The Chairman of the Commission has issued instructions not to receive any document from him or to obey his orders; 7.
His telephone bill for the month of Oct. 1991, for Rs. 598 only has not been paid though a sum of Rs. 18,154 on account of telephone bill of the Chairman 's residence has been paid.
The newspaper allowance payable to him is not being paid; 9.
He has not been allowed to attend the meetings of the Commission held on 11th December.
20th December and 31st December, 1991 and he is not aware when any other meeting has been held thereafter or not in as much as he has not been provided with any notice in respect of the same; 10.
He has been physically prevented from going to inside [sic.] the campus of the Commission since 28th of November, 1991.
" In the list of events accompanying his counter affidavit he has also referred to other incidents such as the attempted physical assault on him by the Chairman during a meeting of the Commission, the threats of physical liquidation administered from the telephonic line of the Chairman, the complaints made by him to the police, to the Chief Minister and to the 537 Governor etc.
We do not desire to burden this judgement, with the said details.
it is also not necessary to make any comment upon the aforesaid events since they speak for themselves.
They only reinforce the conclusion that the belated claim of the State Government that the appointment of respondent No.6 is invalid and that his blindness hampers the discharge of his duties has its obvious roots in the strained relations between him on the one hand and the Chairman and the State Government on the other.
While, therefore, dismissing appeal in the special facts of the case,, we also direct both the appellant and the respondent State of pay the costs of this appeal to respondent No.6, in the amounts of Rs. 5,000 and Rs., 10,000 respectively.
P.S.S. Anneal dismissed.
| The proviso to clause (1) of Article 316 of the Constitution requires that 'as nearly as may be ', one half of the members of the Public Service Commission shall be from service category.
Clause (2) of the Article entities a member of a Public Service Commission to hold office for a term of six years from the date on which he enters upon his office or he attains the age of superannuation provided therein whichever is earlier.
Subclause (c) of clause (3) of Article 317 provides for removal of a member of the Public Service Commission by reason of infirmity of mind or body.
Respondent No. 6, a blind, acknowledged scholar of English and Associate Professor in the Patna University, was appointed the seventh non service member of the Bihar State Public Service Commission on 4th March 1991.
The total strength of the Public Service Commission was eleven.
The other four members belonged to the services category.
On 11th September 1991, respondent No.5, the Chairman of the said Commission, gave a certificate stating that the respondent has been performing his duties with exceptional excellence without letting his blindness hinder his work and strongly recommended conferment of a national award in recognition of his excellence despite his blindness.
On 22nd October 1991 the State Government addressed a letter to the Union Ministry of Home Affairs recommending him for the prestigious national award of 518 'Padamshree ' for his services as a member of the Public Service Commission.
On 15th March 1992 the President of India conferred on him the National Award.
On 14th January 1992 the appellant, in a public interest ligigation, challenged the appointment of respondent No. 6 as a member of the Bihar Public Service Commission.
The High Court dismissed the writ petition.
In the appeal by special leave it was contended that the appointment of the seventh member from the non service category was violative of the proviso to Article 316(1) of the Constitution.
It was submitted that the expression 'as nearly as may be one half ' occurring in the said proviso has been used to convey that a fraction may be ignored if the total number of members cannot be exactly halved between service and non service categories.
The argument was that if the representation of the service members of the Commission fell short of 50% then all persons to be appointed on the Commission till the said proportion was made up, had to be from the service category, that being their necessary qualification.
It was further contended that respondent No. 6 was totally blind even from a date prior to his appointment and was unfit to be appointed by reason of the said physical infirmity.
The argument was that the blindness was an infirmity of body and if it was a ground for removal from office under Article 317(3) (c), it was much more a disqualification for appointment and hence respondent No. 6 should be prevented from continuing in his office.
In the affidavit riled on behalf of the State Government on 23rd January 1993 it was stated that although the proviso to Article 316(1) was not mandatory, that by itself was not a good ground for departing from the suggestion of the Constitution and hence the appointment of respondent No. 6 as the 7th non Government member was not justified.
It was further stated that at the time of the appointment, the aspect about his blindness was not specifically considered as the same was stated in the bio data of respondent No. 6 in very causal way and in such a manner that it had escaped the attention of the constitutional authorities at the time of recommending respondent No. 6 for appointment.
The affidavit further stated that while conducting the interviews, members of the Commission had to visually interview each of the candidates to determine his suitability and after the appointment of respondent No. 6 it had come to 519 the notice of the respondent State that the blindness of respondent No. 6 was clearly hampering the effective discharge of official duties by him.
It was contended for respondent No. 6 that it was on account of his academic distinctions, and with the full knowledge that he was totally blind from childhood that he was appointed as a member of the Public Service Commission; that his blindness did not come in his way of discharging his duties effectively , that the only thing he could not do was to assess the individuals external personality on the basis of the candidate 's external appearance, which was not a material requirement for the candidates for many posts; that his dependence upon the opinion of the other members of the interview board for this aspect was not of a kind which vitiated the assessment of the interview board as a whole; that he had made a representation to the President of India, the Governor of Bihar and others, against the serious misconduct, gross malpractices and wilful violation of the constitutional mandate by the Chairman of the Commission, and that it was this dispute with the Chairman, who was backed by the Chief Minister of the State, which had led to the writ petition.
Dismissing the appeal, the Court, HELD: 1.1.
Merely because at the time of appointment of respondent No. 6, there were four service members and six non service members, it cannot be said that he was disqualified for being appointed as the 7th member from the non service category.
[531D] 1.2.
The reasonable interpretation of the proviso to Article 316(1) of the Constitution requiring that as nearly as may be one half of the members of the Public Service Commission shall be from service category, is to treat it not as a strict rule to be enforced but as a binding guideline to be followed in practice in spirit as far as possible and without deliberately flouting it.
[531D] 1.3.
The expression "as nearly as may be" used in the proviso itself suggests that the proportion of 50% of the service members is not exact but approximate and is meant not to, be mandatory but directory.
The said proviso does not, in terms, say that In no case and at no point of time, the said proportion should either go above or fall below 50%.
The fraction is and can be taken care of without the aid of the expression "as nearly as may bell, and a document like Constitution does not have to Incorporate 520 normal rules of interpretation.
The need to have 50% members from the service category also cannot be said to be of such paramount importance to the composition of the Commission that the breach of it at any particular point of time would defeat the very object of constituting the Commission.
[528F G, 529F] 1.4.
Furthermore, when the members are appointed, they are bound to differ in age, whether they belong to the service category, or the non service category.
In the normal course, they would retire at different points of time.
At that time, a suitable person from the same category may not be available to be appointed in their place.
It is not always possible to make an advance list of persons of either category who are suitable for such appointment.
Hence the total strength of the Commission as well as the number from each of the categories, are bound to vary from time to time.
At any given point of time, therefore, it may not be possible to maintain the proportion between the two categories strictly in accordance with the direction given in the Constitution.
[529B C] 1.5.
By providing the proportion between the service and non service members of the Commission, the framers of the Constitution sought to strike a balance amongst the two categories.
However, on that account, the framers of the Constitution cannot be presumed to ensure that on all occasions there shall be an exact balance of views between these two categories of members.
It is unrealistic to believe that individuals with different backgrounds always insist on the acceptance of the outlook dictated by their background alone and refuse to share the viewpoint of others.
It is certainly not expected of the members of such high ranking constitutional body as the Public Service Commission.
Furthermore, the Service Commissions mostly sit in Committees and are aided and assisted by experts from the concerned faculties, disciplines and departments.
The Committees take their decision collectively after due deliberations and discussion.
It is, therefore, the composition of these Committees and not so much the composition of the Commission at any particular point of time that matters.
[530C E] 1.6.
The appointing authority, therefore, cannot be said to have no option, under any circumstance whatever, to allow reduction of representation from the service category and a breach of the requirement contained in the proviso to Article 316(1) by reasons of appointment of a 521 member from non service category would vitiate such appointment or the duties performed by such appointee as a member of the Public Service Commission.
[530G] 2.
Respondent No. 6 cannot be said to be unfit to carry on his duties as a member of the Commission because of his blindness.
Nothing concrete has been brought on record to show that he had failed to perform his duties as a member of the Commission efficiently.
Except the external appearance of the candidates appearing before him, he is able to ascertain the required merits or demerits of the candidates, as to the other members of the Commission.
The Commission operates through Committees.
For selecting the candidates for almost all disciplines and departments, the experts from the concerned departments sit in these Committees and the opinion of the experts ordinarily prevails in such appointments since the members of the Committees, who are the members of the Commission do not have the expertise in the relevant fields.
This shows that all members of the Commission sitting on the interview Committees have also to be guided in their opinion by the experts.
If respondent No. 6 has to take guidance only in the matter of external appearance of the candidates, all members of the Commission have to be guided by the experts with regard to the most vital equipment of the candidates, viz., the intellectual caliber and the proficiency of the candidates in the relevant subjects.
There is,, therefore, nothing wrong if only for external appearance, for which only a small percentage of the total marks is reserved, respondent No. 6 has to depend on the advice, opinion or guidance of other members of the Committees and the Commission.
[532B E] 3.1.
By 'infirmity of body ' what is spoken of in sub clause (c) of clause (3) of Article 317 of the Constitution is an infirmity which disables the member from discharging his functions as such member effectively.
It is not every infirmity of body or every loss of use of every limb of the body.
The defect or deficiency must be such as would disable the member from carrying out his duties satisfactorily and consistent with the trust reposed in him.
The said infirmity further must necessarily be such as has arisen after the appointment and not the one which existed at the time of the appointment, unless of course, the Government was unaware of the same at the time of appointment.
[533A B, D] 3.2.
In the instant case, not only the blindness of respondent No. 6 522 does not prevent him from discharging his duties expected of him, but in fact the services rendered by him as such member have been eulogised and commended for a national award by no other than the State Government itself and the Chairman of the Commission, who had first hand knowledge of his functioning.
This is apart from the fact that the Governor who appointed him on the advice of the Council of Ministers is presumed to have done so after satisfying himself that the loss of eyesight was not an infirmity which would impede him in the discharge of his duties.
[533C] 4.1.
No responsible public authority could have made the claim that none of the constitutional functionaries concerned was aware that respondent No. 6 was totally blind from his childhood, when that fact must have been widely known in the State and in all probability the extra ordinary Abilities exhibited by him despite his blindness must have been the main reason for his appointment as a member of the Public Service Commission.
The State Government should not have considered it compulsive to allow such blatantly rabid statements to be made on oath with impunity.
The affiant by making such statement has made the constitutional authorities look ridiculous and their functioning a mockery.
[534H G] 4.2.
Neither the certificate given by respondent No. 5, the Chairman of the Public Service Commission, on 11th September, 1991 nor the letter of the State Government to the Union Home Ministry dated 22nd October 1991, has been controverted by the Chairman and the State Government.
The averment in the affidavit that the blindness of respondent No. 6 is hampering his work, therefore, has no basis.
The belated claim of the State Government against respondent No. 6 has its obvious roots in the strained relations between him on the one hand and the Chairman and the State Government on the other.
[535E F] 5.
The appellant and the respondent State is directed to pay the costs of the appeal to respondent No. 6.
[537C]
|
it Petitions Nos. 627, 662,296, 27 1 & 452 of 1987.
(Under Article 32 of the Constitution of India).
WITH Civil Miscellaneous Petition No. 12733 of 1988.
M.K. Ramamurthy, M.A. Krishnamurthy and Mrs. Indira Sawhney for the Petitioners.
Ram Panjwani, Raj Panjwani and Vijay Panjwani for the Respondents.
The Judgment of the Court was delivered by AHMADI, J.
This batch of petitions brought under Arti cle 32 of the Constitution of India challenge certain ac tions taken by the officers of the Trade Fair Authority of India (TFAI) in exercise of their disciplinary jurisdiction whereby the services of certain regular workmen have been terminated and several casual or daily rated workers are rendered jobless.
Put briefly, the facts giving rise to these petitions are as under: The 'Trade Fair Authority Employees ' Union (Union here after) was demanding housing facilities, regularisation of atleast 50% of casual or daily rated employees and upward revision of the salaries and allowances of the workers of TFAI.
These demands were discussed with the Chief General Manager of TFAI on August 29, 1986 and thereafter from time to time but nothing concrete emerged.
The case 262 of the Union is that the Chief General Manager had assured the Union representatives that although it may not be possi ble to regularise the service of casual labour to.
the extent Of 50% some posts had already been identified and the Standing Committee of TFAI which was seized of the matter would take a decision at an early date.
On the question of upward revision of wages and allowances the Union 's case is that the Chief General Manager had given an assurance that pending final decision by the High Powered Committee of TFAI, the scales prevailing in MMTC and STC could be adopt ed.
The grievance of the Union is that despite these assur ances no action to implement the same was taken whereupon the Union wrote to the Chief General Manager on October 29, 1986 seeking implementation of the assurances at an early date and not later than November 15, 1986.It was also commu nicated that the workers belonging to the Union had decided to proceed on a token strike of one day on November 13, 1986.
At a subsequent meeting held on November 3, 1986 the General Manager of TFAI is stated to have assured the Union representatives that the Standing Committee will be request ed to take up the issue on priority basis so that the out come becomes known by the end of November, 1986.
No such decision was taken by the end of November, 1986; not even after the Union 's reminders of December 18, 1986 and January 9, 1987 whereupon the Union wrote a letter dated January 15, 1987 to the Chief General Manager to permit the Union to hold a General Body Meeting of the Union on January 19, 1987 during lunch hours.
In anticipation of such permission being granted, which had always been granted in the past, the Union despatched notices to its members to attend the meet ing.
However, the Chief General Manager informed the Union representatives that the permission was refused.
Within minutes of the receipt of this communication, the President of the Union sent a reply stating that it was not possible to cancel the meeting at such short notice.
The General Body Meeting was held as schedule and a decision was taken to strike work on January 21, 1987 to protest against the management 's failure to implement the assurances already given.
On the same day, January 19, 1987, the Union served the management with a notice informing it about the decision to strike work on January 21, 1987.
The management reacted by placing the President, Vice President and Executive Mem bers of the Union under suspension with immediate effect, i.e. with effect from January 20, 1987.
This angered the striking workmen who had gathered outside the precincts of TFAI on January 21, 1987.
They demanded the immediate with drawal of the suspension orders failing which they threat ened that the strike would continue indefinitely.
Intimation to this effect was served on the Chief General Manager.
The management however suspended all the re 263 maming office bearers, the executive members and leading activists of the Union w.e.f. January 23, 1987.
The strike was, however, called off w.e.f.
January 24, 1987, according to the Union in the larger interest of .TFAI and in national interest as the President of India was to inaugurate the AHARA '87 on January 25, 1987, while according to the man agement it continued for almost two weeks.
Writ Petition No. 296/1987 is by those 42 suspended workers.
Now, during the strike some of the casual workers at tended duty and their services remained unaffected, some others who reported for duty after the strike and were prepared to sign an undertaking in the prescribed form were given work while the remaining casual workers who did not sign such an undertaking or were late in reporting for work were denied employment.
The Union 's case is that out of a total work force of about 500 casual workers, 160 did not participate in the strike and about 90 signed the undertak ing and they have since been employed while the remaining casual workers are denied work.
The Union sought the inter vention of the Union Commerce Minister and also invoked the jurisdiction of the Labour Commissioner, Delhi Administra tion, with a view to finding an amicable settlement as the discharged workers were facing untold miseries.
However, contends the Union, the response of the management was not positive and hence the Union was left with no alternative but to invoke this court 's jurisdiction for an early solu tion of the unemployment problem faced by the workers.
Writ Petition No. 271/87 is by 243 casual laborers who have thus been rendered jobless.
Thereafter the management by their orders of March 3, 1987 terminated the services of all the 12 office bearers and Executive Committee Members who had been suspended earlier in exercise of their power under the special proce dure outlined in Rule 32 of the TFAI Employees (Conduct, Discipline and Appeal) Rules, 1977 ( 'The Rules ' hereafter).
This rule inter alia empowers the Board of TFAI to impose any of the penalties specified in Rule 25 (which includes penalties from Censure to Dismissal), without holding an inquiry if the Board is satisfied for reasons to be stated in writing that it is not practicable to hold such inquiry or in the interest of the security of the Authority it is not expedient to hold such inquiry.
This provision overrides the need to hold a departmental inquiry under Rules 27 to 29 of the Rules.
The Board in the impugned orders of dismissal has assigned three reasons in support of its decision that is not practicable to hold an inquiry, namely "(i) you by yourself and together with and through other associates have threatened, intimidated and terrorised the Disci 264 plinary Authority so that he is afraid to direct the inquiry to be held; (ii) you the employee of Trade Fair Authority of India particularly through and together with your associates have terrorised and threatened and intimidated witnesses who are likely to give evidence against you with fear of repris al as to prevent them from doing so; and (iii) as an atmos phere of violence and of general indiscipline and insubordi nation has been created by a group of suspended employees".
The board has also stated in the impugned order that it is not expedient in the interest of security of the TFAI to hold an enquiry in the manner provided by the Rules.
Annex ure I to each order sets out the reasons which impelled the Board to visit the 12 employees with the extreme penalty of dismissal.
These 12 dismissed workers have challenged the orders of dismissal by their writ petition No. 267 of 1987.
Writ Petition No. 452 of 1987 is by one Raju, an employ ee of TFAI.
He was a casual laborer of TFAI since 1982 and was selected on July 4, 1986 as a Mini Stiller Driver in the scale of Rs.260 400.
He joined the new post on the same day but his appointment was cancelled without assigning any valid reason on July 25, 1986 and he was reverted as a daily wager.
He too had joined the others for regularisation of his service and had taken part in the strike.
The management by office order dated March 2, 1987 terminated his service w.e.f. December 1, 1986.
No enquiry was held nor was any opportunity to explain his conduct given to the delinquent before his services came to be terminated.
He has, there fore, challenged the order dated July 25, 1986 and the subsequent order dated March 2, 1987 as violative of the principles of natural justice.
Writ Petition No. 662 of 1987 concerns two daily rated Security Guards of TFAI whose services came to be terminated by TFAI.
The service of Bansi Dhar came to be terminated on April 2, 1987 while that of his companion Vipti Singh came to be terminated on April 8, 1987.
Their allegation is that their services were dispensed with because they refused to give false evidence against their co workers who were active members of the Union and who had filed W.P. No. 271/87 challenging the mala fide action of TFAI terminating the services of 243 casual daily rated workers.
They contend that even though they had remained on duty during the strike, their services were terminated because they refused to falsely implicate their coworkers who had espoused their cause.
They, therefore, contend that their termination smacks of victimisation.
In all the writ petitions Mr. N.N. Kesar, Manager (Admn) TFAI 265 has filed his counter contending that as the.
petitions require collection of facts this Court should refuse to entertain these petitions and should relegate the petition ers to the industrial tribunal or the concerned High Court.
According to the deponent TFAI had to take action against the office bearers of the Union as they had created an atmosphere of violence and had paralysed the smooth func tioning of TFAI from November, 1986 onwards.
Instances of insubordination, threats, violence and lack of discipline have been enumerated to show that officers of TFAI found it difficult to carry out their functions and duties because of constant fear to themselves and their kith and kin.
Even though permission for holding a General Body meeting on January 19, 1987 within the precints of TFAI was refused, the meeting was held at which inflammatory and provocative speeches were made by the Union leaders.
Extracts from the speeches of the various Union leaders have been set out in the counter to acquaint the court to the type of atmosphere that prevailed at a point of time when several important foreign delegates and VIPs were attending the International Fair held by TFAI.
The secret reports which were received from the officers of TFAI at different levels also suggested that trouble was brewing and immediate firm action was necessary.
Therefore, when the management learned that the employees had decided to go on a token strike on January 21, 1987 it took action of suspending some of the office bearers of the Union.
After the strike was prolonged upto January 23, 1987, TFAI had to make alternative arrangements includ ing security arrangements to ensure that no untoward inci dent occurred during the visit of foreign VIPs and more particularly during the visit of the President of India who was to inaugurate the AHARA 1987 on January 25, 1987.
Even during the visit of the President certain employees posted themselves at the main gates along with the President, Vice President, General Secretary and Secretary of the Union for picketing.
Since certain other inaugurations by VIPs were to take place between January 28, 1987 and February 2, 1987, TFAI was constrained to file a suit No. 263 of 1987 in the Delhi High Court against the Union and seven office bearers to restrain them from preventing and obstructing the entry of delegates, guest, dignitaries, etc.
into the Pra gati Maidan where TFAI was having its fair.
An ex parte injunction was granted prohibiting picketing, slogan shout ing, etc.
within 75 meters of all gates leading to the Fair as shown in the map appended to the suit.
It will thus be seen that according to TFAI the workers ' agitation was not a peaceful one as is alleged by the petitioners.
It was in the backdrop of these facts that the Board decided to terminate the services of the 12 employees by virtue of the power conferred on it by Rule 32 of the Rules.
The reasons which impelled 266 the Board to take this drastic action have been set out in the annexure appended to each order of dismissal.
TFAI, therefore, contends that the action taken against the 12 erring workers is just, legal and proper and this Court should refuse to interfere with the same.
So far as the suspended employees are concerned TFAI contends that it has power under Rule 22 of the Rules to suspend erring delin quents pending inquiry.
Such suspended employees are enti tled to suspension allowance paid at 50% of salary and allowances.
It is denied that TFAI has used the power of suspension as a coercive measure.
It is however stated that the correct number of suspended employees is 34 as named in the Counter.
Out of these 34 employees, the suspension order of 33 workmen have since been revoked on acceptance of their explanation.
Hence the suspension order that survives is against Peon Umed Singh only, who is receiving suspension allowance as per rules.
Insofar as the casual labour is concerned, it is con tended that TFAI had taken over the maintenance of Pragti Maidan from C.P.W.D.w.e.f.
January 1983.
The Standing Com mittee had, therefore, sanctioned a certain number of posts of the Engineering staff for this purpose.
A number of daily wage posts on muster roll were created from time to time and were filled in by both skilled and unskilled labour.
A proposal for regularising such employees was pending before the Standing Committee which had called for information.
It was however tentatively decided that 85 posts may be consid ered urgently for regularisation.
This proposal was cleared in January, 1987.
The matter was pending with the Internal Works Study Unit in the Ministry of Commerce and their report was awaited.
It was, therefore, contended that TFAI was always sympathetic in its approach and yet the Union gave a call for a strike on January 19, 1987.
The TFAI denies that it did not provide work to casual labour when they reported on January 24, 1987 or thereafter or that they demanded any such undertaking as alleged.
As regards the termination of Raju 's service it is contended by TFAI that he was given a provisional appoint ment on July 4, 1986 but the same had to be terminated on July 25, 1986 firstly because it subsequently came to light that he was convicted on June 30, 1987 under Sections 87 and 113 of the Motor Vehicles Act and fined Rs.300 and secondly because of his outrageous behaviour with his dealing assist ant on July 22, 1986.
These two reasons 'formed the basis and the grounds and the administrative reasons ' for with drawal of the provisional offer made in the letter of July 4, 1986.
However, the letter of July 25, 1986 uses the words 'some administrative reasons ' for cancel 267 lation of the order and impugned order of March 2, 1987 gives no reason whatsoever.
It is, ' therefore, contended that since the offer was only provisional, the petitioner had no right to the post and hence the petition deserves to be dismissed.
So far as the termination of service of the two Security Guards is concerned it is contended that the allegation that their services were dispensed with because they refused to co operate with the management and give evidence against their co workers is denied.
It is, therefore, contended that their petition is without merit.
When these petitions reached hearing before this Court on October 13, 1987, this Court passed a common order di recting the Chief Secretary of Delhi Administration to spare the services of a Judge of the Labour Court to look into the facts of these cases and finalise its report so as to reach the Registry of this Court on or before December 18, 1987.
Since the inquiry could not be finalised within the time allowed the time was extended upto October 31, 1988.
Shri Bhola Dutt, Presiding Officer, Labour Court (VII) submitted his report on October 29, 1988.
Before finalising its report the Labour Court gave an opportunity to the contesting parties to file their pleadings.
Issues were framed thereaf ter, parties were permitted to lead oral and documentary evidence, counsel were heard on the evidence tendered and only thereafter the Labour Court recorded its findings.
It came to the conclusion that the 243 casual labourers had been doing conservancy work since several years and all of them were denied work when they reported for duty on January 24, 1987 and thereafter because the work of Safai Kamdars was handed over to M.C.D.w.e.f.
January 22, 1987.
It, howev er came to the conclusion that denial of work to all the 243 casual workers was not justified.
So far as the only sus pended employee Peon Umed Singh is concerned, the Labour Court opined that mere participation in the strike called by the Union would not furnish a sufficient cause to order large scale suspension of employees much less termination of their employment.
Since 33 of his colleagues similarly suspended were taken back in service there was no justifica tion to single out Umed Singh for different treatment, more so when no disciplinary action is initiated or contemplated against him.
With regard to the termination of Raju driver 's service, the Labour Court came to the conclusion that the management had acted in an illegal manner.
In the first place it was not possible to accept the reason that during the summer season there is paucity of work and hence the provisional offer made on July 4, 1987 had to be cancelled within twenty days on July 25, 1987.
It would it difficult to believe that 268 within such a short period there was a slump in work neces sitating cancellation of the order.
As to the second reason regarding his conviction under the Motor Vehicles Act it pointed out that the allegation that he had abused Amar Singh was not inquired into and the delinquent was not given an opportunity to explain his conduct.
Certain other allega tions by the management regarding his behaviour e.g. absence without prior intimation, etc., all amount to misconduct for which a departmental enquiry was necessary and in the ab sence of such an enquiry the order was unsustainable.
It therefore, held that the termination of Raju 's service was illegal.
The case of the two security guards has been dealt with in detail by the Labour Court.
The Labour Court points out that the management decided to refuse work to Bansi Dhar as his performance was not found to be satisfactory.
He was served with memos dated December 25, 1984, February 10, 1986 and February 20, 1987 with a warning to improve his perform ance failing which the management would be constrained to refuse work to him.
The note submitted by the Chief Security Officer on March 3, 1987 that his termination may be consid ered if he is found absent or indisciplined in future is indicative of the fact that the management desired to give him an opportunity to improve.
Nothing had happened between March 3, 1987 and April 2, 1987 to warrant the termination of his service.
The Labour Court, therefore, held that the termination of his employment by the order of April 2, 1987 was not sustainable.
As regards his companion Vipti Singh the management pointed out that apart from the fact that his service was not satisfactory as is reflected by the memos of August 14, 1985 and October 20, 1986, he was found to have signed the attendance register from March 23, 1987 to March 29, 1987 even though he was admittedly absent on those days.
The Labour Court examined this ground in detail and came to the conclusion that even though the workmen had signed his presence on those dates, some doubt arose on account of absence of cross marks in the register.
The Labour Court, therefore, came to the conclusion that the termination of the service was also not justified.
Taking note of the fact that the Union was demanding the upward revision of wages of non executive staff, housing facility and regularisation of casual labour and the manage ment 's failure to accede to the demands notwithstanding the meetings held on August 29, 1986, November 3, 1986 and January 19, 1987, the Labour Court came to the conclusion that the strike was legal and justified, peaceful and nonvi olent and for a duration of only three days.
The Labour Court also 269 came to the conclusion that there was no justification for resorting to the exercise of extraordinary powers under Rule 32 of the Rules.
In the view of the Labour Court participa tion in strikes and slogan shouting are part of trade union activity and hence it was not legal and proper to visit the twelve Union leaders with the extreme punishment of dismiss al from service.
It, therefore, held that their dismissal was illegal, unjustified and wholly arbitrary.
All the above findings of the Labour Court have been assailed by the TFAI in the objections to the report.
It is not necessary for us to indicate in detail the nature of the objections but suffice it to say that according to the TFAI the findings reached by the Labour Court are one sided, perverse and contrary to the evidence on record.
We have perused the objections as well as the reply filed thereto by the petitioners.
From the above resume it clearly emerges that the char ter of demands put forth by the Union was pending considera tion.
The main demands were three in number, namely, (i) for upward revision of wages (ii) for regularisation of services of casual labour and (iii) for providing housing facilities to the employees.
Efforts to settle these pending issues through negotiations were made at the level of the Chief General Manager and it appears that this response was not negative.
It appears that the question of regularisation of casual and daily rated workers was referred to the Standing Committee of the Board which had taken the tentative deci sion to create 85 posts on the regular establishment for regularisation.
This proposal was forwarded to the I.W.S. unit of the concerned Ministry for approval.
However since the final decision was delayed the union leaders become restive.
The Union representatives, therefore, decided to call a General Body Meeting to decide on the future course of action.
On January 15, 1987 it wrote to the management to permit it to hold a meeting on January 19, 1987.
Notwith standing the refusal of the permission the Union was com pelled to hold the meeting as it had informed its members and it was not possible to shift the venue at short notice.
The angered leaders who addressed the workers condemned the management 's action in refusing to solve the outstanding problems of the workers in strong language.
We have perused the extracts from their speeches on which TFAI relies.
The language used is no doubt harsh and it would have been proper if such language had been avoided.
Counsel for TFAI also strongly contended that since the strike was illegal the workers are not entitled to any relief.
We see no merit 270 in this submission.
The right to form association or unions is a fundamental right under Article 19(1)(c) of the Consti tution.
Section 8 of the Trade Unions Act provides for registration of a trade union if all the requirements of the said enactment are fulfilled.
The right to form associations and unions and provide for their registration was recognised obviously for conferring certain rights on trade unions.
The necessity to form unions is obviously for voicing the de mands and grievances of labour.
Trade unionists act as mouthpieces of labour.
The strength of a trade union depends on its membership.
Therefore, trade unions with sufficient membership strength are able to bargain more effectively with the managements.
This bargaining power would be consid erably reduced if it is not permitted to demonstrate.
Strike in a given situation is only a form of demonstration.
There are different modes of demonstrations, e.g., go slow, sit in, work to rule, absentism, etc., and strike is one such mode of demonstration by workers for their rights.
The right to demonstrate and, therefore, the right to strike is an important weapon in the armoury of the workers.
This right has been recognised by almost all democratic countries.
Though not raised to the high pedestal of a fundamental right, it is recognised as a mode of redress for resolving the grievances of workers.
But the right to strike is not absolute under our industrial jurisprudence and restrictions have been placed on it.
These are to be found in sections 10(3), 10A(4A), 22 and 23 of the (`I.D. Act ' for short).
Section 10(3) empowers the appropriate Government to prohibit the continuance of a strike if it is in connection with a dispute referred to one of the fora created under the said statute.
Section 10A(4A) confers similar power on the appropriate Government where the industrial dispute which is the cause of the strike is referred to Arbitration and a notification in that behalf is issued under Section 10(3A).
These two provisions have no application to the present case since it is no body 's con tention that the union 's demands have been referred to any forum under the statute.
The field of operation of Sections 22 and 23 is differ ent.
While Section 10(3) and Section 10A(4A) confer power to prohibit continuance of strike which is in progress, Sec tions 22 and 23 seek to prohibit strike at the threshold.
Section 22 provides that no person employed in a public utility service shall proceed on strike unless the require ments of clauses (a) to (d) of sub section (1) thereof are fulfilled.
The expression 'public utility service ' is de fined in Section 2(n) and indisputably TFAI does not fall within that expression.
Section 23 next imposes a general restriction on declaring strikes in breach of contract during pendency of (i) conciliation proceedings.
(ii) pro ceed 271 ings before Labour Court, Tribunal or National Tribunal, (iii) arbitration proceedings & (iv) during the period of operation of any settlement or award.
In the present case no proceedings were pending before any of the aforementioned fora nor was it contended that any settlement or award touching these workmen was in operation during the strike period and hence this provision too can have no application.
Under Section 24 a strike will be illegal only if it is commenced or declared in contravention of Section 22 or 23 or is continued in contravention of an order made under Section 10(3) or 10A(4A) of the I.D. Act.
Except the above provisions, no other provision was brought to our attention to support the contention that the strike was illegal.
We, therefore, reject this contention.
The next question is whether the material on record reveals that the office bearers of the union had given threats to officials of TFAI as alleged.
The Labour Court has negatived the involvement of office bearers of the union in giving threats either in person or on telephone.
We have perused the evidence on record in this behalf and we are inclined to think that there were angry protests and efforts to obstruct the officers from entering the precints of TFAI but there is no convincing evidence of use of force or violence.
From what we have discussed above we are of the view that although TFAI was sympathetic to regularisation of service of the casual workers, since the proposal had to pass through various levels it was not possible to take an early decision in the matter.
It was held up in the Ministry for which TFAI could not be blamed.
So also the proposal to revise the wages of non executive staff was under considera tion since some time.
However, the Union leaders lost pa tience and took a decision to proceed on strike on the eve of the President 's visit to TFAI.
This action of the Union impelled TFAI to make alternative arrangements.
It, there fore, dismissed the 12 union leaders invoking Rule 32 of the Rules.
On going through the material placed before the Labour Court, we feel that the criticism levelled by TFAI that it exceeded its brief and has betrayed a somewhat one sided approach cannot be said to be wholly misplaced.
We have, however, looked to the bare facts found by it.
We are howev er disinclined to analyse the evidence before the Labour Court because we are of the view that even though TFAI was not averse to the demands of labour it could not take a final decision at an early date for want of approval from the concerned Ministry.
This angered the Union representa tives more particularly because the 272 executive staff was granted upward revision of salary, allowances, etc., and hence they decided to call a meeting of the general body to decide on the future course of ac tion.
In their frustration they decided to put pressure by proceeding on strike.
During the strike period certain events happened which we wish were avoided.
But fortunately nothing destructive, meaning thereby damaging to the proper ty of TFAI, took place.
A few brushes and exchange of strong words appear to have taken place which are described as threats by the management.
The vast mass of labour was only responding to the call of the Union.
Even the union repre sentatives were acting out of frustration and not out of animoisity for the officers.
The facts of this case, there fore, demand that we appreciate the conduct of both sides keeping in mind the prevailing overall situation.
While the workers were frustrated for want of an early solution, the management was worried because of the impending visit of the President on January 25, 1987.
Instead of trying to lay the blame at the door of either party, which would only leave a bitter taste for long, we think we should resolve the crisis in the larger interest of the institution.
Taking an overall view of the facts and circumstances which emerge from the oral as well as documentary evidence placed on record, we are of the opinion that while some of the Union leaders acted in haste, they do not appear to have been actuated by any oblique motive.
The management also took action against the workmen not because it was unsympa thetic towards their demands but because of the anxiety caused to them on account of untimely action taken by the Union only a few days before the President 's scheduled visit to the fare.
The management also felt hurt as its reputation was at stake since several dignitaries from abroad were participating in the fare.
Its action must, therefore, be appreciated in this background.
The interest of the institution must be paramount to all concerned including the workmen.
At the same time this Court cannot be oblivious to the economic hardship faced by la bour.
We have already pointed out earlier how both parties reacted to the tense atmosphere that built up over a period of time.
The facts found by the labour court clearly show that while the labour was frustrated as its demands were outstanding since long and they were finding it difficult to combat the inflation without an upward revision in wages, etc., the management was worried about TFAI 's reputation likely to be lowered in the eyes of visiting dignitaries because of certain events that were happening due to the workers ' agitation.
In these circumstances it would be unwise and futile to embark upon a fault finding mission.
273 Keeping the interest of the institution in mind and bearing in mind the economic hardships that the labour would suffer if the impugned orders are not set aside, we think that it would be desirable to restore the peace by directing the re instatement of the workers.
However, so far as the case of the security guard Vipti Singh is concerned, we are constrained to say that the material on record does disclose that he had signed the attendance register showing his presence from March 23, 1987 to March 29, 1987 even though he was in fact absent on those days.
His explanation in this behalf is far from convincing.
We are, therefore, of the opinion that he deserves punishment, but not the extreme punishment of dismissal from service.
We think that the ends of justice would be met if we direct his reinstatement without back wages.
So far as the case of driver Raju is concerned, it must be pointed out that the management cancelled the offer of July 4, 1986 by the letter of July 25, 1986 because of his conviction under Sections 87 and 113 of the Motor Vehicles Act and his so called outrageous behaviour with the dealing assistant on July 22, 1986.
These being clearly acts of misconduct, the action of the management must be held to be penal in nature and cannot be sustained as it was taken without hearing the delinquent.
To hold an enquiry against him at this late stage is not desirable.
In the result all the writ petitions are allowed and the rule is made absolute in each case to the extent indicated hereinafter.
The management will prepare a list of casual daily rated workers who were its employees prior to the strike on January 21, 1987 in accordance with their seniori ty, if such a list does not exist.
TFAI will provide them work on the same basis on which they were given work prior to the strike.
After the seniority list is prepared TFAI will absorb 85 of the seniormost casual workers in regular employment pending finalisation of the regularisation scheme.
TFAI will complete the regularisation process within a period of 3 months from today.
TFAI will determine the .umber of casual employees who would have been employed had they not proceeded on strike.
The wages payable to such casual employees had they been employed for the period of 6 months immediately preceding the date of this order will be worked out on the basis of actual labour employed and the amount so worked out will be distributed amongst the casual employees who report for work in the next three months after TFAI resumes work to casual labour.
Peon Umed Singh, Securi ty Guard Bansi Dhar and Driver Raiu will also be reinstated in service forthwith.
They too will be paid 274 back wages (less suspension allowance, if any) for a period of 6 months immediately preceding this order.
So far as Driver Raju is concerned he will be absorbed in regular service as per the offer made in the letter of July 4, 1987 disregarding the subsequent communication of July 25, 1987.
The security guard Vipti Singh will also be reinstated in service but without back wages.
In the case of the 12 dis missed workers we are, on the facts placed before us, of the view the circumstances did not exist for the exercise of extraordinary powers under Rule 32 of the Rules.
The orders terminating the services of the 12 union representatives are therefore set aside and they are ordered to be reinstated in service forthwith with back wages coveting a period of 6 months immediately preceding the date of this order.
They should be reinstated forthwith.
In view of the above direc tions no further order is required on the C.M.P TFAI will pay Rs.5,000 in all by way of costs to the Union.
Y. Lal Petition allowed.
| The appellants are interested in running educational institutions which are covered by the expression "private educational institution" within the meaning of Section 2(f) of the Tamil Nadu Private Educational Institutions (Regula tion) Act, 1966.
The vires of the Act especially sections 2(c), 3(a), 3(b), 6, 7, read with sections 15, 22 and 28, was challenged before the High Court, by way of a writ petition.
The High Court struck down section 28 and upheld the other sections.
This appeal by certificate is against the High Court 's judgment upholding the validity of the said sections.
As regards the striking down of section 28, it has not been impugned by the respondent State.
The appellants contended that the Act does not lay down any guideline for the exercise of power by the delegated authority and so the decision of the competent authority is bound to be discriminatory and arbitrary.
It was also con tended that the Act imposed unreasonable restrictions on the appellants in the running of tutorial institutions, and such regulations were violative of Article 29(1)(g) of the Con stitution of India.
On behalf of the respondent, it was stated that suffi cient guidance is available to the authority concerned, by virtue of subsection (2)(c) of Section 4 and hence the appellants ' contentions were not justified.
372 Allowing the appeal, HELD: 1.1.
It is well established that determination of legislative policy and formulation of rule of conduct are essential legislative functions which cannot be delegated.
What is permissible is to leave to the delegated authority the task of implementing the object of the Act after the legislature lays down adequate guidelines for the exercise of power.
Examined in this light, the impugned provisions of the Tamil Nadu Private Educational Institutions (Regulation) Act, 1966 miserably fail to come to the required standard.
These sections are held to be invalid.
They are inextricably bound up with the other parts of the Act so as to form part of a single scheme, and it is not possible to sever the other parts of the Act and save them.
Hence, the entire Act is declared ultra vires.
[376D E; 379G] 1.2.
There is no indication, whatsoever, about the legislative policy or the accepted rule of conduct on the vital issue about the maintenance of academic standard of the institution and the other requirements relating to the building, library and necessary amenities for the students, as the Act is absolutely silent about the criteria to be adopted by the prescribed authority for granting or refusing permission.
Even the rules which were made under Section 27 in 1968 and called the Tamil Nadu Private Educational Insti tutions (Regulation) Rules, 1968, are not called upon to lay down any norm on these issues and naturally do not make any reference to these aspects.
The result is that the power to grant or refuse permission is to be exercised according to the whims of the authority and it may differ from person to person holding the office.
The danger of arbitrariness is enhanced by the unrestricted and unguided discretion vested in the State Government under Section 2(c) of the Act in the choice of competent authority.
[377E G] 2.1.
Section 6 which empowers the competent authority to grant or refuse to grant permission for establishing and running an institution does not give any idea as to the conditions which it has to fulfil before it can apply for permission under the Act, nor are the tests indicated for refusing permission or cancelling under Section 7 of an already granted permission.
[376H; 377A] 2.2.
The only safeguard given to the applicant institu tion is to be found in the first proviso to Section 6 which says that the permission shall not be refused unless the applicant has been given an opportunity of making his repre sentation, but that does not by itself protect the applicant from discriminatory treatment.
So far as Section 7 dealing with 373 power to cancel the permission granted earlier is concerned, no objection can be taken to the first part of the section, whereunder the permission may be cancelled in case of fraud, misrepresentation, suppression of material particulars or contravention of any provision of the Act or the Rules.
But the other ground on which the authority can exercise its power being contravention "of any direction issued by the competent authority under this Act" again suffers from the vice of arbitrariness.
[378B D] 2.3 Section 15 is too wide in terms and does not indi cate the nature of the direction or the extent within which the authority should confine itself while exercising the power.
Similarly under Section 22, the State Government has been vested with unrestricted discretion in picking and choosing the institutions for exemption from the Act.
[378D E] State of West Bengal vs Anwar Ali Sarkar, ; ; Kunnathat Thathunni Moopil Nair vs The State of Kerala and Anr., ; ; Harakchand Ratanchand Banthia and Ors.
vs Union of India & Ors.
, ; , relied on.
|
Appeal No.1539 of 1971.
(From the Judgment and Order dated 5 8 1969 of the Allahabad High Court in Special Appeal No. 58/65).
B.B. Ahuja and R.N. Sachthey, for the Appellant.
A.T.M. Sampath and Ram Lal, for Respondent No. 1. 215 The Judgment of the Court was delivered by SARKARIA, J.
This appeal on certificate is directed against an appellate judgment, dated August 5, 1969, of a Bench of the High Court of Allahabad.
It arises as follows: M/s. S.B. Singar Singh and Sons (hereinafter called the assessee) were assessed to Excess Profits tax for the chargeable accounting periods, ending March 31, 1945 and March 31, 1946.
under two assessment orders dated August 26, 1949.
The previous years 193637 was chosen by the assessee as his standard period.
" The profits of that year were Rs. 38,703/ .
After deducting the profits of the standard year, the Excess Profits Tax Officer, assessed the tax on the remaining amounts of profits.
The Excess Profits Tax thus assessed for the accounting years, was to the tune of Rs. 1,06,181.5 and Rs. 48,978/ , respectively.
In his orders, the assessing Officer said that "for reasons detailed in the earlier assessment orders no adjustments are made for capital variations in the standard period and the chargeable accounting period".
These reasons as given in the earlier assessment order, dated October 30, 1947, per taining to the chargeable accounting period ending March 31, 1944, were: "As complete and regular accounts are not maintained by the assessee, it is not possible to make any adjustment for variations in average capital which cannot be accurately ascertained".
Against the orders of assessment, the assessee preferred two appeals on September 24, 1949 to the Assistant Appellate Commissioner.
By two separate applications dated October 24, 1949, the assessee took an additional ground of appeal which obvious ly he had not taken in the original memorandum of appeal that the Excess Profits Tax Officer had erred in not allowing adjustments on account of the increase and decrease of capital in the relevant chargeable accounting period.
The assessee added that he "was always prepared to file his computa tions of average capital".
Dismissing the appeals by his orders, dated November 24, 1949, the Assist ant Appellate Commissioner negatived the assessee 's contention, in these terms: "As in these years no regular accounts have been maintained and it is not possible to make any adjustment for variations in average capital which cannot be exactly ascertained.
No figures have been shown to me, nor has any exact working been fur nished at this stage.
The accounts are left in the same manner as for the earlier years.
Profits in the major accounts had to be worked out by the application of a rate to the turnover.
I am, thus, unable to allow this contention.
" Aggrieved, the assessee carried appeals to the Income tax Appellate Tribunal.
In the memoranda of appeals, one of the specific grounds taken was, that "the Excess Profits Tax Officer and the Assistant Appellate Commissioner had erred in not allowing to the assessee proper standard profits in accordance with the standard period subject to the adjust ment on account of the increase and decrease of capital in the relevant chargeable accounting period.
" It was reiter ated that "the 216 appellant was always prepared to file his computation of average capital.
" This ground relating to standard profits was not dis cussed by the Tribunal and no finding was recorded thereon.
The Excess Profits Tax Appeals and other Income tax appeals filed by the assessee were heard together by the Tribunal and disposed of by common orders dated February 24, 1951.
In the Income tax appeals, some relief was granted, but in the Excess Profits appeals, no relief was granted due to the variation of the capital in the chargeable accounting period of 1945 46 and 1946 47.
The assessee on July 27, 1951, made an application under section 35 of the Income tax Act, 1922 for rectification of its order to the Tribunal on grounds other than the one regarding variation in the standard profits due to increase and decrease of the capital.
This application was dismissed on August 27, 1951 by the Tribunal on the ground that there was no mistake apparent on the record.
No grievance was made in this application that the Tribunal did not consider and decide the ground relating to adjustment of standard profits according to variation in capital during the relevant peri od.
On March 11, 1954, the assessee made a representation to the Central Board of Revenue praying for reopening of the assessments.
In this representation, also, he did not take up Ground No. 1.
Subsequently however on May 24, 1954 he wrote a letter to the Income tax Officer saying that he was sorry to omit 'one important point ' i.e., Ground No. 1, from his representation to the Board, and that the Income tax Officer should "supplement the same while making (his) report to the higher authorities. '
His representation dated March 11, 1954 and the petition dated May 24, 1954, both were rejected and the Commissioner communicated those rejec tions to the assessee by a letter dated May 25, 1955, saying that he did not see any justification for re opening the assessments which had become final and closed.
Thereafter on April 2, 1956, the assessee made a second application to the Tribunal (which in substance was one for review of its orders, dated .February 24, 1951), contending that Ground No. 1 raised in his two appeals, relating to the standard profits of the two chargeable accounting periods and pointing out the failure of lower authorities to make necessary adjustments in such profits according to section 6 of the Excess Profits Tax Act (hereinafter referred to as Ground No. 1 ) was not disposed of by the Tribunal.
It was prayed that the appeals relating to excess profits tax matters which should be deemed to be still pending owing to the non decision of Ground No. 1 be disposed of after hear ing the assessee.
The Tribunal rejected this contention with the remark that the appeals were decided as early as 24th February, 1951 and it is now futile to contend that the matter was pending when the Tribunal had already passed orders and the orders were served on the assessee.
" The Tribunal further observed that the absence of a reference "to the contention of the assessee regarding the standard profits and the necessary adjustments would not render the Tribunal 's order a nullity, nor would it mean that the Tribunal had partially disposed of the appeals and some residue is pending".
In the alternative, it held that even on the assumption that 217 Ground No. 1 was argued and was not disposed of by the Tribunal, the proper remedy for the assessee was either to apply for rectification under section 35 or to move an applica tion under section 66.
The Tribunal refused to treat this application as one for rectification because, in its opinion, such an application would be much too time barred.
In the result, the Tribunal dismissed that application by an order dated June 9, 1956.
The assessee had filed a reference application, also under section 66(1) the Income tax Act in these cases.
That application was dismissed by the Tribunal on August 28, 1951.
The assessee then made applications under section 66(2) of the Income tax Act before the High Court requesting for reference on certain question of law arising out of the order, dated February 24, 1951, of the Tribunal.
In these applications, alsO, he did not ask for reference on a question relating to Ground No. 1 (regarding adjustment of standard profits).
These applications were allowed by the High Court by an order, dated April 12, 1956, whereby the Tribunal was directed to state a case and refer for decision certain questions of law to the High Court.
Thereafter, during the proceedings before the Tribunal for preparation of the statement of the case, the assessee moved an application, dated July 23, 1957, requesting it to refer the question of adjustment of standard profits on account of increase and decrease in the capital in the relevant periods to the High Court, in addition to the questions of law directed by the High Court to be referred to it.
This application was rejected for the reason that the question had not been raised in the reference applica tion, nor did it arise out of the appellate orders of the Tribunal.
On July 24, 1957, the Tribunal stated the case and made a reference on the other question to the High Court in compliance with that Court 's order, dated April 12, 1956.
On November 4, 1968, the assessee filed a writ petition in the High Court praying for a writ of Mandamus requiring the Tribunal to consider his Ground No. 1 mentioned in the Excess Profits Tax Appeals Nos. 651 and 660 of 1949 and 1950 and his subsequent application dated April 2, 1956.
The writ petition was heard by a learned single Judge of the High Court who held that while disposing of the appeals, it was the duty of the Tribunal to record a finding on Ground No. 1 which had been specifically raised in the memoranda of appeals before it, that the Tribunal therefore, could and should have reviewed its orders and rectified its mistake in the exercise of its inherent powers when that mistake was brought to its notice by the assessee by his application dated April 2, 1956; that section 35 of the Income tax Act which provides a period of four years ' limitation for seeking rectification of mistakes in assessment orders, was not applicable to assessment orders made by the.
Tribunal under the Excess Profits Act; that consequently, the Tribunal was in error in refusing to treat the assessee 's application, dated April 2, 1956,.as one for rectification of a mistake of the Tribunal on 16 1003 8C1/76 218 the ground of limitation.
In the result, the learned Judge set aside the Tribunal 's order, dated June 9, 1956, and directed the Tribunal to dispose of the assessee 's applica tion dated April, 2, 1956, afresh in accordance with law.
The Revenue filed a Special Appeal against the order of the learned single Judge before the Appellate Bench of the High Court.
The Bench dismissed the appeal and affirmed the findings and orders of the learned single Judge.
Hence this appeal.
Mr. Ahuja, appearing for the appellant, con tends that the writ petition of the assessee should have been thrown out by the High Court on the preliminary ground that he had not come with clean hands.
In this connection Counsel has pointed out several circumstances which according to him, belie the main plea of the assessee that the Tribunal had not considered his Ground No. 1 although the same was urged before it at the hearing of the appeals.
It is stressed that .Ground No. 1 was not original ly taken by him in the grounds of appeal filed before the Assistant Appellate Commissioner, al though subsequently in the Additional grounds filed about one month after the institution of the ap peals, he, as an after thought, did introduce "Ground No. 1", that he did not make any grievance whatever on the score of Ground No. 1 in his appli cation for rectification of the Tribunal 's orders, filed on July 27, 1951; that for more than 5 years after the announcement of the appellate orders of the Tribunal, he made no application to the Tribu nal for review and rectification of its appellate orders in relation to Ground No. 1; that the assessee delayed the making of the application, dated April 2, 1956 presumably with a view to ensure that at the time of its presentation, none of the members of the Tribunal who had originally decided the assessee 's appeals, was there to hear the application; that even in this inordinately delayed application, review and rectification was not asked for in a straight forward manner but it was disguised as an application for decision of the appeals which on account of non decision of Ground No. 1 were alleged to be still pending; that the writ petition was filed after an abnormal delay of ten years; that a perusal of the assessment orders made by the Excess Profits Tax Officer and the Assistant Appellate Commissioner, and even the memoranda of appeals filed before the Tribunal shows that at no stage the assessee furnished complete accounts or even a statement showing variation in the capital during the relevant peri ods.
It is emphasised that all that the assessee said in the memoranda of appeals was that he was "prepared" to furnish a statement of such computa tion and accounts.
It is further pointed out that no certificate of Shri Surinderjit Singh, Advocate who is supposed to have argued the appeals before the Tribunal, was filed.
It is maintained that the only reasonable inference from these circumstances was that Ground No. 1 was not pressed or argued at all by Shri Surinderjit Singh before the Tribu nal who consequently, did not think it necessary to deal with it.
Mr. Sampath, appearing for the assessee respondent has not been able to deny the existence of the circumstances pointed out by Mr. 219 Ahuja.
His argument is that in the affidavit accompanying the writ petition, the deponent had sworn that Ground No. 1 was, in fact, argued before the Tribunal and that this sworn statement had been believed by the High Court.
This being the case, it is argued, this Court should not re open the question as to whether Ground No. 1 was, in fact, argued or not before the Tribunal.
According to Mr.Sampath, over 5 years ' delay in making the application dated April 2, 1956, partly stood explained by the circumstance that he had made a representation to the Board supplemented by the assessee 's letter of May 24, 1954 to the Income tax Officer, seeking relief on the basis of Ground No. 1.
We find a good deal of force in the submissions made by Mr. Ahuja.
The sheet anchor of the assessee 's case in the writ petition was that at the hearing of the appeals, his Counsel had argued Ground No. 1 set out in the memoranda of appeals, but the Tribunal did not consider it at all.
The question whether or not this Ground had been argued, was one of fact.
The tell tale circumstances enumerated by Mr. Ahuja, unerringly lead to the conclusion that, in all proba bility, Ground No. 1 was not argued by the Counsel, possibly because he was aware that in the absence of a complete statement of accounts showing variations in the capital during the relevant periods, a contention rounded on Ground No. 1 would be an exercise in futility.
It is noteworthy that at no stage before the Revenue authorities or the Tribunal, did the assessee categorically say that he had actually produced a complete statement of accounts and computation of the increase and decrease in capital.
All that he said in his Additional Grounds of appeal before the 'Assistant Appellate Commissioner and the Appellate Tribunal in Ground No. 1, was that he was prepared to file such a statement.
Shri Surinderjit Singh, Counsel who argued the appeals, has not thought it fit to certify that Ground No. 1 was actually argued, and not abandoned, by him.
The affida vit of another person who could not be the best informed person on this point, was of little value and could hardly displace the irresistible inference arising from the sur rounding circumstances and the conduct of the assessee, namely, that his Counsel had not argued on Ground No. 1, at all and had thus given it up.
In the light of what has been observed above, we are of opinion that the High Court could not justifiably interfere in the exercise of its extraordinary jurisdiction under Article 226 of the Constitution with the appellate orders of the Tribunal.
In any case, the question as to whether the omission to record a finding on Ground No. I by the Tribunal was due to the failure of the appellant to urge that ground or due to a lapse on the part of the Tribunal, which de served rectification, was a .matter entirely for the author ities under those Taxation statutes.
It will be well to recall once more what this Court speaking through J.C. Shah J. (as he then was,) had stressed in Shivram Poddar vs Income tax Officer(1) "Resort to the High Court in exercise of its extraordi nary jurisdiction conferred or recognised by the Constitu tion in matters relating to assessment, levy and collection of income tax may be permitted only when questions of infringe ment of fundamental rights arise, or where on undisputed facts the taxing authorities are shown to have assumed jurisdiction which they do not possess.
In attempting to bypass the provisions of the Income tax Act by inviting the High Court to decide questions which are primarily within the jurisdiction of the revenue authorities, the party approaching the court has often to ask the Court to make assumptions of facts which remain to be investigated by the revenue authorities."
In the instant case, the High Court had assumed juris diction on the assumption that a certain ground had been urged before the Income tax Appellate Tribunal which had arbitrarily refused to consider the same and record a find ing thereon.
This assumption, in our opinion, stood thor oughly discounted by the concomitant circumstances of the ease, including the dilatory and questionable conduct of the assessee.
This was therefore not a fit ease for the exer cise of its special jurisdiction under Article 226 by the High Court.
Accordingly, on this short ground we allow the appeal and dismiss the writ petition.
As the appeal succeeds on a preliminary ground, we do not feel it necessary to express any opinion on the question as to whether or not the Appel late Tribunal under the Excess Profits Tax Act has statutory or inherent power to review and rectify mistakes in its orders.
The assessee shall pay one set of the costs of the appellant.
P.B.R. Appeal allowed.
| Since the assessee had not maintained complete and regular accounts for the purpose of Excess Profits tax, the Excess Profits Tax Officer assessed tax on the basis of accounts of certain previous years chosen by the assessee as his "standard period", pointing out that because of this position it was not possible to make any adjustment for variations in average capital.
The Assistant Appellate CommisSioner upheld the assessment order.
In appeal to the Appellate Tribunal one of the specific grounds taken by the assessee was that the Excess Profits Tax Officer and the Assistant Appellate Commissioner had erred in not allowing proper standard profits in accordance with the standard period subject to the adjustment on account of increase and decrease of capital in the relevant chargeable accounting period and that they were prepared to file computation of average capital.
Without discussing the ground relating to the standard profits the Tribunal disposed of the appeals.
The assessee 's second application alleging that the ground relating to the standard profits was not disposed of by it was rejected by the Tribunal.
In an application under section 66(2) of the Income Tax Act before the High Court, the assessee did not ask for a reference on this ground.
But during proceedings for preparation of statement of case, the assessee 's application requesting the Tribunal to refer this ground to the High Court was rejected by it.
The assessee 's petition for a writ of Mandamus requiring the Tribunal to consider the ground relating to standard profits was allowed by the High Court.
Allowing the Department 's appeal to this Court, HELD: The High Court could not justifiably interfere, in the exercise of its extraordinary jurisdiction under article 226 of the Constitution, with the appellate orders of the Tribunal.
The question as to whether the omission to record a finding on Ground No. 1 by the Tribunal was due to the failure of the appellant to urge that ground or due to a lapse on the part of the Tribunal, which deserved rectifica tion, was a matter entirely for the authorities under the statute to decide.
[219 G] Shivram Poddar vs Income tax Officer (1964) 51, I.T.R. 823, 829 (,S.C.) applied.
In the instant case the High Court had assumed jurisdic tion on the assumPtion that a certain ground had been urged before the Tribunal which had arbitrarily refused to consid er the same and record a finding thereon.
This assumption, stood thoroughly discounted by the concomitant circumstances of the case including the dilatory and questionable conduct of the assessee.
This was not a fit case for the exercise by the High Court of its ' special jurisdiction under article 226.
[220 C]
|
Civil Appeal No. 1785 of 1970.
From the Judgment and Order dated 25 9 69 of the Calcutta High Court in Appeal No.146 of 1967.
section V. Gupte, section B. Mukherjee, P. C. Bhartari, J. B. Dadachanji and Dilip Sinha for the Appellant.
A. K. Sen, R. C. Nag, O. P. Khaitan, B. P. Maheshwari, Suresh Sethi and R. section Agarwal for Respondents.
The Judgment of the Court was delivered by GOSWAMI, J.
This appeal by certificate is against the common judgment of the Calcutta High Court in respect of respondents ' application for winding up and appellant 's stay application relating to the Hind Overseas Private Limited, a private limited company (briefly the company).
The question that is raised in this appeal relates to the scope of section 433(f) of the (briefly the Act) and in particular whether the principles applicable in the case of dissolution of partnership could be involved in the case of the company.
The allegations in the winding up petition before the High Court are as follows: The company was incorporated under the Act in August 1956.
The nominal capital of the company is Rs. 5,00,000/ divided into 2,500 Equity shares of Rs. 100/ each and 2,500 unclassified shares of Rs. 100/ each, the entire nominal capital has been issued and fully paid up.
The petitioners (respondents herein), Raghunath Prasad Jhunjhunwalla and his son, Phoolchand Jhunjhunwalla (hereinafter to be described as R.P.J. and P.C.J. respectively), and the members of their family hold 1875 shares in the company and the remaining 3125 shares are held by one V. D. Jhunjhunwalla and the members of his family.
In or about the month May, 1956, R.P.J. and V. D. Jhunjhunwalla (briefly V.D.J.) who was then carrying on business under the name and style of 'Chimanram Motilal ' with his cousin, one Mahabir Prasad Jhunjhunwalla (for brevity M.P.J.) agreed to start a new business of iron and steel in co partnership and for that purpose an account was 230 opened in the name of 'Raghunath Prasad Jhunjhunwalla Ke Sir Khata ' in the books of 'Chimanram Motilal '.
It was further agreed between the parties that R.P.J. would have six annas share and V.D.J. along with M.P.J. ten annas share in the said proposed partnership business.
Before the said proposed business could be started, V.D.J., however, changed his mind and some time in the month of June 1956, he suggested to R.P.J. that a limited company be formed, inter alia, to carry on the business in iron and steel and the shares in the company would be held by R.P.J., V.D.J. and M.P.J. and the members of their respective families in the same proportion as mentioned above.
V.D.J. further agreed to provide for and arrange along with M.P.J. the entire finance that may be necessary for the purpose of the business of the company and R.P.J. and his group would generally look after the day to day business of the company under the general control and supervision of V.D.J. It is stated in the petition that R.P.J. in view of the relationship between the parties and having trust and confidence in V.D.J. agreed to the said suggestions and accordingly the company was formed on or about August 9, 1956, under the provisions of the Act.
One Anil Chandra Dutta, an employee and nominee of V.D.J. along with R.P.J. became the subscribers to the Memorandum of Association of the company and also became its first directors.
After its incorporation, the company carried on for some time the business of controlled stockists of iron and steel and since the end o the year 1958 the company carried on the business of the manufacture and supply of railway sleepers in execution of Government contracts.
On or about August 23, 1956, V.D.J. and M.P.J. were co opted as directors of the company.
On or about November 23, 1957, Anil Chandra Dutta resigned from the Board of Directors and P.C.J. was co opted as a Director in this place.
R.P.J. was appointed as Director in charge of the company on November 23, 1957 at a monthly remuneration of Rs. 1000/ .
This remuneration was subsequently increased to Rs. 1250/ per month with effect from October 1, 1961 and he was also granted further allowance of Rs. 250.00 per month on account of maintenance of guest house.
His monthly remuneration was again increased to Rs. 2000.00 with effect from September, 1964.
The monthly remuneration of P.C.J. was initially fixed at Rs. 750.00 per month with effect from October 1, 1961 and was subsequently increased to Rs. 1500.00 from September 1, 1964.
Following a family partition between V.D.J. and M.P.J. about the year 1958, the shares of the latter were transferred in the name of the wife of V.D.J. M.P.J. also resigned from the Board of Directors on or about January 31, 1959.
Since that date and until October 1965, the Board of Directors of the company consisted of R.P.J., P.C.J. and V.D.J. In or about the month of October, 1965, V.D.J. got his son, Vinode Kumar Jhunjhunwalla, appointed as the Technical Director of the company.
Since the year 1958 and until February 26, 1965, the entire business of the company has been the manufacture and supply of 231 railway sleepers in execution of Government contracts.
The business of the company during this period had been always managed by R.P.J., P.C.J. under the general supervision and guidance of V.D.J. and the business policy was always dictated by V.D.J. The Cashier, Manager cum Engineer, Munim, and Cash Peon and other important Officers and employees were always appointed by V.D.J. of his own choice and on his terms.
R.P.J. has been acting as the Director in charge throughout since his appointment at a Board meeting held on November 23, 1957.
V.D.J. asked for and received daily reports of the working of the factory and of the business of the company from R.P.J. and gave detailed instructions even relating to the daily administration.
From 1959 onwards the factory commenced its regular production of railway sleepers and made substantial profits between 1960 and 1965 except in the year 1961 when there was some loss.
It is alleged that after trying to take wrongfully and illegally full control and management of the affairs of the company in order to oust R.P.J. group, V.D.J. ultimately succeeded in getting hold of Directors ' Minute Books and the Minute Books of the General Meetings of the company.
V.D.J. with the help of the members of his group, wrongfully and illegally took away the keys and the other statutory books and documents of the company from the registered office and refused R.P.J. group any access to them, R.P.J. was also assaulted by an employee of the company at the instance of V.D.J. and there were some criminal proceedings against R.P.J. and P.C.J. V.D.J. as a Director called a meeting of the Board on May 27, 1966, by Notice dated May 24, 1966.
R.P.J. 's solicitors on May 27, 1966, sent a notice to the company and V.D.J. calling upon them to desist from holding the meeting which was called with a view to oust the R.P.J. group completely from the control and management of the affairs of the company.
V.D.J. group did not pay any heed to the Solicitors ' letter and passed various resolutions in the Board 's meeting held on May 27, 1966, whereby the previous resolutions of the Board were countermanded and cancelled and R.P.J. was deprived of his all lawful authority and powers as a Director including the right to operate the banking account of the company.
R.P.J. was purported to be removed from the office of the Director in charge of the company.
V.D.J. group caused an advertisement to be published in the Vishwamitra on or about May 20, 1966, intimating the cancellation of powers in favour of R.P.J. V.D.J. taking advantage of the majority holding of shares by himself and the members of group, caused to be issued through certain shareholders belonging, to his group a requisition dated May 28, 1966, for calling an Extra ordinary general meeting with a view to remove R.P.J. and P.C.J. as directors of the company and to appoint other persons belonging to their group in their places instead.
The explanatory statement to that Notice alleged that there was a loss of about Rs. 8 lakhs in the year 1965.
It is further alleged that V.D.J. with the help of goondas and armed guard took possession of the company 's factory and ousted R.P.J. and P.C.J. therefrom.
It is also alleged that the liabilities of the company would exceed its assets and the same was not commercially 232 solvent.
That serious disputes and differences had arisen among the shareholders of the company and there was a complete deadlock in the management of its affairs.
There was also complete loss of confidence of one group in the other.
Lastly it is averred that the company was in substance a partnership and it could not carry on its business any more and the circumstances would justify the dissolution of the company had it been a partnership.
The above are the allegations in the winding up petition which came up for admission before the learned Company Judge.
There was a counter affidavit filed by V.D.J. in opposing the prayers.
We may only note paragraph 14 of his counter affidavit "The respondent, Raghunath Prasad Jhunjhunwalla was an employee of the firm of Messrs Kamlapati Motilal of Kanpur of which I am the Managing Partner.
Having gained confidence as such employee the said Raghunath Prasad Jhunjhunwalla was taken in as a Director of the Company and entrusted with the powers of management of the Company.
The respondents had no money to subscribe for the shares of the Company and moneys were procured by me to enable them to subscribe for the share of the Company.
The applicants on their own admission were in charge of the management of the affairs of the Company.
While in such management they have mismanaged the affairs of the Company and misappropriated the funds and assets of the company as would appear from the statements made in my affidavit affirmed on June 16, 1966. " The only point which appears to have been canvassed before the learned Company Judge and later before the appellate court was that the company was formed as a result of mutual trust and confidence and the company was in substance a partnership and, therefore, the principles of partnership would be attracted.
The same arguments are pressed into service by the respondents before us.
If it were a partnership, says Mr. Sen on behalf of the respondents, on the facts and circumstances disclosed in the petition dissolution would have been ordered by the court under section 44(g) of the Partnership Act.
A case for winding up has been, therefore, prima facie, made out by the respondents on these allegations.
It is submitted that the learned Company Judge committed an error of law in dismissing the winding up petition without admitting it and in allowing the stay petition of the company (appellant herein) and that the Division Bench in the Letters Patent Appeal was right in setting aside the order of the Company Judge.
According to the learned Company Judge the principle of dissolution of partnership applies to companies either on the ground of complete deadlock or on the ground of domestic or family companies.
A complete deadlock, according to the learned Judge, is where the Board has two real members or the ratio of shareholding is equal.
In the domestic or family companies, says the learned Judge, courts have 233 applied the dissolution of partnership principle where shareholdings are more or less equal and there is ousting not only from management but from benefits as shareholders.
Lack of probity has to result in prejudice to company 's business, affecting rights of complaining parties as shareholders and not as directors.
The learned Judge relied on an English case [In re Cuthbert Cooper & Sons Limited(1)] which illustrates that if a deadlock can be resolved by the articles there is no deadlock to bring in winding up and if there are alternative remedies the company should not be wound up.
The learned Judge was also unable to hold that the substratum of the company was gone.
The learned Judge concluded as follows: "As I have indicated these charges and counter charges raise disputed questions of fact between two contesting parties for power.
The petitioners desire that they should be in power and the respondents would go on financing.
This was said to be the heart of the matter by counsel for the respondents.
This comment is not without foundation.
I am unable to hold that there is any mismanagement or misapplication either as regards shareholders or as regards directors.
Directors ' disputes are not grounds for winding up on the facts and circumstances of the present case".
According to the learned Judge the case of In re Yenidje Tobacco Company Limited (2) and the cases following it have established that in applying the principles of dissolution of partnership to companies the following factors were important: (1) Equal share holding.
(2) Complete deadlock in the administration of the company.
(3) Lack of probity and mismanagement in the conduct of affairs of the company.
The learned Company Judge held that the principle in Yenidje 's case (supra) was not attracted in this case.
On the other hand, according to the appellate court the principles in Yenidje 's case were to the effect that "if a private company could be fairly called a partnership in the guise of a private company then the things which might be a ground for dissolution of a partnership will apply also in the case of a private company" and that "in this connection deadlock is not material".
The appellate court then described the circumstances which according to Lindley justify the dissolution of the partnership: (1) if the partnership agreement is wilfully or persistently violated; 234 (2) if one partner so behaves in matters relating to the partnership business that the other partners find it impossible to carry on business in partnership with him; (3) if some partners are in effect excluded from the concern; (4) if the misconduct of one or more partners is such that the mutual confidence which must subsist in a partnership is destroyed; (5) if there is a state of animosity which precludes all reasonable hope of reconciliation and friendly cooperation; (6) if it is impossible for the partners to place that confidence in each other which each has a right to expect, provided that the impossibility has not been caused by the persons seeking to take advantage of if Having noted the above, the appellate court held that conditions (2), (3) and (4) were unquestionably fulfilled in this case and, therefore, allowed the application and rejected the stay application.
Before we proceed further we may refer to a recent decision of the House of Lords in Ebrahimi and Westbourne Galleries Ltd. and Others (1) (briefly Ebrahimi 's case) wherein after reviewing all the earlier cases it was held as follows: "The foundation of it all lies in the words 'just and equitable ' and, if there is any respect in which some of the cases may be open to criticism, it is that the Courts may sometimes have been too timorous in giving them full force.
The words are a recognition of the fact that a limited company is more than a mere legal entity, with a personality in law of its own; that there is room in company law for recognition of the fact that behind it, or amongst it, there are individuals, with rights, expectations and obligation inter se which are not necessarily submerged in the company structure.
That structure is defined by the and by the articles of association by which shareholders agree to be bound.
In most companies and in most contexts, this definition is sufficient and exhaustive, equally so whether the company is large or small.
The 'just and equitable provision does not, as the respondents suggest, entitle one party to disregard the obligation he assumes by entering a company, nor the court to dispense him from it.
It does, as equity always does, enable the court to subject the exercise of legal rights to equitable considerations: considerations, that is, of a personal character arising between one individual and another, which may make it unjust, or inequitable, 235 to insist on legal rights, or to exercise them in a particular way. "The superimposition of equitable considerations requires something more, which typically may include one, or probably more, of the following elements: (i) an association formed or continued on the basis of a personal relationship, involving mutual confidence this element will often be found where a pre existing partnership has been converted into a limited company; (ii) an agreement, or understanding, that all, or some (for there may be 'sleeping ' members), of the shareholders shall participate in the conduct of the business; (iii)restriction upon the transfer of the members ' interest in the company so that if confidence is lost, or one member is removed from management, he cannot take out his stake and go elsewhere.
" The respondents have laid great emphasis on the ratio of the above decision.
It is true that section 222(f) of the English Companies Act, 1948 which the House of Lords was considering corresponds to section 433(f) of the Act.
In the above decision the House of Lords had to deal with a private limited company consisting of three members, the petitioner therein, being one of the three.
Lord Wilberforce delivering his reasoned speech has himself noted that "It is a fact of cardinal importance that since about 1945 the business had been carried on by the appellant and Mr. Nazar as partners, equally sharing the management and the profits".
It was also noticed that "the company made good profits, all of which were distributed as directors ' remuneration.
No dividends have ever been paid, before or after the petition was presented." In Ebrahimi 's case (supra) the company which was first formed by the two erstwhile partners, Ebrahimi and Nazar, was joined by Nazar 's son, George Nazar, as the third director and each of the two original shareholders transferred to him 100 shares so that at all material times Ebrahimi held 400 shares, Nazar 400 shares and George Nazar 200 shares.
The Nazars, father and son, thus had a majority of the votes in general meeting.
Until the dispute all the three remained directors.
Later on an ordinary resolution was passed by the company in general meeting by the votes of Nazar and George Nazar removing Ebrahimi from the office of director.
That led to the petition for winding up before the court.
The following features are found in Ebrahimi 's case: (1) There was a prior partnership between the only two members who later on formed the company.
236 (2) Both the shareholders were directors sharing the profits equally as remuneration and no dividends were declared.
(3) One of the shareholders ' son acquired shares from his father and from the second shareholder, Ebrahimi, and joined the company as the third shareholder director with two hundred shares (one hundred from each).
(4) After that, there was a complete ouster of Ebrahimi from the management by the votes of the other two directors, father and son.
(5) Although Ebrahimi was a partner, Nazar had made it perfectly clear that he did not regard Ebrahimi as a partner but regarded him as an employee in repudiation of Ebrahimi 's status as well as of the relationship.
(6) Ebrahimi through ceasing to be a director lost his right to share in the profits through directors ' remuneration retaining only the chance of receiving dividends as a minority shareholder.
Bearing in mind the above features in the case, the House of Lords allowed the petition for winding up by reversing the judgment of the court of appeal and restoring the order of Plowman, J. None of the parties questions the principles as such adumbrated by the House of Lords in Ebrahimi 's case (supra) or even those in the earlier Yenidje 's case (supra) and indeed these are sound principles depending upon the nature, composition and character of the company, The principles, good as they are, their application in a given case or in all cases, generally, creates problems and difficulties.
The respondents ' counsel is well cognizant of this difficult aspect and, therefore, rests his argument on the footing that the company is in substance a partnership and necessarily, therefore, according to him, the principles of partnership should be attracted.
Before we come to the facts of the present case, we have to deal with the principles of the Yenidje 's case (supra) which were the cornerstone of the arguments on behalf of both the parties before the Company Judge as well as the appellate court.
Ebrahimi 's case (supra) was not available to the parties at that stage.
Yenidje 's case (supra) has acquired celebrity and in application of the ratio of that case varying shades and colour have been sought to be given from time to time in England and appropriate to occasions and to facts and circumstances of cases coming before the courts.
It is not necessary for us to go over the labyrinth of cases wherein the Yenidje 's principle was applied and it will be sufficient to gather the ratio from the words of Lord Cozens Hardy M.R. expressed in the decision itself.
The learned Master of Rolls posed the question thus in that case: "I think it right to consider what is the precise position of a private company such as this and in what respects it can be fairly called a partnership in the guise of a private company.
" 237 This was a company of the two shareholders and two directors who had earlier traded separately but amalgamated their businesses and formed a private limited company.
The constitution of the company was such that under its articles of association for any case of difference or dispute between the directors there was a provision for arbitration.
In fact in one of such disputes a reference was made to arbitration which resulted in an award to which one of the two shareholders declined to give effect.
It was proved in that case that the two directors were not on speaking terms, that the so called meetings of the board of directors had been almost a farce or comedy, the directors would not speak to each other on the board, and some third person had to convey communications between them which ought to go directly from one to the other.
Under the above situation it was observed by the learned Master of Rolls as follows: "Is it possible to say that it is not just and equitable that that state of things should not be allowed to continue, and that the Court should not intervene and say this is not what the parties contemplated by the arrangement into which they entered ?" * * * * * "Certainly, having regard to the fact that the only two directors will not speak to each other, and no business which deserves the name of business in the affairs of the company can be carried on, I think the company should not be allowed to continue.
I have treated it as a partnership, and under the Partnership Act of course the application for a dissolution would take the form of an action; but this is not a partnership strictly, it is not a case in which it can be dissolved by action.
But ought not precisely the same principles to apply to a case like this where in substance it is a partnership in the form or the guise of a private company ? It is a private company, and there is no way to put an end to the state of things which now exists except by means of a compulsory order.
It has been urged upon us that the just and equitable clause has. been held. not to apply except where the substratum of the company has gone or where there is a complete deadlock.
Those are the two instances which are given, but I should be very sorry, so far as my individual opinion goes, to hold that they are strictly the limits of the 'just and equitable ' clause as found in the Companies Act".
* * * * * "If ever there was a case of deadlock I think it exists here; but, whether it exists or not, I think the circumstances are such that we ought to apply, if necessary, the analogy of the partnership law and to say that this company is now in a state which could not have been contemplated by the parties when the company formed and which ought to be terminated as soon as possible".
238 It is clear that although Yenidje 's case (supra) was a case of a complete deadlock, that was not stated to be the sole basis for a conclusion to wind up the company.
The House of Lords in Ebrahmi 's case (supra) approved the decision in Yenidje 's case (supra).
We may also point out that the House of Lords did not approve of the undue emphasis put on the contractual rights arising from the articles over the equitable principles, derived from partnership law in re Cuthbert Cooper & Sons Limited (supra).
We may also refer to the Privy Council decision in Loch and Another and John Blackwood Limited(1), wherein section 127 of the Companies Act, 1910, of Barbados, identical with section 433(f) of the Act was considered.
Lord Shaw of Dunfermline quoted in the judgment a passage from the case of Baird vs Lees(2), which is as follows : "I have no intention of attempting a definition of the circumstances which amount to a `just and equitable ' cause.
But I think I may say this.
A shareholder puts his money into a company on certain conditions.
The first of them is that the business in which he invests shall be limited to certain definite objects.
The second is that it shall be carried on by certain persons elected in a specified way.
And the third is that the business shall be conducted in accordance with certain principles of commercial administration defined in the statute, which provide some guarantee of commercial probity and efficiency.
If shareholders find that these conditions or some of them are deliberately and consistently violated and set aside by the action of a member and official of the company who wields an overwhelming voting power, and if the result of that is that, for the extrication of their rights as shareholders they are deprived of the ordinary facilities which compliance with the Companies Acts would provide them with, then there does arise, in my opinion, a situation in which it may be just and equitable for the Court to wind up the company".
We may also refer to another decision of the Privy Council in D. Davis & Co. Ltd. vs Brunswick (Australia), Ltd. and others(3) which was from the decision of the Full Court of the Supreme Court of New South Wales.
Section 84(e) of the New South Wales Companies Act (1899) also provides for winding up, inter alia, on just and equitable ground.
In dealing with that clause, the Privy Council observed as follows : "The position of the Court in determining whether it is just and equitable to wind up the company requires a fair consideration of all the circumstances connected with the formation and the carrying on of the Company during the short period which had elapsed since 12th May, 1930; and the 239 common misfortune which had befallen the two shareholders in the Company does not, in their Lordships view, involve the consequence that the ultimate desires and hopes of the ordinary, shareholders should be disregarded merely because there is a strong interest in favour of liquidation naturally felt by the holders of the preference shares".
* * * * * "Nor on the other hand can any general rule be laid down as to the nature of the circumstances which have to be borne in mind in considering whether the case comes within the phrase".
This Court had to deal with the `just and equitable ' clause under section 162(vi) of the Indian Companies Act, 1913, in Rajahmundry Electric supply Corporation Ltd. vs A Nageswara Rao and others(1) and the Court quoted with approved the following passage in Loch 's case (supra) : "It is undoubtedly true that at the foundation of applications for winding up, on the `just and equitable ' rule, there must lie a justifiable lack of confidence in the conduct and management of the company 's affairs.
But this lack of confidence must be grounded on conduct of the directors, not in regard to their private life or affairs, but in regard to the company 's business.
Furthermore the lack of confidence must spring not from dissatisfaction at being outvoted on the business affairs or on what is called the domestic policy of the company.
On the other hand, wherever the lack of confidence is rested on a lack of probity in the conduct of the company 's affairs, then the former is justified by the latter, and it is under the statute just and equitable that the company is wound up".
Again in Mohan Lal & Anr.
vs Grain Chamber Ltd. Muzaffarnagar & Ors.,(2) this Court had held that "Primarily the circumstances existing at the date of the petition must be taken into consideration for determining whether a case is made out for holding that it is just and equitable that the company should be wound up" (See also Rajahmundry Electric Supply Corporation 's case (supra) and section P. Jain vs Kalinga Tubes Ltd.(3).
Keeping the ratio of Ebrahimi 's case in the forefront of his argument Mr. Sen submits that in the present case also there was a definite understanding and agreement between the two family groups for equal status and equal participation in management and, therefore, exclusion of the respondents from the directorship is burial of mutual trust and denial of that relationship on which alone the company was formed and hence there is a prima facie case for admitting the petition.
240 Although the Indian Companies Act is modelled on the English Companies Act, the Indian law is developing on its own lines.
Our law is also making significant progress of its own as and when necessary.
Where the words used in both the Acts are identical, the English decisions may throw good light and reasons may be persuasive.
But as the Privy Council observed long ago in Ramanandi Kuer vs Kalawati Kuer(1) "It has often been pointed out by this Board that where there is a positive enactment of the Indian legislature, the proper course is to examine the language of that statute and to ascertain its proper meaning uninfluenced by any considerations derived from the previous state of the law or of the English law upon which it may have been founded.
" If it was true in the twenties it is more apposite now that the background, conditions and circumstances of the Indian society, the needs and requirements of our country call for a somewhat different treatment.
We will have to adjust and adapt, limit or extend, the principles derived from English decisions, entitled as they are to great respect, suiting the conditions of our society and the country in general always, however, with one primary consideration in view that the general interests of the shareholders may not be readily sacrificed at the altar of squabbles of directors of powerful groups for power to manage the company.
When more than one family or several friends and relations together form a company and there is no right as such agreed upon for active participation of members who are sought to be excluded from management, the principles of dissolution of partnership cannot be liberally invoked.
Besides, it is only when share holding is more or less equal and there is a case of complete deadlock in the company on account of lack of probity in the management of the company and there is no hope or possibility of smooth and efficient continuance of the company as a commercial concern, there may arise a case for winding up on the just and equitable ground.
In a given case the principles of dissolution of partnership may apply squarely if the apparent structure of the company is not the real structure and on piercing the veil it is found that in reality it is a partnership.
On the allegations and submissions in the present case, we are not prepared to extend these principles to the present company.
The principle of `just and equitable ' clause baffles a precise definition.
It must rest with the judicial discretion of the court depending upon the facts and circumstances of each case.
These are necessarily equitable considerations and may, in a given case be superimposed on law.
Whether it would be so done in a particular case cannot be put in the strait jacket of an inflexible formula.
In an application of this type allegations in the petition are of primary importance.
A prima facie case has to be made out before the court can take any action in the matter.
Even admission of a petition which will lead to advertisement of the winding up proceedings 241 is likely to cause immense injury to the company if ultimately the application has to be dismissed.
The interest of the applicant alone is not of predominant consideration.
The interests of the shareholders of the company as a whole apart from those of other interests have to be kept in mind at the time of consideration as to whether the application should be admitted on the allegations mentioned in the petition.
The question that is raised in this appeal is as to what is the scope of section 433(f) of the Act.
Section 483 provides for the circumstances in which a company may be wound up by the court.
There are six recipes in this section and we are concerned with the sixth, namely, that a company may be wound up by the court if the court is of the opinion that it is just and equitable that the company should be wound up.
Section 222(f) of the English Companies Act, 1948 is in terms identical with the Indian counter part, section 433 (f).
It is now well established that the sixth clause namely, 'just and equitable ' is not to be read as being ejusdem generis with the preceding five clauses.
While the five earlier clauses prescribe definite conditions to be fulfilled for the one or the other to be attracted in a given case, the just and equitable clause leaves the entire matter to the wide and wise judicial discretion of the court.
The only limitations are the force and content of the words themselves, 'just and equitable '.
Since, however, the matter cannot be left so uncertain and indefinite, the courts in England for long have developed a rule derived from the history and extent of the equity jurisdiction itself and also born out of recognition of equitable considerations generally.
This is particularly so as section 35(6) of the English Partnership Act, 1890 also contains, inter alia, an analogous provision for the dissolution of partnership by the court.
Section 44(g) of the Indian Partnership Act also contains the words 'just and equitable '.
Section 433(f) under which this application has been made has to be read with section 443(2) of the Act.
Under the latter provision where the petition is presented on the ground that it is just and equitable that the company should be wound up, the court may refuse to make an order of winding up if it is of opinion that some other remedy is available to the petitioners and that they are acting unreasonably in seeking to have the company would up instead of pursuing that other remedy.
Again under sections 397 and 398 of the Act there are preventive provisions in the Act as a safeguard against oppression in management.
These provisions also indicate that relief under section 433(f) based on the just and equitable clause is in the nature of a last resort when other remedies are not efficacious enough to protect the general interests of the company.
Coming to the present case we find that the company was formed first with R.P.J. and Anil Chandra Dutta.
Anil Chandra Dutta was admittedly an employee of V.D.J. and it is also claimed that even R.P.J. was an employee of a company in which V.D.J. was a managing partner.
Although the entire finance was to be arranged by V.D.J., it appears the company was started by the above two persons 242 with V.D.J. remaining in the background.
Anil Chandra Dutta soon resigned and other people came in and in 1965 66 there were 19 shareholders, nine headed by R.P.J. and ten headed by V.D.J., clearly showing two family groups R.P.J. group had 1875 shares and V.D.J. group had 3125 shares.
V.D.J. stood guarantee for bank overdraft to the tune of Rs. 47 lakhs and as the learned Company Judge has noted the stake of the appellant in the company was about Rs. 63 lakhs as opposed to the stake of the respondents amounting to Rs. 1.87 lakhs.
It is, therefore, clear that R.P.J. group 's interest in the company was not of the same magnitude as that of the appellants.
The learned Company Judge put the picture as follows: "The entire affidavit evidence brings in the forefront two broad features.
First, that there are disputes between the petitioners and the respondents regarding appointment of Vinode Kumar Jhunjhunwalla and Hariram Modi.
It is said on behalf of the petitioners that these appointments in breach of articles and in breach of the provisions of the Companies Act are adequate grounds for winding up.
It is, on the other hand said by the respondents that the allegations of breach of articles and provisions of the Act are denied and these are the subject matter of remedy by suit and are not the subject matter of winding up.
The other feature is that the respondents charge the petitioners with misappropriation.
The petitioners also charge the respondents with having utilised the funds of the company.
" Is this company, in substance a partnership or in the image of a partnership as claimed ? We may now address to this aspect strenuously emphasised by Mr. Sen. It as in Ebrahimi 's case (supra) there had been an earlier partnership and the partners later on formed into a company, the matter would have stood on a different footing.
In the present case, however, we do not find any special features which would unquestionably lead to the conclusion that the company is in substance a partnership.
On the other hand the following aspects are noteworthy: Assuming partnership had been contemplated, the idea was deliberately abandoned.
The company was started with one Anil Chandra Dutta who was no relation of the two families but was an employee of V.D.J. This would negative the idea of partnership which connotes equal status amongst the partners.
While it is true that a director may work in the company on remuneration, R.P.J., however, served like an employee on monthly salary not on his own initiative enjoying an equal partner 's freedom and prestige but directly under the supervision and control of V.D.J. acknowledging a status definitely of a subordinate character.
The voluntary financial involvement of a large stake by V.D.J. carefully sought to be protected against erosion of his interests by constant vigil on the day to day working does not fit in with the concept of a partnership.
All the above features do not enable us to accept the submission of the respondents that the company in this case is in substance a partnership.
243 In the present case there is yet another important feature against the respondents.
Serious trouble apparently arose on or about May 23, 1966, when a Board meeting was notified.
Prior to that even though something might, perhaps, be brewing inside, but nothing came to the surface although the respondents alleged that V.D.J 's son, Vinode Kumar Jhunjhunwalla, had been sent to the States at company 's expense and was later on, after completion of education, appointed as Technical Director and that all these were illegal actions.
It is significant that R.P.J. group was present in the meeting when these resolutions were passed and they made no grievance at the time about the same.
The petition for winding up was filled on June 7, 1966 and the foundation for it was laid in the solicitors ' letter to the appellants on May 27, 1966.
That may be said to be nucleus of the dispute so far as the records show.
It is not a proper principle to encourage hasty petitions of this nature without first attempting to sort out the dispute and controversy between the members in the domestic forum in conformity with the articles of association.
There must be materials to show when 'just and equitable ' clause is invoked, that it is just and equitable not only to the persons applying for winding up but also to the company and to all its shareholders.
The company court will have to keep in mind the position of the company as a whole and the interests of the shareholders and see that they do not suffer in a fight for power that ensues between two groups.
The cases of small companies stand on a different footing from a company like the present with nineteen shareholders, although apparently arrayed in two groups.
It is not, prima facie, established on the allegations that the company cannot run smoothly in the best interest of the general shareholders, including the R.P.J. group, after exit of the quondam directors.
The conclusion of the Division Bench that the company is in substance a partnership venture was based on the following principal reasons: (1) The original idea was to start a partnership venture and that idea was given ultimately the shape of a private company (2) The Sir Khata account shows that the starting on a partnership venture the parties set up a private company.
(3) The shareholding shows division amongst two family groups.
(4) There was no denial by the appellants of a specific averment of the respondents that the company was in substance a partnership.
(5) The respondents were all along functioning as working partners and the respondent, V.D.J. was the financial partner.
We will examine each of these reasons.
244 With regard to the first reason, the solicitors ' letter of May 27, 1966, which is the nucleus of the subsequent winding up petition filed in court is of great significance and the improvement in the version later in the petition will lose its importance.
It was stated in the solicitors ' letter that "some time in May 1956 it was agreed between our client Shri R. P. Jhunjhunwalla and Shri V. D. Jhunjhunwalla and Shri Mahabir Prasad Jhunjhunwalla to do some type of business in partnership, Shri V. D. Jhunjhunwalla suggested that a limited company should be formed in which our client could hold shares to the extent of /6/ annas and Shri V. D. Jhunjhunwalla and Shri Mahabir Prasad Jhunjhunwalla to the extent of annas /10/ and that our client would manage the business of such company as and when it was formed and that the requisite finance for the working of the company would be made by Shri V. D. Jhunjhunwalla and Shri Mahabir Prasad Jhunjhunwalla.
" There is nothing in the above paragraph which is the corner stone of the plea of partnership in substance that there was any active contemplation about forming of a partnership.
Reference to 'some type of business of partnership ' is very casual in the above extract.
On the other hand, it is more reasonable to conclude that although there might have been discussion about the advantages and disadvantages of partnership vis a vis a private limited company, no time was lost in deciding to form a company.
If this is the only basis of agreement between the parties to sustain the claim, we are unable to accept the same.
Regarding the second reason, the Sir Khata account which has been heavily relied upon to found an agreement or understanding is wholly misconceived.
It merely shows that a joint account was, for the time being opened for the purpose of the formation of the company and the account was closed on such formation.
It does not indicate any understanding as to the right of management of the company by any group of shareholders.
Thirdly, because the shareholding is between two family groups, it cannot be said that the company thereby takes the image of partnership.
On the other hand, the fact that after discussion, the parties deliberately abandoned the idea of forming a partnership would go to show that there was no intention to carry on business as partners.
Fourthly, after going through the correspondence it is not possible to say that there was no denial of the averment by the respondents that the company was in substance a partnership.
Apart from anything else it is enough to point out that in the letter of V.D.J. dated June 3, 1963, the allegations have been clearly denied.
It is, therefore, a very weak reason to reckon.
With regard to the last reason, it appears that the respondents themselves took the position in their petition that R.P.J. was managing the affairs of the company under daily supervision and control of V.D.J. Whether this position is accepted by the appellants or not, their statement in that respect gives no indication of their right to manage the business as a working partner as claimed.
Besides, working on remuneration by a director is not an unknown feature even in company business and we have already adverted to the status in 245 which he worked.
Nothing, therefore, turns on this feature.
All the above reasons, therefore, fail to convince us that the conclusion of the Division Bench that the company is in substance a partnership, is correct.
We should observe, that nothing observed by us in this appeal may be taken as expression of any opinion on the merits of the allegations and counter allegations of the parties.
In the result the appeal is allowed with costs.
The judgment of the Division Bench is set aside.
The winding up petition stands dismissed and the stay petition of the appellant is allowed.
S.R. Appeal allowed.
| The Ordinance Factory in which the petitioners were employed hold four cadres.
In the 2nd cadre of non gazetted officers there were four grades Foremen.
Assistant Foremen, Chargemen Grade I and Chargemen Grade II.
The 3rd cadre of non industrial employees had 2 grades Supervisor 'A ' Grade and 'B ' Grade, and were governed by the Indian ordnance Factories (Recruitment and Conditions of Service of Class III Personnel) Rules,1956.
Appointment was on the basis of 20% of the quota for direct recruits and 80% for promotees.
In answer to an advertisement for appointment by direct recruitment to the 4 grades of the 2nd cadre, the petitioners, all of whom except petitioner No. 12, were serving as Supervisors 'A ' Grade, applied.
Petitioner No. 12 was not in service.
They were interviewed but none of the petitioners, except Petitioner No. 12, received orders of appointment.
Petitioner No. 12 was appointed Chargeman Grade II.
Between April, 1963, and November, 1963, The other petitioners were promoted as Chargemen Grade II.
Respondents 5 to 16 who were apprentices, were also promoted as Chargemen Grade II, and were later promoted to the grade of Assistant Foremen.
Treating this order as an order of supersession, the petitioners filed a writ petition under article 32 claiming to be promotees, and seniority on the basis of statutory rules 10(1)(i) to (iv) contained in S.R.O. 4.
Dismissing the petition, ^ HELD.
(I) There was a justifiable ground for distinction between the petitioners, who were direct recruits, and the respondents who were promotees, and hence, there was no violation of article 16.
1762 G] The petitioners were really direct recruits and not promotees despite the wrong description in their service records and even wrong orders conveying the impression that they were promoters.
even though they had not received intimation of their appointment as direct recruits.
Promotions arc only made under section 8 of the Indian ordnance Factories (Recruitment and Conditions of service of Class III Personnel) Rules, 1956, as amended in 1961, to Charge men Grade II, on the basis Of a selection list prepared by the appropriate Departmental Promotion Committee.
The Committee had prescribed a normal minimum qualification of 3 years ' service in the post of Supervisor Grade 'A ' before promotion except in exceptional cases of ex apprentices.
The petitioners did not belong to the class which had any exceptional qualification, and, since they had not satisfied tho 3 years ' condition, they could not be considered for promotion in the 80% quota reserved for promotees, to the post of Chargemen, Grade Ir.
E Hl (2) The petitioners have not established that they have been denied their seniority in violation of any right under article 16 nor that the seniority list had been prepared in violation of any rule or principle of justice.
The question of inter se seniority is also based upon the 4:1 (80%: 20%) ratio and it was for the petitioners to satisfy the Court that they were not given the senior 759 grade although they satisfied all the required conditions, and that others, who A were promoted, were given unjustifiable preference over them.
[763C] Amrit Lal Berry vs Collector of Central Excise Central Revenue & ors., AIK @ 546, followed.
|
it Petition No. 1119 of 1986 etc.
(Under Article 32 of the Constitution of India).
G. Ramaswamy, A.S.G., N.C. Sikri, N.S. Das Bahl, B.D. Sharma, Ms. Madhu Sikri, B.W. Vaidya, R.B. Misra, Ms. A. Subhashini (not present) and Dalveer Bhandari for the ap pearing parties.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
The first of these applications under article 32 of the Constitution is on behalf of the Delhi Reserve Trained Pool Telephone Operators (RTPTOs) asking for a direction to the Mahanagar Telephone Nigam Limited to treat all the telephone operators at par after their absorp tion as regular employees.
Three letters addressed to the learned Chief Justice of this Court have been treated as writ petitions and are the remaining one under article 32 of the Constitution.
The first one (1276/86) is by the Reserve Trained Pool Telephone Operators of Bombay.
They claim the self same relief as asked for in the earlier case; the second one (1623/86) is on behalf of the Reserve Trained Pool Operators in the Department of Posts and they have .claimed relief of being placed at par with regular, permanent or temporary employees in the matter of service conditions.
The third one (1624/86) is on behalf of substi tute employees and casual labourers in the Department of Posts.
They have claimed that substitute employees and casual labourers be paid the same emoluments as regular employees.
331 In an earlier Writ Petition No. 11764 of 1985 filed by the All India Telegraph Engineering Employees Union Class III of Bombay Telephone where the prayer for treating the Reserve Trained Pool Telephone Operators at par with regular staff had also been asked for, this Court made the following order on 1.5.
1986: "The matter is adjourned to 28.7.
1986 to enable the newlyadded respondent No. 3 to file counter affidavit on or before 15.7.
Rejoinder, if any, will be filed within one week thereafter.
Meanwhile, the respondent will pay to the operators drawn from the Reserve Trained Pool of the Telephone Opera tors from Bombay and Delhi Telephones Rs.4.90 per hour provided that the total salary of the Telephone Operators from the Reserve Trained Pool shall not exceed the salary of regularly appointed Telephone Operators.
" On 23.7.
1986, this Court in that Writ Petition further ordered: "The order passed by the Court on 1.5.
1986 shall be final.
The wages shall be paid in accordance with the terms contained in that order.
We, however, make it clear that if the Dearness Allowance and other allowances are varied hereafter the workers concerned shall get D.A. and other allowances accordingly subject to the limit that the total emoluments would not exceed the salary of regularly appointed Telephone Operators.
If the peti tioners have any other grievance they are at liberty to agitate.
This order will apply to all RTPA employees who 'are similarly situated.
" It is the stand of the respondents that that order of this Court has been implemented with effect from 28.7.
After that was done, the RTPTOs of Bombay and Delhi have in their respective Writ Petitions applied for further reliefs as already indicated.
According to the petitioners in these two Writ Petitions, the RTPTOs are entitled to be brought on par with the regular staff for grant of other service bene fits as they have been performing the same duties as per formed by regular operators.
The two petitions have been opposed by the relevant Ministry by filing counter affidavits where the stand taken is that RTPTOs are a special class by themselves with their own incidents of service and they cannot be treated at par with regular employees.
The differences between the two services have been highlighted in the counter affidavits.
332 It is also the stand of the respondents that the order of this Court referred to above dated 28.7.1986 finally dis posed of the major claim raised in the two petitions of the employees of the two Telephone Nigams and fresh action was not appropriate.
It is also pointed out that on 10th of February, 1986, there was an agreement of settlement and the present petition was an attempt to reopen the matter.
On 31.1.
1989, when Writ Petition No. 1276 of 1986 came up for hearing before this Court, the following order was made: "Learned counsel for the petitioners concedes that the regularisation of 21,000 employees in the Department of Telecommunications has been effected but complains that no such proceeding has taken place in respect of the postal employees.
He states that there is pressing need for a parity of service conditions in cluding pay, house rent allowance and other allowances between the temporary employees and the regular employees covered by this catego ry.
The learned Additional Solicitor General of India assures us that the scheme will be finalised latest by first week of April, 1989 and that complete position will be placed before the Court at that stage . " The scheme known as Casual Labourers (Grant of Temporary Status in Regularisation) Scheme has been formulated and put into operation from 1.10. 1989 and a copy thereof has been placed for our consideration.
We find that the scheme is comprehensive and apart from provision for conferment of temporary status, it also specifies the benefits available on conferment of such status.
Counsel for the respondent Nigams have told us that the scheme will be given full effect and other benefits contemplated by the scheme shall be worked out.
In these circumstances, no further specific direction is necessary in the two applications relating to the two Nigams of Bombay and Delhi except calling upon the respondents to implement every term of the scheme at an early date.
The two remaining writ petitions relate to the Depart ment of Posts.
Though an assurance had been held out by the learned Additional Solicitor General that a separate scheme for the postal employees would be prepared and placed before the Court within a time frame, that has not been done.
At the hearing, a note containing tentative proposals and a statement as to what has been done by way of improving the conditions of service have, however, been placed before the Court.
The statement relating to improvements brought about 333 indicates that after April, 1986, about seven thousand RTPs have been absorbed.
Since the RTP category is no more ex panding, only about 2,900 of them remain to be absorbed.
We have been told by learned counsel for the Department that equal number of justified and supernumerary posts are being created and the Ministry 's proposal is in the hands of the Ministry of Finance for approval and is expected to be finalised soon.
This has to be done within a time frame.
and we direct the posts of both the categories to be created by the end of January, 1990, and the process of absorption to be completed by 31.3.
With such absorption made, the RTPs will become regular employees.
All their claims would, thereafter, be regulated on the basis of entitlement in accordance with extant rules.
So far as the claim of earned leave is concerned, we find that Telecommunications Regularisation Rules provide for leave entitlement on pro rate basis one day for every ten days of work.
The same benefit would be admissible to the employees of the Department of Posts as we find no reason to adopt a different basis.
In National Federation of P & T Employees & Anr.
vs Union of India & Anr.
, , this Court direct ed: "The Union of India and other respondents are directed to pay wages to the workmen who are employed as casual labourers belonging to the several categories of employees in the Posts and Telegraphs Department at the rates equiva lent to the minimum pay in the pay scales of the regularly employed workers in the corre sponding cadres but without any increments with effect from February 5, 1986 on which date the first of the above two petitions, namely, Writ Petition No. 302 of 1986 was filed.
The petitioners are entitled to corre sponding dearness allowance and additional dearness allowance, if any, payable thereon.
Whatever other benefits which are now being enjoyed by the casual labourers shall continue to be extended to them .
" It has been stated that in compliance with that direc tion the Department has alredy formulated a scheme for absorption of casual labourers and about a thousand justi fied posts are being created with concurrence of the nodal Ministry.
As per existing recruitment rules, extra depart mental agents are given preference in the matter of absorp tion as Group 'D ' postmen.
Directions have already been issued for their absorption against the vacancies.
It has been pointed out 334 again that casual labourers are being paid bonus while substitutes are not entitled under the existing scheme.
The other note placed before us at the bearing indicates: 1. Justified (by necessity) posts in Groups 'C ' and 'D ' will be created in the administra tive and operative establishments as per the existing norms for creation of posts in con sultation with the Finance Ministry, 2.
On creation of the posts, recruitment will be done following the existing recruitment rules giving preference to extra departmental agents over casual labourers; 3.
If on the basis of established norms, casual labourers are in excess, their services shall be dispensed with in accordance with law; and 4.
If any casual labourers cannot be re trenched straightaway, they shall be paid wages for three months at the existing rates.
This tentative scheme does not take into account the several specific claims advanced by the petitioners in the two writ petitions.
These are House Rent Allowance, City Compensatory Allowance, Bonus and Earned Leave.
There are also demands for weekly off day, postal holiday and materni ty leave.
Weekly off has now been given to RTPs, casual labourers and substitutes under order of this court and the claim does not survive for adjudication.
All these three categories in these two writ petitions are also being given three national Holidays.
For the remaining postal holidays, the claim has been pressed but we are of the view that until absorption, they may not be granted.
It has been agreed before us that the claim of bonus may be left to arbitration or for being dealt with by the Consultative Council.
As regards House Rent Allowances, City Compensatory Allowance and Maternity Leave, we see.
no justification for treating the employees of the Postal Department differently from those covered under the Regularisation Rules in the Telecommunications Department.
Temporary status would be available to the casual labourers in the Postal Department on completion of one year of continuous service with at least 240 days of work (206 days in the case of officers observing five days ' week) and on conferment of temporary status, House Rent Allowance and City Compensatory Allowance shall be 335 admissible.
There would be no justification to withhold Maternity Leave as that is an obligation of the employer under the law and the State as an ideal employer fulfilling the Directive Principles of State Policy envisaged in Part IV of the Constitution should provide the same.
After ren dering three years of continuous service with temporary status, the casual labourers shall be treated at par with temporary Grade 'D ' employees of the Department of Posts and would thereby be entitled to such benefits as are admissible to Group 'D ' employees on regular basis.
So far as the substitutes are concerned, it has been stated to us that orders have been issued for considering their claims against Group 'D ' vacancies and a copy of the Department 's letter has been produced.
We hope and trust that the direction shall be implemented in its true spirit.
The claim on behalf of substitutes ordinarily is not enter tainable but we have been told that there are substitutes who work for long periods continuously.
We are inclined to agree with counsel for the petitioners that in such cases their claims should have been appropriately considered by the Department.
The writ petitions are disposed of with the aforesaid directions without any order as to costs.
R.N.J. Petitions dis posed of.
| In these appeals on the question: whether section 15 (as amended) of the Rajasthan Imposition of Ceiling on Agricul tural Holdings Act, 1973 was violative of Article 14 of the Constitution of India.
Dismissing the appeals, this Court, HELD: Rajasthan Imposition of Ceiling on Agricultural Holdings Act, 1973 was a legislation which was made for the purpose of bringing about agrarian reforms.
The provisions of the Act including section 15 (as amended) are protected by Article 31(A)(1)(a) of the Constitution.
Therefore, the attack that section 15 of the Act was violative of Article 14 of the Constitution does not survive.
The High Court was right in upholding the validity of section 15 of the Act.
[247B; C D] Bansidhar vs State of Rajasthan, ; , followed.
|
Civil Appeal No. 965 of 1980 Appeal by special leave from the judgment dated the 28th November, 1979 of the Allahabad High Court in Civil Revision No.661 of 1977.
Manoj Swarup & Miss Lalita Kohli for the Appellant.
R. N. Sharma and N. N. Sharma for the Respondent.
The Judgment of the Court was delivered by BALAKRISHNA ERADI, J.
This appeal by special leave is against a judgment rendered by the First Additional District Judge, Bulandshahr, allowing a Revision Petition filed before him by the respondent herein.
333 The respondent is the owner of a shop building in Jahangirabad town which he had let out to the appellant on a month to month tenancy basis.
A suit for ejectment was filed by the respondent in the Court of Small Causes (Civil Judge), Bulandshahr, praying for eviction of the appellant from the shop under Section 2() (2) (a) of the U. P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972 (for short, the Act) on the ground that the tenant was in arrears of rent for not less than four months commencing from April 9, 1972 and had failed to pay the same to the landlord within one month from the date of service upon him of a notice of demand (October 19, 1972).
It was alleged in the plaint that the agreed rent of the shop was Rs. 100/ per month and that the tenant had kept the rent in arrears from April 9, 1972 onwards despite notice having been served on him on October 19, 1972 demanding payment of arrears of rent and determining the tenancy.
The appellant (defendant) pleaded in defence that the rent was only Rs. 90/ per month, that he had not committed any default in payment of the same and hence the suit for ejectment was not maintainable.
According to the defendant, after service of the notice of demand for payment of arrears of rent, the respondent had approached him with a request to stand surety for him for the payment of arrears of sales tax due by him for the realisation of which the Amin had come with a warrant for the arrest of the respondent and since the appellant had acceded, to the said request and stood surety for the respondent there could be no further question of any arrears of rent being outstanding as due by him to the respondent.
The trial court held that the rent of the shop was Rs. 90/ per month, that it had been kept in arrears by the tenant from April 9, 1972 onwards and a default had been committed by the tenant in payment of arrears of rent of more than four months after the notice of demand.
Notwithstanding the aforesaid finding that there had been such default committed by the tenant, the trial court took the view that the conduct of the plaintiff respondent in inducing the defendant to stand surety for him for the payment of sales tax arrears due by him constituted a waiver of the demand made in the notice for surrender of possession on the ground of arrears of rent made.
On this reasoning, the trial court denied the plaintiff the relief of ejectment and decreed the suit only for recovery of arrears of rent.
The respondent plaintiff carried the matter in revision before District Court, Bulandshahr.
The learned District Judge found that 334 the plea of waiver had not been put forward by the defendant either in the written statement or in any other manner at any stage before the trial court and that the issue covering the question of waiver had been framed by the trial court of its own accord.
The District Judge further found on the merits that no conduct amounting to waiver on the part of the plaintiff had been established by the evidence because even according to the case of the defendant himself, excepting for standing surety for the plaintiff, he had not actually made any payment on behalf of the plaintiff towards the sales tax dues since the plaintiff had specifically refused to make any endorsement in the Rent Deed adjusting the proposed payment of sales tax against the arrears of rent due by the defendant.
Inasmuch as the trial court had found that the default in payment of the arrears of rent for a period exceeding four months had been committed by the defendant and it had denied a relief of ejectment only on the reasoning that there had been a waiver of the demand for eviction on the part of the plaintiff, the District Judge allowed the Revision Petition and granted the plaintiff a decree for ejectment under Section 20 (2) (a) of the Act.
Thereafter, the appellant defendant took up the matter in further revision before the High Court under Section 115, Code of Civil Procedure.
The High Court by its judgment dated November 28, 1979 confirmed the findings of the District Judge and dismissed the Revision Petition.
The defendant thereupon approached this Court for the grant of special leave to appeal against the said judgment of the High Court.
It would appear that, at the time of the preliminary hearing of the Special Leave Petition, the appellant realised that the Revision Petition filed by him before the High Court was not maintainable in law.
Hence, this position was conceded by the appellant before a Bench which heard the Special Leave Petition and a request was made by the appellant for the grant of special leave to him to appeal against the judgment of the District Court.
That request was granted by order of this Court dated April 23, 1980.
This Civil Appeal is thus directed against the judgment of the District Judge.
After hearing counsel on both sides, we are satisfied that the District Court was perfectly right in its view that there had not been any conduct on the part of the plaintiff which would constitute a waiver by him of the demand for surrender of possession made as 335 per the notice dated October 9, 1972 which was served on the tenant on October 19, 1972.
As rightly observed by the District Court, the defendant had not put forward any plea of waiver in the written statement filed by him before the trial court and the absence of any specific pleading in that behalf, the trial court was not really called upon to go into the question of waiver.
Further, it being the specific case put forward by the defendant himself that no amount whatever had been paid by the appellant defendant to the sales tax authorities on behalf of the plaintiff and that the respondent plaintiff was not agreeable to make any endorsement on the Rent Deed adjusting the proposed payment of sales tax against the arrears of rent, we fail to see how it can be said that there had been any waiver by the plaintiff respondent of the demand for surrender of possession already made by him as per the notice dated October 9, 1972.
The finding rendered b)! the trial court that the effect of the notice had been effaced by the subsequent conduct on the part of the landlord which amounted to a waiver was manifestly illegal and perverse and it was rightly set aside by the District Judge.
Before us, an additional point was sought to be raised by the appellant which had not been put forward by him either before the trial court or before the District Judge at the revisional stage.
It was urged that on the date of first hearing of the suit the defendant had deposited into the trial court an amount of Rs. 1,980/ and hence he is entitled to the benefit of sub section (4) of Section 20 of the Act which empowers the Court to pass an order relieving the tenant against his liability for eviction on the ground mentioned in clause (a) of sub section (2) of the said Section.
It is necessary in this context to reproduce clause (a) of sub section (2) and sub section (4) of Section 20 of the Act.
They are in the following terms: "20 (2). . . . . . . (a) that the tenant is in arrears of rent for not less than four months, and has failed to pay the same to the landlord within one month from the date of service upon him of a notice of demand.
(4) In any suit for eviction on the ground mentioned in clause (a) of sub section (2), if at the first hearing of the suit, the tenant unconditionally pays or tenders to the landlord the entire amount of rent and damages for use and occupation of the building due from him (such damages for 336 use and occupation being calculated at the same rate as rent) together with interest thereon at the rate of nine per cent per annum and the landlord 's costs of the suit in respect thereof, after deducting therefrom any amount already deposited by the tenant under sub section (I) of Section 30, the court may, in lieu of passing a decree for eviction on that ground, pass an order relieving the tenant against his liability for eviction on that ground: Provided that nothing in this sub section shall apply in relation to a tenant who or any member of whose family has built or has otherwise acquired in a vacant state, or has got vacated after acquisition, any residential building in the same city, municipality, notified area or town area.
" The provisions of sub section (4) will get attracted only if the tenant has, at the first hearing of the suit, unconditionally paid or tendered to the landlord the entire amount of rent and damages for use and occupation of the building due from him together with interest thereon at the rate of nine per cent per annum and the landlord 's costs of the suit in respect thereof, after deducting therefrom any amount already deposited by him under sub section (I) of Section 30.
There is absolutely no material available on the record to show that the alleged deposit of Rs. 1,980/ was made by the tenant on the first date of hearing itself and, what is more important, that the said deposit was made by way of an unconditional tender for payment to the landlord.
The deposit in question is said to have been made by the appellant on January 25, 1974.
It was only subsequent thereto that the appellant filed his written statement in the suit.
It is noteworthy that one of the principal contentions raised by the appellant defendant in the written statement was that since he had stood surety for the landlord for arrears of sales tax, there was no default by him in the payment of rent.
In the face of the said plea taken in the written statement, disputing the existence of any arrears of rent and denying that there had been a default, it is clear that the deposit, even it was made on the date of the first hearing, was not an unconditional tender of the amount for payment to the landlord.
Further, there is also nothing on record to show that what was deposited was the correct amount calculated in accordance with the provisions of Section 20 (4).
In these circumstances, we hold that the appellant has failed to establish that he has complied with the conditions specified in sub section (4) of Section 20 and hence he is 337 not entitled to be relieved against his liability for eviction on the ground set out in clause (a) of sub section (2) of the said Section.
This appeal is, therefore, devoid of merits and is accordingly dismissed.
We direct the parties to bear their respective costs.
N. K. A. Appeal dismissed.
| The appellants, who were manufacturers of medicinal and toilet preparations containing alcohol challenged the constitutional validity in their writ petitions under article 226 of the Constitution of the provisions of sections 12A, 12B, 14(e) and (f ), 56A and section 68A of the Kerala Abkari Act, 1967 (Act No. X of 1967) and Rules 13 and 16 of the Kerala Rectified Spirit Rules, 1973 and rr.
5, 6 and 7 of the Kerala Spiritious Preparations Rules, 1969 on the ground that the State Legislature had no power to enact a law relating to medicinal and toilet preparations as the topic of the legislation was within the exclusive domain of Parliament under Entry 84, List I of the Seventh Schedule of the Constitution and also on the ground that they were violative of article 19(1) (g) read with article 301 of the Constitution.
The High Court dismissed the writ petition holding that there was no conflict between the impugned provisions and the Central law, i.e., the or the Medicinal and Toilet Preparations (Excise Duties) Rules, 1956 framed thereunder as they dealt with different subjects.
The High Court further held that the impugned provisions do not offend against article 19(1) (g) or article 301 of the Constitution.
In the appeal and the special leave petition to this Court it was contended on behalf of the appellants (t) The State Legislature had no legislative competence 520 to enact the impugned provisions because the field was occupied by the provisions of The (The Central Act) and the Medicinal and Toilet Preparations (Excise Duties) Rules, 1956 (the Central Rules), and alternatively, the impugned provisions are violative of the fundamental right guaranteed in article 19(1) (g) of the Constitution.
(2) "Drugs and Pharmaceuticals" having been declared by Parliament under section 2 of the Industries Development and Regulation) Act, 1951 to be a scheduled industry, being item 22 of the First Schedule thereof, the power of the State Legislature to make a law in respect of medicinal and toilet preparations containing alcohol was taken away.
(3) The provisions made in section 14(e) of the Act for the collection of supervisory charges was clearly invalid in as much as (a) they are in conflict with r. 45 of the Central Rules, and (b) they could not be sustained as a fee as there was no quid pro quo.
(4) Rule 13 of the Kerala Rectified Spirit Rules, 1972, providing for the levy of excise duty as excess wastage of alcohol in the manufacture of medicinal and toilet preparations cannot be supported in terms of the charging provision contained in section 17 of the Act.
(S) The power to restrict the quantity of ayurvedic asavas and arishtas in which alcohol is self generated in the process of manufacture having regard to the total requirement of such medicinal preparations for consumption or use in the State is an unreasonable restriction on The fundamental right to carry on trade or business guaranteed under An.
19(1) (g) and was also violative of article 301 as there was demand for such medicinal preparations not only in The Slate but throughout the country.
Dismissing The Appeal and Special Leave Petition, ^ HELD: (l) The Central and State Acts operate in two separate and distinct fields and are not in conflict with each other.
While the main purpose of the impugned Act is to consolidate the law relating to manufacture, sale and possession of intoxicating liquors and intoxicating drugs, a subject which falls under Entry 8 of List II of the Seventh Schedule, the main object of the Central Act is lo provide for the levy and collection of duties of excise on medicinal and toilet preparations containing alcohol falling under Entry 84 List I. [536 G F] 2(i).
The enactment of the by Parliament under Entry 84, List I of the Seventh Schedule of the Constitution, or the framing of the Medicinal and Toilet Preparations (Excise Duties) Rules, 1956 by the Central Government in exercise of their rule making power under section 19 of the Act, for the purpose of levying duties of excise on medicinal and toilet preparations containing alcohol etc., do not pre vent the State Legislature from making a law under Entry 8, List II of the Seventh Schedule to the Constitution with respect to 'intoxicating liquors ' or a law under Entry 51 List II for levying excise duties on alcoholic requirements for human consumption.
[528 C D] (ii) It is the charging section which gives the true index to the real character of a tax.
The nature of the machinery by which the tax is to be assessed is not of assistance, except in so far as it may throw light on the general character of the tax.
The charging section in section 3 of the Central Act clearly shows that it does not seek to levy a duty of excise on alcohol liquor for human consumption falling within Entry 51 List II of the Seventh Schedule, but to levy a duty of 521 excise on medicinal and toilet preparations containing alcohol etc.
The topic of legislation under Entry 84, List I of the Seventh Schedule is 'duties of excise on medicinal and toilet preparations containing alcohol etc.
The Central Act must in pith and substance, be attributed to Entry 84, List.
[532 C E] (iii) The Central and the State Legislations operate on two different and distinct fields.
The Central Rules, to some extent, trench upon the field reserved to the State Legislature, but that is merely incidental to the main purpose, that is, to levy duties of excise on medicinal and toilet preparation containing alcohol.
Some of the impugned provisions may be almost similar to some of the provisions of the Central Rules, but that does not imply that the State Legislature had no competence to enact the provisions.
The State Legislation is confined to 'intoxicating liquor ', that is, to ensure proper utilisation of rectified spirit in the manufacture of medicinal and toilet preparations and, therefore, within the powers granted to the State Legislature under Entry 8, List II.
It further seeks to regulate the manufacture of bona fide medicinal preparations and prevent misuse of rectified spirit in the manufacture of spurious medicinal and toilet preparations containing alcohol capable of being used as ordinary alcoholic beverages.
[532 F 533 A] (iv) The enumeration of 'intoxicating liqour ' in Entry 8, List II, confers exclusive power to the State to legislate in respect of medicinal and toilet preparations containing alcohol.
[533 B] (v) In matters of seeming conflict or encroachment of jurisdictions, what is more important is the true nature and character of the legislation.
A necessary corollary of the doctrine of pith and substance is that once it is found that in pith and substance the impugned Act is a law on a permitted field, any incidental encroachment on a forbidden field does not affect the competence of the legislature to enact the law.
[534 B C] Prafulla Kumar Mukherjee and Ors.
vs Bank of Commerce Ltd. Khulna A.I.R. 1947 PC 60 at 65 and State of Bombay vs F. N. Balsara ; at 694 5 referred to.
(vi) There can be no doubt that the impugned Act is relatable to Entry 8, List II of the Seventh Schedule.
[536 A] (vii) When the frame work of the two enactments is examined, it would be apparent that the Central and the State Legislature operate in two different and distinct fields.
In the matter of making rules or detailed provisions to achieve the object and purpose of a legislation, there may be some provisions seemingly overlapping or encroaching upon the forbidden field, but that does not warrant the striking down of the impugned Act as ultra vires the State Legislature.
[536 G 537 A] Hyderabad Chemical and Pharmaceutical Works Ltd. vs State of Andhra Pradesh and Ors.
; distinguished.
(viii) No citizen has any fundamental right guaranteed under article 19(1) (g) of the Constitution to carry on trade in any noxious and dangerous goods like intoxicating drugs or intoxicating liquors, The power to legislate with regard to intoxicating liqour carries with it the power to regulate the manufacture, sale and possession of medicinal and toilet preparations containing alcohol, not for the 522 purpose of interfering with the right of citizens in the matter of consumption or use for bonafide medicinal and toilet preparations, but for preventing intoxicating liquors from being passed on under the guise of medicinal and toilet 'preparations.
It was within the competence of the State Legislature to prevent the noxious use of such preparations i.e. their use as a substitute for alcoholic beverages.
[537B D] In the instant case the provisions have been enacted to ensure that rectified spirit is not misused under the pretext of being used for medicinal and toilet preparations containing alcohol.
Such regulation is a necessary concomitant of the police power of the State to regulate such trade or business which is inherently dangerous to public health.
[537 E] (ix) All that the provisions of sections 12A and 12B ordain is that the Commissioner "shall have due regard to the total requirement of such medicinal preparations for consumption or use in the State".
The Commissioner has, therefore, only to take into account the total requirements within the State as an element which should enter the assessment and no more.
As a necessary corollary, it follows that in fixing the quantity of medicinal and toilet preparations to which alcohol is added or in which it is self generated, normally the Commissioner shall have regard to larger requirements of the manufacture, if the manufactured product has a market outside the State.
The restrictions imposed by section 12B as to the alcoholic content of medicinal and toilet preparations and the requirement that they shall not be manufactured except and in accordance with the terms and conditions of a licence granted by him, are nothing but reasonable restrictions within the meaning of article 19(6).
The impugned provisions, therefore, cannot be struck down as offending article 19(1) (g) of the Constitution.
[538 E 539 B] 3.
The State Act, in pith and substance, is not a legislation under Entry 24, List 11 and, therefore, the question does not arise.
[539 E 539 B] 4(i) (a) The provision contained in section 14(e) of the Act is clearly relatable to the State 's power to make a law under Entry read with Entry 51(a), List II of the Seventh Schedule.
section 14(e) of the Act is valid in so far as it provides that the Commissioner may prescribe the size and nature of the establishment for such supervision and the cost of establishment and other incidental charges in connection with such supervision to be realised from the licensee.
There is no warrant for the submission that the framing of such an incidental provision like r. 45(1) of the Central Rules takes away the State 's power to recover supervisory charges from the licensee.
[540 B C] (b) 'Fees ' are the amounts paid for a privilege and are not an obligation.
Fees are distinguished from taxes in that the chief purpose of a tax is to raise funds for the support of the Government or for a public purpose, while a fee may be charged for the privilege or benefit conferred, or service rendered or to meet the expenses connected therewith.
Thus, fees are nothing but payment for some special privilege granted or service rendered.
Taxes and taxation are, therefore, distinguishable from various other contributions, charges, or burdens paid or imposed for particular purposes and under particular powers or functions of the Government.
It is now increasingly realised that merely because the collections for the services rendered or grant of a privilege or licence, are taken to the Consolidated Fund of the State and are not separately appropriated towards the expenditure for rendering the service is not by itself decisive.
It is also increasingly realised that the element of quid pro quo stricto sensu is not 523 always a sine qua non of a fee.
It is needless to stress that the element of quid A pro quo is not necessarily absent in every tax, [541 G 542 D] Mahant Shri Jagannath Ramanuj Das vs The State of Orissa ; , Ratilal Panachand Gandhi vs The State of Bombay [1954] SCR 1055, Constitutional Law of India by H.M. Seervai, 2nd Edn.
Vol. 2, p. 1252, para 22.39 & Kewal Krishan Puri & Anr.
vs State of Punjab & Ors.
at 1230 referred to.
(ii) In the case of a manufacturer of medicinal and toilet preparations containing alcohol in a bonded manufactory, the imposition of the cost of establishment under section 14(e) of the Act calculated in accordance with the nature and extent of that establishment could not be said to be an imposition of a duty of excise, but is a price for his franchise to carry on the business.
[543 D E] (iii) No one has a fundamental right to the supply of rectified spirit which is an intoxicating liquor.
It is upto the State to control and regulate its supply from a distillery or a spirit warehouse in the State under and in accordance with the terms and conditions of a licence or permit its import from outside by grant of a privilege and charge a fee for the same.
A fee may be charged for the privilege or benefit conferred, or service rendered, or to meet the expenses connected therewith.
A fee may be levied to meet the cost of supervision and may be something more.
It is in consideration for the privilege, licence or service.
The State is undoubtedly entitled to levy excise duty on the rectified spirit issued from a distillery under section 17(f) of the Act read with r. 13 of the Kerala Rectified Spirit Rules, 1972 but it refrained from making any such levy by reason of rule 21 of the Central Rules and has, therefore, by proviso tc) rule 8 allowed a manufacturer of medicinal and toilet preparations to draw rectified spirit from a distillery without payment of duty.
It is thus a privilege conferred on the licensee.
To claim the privilege he must comply with the conditions prescribed If one of the conditions is the payment of cost of establishment under section 14(e) of the Act read with rule 16(4) of the Central Rules, the manufacturer of such preparations must necessarily bear the burden s the licensee gets services in return in lieu of such payment.
[543 G 544 C] 5.
Rule 13(2) is nothing but a corollary of rule 13(1).
On a combined reading of section 17(f) and rule 8 read with the proviso thereof, no duty is chargeable on alcohol actually used in the manufacture of medicinal and toilet preparations.
The Government realised that some margin for wastage should be allowed and, therefore, inserted the proviso to rule 13(2), which provides that the Government may, in consultation with the Drugs Controller and the Chemical Examiner, by notification in the Gazette, permit allowance for wastage occurring during the manufacture.
Beyond the permissible limit, the State has the right to levy a duty on excess wastage of alcohol, i.e. on alcohol not accounted for.
[548 D F] 6.
The restriction imposed by section 12A of the Act as to the quantity of medicinal preparations to be manufactured relate not only to preparations to which alcohol is added but also to medicinal preparations in which alcohol is self generated.
There can be no doubt that ayurvedic asavas and aristhas which are capable of being misused as alcoholic beverage and come within the purview of the definition of 'liquor ' contained in section 3(10) of the Act being liquid containing alcohol.
The contention that Note to rule 3(1) is an unreasonable restriction on the freedom of trade guaranteed under.
Article 19(1) (g) of the Constitution has no substance.
[549 B D] 524
|
Appeal No. 1228 of 1966.
Appeal by special leave from the judgment and decree dated December 2, 1965 of the Punjab High Court, Circuit Bench at Delhi in Letters Patent Appeal No. 57 D of 1965.
C. B. Agarwala and P. P. Juneja, for the appellant.
Sardari Lal Bhatia, D. R. Gupta and H. K. Puri, for the respondent.
The Judgment of the Court was delivered by Bhargava, J.
The appellant Hatti was declared a Bhumidar ,of some land belonging to the respondent, Sunder Singh, under section 13 of the Delhi Land Reforms Act No. 8 of 1954 (hereinafter referred to as "the Act").
The respondent then brought a suit in the Civil Court claiming three reliefs.
The first relief claimed was for a declaration that the declaration of Bhumidari issued in the name of the appellant with respect to the land in dispute was wrong, illegal, without jurisdiction, ultra vires, void and ineffective against the respondent.
The second relief was that the respondent be declared entitled to Bhumidari rights under section 11 of the Act; and the third relief was for possession of the land.
The suit was brought on the allegation that the respondent was the owner of the land, while the appellant had no rights in it.
The land along with some other land was on Mustrajri with one Sultan Singh for a period of 20 years ending in June, 1952, and the appellant had been admitted as a tenant at will by the Mustrajar.
On the expiry of the period of 20 years in June, 1952, the Mustrajri stood terminated and the original Mustrajar 's heirs left the land.
The appellant, however, continued in possession, but, since he was a tenant at will of the Mustrajar, he had no rights in the land after the expiry of the Mustrajri.
He was asked to surrender possession, but failed to do so.
On the other hand, he was wrongly granted the declaration under section 13 of the Act that he was a Bhumidar when he had no rights as tenant in the land at all.
The main defence taken on behalf of the appellant was that he was a non occupancy tenant and he was entitled to the declaration of his Bhumidari rights.
Apart from the issues on merits, one issue was raised by the appellant that the Civil Court bad no jurisdiction to entertain the suit in view of the provisions 165 of section 185 of the Act.
The trial Court held that the jurisdiction of the Civil Court was not barred.
On merits, the finding recorded was that the respondent was the proprietor of the land, but no declaration could be granted that he became Bhumidar under section 11 of the Act, as that relief could only be granted by the revenue authorities under the Act.
It was held that he was, however, entitled to possession in exercise of his right as proprietor, so that a decree for possession was granted in his favour.
That decree was upheld, in appeal, by the District Judge and, in second appeal, by a learned single Judge of the High Court of Punjab.
The Letters Patent appeal before the Division Bench was also dismissed, so that the appellant has now come up to this Court in this appeal by special leave.
The only point that was argued before the Division Bench in the Letters Patent appeal was that the Civil Court had no jurisdiction to entertain the suit,, so that, in this appeal, we are also concerned with this issue alone.
Section 185(1) of the Act, on, which reliance has been placed for urging that the Civil Court has no jurisdiction, is as follows : "185.
(1) Except as provided by or under this Act, no court other than a court mentioned in column 7 of Schedule 1 shall, notwithstanding anything contained in the Code of Civil Procedure, 1908, take cognizance of any suit, application, or proceedings mentioned in column 3 thereof.
" The relevant entries in the First Schedule, which require consideration, are Numbers 4, 19 and 28.
Item 4 mentions applications for declaration of Bhumidari rights in column 3 and, inter alia refers to sections 1 1 and 1 3 of, the Act.
For these applications, there is no period of limitation prescribed at all, and the Court of original jurisdiction is that of the Revenue Assistant.
Item 19 refers to section 84 of the Act, and relates to suit for ejectment of a person occupying land without title and for damages.
The three sub clauses mention that the suit can be instituted (i) by a Bhumidar declared under Chapter III of the Act or by an Asami falling under section 6 of the Act where such unlawful occupant was in possession of the land before the issue of the prescribed declaration form; (ii) by a Gaon Sabha where the unlawful occupant was in possession of the land before the constitution of Gaon Panchayat; and (iii) by a Bhumidar, Asami or Gaon Sabha in any other case.
The period of limitation is three years, in the first case, from the date of issue of the prescribed declaration form; in the second case, from the date of constitution of Gaon Panchayat under section 151; and, in the third case, from the 1st of July following the date of occupation.
The 166 Court of original jurisdiction in each case is that of the Revenue Assistant.
Item 28 refers to section 104 and relates to declaratory suit under that section.
No period of limitation is prescribed for such a suit, and the Court of original jurisdiction is again the Revenue Assistant.
The plea put forward on behalf of the appellant was that this suit, which was instituted by the respondent, ,covered only those reliefs which could be granted by the Revenue Assistant under the three items Nos. 4, 19 and 28 of the First .Schedule to the Act mentioned above, so that, by virtue of section 185 of the Act, the jurisdiction of the Civil Court was barred.
The High Court has taken the view that the suit is really in the nature of a title suit and such a title suit is not covered by these items, so that the jurisdiction of the Civil Court was not barred.
It is this view of the High Court that has been challenged before us in this appeal.
Learned counsel appearing for the appellant took us through the various provisions of the Act to show that the Act is a complete Code which lays down the rights that any person can possess in agricultural land in the area to which the Act applies, and the remedies that can be sought in respect of such land for obtaining declaration of their rights or any other declaration for possession.
The Act abolished the ownership of agricultural land by the previous proprietors.
This was effected by first laying down in sections 11 and 13 that proprietors will become Bhumidars in respect of their lands which were their Khud Kasht or Sir, while tenants would become Bhumidars in respect of their holdings.
Under section 6 of the Act, persons belonging to several classes, which included non occupancy tenants of proprietor 's grove and sub tenants of tenant 's grove, and non occupancy tenants of pasture land, or of land covered by water,, and some other classes, shall become Asamis.
"Holding" was defined in section 3(11a) ,of the Act by stating that it means: (a) in respect of (i) Bhumidar or Asami; or (ii)tenant or sub tenant under the Punjab Tenancy Act, 1887, or the Agra Tenancy Act, 1901; or (iii)lessee under the Bhoodan Yagna Act, 1955, a parcel or parcels of land held under one tenure, lease, engagement or grant; and (b) in respect of proprietors, a parcel or parcels of land held as sir or khud kasht.
The effect of sections 6 and 13 was that, thereafter, tenants and :sub tenants are lessees under the Bhoodan Yagna Act, 1955, 167 ceased to continue as such, and either became Bhumidars or Asamis in respect of their holdings.
Similarly, under section 11, proprietors in respect of their sir and khud kasht land became Bhumidars.
These sections have to be read in conjunction with section 154 of the Act of which the relevant portion is quoted below: " 154.
On the commencement of this Act (i) all lands whether cultivable or otherwise, except land for the time being comprised in any holding or grove, situate in a Gaon Sabha Area, shall vest in the Gaon Sabha Sections 6, 11, 13 and 154 of the Act read together, thus, show that, after the Act came into force, proprietors of agricultural land as such ceased to exist.
If any land was part of a holding of a proprietor, he became a Bhumidar of it.
If it was part of a holding of some other person, such as a tenant or a sub tenant etc., he became either a Bhumidar or an Asami, whereupon the rights of the proprietor in that land ceased.
Lands, which were not holdings of either the proprietor or any other person, vested in the Gaon Sabha.
In the case of proprietors, their rights in the land continued to exist only in respect of holdings which, under the definition, must have been either their sir or khud kasht at the commencement of the Act.
If it was not sir or khud kasht of a proprietor, it would not be his holding and, consequently, such land would vest in the Gaon Sabha under section 154, the result of which would be that the rights of the proprietor would be extinguished.
It appears that it was in view of this scheme of the Act that, under section 84, the right to institute a suit for posses sion was granted only to a Bhumidar, or an Asami, or the Gaon Sabha.
The Act envisaged only these three classes of persons who would possess rights in agricultural I and after the commencement of the Act.
Proprietors as such having ceased to exist could not, therefore, institute a suit for possession.
This aspect of the case has been lost sight of by the High Court and the lower courts, because it appears that their attention was not drawn to the provisions of section 154 of the Act, under which all lands of proprie tors, other than those comprised in their holdings, vested in the Gaon Sabha, thus extinguishing their proprietary rights.
168 A second aspect that needs examination relates to the provi sions of the Act for declaration of Bhumidari rights.
Sections 11 and 13 grant power to the Deputy Commissioner to declare proprietors in respect of their holdings and certain classes of tenants in respect of their holdings as Bhumidars.
The procedure to be adopted for issuing the declaration forms was laid down in the Delhi Land Reforms Rules, 1954 (hereinafter referred to as "the Rules") made by the Chief Commissioner of Delhi in exercise of the powers conferred by sections 9, 105, 149, 162, 180 and 191 of the Act.
The relevant Rules are 6 to 8.
These Rules envisaged preparation of declaration forms by the revenue authorities without any application from any party.
The declaration forms are based on the entries in the revenue records and, having been prepared on their basis, the declaration forms are issued to the persons who, under the forms, are held to be entitled to.
be declared as Bhumidars.
These Rules, thus, do not envisage any application under section 11 of section 13 at this early stage.
Rule 8(4) lays down that anyone, who challenges the correctness of entries in the forms of declaration, shall, except where it refers to a clerical omission or error, be directed by the Revenue Assistant to file a regular suit within two months of the date of issue.
Obviously, this sub rule has to be interpreted in conformity with section 185 and item 4 of the First Schedule to the Act, so that the scope of this sub rule must be confined to institution of suits in respect of matters not covered by item 4 of the First Schedule.
This sub rule would not stand in the way of an application being made by any person claiming to be Bhumidar under item 4 of the First Schedule.
The Rules were examined by Khanna J., in Lal Singh vs Sardara and Another(1) and in our opinion, he rightly held that a perusal of the Rules goes to show that there is no provision for giving notice to different interested parties before a declaration of Bhumidari rights is made and the whole thing is done in more or less a mechanical way.
That being the position, it becomes obvious that an application for declaration of a Bhumidari right under item 4 of Schedule I of the Act is intended to be made even in cases where a declaration may have been previously granted under section 11 or section 13 in accordance with the Rules.
The ,scheme of the Act appears to be that, initially, a declaration of Bhumidari right can be granted under section 11 or section 13 without calling for objections and without hearing contesting parties in favour of the person who appears to the revenue authorities to be entitled to the declaration on the basis of the records maintained by them.
Thereafter, any person aggrieved and claiming Bhumidari rights is expected to move an application before the Revenue Assistant (1).
I.L.R. [1964] Vol. 169 who is to adjudicate upon the rights after following the usual judicial procedure.
The order made by the Revenue Assistant in such a proceeding will then have to be given effect to and would override the declarations earlier issued in accordance with the Rules.
This shows that any person, who is aggrieved by a declaration of Bhumidari right issued in favour of another person, can appropriately seek his remedy by moving an application before the Revenue Assistant under item 4 of the First Schedule, whereupon, if he succeeds, he will obtain a declaration that he is the Bhumi dar.
Such a declaration will automatically supersede the declaration issued by the authorities in accordance with the Rules without any adjudication of rights and without notice to interested parties.
Khanna, J., in the case of Lai Singh vs Sardara & Another(1) correctly interpreted the scope and purpose of the Rules, under which forms of declaration of Bhumidari rights are issued, but, in our opinion, incorrectly inferred that, since there is no effectual adjudication of rights by the revenue authorities while declaring Bhumidari rights, their declaration must be subject to the due adjudication of rights which, in the absence of anything to the contrary, can only be by a Civil Court.
It is true that the declarations made by the revenue authorities without going, through the judicial procedure are subject to due adjudication of rights; but such adjudication must be by an application under item 4 of Schedule I and not by approach to the Civil Court.
The jurisdiction of the Civil Court is clearly barred by section 185 of the Act read with the various items of the First Schedule mentioned above.
If a Bhumidar seeks a declaration of his right, he has to approach the Revenue Assistant by an application under item 4, while, if a Gaon Sabha wants a clarification in respect of any person claiming to be entitled to any right in any land, it can institute a suit for a declaration under item 28, and the Revenue Assistant can make a declaration of the right of such person.
So far as suits for possession are concerned, we have already held earlier that section 84 read with item 19 of the First Schedule gives the jurisdiction to the Revenue Assistant to grant decree for possession, and that the suit for possession in respect of agricultural land, after the commencement of the Act, can only be insti tuted either by a Bhumidar or an Asami or the Gaon Sabha.
There can be no suit by any person claiming to be a proprietor, because the Act does not envisage a proprietor as such continuing to have rights after the commencement of the Act.
The First Schedule and section 84 of the Act provide full remedy for suit for possession to persons who can hold rights in agricultural land under the Act.
(1) I.L.R. [1964] Vol.
2 L235Sup.
CI/71 170 The High Court, in this connection, referred to section 186 of the Act under which any question raised regarding the title of any party to the land, which is the subject matter of a suit or proceeding under the First Schedule, has to be referred by the Revenue Court to the competent Civil Court for decision after framing an issue on that question.
Inference was sought to be, drawn from this provision that questions of title could be competently agitated by a suit in the Civil Court, as the jurisdiction of the Civil Court was not barred.
It appears to us that there is no justification for drawing such an inference.
On the contrary, section 186 envisages that questions of title will arise before the Revenue Courts in suits or proceedings under the First Schedule and, only if such a question arises in a competent proceeding pending in a revenue Court, an issue will be framed and referred to the Civil Court.
Such a provision does not give jurisdiction to the Civil Court to entertain the suit itself on a question of title.
The jurisdiction of the Civil Court is limited to deciding the issue of title referred to it by the Revenue Court.
This clearly implies that, if a question of title is raised in an application for declaration of Bhumidari rights under item 4 of Schedule I of the Act, that question will then be referred by the Revenue Assistant to the Civil Court; but a party wanting to raise such a question of title in order to claim Bhumidari right cannot directly approach the Civil Court.
The ,Act is a complete Code under which it is clear that any one, wanting a declaration of his right as a Bhumidar, or aggrieved by a declaration issued without notice to him in favour of another, can approach the Revenue Assistant under item 4 of the First Schedule and this he is allowed to do without any period of limitation, because he may not be aware of the fact that a declaration has been issued in respect of his holding in favour of another.
A declaration by a Gaon Sabha of the right of any person can also be sought without any period of limitation.
If there is dispute as to possession of agricultural land, the remedy has to be sought under section 84 read with item 19 of the First Schedule.
All the reliefs claimed by the respondent in the present suit were, thus, within the competent jurisdiction of the Revenue Assistant, and the Civil Court had no jurisdiction to entertain the suit.
In the result, the appeal is allowed, the decree passed by the High Court is set aside and the suit of the respondent is dismissed.
The appellant will be entitled to his costs in this Court, while, costs in other Courts will be borne by the parties themselves.
Y.P. Appeal allowed.
| Under ss.4 and 5 of the Assam Municipal Act, 1923, the Provincial Government was authorised to signify its intention to include within a municipality any local area in its vicinity, and, after considering.
any objections to the proposed action to so include the area.
Section 328 provided for the constitution of notified areas.
Sections 4 and 5 were not applicable to a notified area but the Provincial Government could extend to any notified area any section of the Act by virtue of section 330(1)(d).
Under section 330(3), for the purpose of any section so extended, the town committee constituted for such notified area would be deemed to be a Municipal Board.
In 1957, the 1923 Act was repealed and was replaced by the Assam Municipal Act, 1957.
The respondent owned tea gardens in the village of Nazira.
In 1909, a town committee was constituted at Nazira adjacent to the tea garden.
In 1951, by a notification issued by the Government of Assam, s.4(1)(b) and (c), and s.5(1) and (2)(b) of the 1923 Act were extended to the notified area committee including the Nazira Town Committee.
On January 6, 1964, a notification was issued under the 1957Act to revise the boundaries of the notified area at Nazira, and after considering the objections of the respondent on September 30, 1964, by a final notification, a part of its tea estate was incorporated within the Nazira Town Committee.
On the question whether notifications dated January 6, 1964 and September 30, 1964 were unauthorised, because, sections 4 and 5 of 1957 Act, corresponding to sections 4 and 5 of the 1923 Act, were not extended to the notified area on these dates, HELD : There is no express provision in the 1957 Act which supersedes the notification issued in 1951 under the 1923 Act nor is the continuance of the notification inconsistent with any provision in the 1957 Act.
Therefore, under section 26 of the Assam General Clauses Art, 1915, the 1951 notification continues in force and must be deemed to have been issued under the 1957 Act.
Hence, the State Government was competent, in exercise of the power conferred upon it by the 1957 Act, to include within the area of the Town Committee any local area contiguous to it.
[934 H; 935 A]
|
iminal Appeal No. 36 of 1958.
Appeal by special leave from the judgment and order dated May 9, 1957, of the Patna High Court, in Criminal Reference No. 51 of 1957 and Criminal Revision No. 323 of 1957, arising out of the judgment and order dated March 20, 1957, of the First Additional Sessions Judge, Patna in Criminal Revision No. 14 of 1957.
K. P. Varma and R. C. Prasad, for the appellant.
H. J. Umrigar and B. P. Maheshwari, for the respondents.
728 1959.
September 14.
The Judgment of the Court was delivered by SUBBA RAO J.
This is an appeal by special leave by the State of Bihar against the judgment of the High Court of Judicature at Patna quashing the criminal proceedings launched against the respondents in the Court of Munsif Magistrate, Patna.
The two respondents were the proprietors of a firm called M/s. Patna Textiles doing business in cotton at Patna.
On August 30, 1955, they despatched two bales of saries to M/s. Hiralal Basudev Prasad, cloth merchants of Balia, from Patna Ghat without obtaining a permit from the Textile Controller, Bihar.
They were prosecuted under section 7 of the (X of 1955), hereinafter called the Act, read with section 3 of the Cotton Textiles (Control of Movement) Order, 1948, hereinafter called the Order, in the Court of the Munsif Magistrate, Patna.
The respondents filed a petition before the said Munsif Magistrate praying for their discharge on the ground that the Essential Supplies (Temporary Powers) Act, 1946 (XXIV of 1946), hereinafter called the 1946 Act, whereunder the said Order was made, had been repealed, and, therefore, the Order ceased to have any legal force thereafter, and consequently they could not be prosecuted under the expired Order.
The Munsif Magistrate rejected that petition.
The Additional Sessions Judge, Patna, after perusing the records transmitted the same to the High Court under section 438 of the Code of Criminal Procedure with his opinion that the order of the Munsif Magistrate was wrong and, therefore, it might be set aside with the direction to the Munsif Magistrate to discharge the accused.
The respondents also filed a revision to the High Court against the order of the Munsif Magistrate.
The reference as well as the revision were heard together by Imam, J., of the High Court at Patna, and the learned Judge accepting the reference and the revision set aside the order of the Munsif Magistrate and directed the accused to be discharged.
Hence the appeal.
729 The learned Counsel appearing for the state contended that the Order made under the 1946 Act was saved under section 16 of the Essential Commodities Ordinance of 1955, hereinafter called the Ordinance, and section 16 (2) of the Act, and, therefore, the accused were validly prosecuted under the provisions of the Order.
The learned Counsel for the respondents argued that the order was not saved under either of the said two sections.
To appreciate the contention of the parties, it is necessary to notice the relevant provisions of the 1946 Act, the Order, the Ordinance and the Act.
Essential Supplies (Temporary Powers) Act, 1946.
section 1 (3) : It shall cease to have effect on the twenty sixth day of January, 1955, except as respects things done or omitted to be done before that date, and section 6 of the (X of 1897), shall apply upon the expiry of this Act as if it had then been repealed by a Central Act.
section 3 (1): The Central Government, so far as it appears to it to be necessary or expedient for maintaining or increasing supplies of any essential commodity, or for securing their equitable distribution and availability at fair prices, may by order provide for regulating or prohibiting the production, supply and distribution thereof and trade and commerce therein.
Cotton Textiles (Control of Movement) Order, 1948.
section 3: No person shall transport or cause to be transported by rail, road, air, sea or inland navigation any cloth, yarn or apparel except under and in accordance with (i) a general permit notified in the Gazette of India by the Textile Commissioner; or (ii) a special transport permit issued by the Textile Commissioner.
The Essential Commodities Ordinance, 1955.
Preamble: " Whereas the Essential Supplies (Temporary Powers) Act, 1946 (XXIV of 1946), which confers powers to control the production, 730 supply and distribution of, and trade and commerce in, certain commodities, expires on the 26th day of January, 1955;. . . . . . . . the President in pleased to promulgate the following Ordinance:" section 16: Any order made or deemed to be made under the Essential Supplies (Temporary Powers) Act, 1946 (XXIV of 1946), and in force immediately before the commencement of this Ordinance shall, in so far as such order may be made under this Ordinance, be deemed to be made under this Ordinance and continue in force, and accordingly any appointment made, licence or permit granted or direction issued under any such order and in force immediately before such commencement shall continue in force unless and until it is superseded by any appointment made, licence or permit granted or direction issued under this Ordinance.
This Ordinance was published in the Gazette of India on January 21, 1955, and came into force on January 26, 1955.
The . section 3 (1): If the Central Government is of opinion that it is necessary or expedient so to do for maintaining or increasing supplies of any essential commodity or for securing their equitable distribution and availability at fair prices, it may, by order provide for regulating or prohibiting the production, supply and distribution thereof and trade and commerce therein.
section 7 (1): If any person contravenes any order made under section 3 (a) he shall be punishable (i) in the case of an order made with reference to clause (h) or clause (i) of sub section (2) of that section, with imprisonment for a term which may extend to one year and shall also be liable to fine, and (ii) in the case of any other order, with imprisonment for a term which may extend to three years and shall also be liable to fine: 731 Provided that if the Court is of opinion that a sentence of fine only will meet the ends of justice, it may, for reasons to be recorded, refrain from imposing a sentence of imprisonment;. section 16 (1): The following laws are hereby repealed : (a) the Essential Commodities Ordinance, 1955; (b) any other law in force in any State immediately before the commencement of this Act in so far as such law controls or authorizes the control of the production, supply and distribution of, and trade and commerce in, any essential commodity.
(2): Notwithstanding such repeal, any order made or deemed to be made by any authority whatsoever, under any law repealed hereby and in force immediately before the commencement of this Act, shall, in so far as such order may be made under this Act, be deemed to be made under this Act and continue in force, and accordingly any appointment made, licence or permit granted or direction issued under any such order and in force immediately before such commencement shall continue in force until and unless it is superseded by any appointment made, licence or permit granted or direction issued under this Act.
(3): The provisions of sub section (2) shall be without prejudice to the provisions contained in section 6 of the (X of 1897), which shall also apply to the repeal of the Ordinance or other law referred to in sub section (1) as if such Ordinance or other law had been an enactment.
The said provisions may be briefly summarized thus: Under the Act of 1946, the Central Government had the power to make an order for regulating or prohibiting the production, supply and distribution of essential commodities.
That Act itself provided that it would cease to have effect on January 26, 1955.
In exercise of the powers conferred under section 3 of the said Act, the Central Government made the Cotton Textile (Control of Movement) Order, 1948, prohibiting any person 732 from transporting cloth, among others, without the permit of the Textile Commissioner.
Before the Act ceased to have effect, i.e., on January 26, 1955, the Ordinance was promulgated on January 21, 1955, conferring on the Central Government a power similar to that conferred upon it under section 3 of the 1946 Act.
The said Ordinance also provided for saving clauses in respect of certain things done under the 1946 Act.
On April 1, 1955, the Act was passed practically reenacting the same provisions of the Ordinance, and thereunder the same power exercised by the Central Government under section 3 of the 1946 Act and section 3 of the Ordinance was preserved.
The Act also provided for repeals and savings.
The question, therefore, is whether, on the date of commission of the offence, the Order whereunder the prosecution was launched was subsisting or whether it ceased to exist.
It is common case that an Order made under an Act ceases to have any legal force after the expiry of the term for which the Act is made.
But it is contended that the Order survived the expiry of the 1946 Act by reason of the saving clauses provided by the Ordinance and the Act.
Ordinarily, the Order should have expired on January 26, 1955.
Unless it was saved by section 16 of the Ordinance the saving clause of the Act could not operate on it.
We shall, therefore, consider the question from two aspects: (i) whether section 16 of the Ordinance saved the operation of the Order; and (ii) if it saved it, whether section 16(2) of the Act gave it a further lease of life.
Section 16 of the Ordinance is in two parts.
Under the first part,, "any order made or deemed to be made under the Essential Supplies (Temporary Powers) Act, 1946, and in force immediately before the commencement of this Ordinance shall, in so far as such order may be made under this Ordinance, be deemed to be made under this Ordinance and continue in force.
" The necessary condition for the operation of this part of section 16 is admittedly complied with.
The Order made under section 3 of the 1946 Act can be made under section 3 of the Ordinance; and, if so, by reason of the express words of the section, the Order must be deemed to be made under the Ordinance and continue to be in force 733 after its promulgation.
But it is said that the second part of the section cuts down the wide amplitude of the phraseology used in the first part.
After stating that the said Order shall continue to be in force, the second part proceeds to state " and accordingly any appointment made, licence or permit granted or direction issued under any such order and in force immediately before such commencement shall continue in force unless and until it is superseded by any appointment made, licence or permit granted or direction issued under this Ordinance ".
If the Order continues in force, the argument proceeds, the second part of the section becomes otiose, for the appointment made, licence or permit granted or direction issued under the Order automatically continues in force, and, therefore, there is no necessity for enacting the second part of section 16.
The anomaly occurs even if the argument be accepted, for, in that event the first part becomes unnecessary: The same result can be achieved by enacting only the second part of section 16 and omitting the first part altogether.
To ascertain the meaning of a section it is not permissible to omit any part of it: the whole section should be read together and an attempt should be made to reconcile both the parts.
There is no ambiguity in the provisions of the first part of the section.
In clear and unambiguous terms it posits the continuation in force of the Order notwithstanding the repeal of the Act ; thereafter, it proceeds to enumerate certain past acts done under the Order, and in force immediately before the commencement of the Ordinance and says that they will continue in force in consequence of the continuance of the Order.
The word " accordingly ", which means consequently, indicates that the enumerated acts will not continue in force but for the continuance of the Order itself: they depend upon the continuation of the Order.
It is said that this interpretation imputes tautology to the legislature, and, therefore, should not be accepted.
A scrutiny of the section shows that the second part is not really redundant, as at the first blush it appears to be.
Under section 16 of the Ordinance, the Order made under the Act of 1946 continues to be 93 734 in force till another Order is made under the Ordinance.
It covers two periods: (i) the period up to the date of the commencement of the Ordinance; and (ii) the period thereafter.
The first part gives life to that Order, and, therefore, the acts authorised under that Order can be done subsequent to the coming into force of the Ordinance.
But a question may be raised whether the past acts done under that Order are saved by the continuance of the Order, or whether the acts already done are covered by the words that the "Order shall continue in force ".
The second part appears to have been enacted for the purpose of avoiding this difficulty or, at any rate, to dispel the ambiguity.
Under the section both the Order and the acts previously done under the Order are saved.
If so, it follows that the Order was saved and the prosecution authorized by the Order could legitimately be launched after the Ordinance came into force.
Even so, it is contended that the Order saved by section 16 of the Ordinance fell with the repeal of that Ordinance and was not continued under the Act.
This argument is based upon the provisions of section 16(1) and (2) of the Act.
Section 16 has three sub sections.
For the present argument we are concerned only with sub sections (1) and (2) of section 16.
Sub section (2) is a repetition of section 16 of the Ordinance.
But it is said that section 16(1)(b) of the Act indicates that the Order was not saved under that section.
Under section 16(1)(a), the Essential Commodities Ordinance, 1955, is repealed, and under section 16(1)(b) "any other law in force in any State immediately before the commencement of this Act in so far as such law controls or authorizes the control of the production, supply and distribution of, and trade and commerce in, any essential commodity " is also repealed.
The argument is that the Order is comprehended by the words " any other law " in cl.
(b) of section, 16(1), and, therefore, when that Order is repealed under cl.
(b) of section 16(1), it is unreasonable to hold that it is restored under sub section
(2) of section 16.
To put it in other words, an intention cannot be imputed to the legislature to repeal an order under one sub section and restore it by another sub section.
If we may say 735 so, there is a fallacy underlying this argument.
The words " any other law " in section 16(1)(b) can only mean any law other than the Essential Commodities Ordinance, 1955, mentioned in section 16(1)(a).
It is admitted that there are laws other than the said Ordinance in force in many States controlling the production, supply and distribution of essential commodities.
An order made or deemed to be made under the Commodities Ordinance, 1955, cannot be described as a law other than Essential Commodities Ordinance whereunder it is made.
Such an order is comprehended by cl.
(a) of section 16(1) itself, and, therefore, cl.
(b) thereof has no application to it.
In this view, 'an interpretation different from that we have put on the provisions of section 16 of the Ordinance cannot be given to sub section
(2) of section 16 of the Act.
For the reasons we have given in interpreting the provisions of section 16 of the Ordinance, we hold that under section 16(2) both the order and the acts enumerated in the second part of it survived the expiry of the Ordinance and continued in force under the Act.
For the above reasons, we hold that the prosecution was validly launched against the accused under section 3 of the Order.
Even so, the learned Counsel for the respondents contends that it is not a fit case for this Court to interfere under article 136 of the Constitution.
The offence was alleged to have been committed on August 30, 1955, i.e., more than four years ago.
The varying views expressed by the Courts indicate that there was a plausible justification for reasonable belief on the part of the accused that the Order did not survive the expiry of the life of the 1946 Act.
The order of the High Court dismissing the 'application for leave to appeal to the Supreme Court shows that it was filed in contravention of the provisions of r. 28 of the Patna High Court Rules.
Under the said Rules the application should have been filed immediately after the judgment was delivered.
In the affidavit filed in support of that application the only reason given for not doing so was that the appellant did not give the necessary instructions.
The learned Judge of the High Court rightly did not accept that reason as a sufficient 736 ground for permitting the application to be filed at a later stage.
In the application for special leave filed in this Court, though it was stated that the application filed in the High Court for certificate was rejected, the reason for the rejection was not disclosed.
Further, the State, presumably, filed this appeal to get the legal position clarified.
We also believe that public interest does not require that the stale matter should be resuscitated.
In the circumstances, we would be justified not to exercise our discretionary jurisdiction, and we accordingly dismiss the appeal.
Appeal dismissed.
| The question for determination in this appeal, arising out of a suit filed by the appellant under section 5(3) of the Charitable and Religious Trusts, Act, 1920, was whether the ancient temple of Shri Balaji Venkatesh at Nasik and its Sansthan constituted a charitable and religious trust within the meaning of the Act.
The deity was Swayambhu and revealed itself in a dream to one Ganapati Maharaj who, at its behest, brought the deity from the river Tambraparni and installed it in his house.
Ganapati 's son Timmaya, who removed the deity to Nasik, took the idol to the courts of Rulers and acquired the properties in suit consisting of lands and cash.
Timmaya 's eldest son obtained an extensive plot of land as a gift from the Peshwa and thereon built a vast temple with a Sabha Mandap which could accommodate no less than 600 persons and installed the deity in the first floor with a staircase leading straight to it.
The Hindu public has been worshipping at the temple for more than 200 years and there was no evidence to show that they had ever been excluded from it and any gift had ever been refused.
The ceremonies performed in the temple were appropriate to a public deity.
It was admitted by the sons of Timmaya in Tahanama, executed by them in 1774, that the Inam villages were granted for the worship of the deity and the temple belonged to the Sansthan, none of them having any share in it.
In the Tharav Yadi of 1800, the maintenance allowance provided by the said Tahanama for the different branches of the family was described as 'Vetan '.
The Inam Commissioner, functioning under Act 11 of 1852, recorded the Inam villages as permanently held Debasthan inams at the instance of the then Sthanic and on the basis of original sanads filed by him, reversing the decision of the Assistant Inam Commissioner who had recorded them as personal inams.
Those sanads were not filed in the suit.
In 1931 the appellant published a history of the Sansthan wherein it was clearly stated that the Sansthan was not a private or family property but was the property of the deity, the members of the family being merely the managers.
The deity was not made a party to the suit although representatives of the Hindu public were joined as 98 774 parties under section 1, r. 8 of the Code of Civil Procedure.
The High Court, while it concurred with the trial judge in holding that the deity was a public deity and that its Sansthan constituted a public trust, was, however, inclined to hold that some of the properties might be personal properties of the appellant but refused to grant any such declaration on the ground that no effective decree could be passed against the deity in its absence, It was contended on behalf of the appellant in this court that the courts below had misconstrued the document and were wrong in drawing the inferences they did and that the burden of proof had been wrongly placed on the appellant to prove by positive evidence that the deity was a family deity and the properties his private properties.
Held, that the courts below were right in coming to the conclusion they reached, and the appeal must fail.
A mistaken inference drawn from documents is no less a finding of fact, if there is no misconstruction of the documents and no misconstruction of documents having been proved, the appellant could not succeed.
An admission is the best evidence that an opposing party can rely upon, and, although it is not conclusive, is often decisive of the matter unless it can be successfully withdrawn or proved to be erroneous.
The expression " burden of proof " means one of two things (1) that a party has to prove an allegation before it is entitled to a judgment in its favour, or (2) that the one or the other of the two contending parties has to introduce evidence on a contested issue.
The question of onus is material only where the party on which it is placed would eventually lose if it failed to discharge the same.
Where issues are, however, joined, evidence is led and such evidence can be weighed in order to determine the issues, the question of burden becomes academic.
In the present case, if the onus lay on any party, it was clearly on the appellant to prove by cogent evidence that the admissions made by his predecessors in title and by him were either erroneous or unavailable and this he had failed to do.
The earlier sanads, admittedly in his possession, not having been produced and those produced not being in any way inconsistent with the said admissions or the revenue records, no question of any misconstruction of documents could arise.
Babu Bhagwan Din vs Gir Nar Saroon, (1939) L.R. 67 I.A. 1, held inapplicable.
Srinivasa Chariar vs Evalappa Mudaliar, (1922) L.R. 49 I.A. 237, applied.
The entries made in the Inam Register prepared under Act 11 of 1852, were entitled to great weight and although they could not displace actual and authentic evidence in an individual case, it was well settled that, in absence of such evidence, they must prevail, 775 Arunachalam Chetty vs Venkatachalapathi Guru Swamigal, (1919) L.R. 46 I.A. 204, referred to.
Held, further, that the vastness of the temple, the mode of its construction, the long user by the public as of right, grant of land and cash by the Rulers, taken along with other relevant factors were consistent only with the public nature of the endowment.
Narayanan vs Hindu Religious Endowments Board, A.I.R. 1938 Mad. 209, relied on.
The absence of a dome or Kalas on the temple was not by itself a decisive factor as to its public character, nor was consecration imperative of a deity that was Swayambhu.
Nor is the temporary movement of the idol from place to place inconsistent with its public character.
Ram Soondur Thakoor vs Taruk Chunder Turkoruttum, (1873) 19 Weekly Reporter 28; Hari Raghunath vs Apantii Bhikajii, Bom.
466; Prematha Nath Mullick vs Pradyumna Kumar Mullick, (1925) L.R. 52 I.A. 245 and Venkatachala vs Sambasiva, A.I.R. (1927) Mad. 465; 52 M.L.J. 288, considered.
The defect in the frame of such a suit resulting from the omission of the deity as a party to it, cannot be remedied by the subsequent addition of the representatives of the Hindu Public as parties to it, and no effective decree could be passed against the deity in such a suit.
|
ivil Appeal No. 512 (NT) of 1975.
From the Judgment and Order dated 15.11.1973 of the Bombay High Court in Income Tax Reference No. 15 of 1964.
S.C. Manchanda, K.C. Dua and Ms. A. Subhashini for the Appellant.
Harish Salve, Mrs. A.K. Verma and D.N. Misra for the Respondents.
The Judgment of the Court was delivered by KANIA, J.
This is an appeal, on a certificate given under Section 66(A)(ii) of the Indian Income tax Act, 1922, against a judgment and order of a Division Bench of the Bombay High Court.
The appeal is preferred by the Commissioner of Income tax and the assessee, the Associated Cement Companies Ltd. is the respondent.
The judgment against which the appeal is directed was rendered on a reference under Section 66(1) of the Indian Income tax Act, 1922.
The question referred to the Court for consideration was as follows: "Whether on the facts and in the circumstances of the case, the expenditure of Rs.2,09,459, or any portion thereof, incurred by the company in the accounting period relevant to the assessment period 1959 60 was allowable as deduction in determining the profits of the company for the assessment year 1959 60." The relevant facts are as follows: The assessee, the Associated Cement Companies Ltd. has a chain of factories manufacturing cement all over the country.
The assessment year in question is the year 1959 60 and the corresponding previous year was ended on 31st July, 1958.
One of the factories of the assessee was situated at Shahabad, which is now in the State of Karnataka, but was at the relevant time forming part of the then State 920 of Hyderabad.
In September, 1956, the Government of Hyderabad had decided to include the area on which the said factory at Shahabad was situated within the municipal limits of the Shahabad Town Municipality.
A tripartite agreement between the Government of Hyderabad, the assessee company and the Municipality was arrived at on 30th October, 1956 between the aforesaid three parties.
Under the agreement, the assessee undertook to supply water to the Shahabad town and village.
It further agreed to put up a high tension electric transmission line and to supply electricity for the street lighting of the Shahabad town.
It also agreed to concrete free of charge the existing main road from the factory upto the railway station via the main bazar.
During the relevant previous year, the only work done was with respect to provision of water supply to the said town and village.
Under the agreement, the assessee initially agreed to supply certain quantity of water to the Shahabad town at a concessional rate and for the purpose of such supply the assessee company was to undertake and complete at its own cost the water supply scheme for the town and village, involving laying of the main water pipelines.
The assessee company was to be the owner of the pipelines, installations and other accessories pertaining to the water supply lying within the company 's premises and on the land a little outside the premises.
The Shahabad Municipal Committee was to take over possession of the remaining pipelines, installations and accessories and it was declared to be the owner thereof.
These pipelines, installations, etc.
had to be maintained by the Minicipal Committee in future.
Under Clause 23, in consideration of the assessee company having agreed to provide these amenities, supply and services, the Govt.
of Hyderabad undertook not to include any of the properties of the company comprising the cement factory, the main workshop, the housing colony, quarries and the limestone bearing lands within the limits of the Shahabad Minicipality or the village panchayat or like body for a period of fifteen years from the date of the agreement.
According to the assessee, a sum of Rs.2,09,459 was spent during the year of account under this agreement and this amount pertained to the laying of pipelines, installations and accessories of which the Shahabad Municipality became the owner under the agreement and this amount was claimed as a deduction.
The Income tax officer disallowed this amount, holding that it was a capital expenditure on the basis that as a result of this expenditure the company derived an advantage of an enduring nature, namely that it would not have to pay municipal taxes for a period of fifteen years.
On an appeal by the Company, the Appellate Asstt.
Commissioner allowed the deduction 921 holding that the amount was the payment of a composite sum of the revenue outgoings for the following 15 years.
The Revenue preferred an appeal to the Income tax Appellate Tribunal.
The Income tax Appellate Tribunal passed an order directing the Income tax officer to scrutinize the expenditure and allowed the deduction of the expenditure to the extent that it did not result in the company becoming the owner of any asset.
Before the High Court it was contended on behalf of the company that the entire amount of Rs.2,09,459 pertained to expenditure on pipelines installations and other accessories which under the agreement came to ownership of the Shahabad Town Municipality and did not pertain to any increase of the assets of the company.
The Division Bench which decided the reference has pointed out that it had not been disputed by the Revenue before the Tribunal that the entire expenditure concerned was laid out for the purpose of business and the only question was whether it was capital expenditure or revenue expenditure.
The only ground on which the claim of the assessee for deduction of the said expenditure under Section 10(2) (xv) of the Indian Income tax Act was resisted that it was capital expenditure.
After exhaustively considering several decisions of the Supreme Court and several English decisions, the Division Bench of the Bombay High Court came to the conclusion that the expenditure in question was revenue expenditure and was liable to be allowed as deduction.
On the basis of these conclusions the Bombay High Court decided the question referred in their affirmative and in favour of the assessee.
In the judgment appealed against the learned Judges have referred to the dictum of Viscount Cave L.C. in Atherton vs British Insulated and Helsby Cables Ltd., [1924] 10 Tax Cases 155, 192 which runs as follows: "But when an expenditure is made, not only once and for all, but with a view to bringing into existence an asset or an advantage for the enduring benefit of a trade.
I think that there is very good reason (in the absence of special circumstances leading to an opposite conclusion) for treating such an expenditure as properly attributable not to revenue but to capital." The Division Bench further pointed out that this dictum was stated with approval by this Court in Assam Bengal Cement Co. Ltd. vs Commissioner of Income tax, where this 922 Court inter alia approved the decision of a Full Bench of the Lahore High Court in Banarasidas Jagannath in re (F.B.) holding that expenditure may be treated as properly attributable to capital when it is made not only once and for all, but with a view to bringing into existence an asset or an advantage for enduring benefit of the trade.
If, on the other hand, what is got rid of by lump sum payment is an annual business expense chargeable against revenue, the lump sum payment should equally be regarded as a business expenses, but if the lump sum payment brings in a capital asset, then that puts the business on another footing altogether.
The Division Bench also took into account the fact that the assessee was already running a cement factory at Shahabad and it was not as if the expenditure incurred was in connection with starting of a new business.
Mr. Manchanda, learned counsel for the appellant has raised only two contentions before us.
The first contention was that, since, as a result of the expenditure incurred, certain water pipelines were laid which could be regarded as capital assets the expenditure could only be regarded as capital expenditure.
In our view, there is no substance in this contention.
It is true that certain water supply lines did come to be laid as a result of the expenditure incurred, but the facts on records, which we have referred to above, clearly show that these water pipelines on which the expenditure in question was incurred were not assets of the assessee, but assets of the Shahabad Municipality and hence it was not as if the expenditure resulted in bringing into existence any capital asset for the company.
The only advantage derived by the assessee by incurring the expenditure was that it obtained an absolution or immunity, under normal conditions, from levy of certain municipal rates and taxes and charges.
In view of this the first contention of Mr. Manchanda must be rejected.
The next submission made by Mr. Manchanda was that the advantage of not being liable to pay municipal rates, taxes, etc.
which the assessee company secured by reason of making the expenditure in question was for a period of fifteen years and hence it could be said to be an advantage of an enduring nature, so that the expenditure incurred in acquiring the same would be regarded as capital expenditure.
In our view it is difficult to accept this submission either.
As observed by the Supreme Court in the decision in Empire Jute Co. Ltd. vs Commissioner of Incometax, [1980] 124 I.T.R. SC p. 1 that there may be cases where expenditure, even if incurred for obtaining an advantage of enduring benefit, may, none 923 the less, be on revenue account and the test of enduring benefit may break down.
It is not every advantage of enduring nature acquired by an assessee that brings the case within the principles laid down in this test.
What is material to consider is the nature of the advantage in a commercial sense and it is only where the advantage is in the capital field that the expenditure would be disallowable on an application of this test.
If the advantage consists merely in facilitating the assessee 's trading operations or enabling the management and conduct of the assessee 's business to be carried on more effectively or more profitably while leaving the fixed capital untouched, the expenditure would be on revenue account, even though the advantage may endure for an indefinite future.
In that case the appellant, a company carrying on the business of manufacture of jute, was a member of the Indian Jute Mills Association, which was formed with the objects, inter alia, of protecting the trade of its members, including imposing restrictive conditions on the conduct of the trade and adjusting the production of the mills of its members.
A working time agreement was entered into between the members restricting the number of working hours per week for which the mills were entitled to work their looms.
Clause 4 of the working time agreement provided that no signatory shall work for more than 45 hours per week.
Clause 6(b) provided that the signatories shall be entitled to transfer, in part or wholly, their allotment of hours of work per week to any one or more of the other signatories.
Under this clause the appellant purchased "looms hours" from four other mills for the aggregate sum of Rs.2,03,255 during the previous year relevant to the assessment year 1960 61 and claimed to deduct that amount as revenue expenditure.
The Tribunal held that the expenditure incurred by the appellant was revenue in nature and hence deductible in computing the appellant 's profits.
The High Court reversed this decision, but on appeal, the Supreme Court allowed expenditure as deductible expenditure on the basis of the principle set out earlier.
If this principle is applied to the facts of the case before us, what we find is that the advantage which was secured by the assessee by making the expenditure in question was the securing of absolution or immunity from liability to pay municipal rates and taxes under normal conditions for a period of fifteen years.
If these liabilities had to be paid, the payments would have been on revenue account and hence the advantage secured was in the field of revenue and not capital.
As a result of the expenditure incurred, there was no addition to the capital assets of the assessee company and no change in its capital structure.
The pipelines, etc.
which might have been regarded as capital assets and which came into existence as a result of the expenditure incurred did not belong to the assessee company but to the municipality.
In these circumstances, 924 applying the principles laid down in Empire Jute Co. 's case the expenditure is clearly liable to be allowed as deductible from the profits under Section 10(2) (xv) of the Indian Income tax Act.
In the result, the appeal fails and is dismissed with costs.
S.L. Appeal dismissed.
| The petitioners are a public limited company and its General Manager (Legal).
The Company was a manufacturer of electric resistence, welded steel tubes and pipes, and registered as a dealer under the Haryana General Sales Tax Act, 1973 as also the Central Sales Tax Act.
It filed returns for all the quarters covered within the period 1968 69 to 1974 75 as prescribed by the Punjab General Sales Tax Act, 1948 till March 31, 1973 and under the Haryana Act for the quarters of the remaining years as the Haryana Act came into force with effect from May 5, 1973.
On the receipt of notice relating to the assessment years 1968 69 to 1973 74 in the prescribed form ST XIV under section 14(2) of the Punjab Act, and in the prescribed form ST 25 under section 28(2) of the Haryana Act relating to the year 1974 75 the petitioner Company appeared before respondent No. 2 Assessing Authority, and complied with the requirements of the said notice by production of documents, books and other papers.
While the matter was thus proceeding, respondent No. 2 again issued a notice on September 24, 1982 requiring the petitioner Company to produce certain further records and documents.
The petitioners in their writ petition challenged the notices and also the vires of Section 28A of the Haryana General Sales Tax Act, 1973.
On the question: Whether an order of assessment under subsection (3) of section 11 of the Punjab Act or section 28(3) of the Haryana Act can now be completed or would be barred by limitation.
896 Dismissing the writ petition, ^ HELD: 1.
Assessment of tax should be completed with expedition.
It involves the revenue to the State.
[905B C] 2.
In the case of a registered dealer who collects sales tax on behalf of the State, there is no justification for him to withhold the payment of the tax so collected.
If a timely assessment is completed, the dues of the State can be conveniently ascertained and collected.
Delay in completion of assessment often creates problems.
Long delay is not in the interest of either the assessee or the State.
[905C D] 3.
In the absence of any prescribed period of limitation, the assessment has to be completed within a reasonable period.
What such reasonable period would be, would depend upon the facts of each case.
[904E F] 4.
Until by statute, a limitation is provided, it is proper for the State Government to require, by statutory rules or appropriate instructions, to ensure completion of assessments with expedition and reasonable haste but subject to rules of natural justice.
[905E F] In the instant case, though notices were issued under sections 11(2) of the Punjab Act or Section 28(2) of the Haryana Act within a reasonable period from the filing of returns for the respective quarters in the assessment years under consideration, further action had not been taken by the assessing officer to complete the assessments.
Now that the assessing authority intends to complete assessments under section 11(3) of the Act, no prejudice is seen to be caused to the assessee if the assessing authority is permitted to complete the assessment now.
In the situation which has thus arisen, it would be appropriate to call upon the assessing authority to complete all these pending assessments within a total period of four months on the basis of available material in the record before him, and such other material as the authority may obtain.
Such assessment has to be only under section 11(3) of the Act.
[904D E;G H;905A B] 5.
It may be that in a given case the original notice under section 11(2) or a subsequent order requiring production of some more material on specific points is not complied with.
Non compliance with the notice under section 11(2) of the Act leads to a situation where a best judgment assessment can be complied.
This Court in Indian Aluminium Cables Ltd. & Anr.
vs Excise and Taxation Officer & Anr., [1977] 1 897 SCR 716 has indicated that a further notice has to be given.
The question that fell for determination before the Court did not require examination as to whether such a notice was necessary.
Though such a notice is not a statutory prescription, judicial propriety would require a larger bench of the Court to examine the correctness of the view in the Indian Aluminium case.
On an appropriate occasion, the question as to whether such a notice is a condition precedent to completion of assessment would be examined.
[903E H] Ghanshyamdas vs Regional Assistant Commissioner of Sales Tax, Nagpur & Ors.
14 STC 976; Madan Lal Arora vs Excise and Taxation Officer, Amritsar, 12 STC 387; Jagat Ram Om Prakash vs Excise and Taxation Officer, Amritsar, 16 STC 107 and Indian Aluminium Cables Ltd. & Anr.
vs Excise and Taxation Officer & Anr.
, ; , referred to.
|
Appeal Nos.
86 to 89 of 1965.
Appeals by special leave from the judgment and order, dated October 17, 1963 of the Allahabad High Court in section T. Ref.
No. 109 of 1956.
A. V. Viswanatha Sastri and B. N. Kripal, for the appellant.
N. D. Karkhanis and O. P. Rana, for the respondent, K. K. Jain, for intervener.
The Judgment of the Court was delivered by Sikri, J.
These four appeals by special leave are directed against the judgment of the Allahabad High Court in a Sales Tax Reference made by the Judge (Revisions), Sales Tax, Uttar Pradesh, Lucknow, on being directed to do so by the High Court under section 11 of the Uttar Pradesh Sales Tax Act, 1948, hereinafter referred to as the Act.
The question referred was as follows : "Whether in law the revising authority was right in holding that the sales in dispute were not for delivery outside Uttar Pradesh and that the applicant Was not entitled to a rebate under sec.
5 of the Act.
" The question was referred in the following circumstances.
The appellant, hereinafter referred to as the assessee mills, carries on the business of manufacturing and selling sugar and is registered as a dealer under the provisions of the Act.
During the previous year relevant to the Assessment Year 1948 49, the assessee company had sold sugar to parties who carried on business outside Uttar Pradesh and also delivered the same outside Uttar Pradesh.
It also sold sugar to parties who carried on business inside Uttar Pradesh but the sugar was despatched to stations outside Uttar Pradesh in compliance with the instructions issued by the buyers.
The assessee mills submitted an application.under section 5 of the Act in form VII, prescribed by, the Uttar Pradesh Sales Tax (Temporary) Rules, 1948, claiming 50% rebate on the sales of sugar delivered outside Uttar Pradesh.
The Sales Tax Officer allowed rebate in respect of the sales of sugar to parties who carried on business outside Uttar Pradesh but rejected the claim for the sales which were made to parties carrying on business inside Uttar Pradesh.
In respect of the assessment year 1948 49 there were four assessment orders covering each quarter of the year,, the, 47 first quarter being April 1948 to July 1948.
Section 5 of the Act reads as follows "Sales of certain goods for delivery outside the State In respect of such manufactured goods as may be notified by the State Government and subject to such restrictions and conditions as may be prescribed, a rebate of one half of the tax levied on sales of such goods for delivery outside the Uttar Pradesh shall be allowed if such goods are actually so delivered.
" In exercise of the powers conferred by section 5 of the Act, the Governor was pleased to order that rebate of one half of the tax levied on sales of certain goods including sugar manufactured in Uttar Pradesh for delivery outside Uttar Pradesh shall be allowed if such goods were actually so delivered.
It appears that this notification was modified on March 30, 1949, but we are not concerned with this modification.
The Sales Tax Officer dealt with the question at issue in his order in respect of the quarter ending March 31, 1949, in detail and he was of the view that if property passed from the seller to the purchaser in Uttar Pradesh, section 5 and the notification issued under it could not apply.
The assessee mills then filed four revision applications before the Judge (Revisions) Sales Tax.
The Judge (Revisions) disposed of the four applications by two orders, first dated February 1, 1950, and the second dated December 5, 1950.
He held that "the words 'sales of such goods for delivery outside U.P. clearly show that the intention of the framers of the act was to allow a rebate only in cases in which the goods are sold subject to the condition that they would be delivered outside U.P.
It is also clear that section 5 contemplates only one buyer who purchase the goods and also take their delivery outside U.P.
In other words the party who buys the goods and the party who takes the delivery must be one and the same.
It is not disputed that the sales of sugar in respect of which the claim has been disallowed were in favour of one party and delivery was taken by another party outside U.P.
The party after buying the sugar under a contract of sale had the goods despatched outside U.P. by the Mills to another party outside U.P." He added later that "on a true construction of section 5 rebate will be permissible only if delivery is taken outside U.P. by the same party which purchased the sugar from the mills." Then 48 on the facts he held that the selling agents, Tandon Bros., who entered into a contract with the assessee mills for sale of the goods were really the buyers and although the goods were despatched outside Uttar Pradesh in accordance with the despatch instructions of some contract arrived at between Tandon Bros., and the party to which the goods were ultimately delivered, the assessee mill had not entered into the contract with the parties to which the goods were despatched outside Uttar Pradesh.
He further repelled the argument that despatch instructions formed part of the contract.
The assesses mills then filed four applications under section 1 of the Act, but the Judge (Revisions) Sales Tax rejected the applications on the ground that no question of law arose.
The High Court, however, directed the Judge (Revisions) to state a case under section 11 of the Act.
A consolidated statement of the case was referred.
The Judge (Revisions) drawing up the statement of the case was not the Judge (Revisions) who had disposed of the revision applications.
In the statement of the case certain further facts were given and those are as under "The applicants (assessee mills) were members of the Indian Sugar Syndicate Ltd., and they were entitled to send sugar under the orders of the Syndicate through some selling agents of their own.
M/s. Tandon Bros., were the selling agents of the Mills.
It was through them that the sales had been made to buyers outside U.P.
The goods were despatched outside U.P. under the instructions received from the buyers through the selling agents.
The delivery of the goods was made outside U.P.
It is on the basis of these facts that the applicants (assessee mills) claimed that the sales had been made for delivery outside U.P." The standard contract form prescribed by the Indian Sugar Syndicate has been annexed to the case and the following terms are relevant : "AN AGREEMENT made this Sixteenth day of October 1948 between the AMRITSAR SUGAR MILLS CO. LTD.
ROHANA KALAN (hereinafter called "the Seller") and Tandon Brothers New Mandi Muzaffarpur (hereinafter called "the Buyee") for the sale of the following goods by the Seller to the Buyer upon the following terms and conditions 49 A B C D E F Factory Description Price per Md. ofQuantity Period(s) Re (short) of quality 40 Srs.
82 2/7 lb. of marks Name F.O.R. Factory delivery Station Ex Factory.
Rohana Average colour Rs. Thirty Six Bags 4,000 Ready Mills.
not lower than annas two & I.S.S. No. 127 pies three only.
Average grain not Each of pack finer than I.S.S. ing 2/30.
No. D. or I. 36/2/3 2.
Delivery is to be made F.O.R. Rohana Kalan station, all terms and conditions of the Railway (torn) to be binding on the Buyer.
The goods shall be deemed to have been delivered (a) when tendered Ex Factory godown, (b) when put on F.O.R. at Factory Station or (c) when tendered for carriage by rail at the said station, and in case of delay in accept (torn) by the Railway after such tender the said goods shall be deemed to be held by the Seller on account of the Buyer until they are put on rail.
When the goods are received by Railway, all the terms and conditions of the Railway shall be deemed to be accepted by the buyer.
Tender to the Railway for carriage shall be deemed to have been made when a (torn) carriage or a Forwarding Note has been given to the Station Master of the Station.
The seller shall not, (torn) circumstances whatsoever, be responsible for non despatch, or refusal to despatch or delay in despatch or any (torn) mistake in despatch by the Railway.
Where (after tender as aforesaid) any delay in despatch occurs, the Buyer shall (torn) delivery of the goods without any claim against the Seller on account of such delay or the consequence thereof (torn) delay in despatch is due to non supply of wagons or due to booking restrictions, the Seller, shall, if required by the (torn) obtain from the factory a letter stating the cause of the delay.
Where owing to restriction of whatsoever nature imposed by Carriers on despatches, Seller is unable to despatch according to the route requested by the Buyer, then Seller shall have the right, after giving to the Buyer 50 three days time to despatch by the cheapest available route at Seller 's sole discretion to the destination required by the original despatch instructions.
Within the period of three days above mentioned, Buyer may change the destination provided the (torn) despatching instructions are capable of immediate execution.
In the case of despatch by road, river or other transport any combination thereof, all the terms and conditions of the Carriers are be a binding on the Buyer, and tender to Carrier shall be a good delivery within the meaning of the clause.
The buyer is to give the Seller despatching instructions in accordance with the above schedule, in the case (torn) ready sales within ten days from the date hereof when the quantity is less than 1500 bags, and within fifteen days when quantity is 1500 bags or more; and in the case of forward sales, not less than fourteen days prior to the expiry of the (torn) for delivery of the goods as provided in the above Schedule.
When goods are for delivery in instalments the times (torn) clause provided shall apply to the despatching instructions for each instalment.
The sugar will be despatched at (torn) Risk unless the buyer shall give to the Seller instructions to the contrary in the Despatching Instructions.
The despatching instructions to be given as aforesaid shall be such as the Seller will then be in a position to carry (torn) having regard to restrictions on booking, availability of wagons, transshipment difficulties and other matters.
The despatch (torn) instructions once given shall not ordinarily be amended or altered and they can be altered or amended only with the consent of the seller and before the goods have left the factory, the Seller is not in any way responsible for any delays that may arise through error or mistake in the despatching instructions sent by the buyer.
If the Buyer fails to give despatching instructions within the time and in the manner aforesaid he will be deemed not to have given any despatching instructions at all.
No complaint as regards description, quality or condition of any consignment will be admitted unless the Buyer has complied with Clause 3 thereof and has paid to the Seller the full price and all overdue or other 51 charges and unless the complaint is made in writing to the Seller within three days from the arrival of such consignment at destination, the date of such arrival being deemed to be the date of arrival entered in the Books of the Railway Co., Steamer Co., Carrier or Port Authorities.
The completion of Risk Note form A as required by the Railway authorities at certain seasons of the year shall not be construed as adverse remarks as to the condition of the goods or its packing.
If any complaint, as to quality condition quantity or weight is referred to arbitration and an allowance is awarded in thereof, the Buyer shall retain the goods and such allowance shall be deducted from the price and be refunded by the Seller.
" The High Court, in view of its finding that the delivery was contracted to be made ex factory, the factory being within the State of Uttar Pradesh and the contract not containing any condition requiring the assessee to deliver the goods outside Uttar Pradesh, held that rebate was not admissible under section 5.
The High Court said that its detailed reasons were contained in its, judgment in Lord Krishna Sugar Mills vs Commissioner Sales Tax, II.P.(1) In that case Desai, C.J., held that the obligation to deliver goods outside Uttar Pradesh must arise only from a term in the contract, and in the absence of such a term it could, not be said that the goods were to be delivered outside Uttar Pradesh.
The learned Chief Justice further observed as follows A term in a contract that despatch instructions would be furnished later necessarily means that the seller undertakes to comply with them.
If under a contract itself something is to be settled later, what is settled later becomes as much binding under the contract itself as the terms already settled under the contract.
Still, I do not think that the sales in those cases in which the contracts provided for despatch instructions to be given later became sales for delivery outside Uttar Pradesh merely because the despatch instructions were that they should be despatched outside Uttar Pradesh.
All that can be said is that the sales were for "delivery in accordance with despatch instructions" and a sale for "delivery in accordance with despatch instructions" is not necessarily a sale for "delivery outside Uttar Pradesh." (1) Sales Tax Reference No. 263 of 1954 judgment delivered on, March 19, 1963. 52 He seemed to be of the view that in order to come within the expression "delivery outside Uttar Pradesh ' it must be one of the terms settled at the time of the formation of the contract itself that the goods will be delivered outside Uttar Pradesh, and if this is not so settled and all that is settled is that they will be delivered in accordance with despatch instructions, the sale would neither be a sale for delivery outside Uttar Pradesh nor a sale for delivery inside Uttar Pradesh.
He was clearly of the view that despatch instructions were not a part of the contract when it was formed and did not get incorporated into it or become a part of it when given.
Pathak, J., in a concurring judgment, was of the view that it must be in the contemplation of the parties at the time of entering into the contract that the goods which were the subject of sale must be delivered outside Uttar Pradesh.
He observed that "there is a distinction between settling and determining the terms of a contract and complying with the terms 'of that contract.
The former relates to the formation of the contract, the latter to its execution.
" The first question which arises in these appeals is whether the word "delivery" in the expression "sales of such goods for delivery outside Uttar Pradesh" occurring in section 5 of the Act means actual delivery or constructive delivery.
If it means constructive delivery then there is no doubt that on the facts as stated by the Judge (Revisions) the contract provided for constructive delivery inside Uttar Pradesh and the assessee mills would not be entitled to rebate under section 5.
The Madras High Court had occasion to consider a similar question in India Coffee and Tea Distributing Co. Ltd., vs The State of Madras.(1) It held that the word "delivery" in section 5 of the Madras General Sales Tax Act, 1939, which exempts from taxation sales of tea "if the sale is for delivery outside the State and delivery actually was made" did not include anything which the law deemed "delivery" but was restricted to physical delivery of the thing sold.
In coming to this conclusion, Subrahmanyam, J., observed : "In deciding whether the word "delivery" in section 5 (v) includes delivery in law, we have to have regard to the objects of the Legislature in enacting section 5 (v).
The object obviously was the promotion of the export of tea.
The Legislature intended that where tea was (1) 10 S.T.C. 359.
53 exported from the State for being delivered outside the State, the sale which resulted in such export should be exempt from taxation. 'Mat object would not be wholly achieved if we hold that delivery of documents of title in the State of Madras would make the sale liable to taxation.
" We agree with the view expressed by the Madras High Court.
It seems to us that the object underlying section 5 is to encourage export of goods manufactured in Uttar Pradesh and notified under section 5.
The course of trade adopted by the Indian Sugar Syndicate Ltd. and the assessee mills shows that if the word "delivery" is interpreted to mean 'constructive delivery ' very few 'export sales ', if we may use the expression, would enjoy rebate under section 5.
As long as the contract evinces an intention to export and actual delivery is given to effectuate that intention the object of the Legislature to ensure that only real 'export sales ' enjoy the rebate would be fulfilled.
It seems to us that in the context of section 5 the word 'delivery ' occurring in section 5 means 'actual delivery '.
The next question that arises is whether the sales by the assessee mills were for actual delivery outside Uttar Pradesh.
The answer to this problem depends on the answer to the question whether despatch instructions contemplated by clause 2 and clause 3 of the contract were part of the contract entered into by the assessee mills.
It seems to us that they were.
The contract by the assessee mills was to actually deliver at a place to be communicated.
This view is reinforced by what is contained in clause 11 of the contract.
This clause contemplated a destination in spite of constructive delivery having been contracted to be made at Rohana Kalan Station.
Further, the contract was not to actually deliver at some place to be chosen or assented to by the assessee mills but at any place without restrictions.
The contract required nothing more for completion than a mention of the place.
When the despatch instructions were given, it was not a case of performing the contract but specifying a term of the contract.
If the place of actual delivery had been specified and it was a question merely of communicating the route by which the goods were to be delivered this would perhaps related the mode of performance of the contract.
But communication of the place where actual delivery is to be given does not relate to the mode of performance but formation of the contract.
It seems to us, with respect, that the High Court reared in relating despatch instructions to the mode of performance of the contract.
54 In the result we hold that the assessee mills is entitled to rebate under section 5.
We set aside the judgment of the High Court and answer the question as follows : "The revising authority was not right in holding that the sales in dispute were not for delivery outside Uttar Pradesh.
Further, the applicant was entitled to rebate under section 5 of the Act.
" The appellant will have his costs incurred in the High Court and here.
One hearing fee.
Appeal allowed.
| The assessee sugar mill sold sugar to parties who carried on business inside the State of Uttar Pradesh, but the sugar was despatched to stations outside the State of Uttar Pradesh and delivered to another party in compliance with the instructions issued by the buyers.
Under the contract entered between the assessee and the buyer, the assessee was to deliver the sugar at places to be communicated by the buyer.
The assessee mill claimed rebate on these sales under section 5 of the Uttar Pradesh Sales Tax Act, 1948.
The Sales Tax authorities rejected the claim. 'Me High Court held that the rebate was not admissible under section 5 because the contract did not contain any condition requiring the assessee to deliver goods outside Uttar Pradesh and because the despatch instructions.were not a part of the contract when it was formed and did not get incorporated into it or become a part of it when given.
In appeal to this Court.
HELD : (i) In.
the context of section 5 of the Act the word 'delivery ' occurring therein means 'actual delivery '.
The object underlying section 5 is to encourage export of goods manufactured in Uttar Pradesh and notified under section 5.
The course of trade adopted by the buyers and the assessee shows that if the word 'delivery ' is interpreted to mean 'constructive delivery ' very few 'export sales ' would enjoy rebate under section 5.
As long as the contract evinces an intention to export and actual delivery is given to effectuate that intention the object of the legislature to ensure that only real 'export sales ' enjoy the rebate would be fulfilled.
[53 B D] Lord Krishna Sugar Mills vs Commissioner of Sales Tax, U.P. S.T. reference No. 263/54 dated March 19, 1963, disapproved.
India Coffee and Tea distributing Co. Ltd. vs The State of Madras 10 S.T.C. 359, approved.
(ii)The sales by the assessee were for actual delivery outside Uttar Pradesh.
The despatch instructions contemplated by the contract entered into by the assessee, were part of the contract.
The contract contemplated a destination in spite of constructive delivery having been contracted to be made at the station where the assessee mill was situated.
Further the contract was not to actually deliver at some place to be chosen or assented to by the assessee mill but at any place without restrictions.
The contract required nothing more for completion than a mention of the place.
when the despatch instructions were given, it was not a case of performing the contract but specifying a term of contract.
[53 EG] 4 6
|
Civil Appeal Nos.
2780 2782 of 1977.
Appeals by Special Leave from the Judgment and Order dated 22 8 1977 of the Madras High Court in C.R.P. Nos.
559 561/77.
K. Parasaran, Solicitor General of India and A.V. Rangam for the Appellant.
T.S. Krishnamurthy Iyer, section Srinivasan and A.T.M. Sampath for the Respondent.
The Judgment of the Court was delivered by SHINGHAL, J.
These appeals by special leave are directed against a common judgment of the Madras High Court dated August 22, 1977, in three revision petitions against the orders of the State Transport Corporation, Madras, dated February 16, 1977, by which the High Court allowed the revision petitions and remitted the cases to the Regional Transport Authority for fresh consideration in the light of its observations.
The High Court directed further that the revision petitioners before it as well as the present appellant Corporation would continue to provide transport facilities on the route in question until the disposal of the renewal applications of the revision petitioners.
The facts of the three appeals are quite simple and are not in controversy.
They have been heard together at the instance of the learned Counsel for the parties and will be disposed of by this common judgment.
The controversy relates to the plying of vehicles on the Salem Krishnagiri route.
The facts of one of the three cases have been placed for our consideration by the learned Counsel for the parties and they have informed us that they are sufficient for the adequate disposal of all the appeals.
Balkrishna Bus Service and Company, respondent No. 2, was a private operator on the aforesaid route.
Its permit was due to expire on October 9, 1974, and it applied for its renewal within the time 71 prescribed by law.
Its application was notified on June 5, 1974, under section 57(3) of the , hereinafter referred to as the Act.
Objections to the renewal application were filed by the Anna Transport Corporation Limited, which is the present appellant, on June 25, 1974.
The Corporation, at the same time, also applied for the grant of a permit to it.
A controversy therefore arose in the matter and the Regional Transport Authority fixed December 21, 1974, for its hearing.
The case was, however, adjourned.
Balakrishna Bus Service and Co., in the meantime, filed a writ petition and challenged the validity of rule 155 A of the Motor Vehicle Rules of the State and obtained a stay of the hearing of the matter which was pending before the Regional Transport Authority.
A draft scheme for the route from Mettur to Kallakurchi via Omalur and Salem was published on June 4, 1976, and it formed a sector of the Salem Krishnagiri route.
The validity of aforesaid Rule 155 A was finally upheld by the High Court on June 29, 1976.
It therefore dismissed the writ petition and directed the Regional Transport Authority to dispose of the pending application for renewal within a month.
The Regional Transport Authority rejected that application on October 30, 1976, and granted a permit to the present appellant.
The State Transport Appellate Tribunal confirmed that order.
The matter was taken to the High Court in revision and that led to the passing of the impugned judgment.
The facts are, therefore, quite simple.
There is no controversy about them, and they are sufficient for the disposal of the present appeals by special leave.
It is not disputed before us that the section applicable to the controversy is section 68F of the Act.
The High Court, in fact, not only decided the revision petitions with reference to that section but rightly took the view that the controversy before it fell within the purview of sub section (1D) thereof.
It, however, held on a reading of this Court 's decision in Cheran Transport Co. Ltd. vs Kanan Lorry Service & Anr.,(1) that the case fell within the purview of the so called "rider" to proposition No. 2 set out in that judgment with reference to the proviso to sub section (1D) of section 68F of the Act.
The sub section reads as follows, (1D) Save as otherwise provided in sub section (1A) or subsection (1C) no permit shall be granted or renewed during the period intervening between the date of publication, under section 68C of any scheme and the date of publication of the approved or modified scheme, in favour of any person for any class 72 of road transport service in relation to an area or route or portion thereof covered by such scheme: Provided that where the period of operation of a permit in relation to any area, route or portion thereof specified in a scheme published under section 68C expires after such publication, such permit may be renewed for a limited period, but the permit so renewed shall cease to be effective on the publication of the scheme under sub section (3) of section 68D.
It is not in controversy that sub section (1A) or sub section (1C) of section 68F are not applicable to the controversy.
The rest of sub section (1D) provides that no permit shall be granted or "renewed" during the period intervening between the date of publication under section 68C of any scheme and the date of publication of any approved or modified scheme, in favour of any person in relation to an area or route or portion thereof covered by that scheme.
As has been stated, a draft scheme of road transport service of the appellant Corporation was published on June 4, 1976, under section 68C of the Act and, as has been mentioned, that scheme overlapped a section of the Salem Krishnagiri route.
It follows, therefore, that by virtue of the clear provision of sub section (1D) of section 68F of the Act, no permit could be granted or renewed during the period intervening between the date of publication of the aforesaid scheme under section 68C, that is, after June 4, 1976, and the date of publication of the approved or modified scheme, in favour of any person for any class of road transport service.
The High Court therefore clearly went wrong in thinking that the case fell within the purview of the proviso to sub section (1D) and it consequently erred in taking into consideration the so called rider to proposition No. 2 mentioned in this Court 's judgment in Cheran 's case (supra).
The proviso would have been applicable only if the period of operation of the permit of the respondents had expired after the publication of the scheme prepared under section 68C; but that was not so in this case.
It has also to be remembered that in this case it was the respondent (private operator) who filed a fruitless writ petition and prevented the disposal of the renewal application for a long time by obtaining a stay order.
On a plain reading of sub section (1D) of section 68F of the Act, we have therefore no hesitation in allowing the appeals with costs.
We may however add that if no approved or modified scheme has been published so far, the proper course for the Regional Transport Authority would be to keep the three renewal applications pending and not to treat them as dismissed.
The stay orders are vacated.
N.V.K. Appeals allowed.
| Section 4(2) of the provides that for every completed year of service or part thereof in excess of six months, the employer shall pay gratuity to an employee at the rate of 15 days ' wages based on the rate of wages last drawn by the employee concerned.
The employers sought to pay gratuity by dividing the workman 's monthly wages by 30 and computing the 15 days ' wages on that basis but the workman demanded that his monthly wages should be taken as what he got for 26 working days and not by taking half of his wages in a month of 30 days.
The Controlling Authority upheld the workman 's contention.
In dismissing the employer 's petition under article 227 of the Constitution the High Court observed that a worker received a full month 's wages not by remaining on duty for all the 30 days within a month but by remaining on work and doing duty for only 26 days and, therefore, gratuity payable to him should be calculated on this basis.
Dismissing the employers ' appeals, ^ HELD: The view taken by the authorities, and upheld by the High Court, is not in any way unreasonable.
Although a month is understood to mean 30 days, the manner of calculating gratuity payable under the Act to employees who worked for 26 days a month followed by the High Court cannot be called perverse.
[67C] Treating monthly wages as wages for 26 working days is not new or unknown.
The expression "average of the basic wage" occurring in an award has been interpreted by this Court to mean the wage earned by a workman during a month divided by the number of days for which he has worked and multiplied by 26 in order to arrive at the monthly wage for the computation of gratuity payable to the workman.
[67D & H] Delhi Cloth and General Mills Company Ltd. vs Workmen and others etc., [1969]]2 SCR 107, referred to.
|
Appeals Nos. 321 and 322 of 1956.
Appeals by special leave from the judgment and decree dated September 21.
1951, of the Mysore High Court in Regular Appeals Nos.
3,24,13 and 25 of 1948.
49, arising gut of the judgment and decree dated 85 664 January 9, 1948, of the Principal DistriCt Judge, Bangalore, in Original Suits Nos.
55 of 1946 47 and 117 of 1945 46 respectively.
section K. Venkataranga Aiyangar and section K. Aiyangar, for the appellant.
B. K. B. Naidu, for the respondents.
February 1.
The Judgment of the Court was delivered by SHAH, J.
V. R. Subramanyam, the appellant herein is the owner of plot No. 29, Subedar Chattram Road in the town of Bangalore.
B. Thayappa respondent is a building contractor.
The appellant entrusted the respondent with the work of constructing a house and shops on the plot, on terms and conditions set out in a written agreement dated October 1, 1942, which was slightly modified on October 6, 1942.
By the agreement the respondent was to construct for the appellant on the plot six shops abutting a public road, the main building at the rear of the shops, an out house and a garage according to a site plan.
The respondent was to be remunerated at rates specified in the agreement: for constructions with R. C. C. roofing, the rate stipulated was Rs. 4 2 0 per square foot and for " tiled construction " it was Rs. 3 2 0 per square foot.
The Municipality of Bangalore did not sanction the plan as proposed by the appellant.
The plan was altered and it was sanctioned, subject to those alterations.
By the alterations the shops were deleted from the plan, the area of the out house was increased, and a puja room on the ground floor and an extra room on the first floor were added to the plan.
A compound wall was also to be constructed.
The respondent carried out a substantial part of the construction work according to plan and the appellant paid to him diverse sums of money and delivered building materials.
The aggregate amount accordingly received by the respondent was Rs. 20,200.
But before the work could be completed disputes arose between the appellant and the respondent about the work done by the latter.
The appellant claimed that the work done was defective and that he was entitled to compensation for effecting 665 repairs necessary to rectify the defects.
The respondent claimed compensation at certain rates set up by him for work done for the appellant for which no express provision was made in the written agreement.
Each party set up an oral agreement about the remuneration to be paid to the respondent for the extra work which was not included in the original agreement.
The appellant filed a suit in the court of the Subordinate Judge, Bangalore, against the respondent which was later transferred to the court of the Principal District Judge, Bangalore, and numbered O. section 54 of 1946 47, for a decree for Rs. 8,515 4 0 being the amount of compensation which the appellant claimed he was entitled to receive from the respondent for defective work and for delay in completion of the construction.
The respondent filed a suit against the appellant which was later transferred to the Court of the Principal District Judge, Bangalore, and numbered 55 of 1946 47.
By this suit, the respondent claimed a decree for Rs. 5,988 12 0 being the remuneration due to him for the work done in constructing the house less Rs. 20,200 received from the appellant.
The respondent filed another suit No. 117 of 1945 46 for a decree for Rs. 15,001 10 9 with interest and notice charges being the amount due to him for the construction of the out house, godown, first floor room and flight of steps and the value of some building materials which the respondent claimed he had left in the premises of the appellant and which the latter had wrongfully removed.
The trial court granted to the appellant a decree for Rs. 3,000 in suit No. 54 of 1946 47.
To the respondent, he granted a decree for Rs. 2,989 6 0 in suit No. 55 of 1946 47 and in suit No. 117 of 1945 46, he granted a decree for Rs. 13,329 10 9.
Both the parties felt themselves aggrieved by the decrees passed in the three suits and six appeals were preferred to the High Court of Judicature of Mysore at Bangalore against those decrees.
The High Court reversed the decree passed in suit No. 54 of 1946 47 and dismissed the appellant 's claim in its entirety.
The decrees 666 passed in suit Nos.
55 of 1946 47 and 117 of 1945 46 were also set aside and proceedings were remanded to the District Court with a direction that a qualified engineer be appointed as Commissioner to determine the amounts payable to the respondent for work done in addition to the work agreed to be done under the written contract.
The High Court ordered that the same be determined " in accordance with the directions " given in the judgment.
The appellant has appealed to this court against the decrees in suits Nos.
55 of 1946 47 and 117 of 1945 46 with special leave under article 136 of the Constitution and he challenges the directions given in the order of remand.
The dispute between the parties related to the construction of the out house, garage, puja room, the room on the first floor, the stair case 'leading to the upper floor room and the compound wall.
In respect of these constructions (except for the compound wall) the District Judge awarded compensation to the respondents at the rate of Rs. 4 2 0 per square foot and in respect of the compound wall he awarded compensation at the rate of Rs. 5 per running foot, and certain additional charges.
The High Court held that the respondent was entitled to receive compensation at the prevailing market rate for constructions which were not covered by the agreements dated October 1, 1942 and October 6, 1942.
The High Court negatived the plea of the respondent that the appellant had agreed to pay him at " extra rates for deviations and additions not specifically contained in the original agreement.
" The High Court then held that for the construction of the out house,puja room and the upper floor room, the respondent was entitled to receive compensation at the rate of Rs. 4 2 0 and for the out house he was entitled to receive " some extra amount for the additional constructions. " In these items, according to the High Court, there was no material deviation from the original plan.
The High Court further directed that for the flight of stairs compensation be paid either "by way of a lump sum or on cubical content whichever was more practicable or common according to the rates which they proposed to indicate for such 667 additional work. " The High Court however held that there was substantial variation from the original contract in the construction of the garage, and therefore the garage could " not be covered by the contracted rate" and must be paid for at the rates current at the end of the year 1943.
The High Court also directed that " if the extra items not covered by Exs.
VII and VII(a) have been constructed or supplied by the defendants as claimed in his bills Exs.
XXI, XXII and XXIII are to be paid for in addition to the flat rate, the basis on which they should be paid for may. . be fixed in accordance with the rates contained in exhibit II.
" Counsel for the appellant submitted that as in the view of the High Court the respondent failed to prove the oral agreement pleaded by him, the suit should have been dismissed, and they should not have awarded compensation quantum meruit which was not claimed.
it was urged that the respondent must succeed or fail ' on the case pleaded by him, and not on a cause of action not pleaded.
In our view, there is no substance in this contention.
As we have already observed, in respect of the additional work done by the respondent, both the parties set up conflicting oral agreements.
These were not accepted by the High Court.
If a party to a contract has rendered service to the other not intending to do so gratuitously and the other person has obtained some benefit, the former is entitled :to compensation for the value of the services rendered by him ' Evidently, the respondent made additional constructions to the building and they were not done gratuitously.
He was therefore entitled to receive compensation for the work done which was not covered by the agreement.
The respondent claimed under an oral agreement compensation at prevailing market rates for work done by him: even if he failed to prove an express agreement in that behalf, the court may still award him compensation under section 70 of the Contract Act.
By awarding a decree for compensation under the Statute and not under the oral contract pleaded, there was in the circumstances of this case no 668 substantial departure from the claim made by the respondent.
It was then urged that the High Court was in error in directing assessment of compensation for the additional work " in accordance with the rates mentioned in exhibit II.
" The plaintiff 's witness T. section Narayana Rao had admitted that the rates in exhibit II were the current market rates for building construction work similar to the appellant 's building.
In the view of the High Court, the rates set out in that bill were not excessive.
If with a view to restrict the scope of the enquiry, the learned judges of the High Court gave a direction to the Commissioner for assessing compensation on the basis of rates which were approved by the plaintiff 's witness, it cannot be said that any serious error was committed in incorporating that direction which would justify our interference.
Finally it was urged that the appellant was entitled to claim the loss suffered by him on account of defective work by way of an equitable set off in the claim made by the respondent in suits Nos.
55 of 1946 47 and 117 of 1945 46.
But the appellant made a claim in a substantive suit for compensation for loss suffered by him because of the alleged defective work done by the respondent.
That suit was dismissed by the High Court and it is not open to the appellant thereafter to seek to reagitate the same question in the companion suits when no appeal has been preferred against the decree in suit No. 54 of 1946 47. and no plea of equitable set off has been raised in the written statements in the companion suits.
In our view, there is no substance in any of the contentions raised.
The appeals therefore fail and are dismissed with costs.
One hearing fee.
Appeals dismissed.
| The appellant was the Mahant of the Asthal Estate in Bihar which was in the management of a Receiver appointed by the Civil Court in a suit relating to the estate.
On appeal the question that arose for decision in this Court was whether the appellant Mahant was liable to be assessed under the Bihar Agricultural Income tax Act, 1948, to pay agricultural income tax for the year in which the estate was in the management of the Court Receiver.
Held, that the income though collected by the Receiver was the income of the appellant.
By virtue of the provisions of sections 2, cl.
(m) and 13 of the Bihar Agricultural Income tax Act it was open to the taxing authorities to treat the Receiver as the assessee because he held the property from which income was derived, but on that account the income in the hand of the owner was not exempt from liability to assessment of tax.
Section 3 of the Act provides for charging agricultural income of every person " as defined in section 2, cl.
(m) which includes a receiver and section E3 merely provides a machinery for recovery of tax from "Persons" including receivers and is not by itself a charging section.
|
Civil Appeal No. 69 of 1952.
Appeal from the Judgment and Decree dated the 27th April, 1950, of the High Court of Judicature at Calcutta (Sen & Chunder JJ.) in Appeal from Original Decree No. 19 of 1948 arising out of the Judgment and Decree dated the 27th September, 1947, of the Court of the Subordinate Judge, Third Court of Zillah, 24Parganas at Alipore in Miscellaneous Judicial Case No. 31 of 1947.
Sukumar Ghose for the appellants.
Bankim Chandra Banerji and R. R. Biswas for respondents Nos. 1, 2, 8 & 9. 1954.
April 26.
The Judgment of the Court was delivered by BAAGWATI J.
This is an appeal against the judgment and decree of the High Court of Judicature at Calcutta reversing the order of the Third Subordinate Judge, Alipore, dismissing the respondents applications for re restoration of certain immovable properties.
One Romesh Chandra Acharji Choudhury (deceased) predecessor in interest of the appellants borrowed on the 16th August, 1918, Rs. 1,60,000 and Rs, 73,000 from the predecessors in interest of the respondents under two deeds of mortgage.
There being default in payment of the mortgage amounts a suit to realise the mortgage securities was filed on the 10th March, 1926, 152 in the Third Subordinate Judge 's Court, Alipore.
A preliminary mortgage decree for Rs. 4,21,851.1 6 was passed on the 4th April, 1929, and a decree absolute for sale was passed on the 13th September, 1929.
The mortgaged properties were put up for sale in execution proceedings in 1930 and the decree holders purchased the properties at auction sales on the 29th February, 1932, and the 23rd April, 1935, for an aggregate amount of Rs. 2,35,200.
These sales were duly confirmed and the auction purchasers took delivery of possession of different items of property on different dates between the 25th June, 1933, and the 9th March, 1936.
The aecree holders obtained on the 13th December, 1937, a personal decree under Order XXXIV, rule 6, of the Civil Procedure Code for the balance due to them, viz., Rs, 3,30,903.
This personal decree was also executed and some properties of the mortgagors were purchased by the decree holders on the 8th August, 1939, for Rs. 3,899 and delivery of possession of these properties was duly given to them on the 6th July, 1940.
Kshitish Chandra Acharji Choudhury, since deceased, the predecessor in interest of the appellants Nos.
1 to 3 and Jyotish Chandra Acharya Choudhury, the appellant No. 4, sons of the mortgagor filed on the 9th December, 1940, a petition under section 36 of the Bengal Money Lenders Act (Act X of 1940) for reopening the mortgage decree and the personal decree.
By an order dated the 25th August, 1941, the learned Subordinate Judge reopened the decrees and on the 10th May, 1943, passed a new decree for a sum of Rs. 3,76,324 12 4.
The said sum was directed to be paid by the judgment debtors to the decree holders in fifteen equal annual instalments.
He also directed the restoration of the properties purchased by the decree holders.
The present respondents preferred, on the 19th June, 1943, an appeal to the High Court of Judicature at Calcutta and cross objections were filed by the said Kshitish Chandra Acharji Choudhury and appellant No. 4.
By their judgment and decree dated the 29th June, 1944, the High Court affirmed the decree of the Court below with some substantial variations and 153 passed a new decree in favour of the mortgagors.
The mortgagees were ordered to put the mortgagors in possession of all the properties they had purchased in ' execution of the reopened decrees and render to them an account of the mesne profits of those properties from the 15th September, 1941, till they restored or relinquished possession to the mortgagors of the collection papers of those properties.
The sum of Rs. 3,76,324 12 6 was declared to be due by the mortgagors to the mortgagees and the mortgagors were to pay the same in twenty equal annual instalments the first of such instalments to be paid on or before the first anniversary of the date on which the mortgagees restored or relinquished possession of all the properties purchased by them in execution to the mortgagors or of the date on which they delivered to the mortgagors the collection papers as therein mentioned, whichever date was later.
The mortgagors were to pay to the mortgagees the successive annual instalments on or before the same date of the succeeding years on which the first instalment became payable and they were also to pay the annual revenue of the aforesaid properties that would become payable after they were restored to possession kist by kist, as they fell due, at least three days before the kist dates and file the challans in the Court below in proof of payment within ten days of the payments.
The road, public works and education cesses and rent due to the superior landlords were also to be paid similarly by the mortgagors and in default of payment of any one instalment or cesses or rent within the time prescribed, the mortgagors were entitled to get back possession of the said properties from the mortgagors and in that event the sum of Rs. 2,39,099 at which the mortgagees had purchased those properties would be balanced against the amount then due to them under the decree.
If thereafter any amount still remained due to the mortgagees under the decree they were entitled to apply in the Court below for a decree for the balance under Order XXXIV, rule 6, of the Civil Procedure Code.
An enquiry was ordered into the mesne profits for the period between the 15th September, 1941, till the restoration of possession to the mortgagors and 20 154 the mortgagors were at liberty to set off the amount that might be decreed in their favour for mesne profits towards the instalment that fell due in the year in which the amount was declared by the Court below and the next succeeding years till the said amount was wiped off.
Possession was delivered to the mortgagors on the 5th October, 1944.
The delivery of the collection papers was however given on the 28th March, 1945.
The mortgagors were alleged to have committed default in the payment of the second instalment which was due in any event on the 28th March, 1947, and also in the payment of the revenue kist and the cesses which were due on or about that date.
The mortgagees therefore made applications in the Court of the Third Subordinate Judge at Alipore on the 6th September, 1946, and the 18th April, 1947, asking for re restoration of the properties.
Several defaults were alleged but only two defaults were pressed, one in regard to the payment of the second instalment which was due on the 28th March, 1947, and the other in regard to the payment of the revenue and the cesses of the Noakhali properties due also on the same date.
The learned Subordinate Judge rejected these applications by his order dated the 27th September, 1947, holding that there was no default in the payment of revenue and cess and that the default in payment of the second instalment though it had accrued was due to the wrongful acts of the decree holders themselves and that the, decree holders were not entitled to take advantage of their own wrong.
An appeal was preferred to the High Court of Judicature at Calcutta.
The appeal was allowed on the 27th April, 1950.
The High Court held that a default had been committed by the mortgagors and ordered rerestoration of the properties.
This appeal has been filed against that order of the High Court with certificate under article 133(1)(a) of the Constitution.
Shri section Ghosh appearing for the appellants before us urged that the bulk of the properties which were the subject matter of the new decree had gone to Pakistan after the 26th January, 1950, being situated in East Pakistan and the High Court at Calcutta had 155 after the 26th January., 1950, no jurisdiction and power to determine the appeal and to pass an order relating to the immovable properties situated in foreign territories.
He further urged that the order of rerestoration of the properties was not appealable and that in any event no default had been committed by the mortgagors.
In support of his first contention reliance was placed on paragraph 4(2) of the Indian Independence (Legal Proceedings) Order, 1947, which ran as under: "4.
Notwithstanding the creation of certain new Provinces and the transfer of certain territories from the Province of Assam to the Province of East Bengal by the Indian Independence Act, 1947. . . . (2) Any appeal or application for revision in respect of any proceedings so pending in any such Court shall lie in the Court which would have appellate, or as the case may be revisional jurisdiction over that Court if the proceedings were instituted in that Court after the appointed day;. . " The applications for re restoration of the properties were pending before the Third Subordinate Judge at Alipore on the 15th August., 1947, and they were saved by the provisions of paragraph 4(1) which provided for the continuance in the same Court of these proceedings as if the said Act that is, Indian Independence Act, 1947, had not been passed.
But he contended that paragraph 4(2) did not save the appeal which had been filed by the mortgagees after the 15th August, 1947.
We cannot accept this contention of the appellant.
Paragraph 4(2) provided for appeals or applications for revision in respect of proceedings which were pending in the Courts after the 15th August, 1947, and laid down that these proceedings by way of appeal or applications for revision could lie in the Courts which would have appellate or revisional jurisdiction over that Court if the proceedings were instituted in that Court after the 15th August, 1947.
It was contended that for the purpose of this provision the words "if the proceedings were instituted in that Court" should be read as meaning "if the proceedings could have been 156 instituted in that Court.
" This certainly could not be the meaning, because by reason of the transfer of the territories no proceedings in respect of the properties which had gone to Pakistan ' could ever have been maintained after the 15th August, 1947, in the Courts concerned.
The only construction which could be put upon this provision was that the Court having appellate or revisional jurisdiction over that Court would have such jurisdiction as if the proceedings had been instituted in that Court after the 15th August, 1947.
For the purpose of the appellate or the revisional jurisdiction that Court had to be treated as the Court in which the proceedings could and should have been instituted and it goes without saying that if the pro ceedings could be treated as having been properly instituted in that Court the only Court to which the appeal or the application for revision could lie was the Court which then had appellate or revisional jurisdiction over that Court.
In the case before us no proceedings could have been instituted in the Third Subordinate Judge 's Court at Alipore in respect of the properties which had gone to East Pakistan after the 15th August, 1947.
But by reason of the fact that these proceedings were pending in that Court on the 15th August, 1947, the High Court of Calcutta which had appellate or revisional jurisdiction over that Court was prescribed to be the Court in which the appeal or the application for revision in respect of such procedings would lie, because that Court, that is the Third Subordinate Judge 's Court at Alipore, was treated as the Court in which such proceedings could and should have been instituted after the 15th August, 1947.
Learned counsel for the respondents drew our attention to the case of Tirlok Nath vs Moti Ram and Others(1).
In that case a suit for possession of land at place X was filed in Court at B in 1943.
On the 15th August, 1947, the suit was pending before the Court at B which dismissed the suit in 1948.
An appeal from the decision was filed in the East Punjab High Court as the place B was included in the East Punjab.
On (1) A.I.R. 1050 East Punjab I49. 157 objection regarding jurisdiction of the High Court being taken on the around that the land in suit was at A, now included in Pakistan, the High,Court held that the suit being pending at place B on 15th August, 1947, appeal from the decision of that Court lay to the East Punjab High Court and not to Lahore High Court under paragraph 4(2) of the Indian Independence (Legal Proceedings) Order, 1947.
This decision is on all fours with the case before us and we are of the opinion that the contention urged on behalf of the appellants is untenable.
The next contention of the appellants is equally untenable.
The Calcutta High Court considered these applications as applications in the suit for a special remedy given under a special law and held that the rules of the Code of Civil Procedure applied and an appeal lay against the orders because they were decrees within the definition of section 2(2) of the Civil Procedure Code.
We cannot accept this reasoning.
These applications were in truth and in substance applications for execution of the new decrees which had been passed in favour of the mortgagors by the High, Court on the 29th June, 1944.
The only thing competent to the mortgagees under the terms of the new decree was to apply for execution of the decrees on default committed by the mortgagors and the applications made by the mortgagees in the Court of the Third Subordinate Judge at Alipore were really applications for execution of the decree though not couched in the proper form and could be treated as such.
If they were treated as such it is clear that the orders passed on such applications for execution were appealable and no objection could be sustained on the ground that no appeals law against these orders.
Treating these applications therefore as applications for execution we see no substance in this contention of the appellants.
if the matter is approached in this way no objection could be urged by the appellants against the decision of the High Court.
The executing Court could not go behind the decree and it is clear on the facts that default was committed by the mortgagors both in 158 regard to the payment of the revenue and the cess as also the second instalment under the new decree.
The contention which was therefore urged on behalf of the appellants that there was no default committed by the mortgagors also could not be sustained.
The High Court of Judicature at Calcutta was therefore rightly seized of the appeal and it had jurisdiction to decide whether the mortgagors had committed default in carrying out the terms of the new decree.
The appeal being a mere rehearing the appellate Court was entitled to review the judgment of the trial Judge and declare that it was wrong and that the decree holder was entitled to re restoration.
The question whether he would be able to obtain possession of the immovable properties in fact was foreign to such an enquiry.
By appropriate proceedings in another jurisdiction he may be able to do so; but this difficulty could not be a deterrent to the High Court passing the necessary orders for re restoration of the properties.
The appeal therefore fails and must stand dismissed.
There will be no order as to costs.
| The respondent leased to the appellant a plot of land for a certain period and stipulated in the lease deed that the appellant would give notice of renewal of the lease within a certain time.
The appellant made the request for renewal of the lease 12 days after the time fixed.
The respondent asked the appellant to vacate the premises stating, that the request being made out of time, was ineffective.
The appellant flied a suit for a declaration that he was entitled to the renewal, and stated that the delay in making the request he excused as (a) it was due to oversight; (b) the respondent had not altered her position for the worse or to her detriment within the space of 12 days; (c) neither party had treated the matter of time as being as the essence of the transaction; (d) the appellant had constructed a service station for petroleum products of immense utility to the public of the locality; and (e) the appellant was in possession of the land.
The Court dismissed the suit, and this decision was affirmed in appeal.
Dismissing the appeal, this Court, .
HELD: The lease fixed a time within which the application for renewal was to be made.
The time so fixed was of essence of the bargain.
The tenant lost his right unless he made the 'application within the stipulated time.
Equity will not relieve the tenant from the consequences of his own neglect which could well be avoided with reasonable diligence.
At common law stipulations as to time in a contract giving an option for renewal of a lease of land were considered to be of the essence of the contract even if they were not expressed to be so and were construed conditions precedent.
Equity followed the common law rule in respect of such contracts and did not regard the stipulation as to time as not of the essence of the bargain, the reason being that a renewal of a lease is a privilege and if the tenant wishes to claim the privilege; he must do so strictly within the time limited for the purpose.
[241 D, E] With regard to equitable relief against a failure of the tenant to give notice of renewal within the stipulated time the relief cannot be given in equity save under special circumstances such as unavoidable accident, fraud, surprise, ignorance,, not wilful or inequitable conduct on the part of the lessor precluding him refusing to give the renewal.
[241 F] Grounds (b) *and (e) stated for the delay could not be regarded as special circumstances.
As to ground (d) it was not shown that the service station was of immense public utility.
The fact that the appellant constructed a service station was an irrelevant consideration.
Ground (c) was not established and it was not shown that the time was not the essence of the bargain.
As to ground (a) there was some evidence to show that the delay in giving the notice of renewal was due to oversight.
But it was not shown that the delay was due to any unavoidable 239 accident, excusable ignorance, fraud or surprise.
The delay arose from mere neglect on the part of the appellant and could have been avoided by reasonable diligence.
[242 E] Jamshed Khodaram Irani vs Durjorji Dhunjibhai, L.R. 43 I.A. 26, PIrate vs Nicoll , 145; Eaton vs Lyon ; ,692; Reid & Anr.
vs Grave & Ors. , 248, Ram Lal Dubey vs Secretary of State for India,, 39 C.L.J. 314 and Maharani Hemanta Kumari Devi vs Safatulla Biswas & Ors. , referred to.
|
Appeals Nos. 565 566 of 1963.
Appeals by special leave from the judgment and order dated January 31, 1962 of the Mysore High Court in Writ Petitions Nos. 940 and 1056 of 1961.
G.S. Pathak and M/s. Rajinder Narain and Co. for the appellants.
R. Gopalakrishnan, for the respondent.
The Judgment of the Court was delivered by Shah, J.
These appeals raise the question whether the Academic Council of the Mysore University was competent in exercise 230 of the powers conferred by sections 22, 23 and 43 of the Mysore University Act 23 of 1956 to frame cl. 3(c) of the Regulations relating to the grant of the degree for Bachelor of Veterinary Science (B.V.Sc.).
The Mysore University Act 23 of 1956 hereinafter referred to as 'the Act ' was enacted to provide for the reorganisation of the University of Mysore and other incidental matters.
The powers of the University are described in section 4.
Section 21 provides for the constitution of the Academic Council which is one of the authorities of the University designated under section 13 and section 22 sets out the powers of the Academic Council.
It provides: "The Academic Council shall, subject to the provisions of this Act, have the control and general regulation of teaching, courses of studies to be pursued, and maintenance of the standards thereof and shall exercise such other powers and perform such other duties as may be prescribed." By section 23 other powers of the Academic Council are prescribed.
Insofar as it is material, the section provides: "In particular and without prejudice to the generality of the powers specified in section 22, the Academic Council shall have, subject to the provisions of this Act, the following powers, namely: (a) x x x x (b) x x x x (c) to make Regulations relating to courses, schemes of examinations and conditions on which students shall be admitted to the examinations, degrees, diplomas, certificates and other academic distinctions;" Section 43 of the Act sets out the scope of the Regulations.
enacts: "Subject to the provisions of this Act, the Regulations may provide for the exercise of all or any of the powers, enumerated in "sections 22 and 23 of this Act and for the following matters, namely: (i) the admission of students to the University; (ii) the recognition of the examinations and degrees of other Universities as equivalent to the examinations and degrees of the University; (iii) the University courses and examinations and the conditions on which students of the University and affiliated colleges and other University institutions shall be admitted to examinations for the degrees, diplomas and certificates of the University; and 231 (iv) the granting of exemptions.
" In exercise of the powers conferred by sections 22, 23 and 43, Academic Council made Regulations relating to the grant of a degree for Bachelor of Veterinary Science.
Clause 3(c) of the Regulations is as follows: "No candidate who fails four times shall be permitted to continue the course.
" The Mysore Veterinary College, Hebbal, Bangalore, is one of the colleges affiliated to the University of Mysore for training students for the degree course in Bachelor of Veterinary Science (B.V.Sc.).
These two appeals arise on facts which are closely parallel.
Gopala Gowda respondent in C.A. No. 565 of 1963 was admitted in the year 1958 as a student in the First Year Course in the Mysore Veterinary College.
Gopala Gowda was declared unsuccessful in four successive First Year Course examinations.
The Controller of Examinations, Mysore University, then informed Gopala Gowda by letter dated August 2, 1961 that he "had lost" his right to continue studies for the Bachelor of Veterinary Science (B.V.Sc.) course under Regulation 3(c) of the Regulations governing the course of study framed by the University leading to the degree of the Bachelor of Veterinary Science (B.V.Sc.).
Gopala Gowda then presented a petition in the High Court of Mysore praying that, for reasons set out in his affidavit, the High Court do issue a writ quashing the order communicated by the Controller of Examinations in his letter dated August 2, 1961 and do further direct the University of Mysore and the Controller of Examinations to permit him to appear for the subsequent examinations and to prosecute his training for the Bachelor of Veterinary Science Course.
The other respondent Bheemappa Reddy had also failed to satisfy the examiners in four successive First Year Course examinations commencing from April 1959, and on being intimated by the Controller of Examinations that he will not be permitted to continue his training for the Bachelor of Veterinary Science (B.V. Sc.) course under Regulation 3(c), he flied a similar writ petition in the High Court.
The High Court of Mysore held that Regulation 3(c) of the Regulations governing the course of study leading to conferment of the degree of Bachelor of Veterinary Science of the Mysore University could not be said "to subserve the purpose of maintaining the standards mentioned in section 22 of the Mysore University Act" and on that account was beyond the competence of the Academic Council or the University and those bodies had no power to prevent Gopala Gowda and Bheemappa from prosecuting their studies and from appearing at the subsequent examinations.
With special leave.
the University of Mysore, the Controller of Examinations and the Principal of the Mysore Veterinary College, have appealed.
In the view of the High Court, under section 22 of the Act the Academic Council could prescribe minimum qualifications for 232 admission to a degree course in an affiliated college, and also could prescribe standards which qualify a candidate .for admission to the degree or academic distinction, but the Council had not the power to prescribe a condition on the 'satisfaction of which a student:admitted to the Course could prosecute his study in the course to which he had been admitted.
Power to frame Regulations for "maintenance of standards" within the meaning of section 22 and prescribing conditions on which a student shall be admitted to an examination within the meaning of section 23(3) (c)did not.
in the opinion.
of the High Court, import power to make Regulation preventing a student admitted to a course from prosecuting his study, for the only consequence of failure in an examination is that the student does not qualify himself for admission to the degree sought by him.
and the University would be entitled to withhold conferment of the degree.
but not to obstruct the prosecution of the course of study.
The expression "maintenance of standards" in the view of the High Court could only take in considerations such as undergoing a course of study and keeping a prescribed minimum attendance to an institution maintained or recognised by the University, but it does not and "cannot be taken to mean that by reason only of the fact that a student has not attained the standard of knowledge or proficiency required for passing the examination within that period, he can be said to be for all times incapable of attaining that standard.
" The High Court proceeded to observe "The power to maintain certain standards before a degree or other academic distinction is conferred upon a person involves the power to withhold the conferment of that degree unless a person attains the necessary standard, but it cannot either in logic or in justice involve the power to refuse to permit a person to attain that standard.
That power can and should be exercised at the time of admission into the course of study if the University is of the opinion that the applicant for .admission into the course does not even possess the minimum suitability for taking that course of study.
Once it admits him into the course of study, it must be held to have entertained the opinion that he does have the minimum suitability to take that course which means that he has the capacity by undergoing the course of study to attain the standard necessary for receiving the degree.
" We are unable to agree with the view expressed by the high Court.
The Academic Council is invested with the power of controlling and generally regulating teaching,.
courses of studies to be pursued.
and maintenance of the standards thereof.
and for those purposes the Academic Council is competent to make regulations.
amongst others, relating to the courses, schemes of examination and conditions on which students shall be admitted to the examinations.
degrees.
diplomas.
certificates and other academic distinctions.
The Academic Council is thereby invested with power to control the entire academic life of the student from the stage of 233 admission.
to a course of study to the.
ultimate conferment of a degree or academic distinction.
Admission to a course or branch of study depending upon possession of the minimum qualifications prescribed does not divest the Academic.
Council of its control over the ' academic career of the student, for the Council has for maintaining standards the power to prescribe schemes of examinations, arid also to prescribe conditions on which students.
Shall be admitted to the examinations.
"Power to prescribe conditions, On which, a student may be admitted to the examinations, in our opinion, necessarily implies the power to refuse to admit a student in certain contingencies, for the power to admit to an examination implies the power to weed out students who have on the application of a reasonable test proved themselves to be unfit to continue the course or persecute training in that course.
If on account of general inaptitude for being trained in a course or on account of supervening disability to prosecute a course of study, a student admitted to that course is found by the Academic Council to be unfit to prosecute his training, it would, in our judgment, be within the power of the Academic Council, in exercise of its authority to control and maintain standards, and also of its authority to prescribe conditions on which students may be admitted to examinations, to direct that the student shall discontinue training in that course.
And failure by a student to qualify for promotion or degree in four examinations, is certainly a reasonable Lest of such inaptitude or supervening disability.
If after securing admission to an institution imparting training for professional courses, a student may be held entitled to continue indefinitely to attend the institution without adequate application and to continue to offer himself for successive examinations, a lowering of academic standards would inevitably result.
Power to maintain standards in the course of studies.
in our judgment, confers authority not merely to prescribe minimum qualifications for admission, courses of study, and minimum attendance at an institution which may qualify the student for admission to the examination, but also authority to refuse to grant a degree, diploma, certificate or other academic distinction to students who fail to satisfy the examiners at the final examination, and to direct that a student who is proved not to have the ability or the aptitude to complete the course within a reasonable time to discontinue the course.
There is no warrant for restricting the expression "maintenance of the standards" only to matters such as minimum attendance, length of the course and prescription of minimum academic attainments.
The High Court was therefore in error in holding that the Academic Council had no power to prescribe Regulation 3(c).
We are informed at the Bar, however, that since the High Court decided.
the case on January 31, 1962, the two respondents were permitted to continue their courses of study and they have appeared for the subsequent examinations and they were declared to have duly 234 passed their second and third year examination and have been permitted to keep terms for the degree examination.
Even though, the view taken by the High Court was erroneous, we do not think.
having regard to the fact that the respondents were permitted to continue their course of study, the University not having applied for any interim orders pending disposal of these appeals, that any order should be passed in these appeals so as to deprive the respondents of the training they have received.
These appeals are filed with special leave, and in the exceptional circumstances of the case, we do not think we would be justified, merely because we disagree with the interpretation of the High Court of the relevant regulation, in making an effective order against the respondents so as to nullify the results declared by the University concerning them in respect of the second and third year examinations.
The appeals are therefore dismissed.
There will be no order as to costs.
Appeals dismissed.
| Under Sections 22, 23, and 43 of the Mysore University Act, the Academic Council of the University was empowered, inter alia, to control and operate the teaching, courses of study, to secure maintenance of standards, etc., and to make necessary regulations including those relating to examinations and conditions on which students may be admitted to examinations, degrees, diplomas, etc.
In exercise of these powers, the Academic Council made certain Regulations relating to the grant of a degree of Bachelor of Veterinary Science and by clause 3(c of these Regulations, it was provided that no candidate who failed an examination four times, would permitted to continue the course.
The respondents were declared unsuccessful in four successive First Year Course examinations and the Controller of Examinations informed each respondent that he had lost their right to continue studying for the degree.
The respondents thereupon filed petitions in the High Court, praying for the issue of writs quashing the orders communicated to them and directing the University to permit them to appear for the subsequent examinations and to continue their studies.
The High Court held that Regulation 3(c) was beyond the competence of the Academic Council and the University.
On appeal to this Court: HELD: that power to maintain standards in the course of studies confers authority not merely to prescribe minimum qualifications for admission, courses of study, minimum attendance at an institution which may qualify the student for admission to the examination, etc.,but also authority to refuse to grant a degree, diploma, or other academic distinction to students who fail at the final examination and to direct that a student, who is proved not to have the ability or the aptitude to complete the course within a reasonable time,discontinue the course.
There is no warrant for restricting the expression "maintenance of standards" only to matters such as minimum attendance, length of the course and prescription of minimum academic attainments.
[233F H]
|
Appeal No. 151 of 1963.
Appeal by special leave from the judgment and decree dated February 17, 1959 of the Madras High Court in Second Appeal No. 252 of 1957.
section T. Desai and R. Ganapathy Iyer, for the appellants.
R. Gopalakrishnan, for the respondents Nos. 1 6.
February 3, 1964.
The Judgment of the Court was delivered by MUDHOLKAR J.
This is an appeal by special leave from the judgment of the High Court of Madras reversing the decisions of the courts below and granting a number of reliefs to the plaintiffs respondents.
The main point which arises for consideration in this appeal is whether the plaintiffs respondents are the lessees of the appellants who were defendants 4 and 5 in the trial court or only their licensees.
In order to appreciate the point certain facts need to be stated.
The appellants are the owners of a private market situate in Madras known as Zam Bazar Market.
There are about 500 odd stalls in that market and meat, fish, vegetables, etc., are sold in that market.
The practice of the appellants has been to farm out to contractors the right to collect dues from the users of the stalls.
Defendants 1 to 3 to the suit were the contractors appointed by the appellants for collecting rent at the time of the institution of the suit.
Two of these persons died and their legal representatives have not been impleaded in appeal as they have no interest in the subject matter of litigation.
The third has been transposed as respondent No. 7 to this appeal.
They were, however, alive when the special leave petition was filed and were shown as appellants 1 to 3, but two of them were struck out from the record after their death and the third trans posed as Respondent No. 7.
Though the building in which the market is located is owned by the appellants it cannot 645 be used as a market for the purpose of sale of meat or any other article of human consumption without the permission of the municipal council under section 303 of the Madras City Municipal Act, 1919 (hereafter referred to as the Act).
Before such a permission is granted the owner has to obtain a licence from the Municipal Commissioner and undertake to comply with the terms of the licence.
The licence granted to him would be for one year at a time but he would be eligible for renewal at the expiry of the period.
Section 306 of the Act confers power on the Commissioner to require the owner, occupier or farmer of a private market for the We of any animal or article of food to do a number of things, for example to keep it in a clean and proper state, to remove all filth and rubbish therefrom, etc.
Breach of any condition of the licence or of any order made by the Commissioner would result, under section 307, in suspension of the licence and thereafter it would not be lawful for any such person to keep open any such market.
Section 308 of the Act confers powers on the Commissioner to make.
regulations for markets for various purposes such as fixing the days and hours on and during which any market may be held or kept for use, requiring that in the market building separate areas be set apart for different classes of articles.
requiring every market building to be kept in a clean and proper state by removing filth and rubbish therefrom and requiring the provision of proper ventilation in the market building and of passages of sufficient width between the stalls therein for the convenient use of the building.
We are told that regulations have been made by the Commissioner in pursuance of the powers conferred upon him by section 308 of the Act.
Thus as a result of the Act as well as the regulations made thereunder a number of duties appear to have been placed upon the owners of private markets.
It would also appear that failure to comply with any of the requirements of the statute or the regulations would bring on the consequence of suspension or even cancellation of the licence.
We are mentioning all this because it will have some bearing upon the interpretation of the documents on which the plaintiffs have relied in support of the contention that the relationship between them and the appellants is that of tenants and landlord.
646 The suit out of which this appeal arises came to be filed because disputes arose between the plaintiffs and the defendants 1 to 3 who became the contractors for collection of rent as from February 9, 1956.
These disputes were with regard to extra carcass fees and extra fees for Sunday Gutha which were claimed by the contractors.
The respondents further alleged that the relationship between them and the appellants was, as already stated, that of lessees and lessors while according to the appellants, the respondents were only their licensees.
The respondents further challenged the extra levies made by the contractors, i.e., the original defendants 1 to 3 who are no longer in the picture.
The reliefs sought by the respondents were for an injunction against the appellants and the defendants 1 to 3 restraining them from realising the extra levies and for further restraining them from interfering with their possession over their respective stalls as long as they continued to pay their dues.
The First Additional City Civil Court Judge before whom the suit had been filed found in the respondents ' favour that the extra fees sought to be levied by the contractor were sanctioned neither by the provisions of the Municipal Act nor by usage but upon the finding that the respondents were bare licensees dismissed their suit.
The appellate bench of the City Civil Court before whom the respondents had preferred an appeal affirmed the lower court 's decision.
The High Court reversed the decision of the courts below and in the decree passed by it pursuant to its judgment granted a number of reliefs to the respondents.
Here we are concerned only with reliefs (ii) (e), (f) and (g) since the appellants are not interested in the other reliefs.
Those reliefs are : "(ii) that the respondents defendants, in particular defendants 1 to 3 (respondents 1 to 3) be and hereby are restrained from in any manner interfering with the appellants plaintiffs 1 to 4, 6 and 7 carrying on their trade peacefully in their respective stalls at Zam Bazar Market, Rovapettah, Madras and imposing any restrictions or limitations upon their absolute right to carry on business as mentioned hereunder 647 (e) Interfering with the possession and enjoyment of the respective stalls by the appellants plaintiffs 1 to 4, 6 and 7 so long as they pay the rents fixed for each stall; (f) increasing the rents fixed for the appellants plaintiffs ' 1 to 4, 6 and 7 stalls under the written agreements between the said plaintiffs and defendants 4 and 5; (g) evicting of the appellants plaintiffs 1 to 4, 6 and 7 or disturbing the plaintiffs and their articles in their stalls by defendants 1 to 3." Further we are concerned in this case only with the relationship between the meat vendors occupying and using some of the stalls in the market (as the plaintiffs respondents belong to this category) and the appellants landlords.
What relationship subsists or subsisted between the appellants and other stall holders vending other commodities is not a matter which can be regarded as relevant for the purpose of deciding the dispute between the appellants and the respondents.
It is common ground that under the licence granted by the Municipal Corporation, the market is to remain open between 4 A.m.
and II P.m. and that at the end of the day the stall holders have all to leave the place which has then to be swept and disinfected and that the gates of the market have to be locked.
None of the stall holders or their servants is allowed to stay in the market after closing time.
In point of fact this market used to be opened at 5 A.M. and closed, at 10 P.m. by which time all the stall holders had to go away.
It is also common ground that the stalls are open stalls and one stall is separated from the other only by a low brick wall and thus there can be no question of a stall holder being able to lock up his stall before leaving the market at the end of the day.
The stall holders were required to remove the carcasses brought by them for sale by the time the market closed.
Meat being an article liable to speedy decay the stall holders generally used to finish their 648 business of vending during the afternoon itself and remove the carcasses.
They, however, used to leave in their stalls wooden blocks for chopping meat, weighing scales, meat choppers and other implements used by them in connection with their business.
These used to be left either in boxes or almirahs kept in the stall and locked up therein.
It is also an admitted fact that some of the stall holders have been carrying on business uninterruptedly in their stalls for as long as forty years while some of them have not been in occupation for more than five years.
It is in evidence that these stall holders have been executing fresh agreements governing their use and occupation of stalls and payment of what is styled in the agreements as rent whenever a new contractor was engaged by the appellants for collecting rents.
The next thing to be mentioned is that the agreements referred to the money or charges payable by the stall holders to the landlords as 'rent ' and not as 'fee.
It has, however, to be noted that the dues payable accrue from day to day.
Thus in exhibit
A 1 the rent of Re. 1 / is stid to be payable every day by 1.00 P.m.
In all these agreements there is a condition that in case there is default in payment of rent for three days the stall holder was liable to be evicted by being given 24 hours ' notice.
A further condition in the agreements is that a stall holder may be required by the landlord to vacate the stall after giving him 30 days ' notice.
There is a provision also regarding repairs in these agreements.
The liability for the annual repairs is placed by the agreement upon the landlord and these repairs are ordinarily to be carried out in the month of June every year.
Where, however, repairs became necessary on account of the carelessness of a stall holder they were to be carried out at the expense of that stall holder.
It may be also mentioned that these agreements are obtained by the contractors from the stall holders in favour of the landlord and bear the signatures only of the stall holder,.
It was contended before us by Mr. R. Gopalakrishnan that in order to ascertain the relationship between the appellants and the respondents we must look at the agree 649 ments alone and that it was not open to us to look into extraneous matters such as the surrounding circumstances.
It is claimed on behalf of the respondents that the lease in their favour is of a permanent nature.
But if that were so, the absence of a registered instrument would stand in their way and they would not be permitted to prove the existence of that lease by parol evidence.
From the fact, however, that with every change in the contractor a fresh agreement was executed by the stall holders it would be legitimate to infer that whatever the nature of the right conferred by the agreement upon the stall holders, it could not be said to be one which entitled them to permanent occupation of the stalls.
It could either be a licence as contended for by the appellant or a tenancy from month to month.
In either case there would be no necessity for the execution of a written agreement signed by both the parties.
Here, the agreements in question are in writing, though they have been signed by the stall holders alone.
All the same, oral evidence to prove their terms would be excluded by section 92 of the Evidence Act.
To that extent Mr. Gopalakrishnan is right.
Though that is so, under the 6th proviso to that section the surrounding circumstances can be taken into consideration for ascertaining the meaning of the word 'rent ' used in the agreements.
Indeed, the very circumstance that rent is to fall due every day and in default of payment of rent for three days the stall holder is liable to be evicted by being given only 24 hours ' notice it would not be easy to say that this 'rent ' is payable in respect of a lease.
On the other hand, what is called rent may well be only a fee payable under a licence.
At any rate this circumstance shows that there is ambiguity in the document and on this ground also surrounding circumstances could be looked into for ascertaining the real relationship between the parties.
Indeed, the City Civil Court has gone into the surrounding circumstances and it is largely on the view it took of them that it found in favour of the appellants.
The High Court, however, has based itself upon the agreements themselves.
To start with it pointed out and, in our opinion rightly that the use of the word 'rent ' in, exhibit A 1 did not carry the respondents ' case far.
The reasons.
650 given by it for coming to the conclusion that the transaction was a lease, are briefly as follows : (1) Notice was required to be given to the stallholder before he could be asked to vacate even on the ground of non payment of rent; (2) the annual repairs were to be carried out by the landlord only in the month of June; (3) the stall holder was liable to carry out the repairs at his own expense when they are occasioned by his carelessness; (4) even if the landlord wanted the stalls for his own purpose he could obtain possession not immediately but only after giving 30 days ' notice to the stall holder; (5) the possession of the stalls by the respondents had been continuous and unbroken by virtue of the terms of the agreement and that the terms of the original agreement were not shown to have been substituted by fresh agreements executed by the respondents.
The High Court, therefore, held that from the general tenor ,of the documents it is fairly clear that as between the appellants and the respondents the terms created only a tenancy in respect of the stalls and not a mere licence or permissive occupation.
After saying that if the occupation of the stall holders was only permissive the condition as to payment of rent, eviction for default in payment of rent for more than 3 days, the provision for annual repairs being carried out by the landlord, the further provision that repairs that might be occasioned by the carelessness of the respondents should be carried out at their expense and the adequate provision for 30 days ' notice for vacating the stalls if they were required by the landlord would all seem to be inconsistent and irrelevant, it observed : "As a matter of fact, there is no evidence whatsoever to show that any of these plaintiffs were at any time turned out of their possession of their 651 stalls at the will of the landlords or for default of any of the terms and conditions stipulated in the agreements.
The specific provision for 30 days ' notice for vacating and delivering possession seems to be conclusive of the fact that the plaintiffs were to occupy the stalls as permanent tenants and not as mere licensees.
The terms of the agreements further disclose that the plaintiffs were to be in exclusive possession of these stalls for the purpose of their trade as long as they comply with the terms and until there was a notice of termination of their tenancy in respect of the shops held by them.
The very tenor of the agreements, the intention behind the terms contained in the agreements and the measure of control established by the terms of the agreements, all point only to the fact that the plaintiffs were to be in undisturbed and exclusive possession of the stalls as long as they paid the rent and until there was a valid termination of their right to hold the stalls as such tenants.
" While it is true that the essence of a licence is that it is revocable at the will of the grantor the provision in the licence that the licensee would be entitled to a notice before being required to vacate is not inconsistent with a licence.
In England it has been held that a contractual licence may be revocable or irrevocable according to the express or implied terms of the contract between the parties.
It has further been held that if the licensee under a revocable licence has brought property on to the land, he is entitled to notice of revocation and to a reasonable time for removing his property, and in which to make arrangements to carry on his business elsewhere.
(See Halsbury 's Laws of England 3rd edn.
23, p. 431).
Thus the mere necessity of giving a notice to a licensee requiring him to vacate the licensed premises would not indicate that the transaction was a lease.
Indeed, section 62(c) of the itself provides that a licence is deemed to be revoked where it has been either granted for a limited period, or 652 acquired on condition that it shall become void on the performance or non performance of a specified act, and the period expires, or the condition is fulfilled.
In the agreements in question the requirement of a notice is a condition and if that condition is fulfilled the licence will be deemed to be revoked under section 62.
It would seem that it is this particular requirement in the agreements which has gone a long way to influence the High Court 's finding that the transaction was a lease.
Whether an agreement creates between the parties the relationship of landlord and tenant or merely that of licenser and licensee the decisive consideration is the intention of the parties.
This intention has to be ascertained on a consideration of all the relevant provisions in the agreement.
In the absence, however, of a formal document the intention of the parties must be inferred from the circumstances and conduct of the parties.
(lbid p. 427).
Here the terms of the document evidencing the agreement between the parties are not clear and so the surrounding circumstances and the conduct of the parties have also to be borne in mind for ascertaining the real relationship between the parties.
Again, as already stated, the documents relied upon being merely agreements executed unilaterally by the stall holders in favour of the landlords they cannot be said to be formal agreements between the parties.
We must, therefore, look at the surrounding circumstances.
One of those circumstances is whether actual possession of the stalls can be said to have continued with the landlords or whether it had passed on to the stall holders.
Even if it had passed to a person, his right to exclusive possession would not be conclusive evidence of the existence of a tenancy though that would be a consideration of first importance.
That is what was held in Errington vs Errington and Woods(1) and Cobb vs Lane(1).
These decisions reiterate the view which was taken in two earlier decisions: Close vs
Theatrical Properties Ltd. and Westby & Co. Ltd.,(1) and Smith & Son vs The Assessment Committee for the Parish of Lambeth(1).
Mr. section T. Desai appearing for the appellants also relied on the decision of the High Court of (1) (2) (3) [1936] 3 All.
E.R.483.
(4) at 330.
653 Andhra Pradesh in Vurum Subba Rao vs The Eluru Municipal Council (1) as laying down the same proposition.
That was a case in which the High Court held that stall holders in the municipal market who were liable to pay what was called rent to the municipality were not lessees but merely licensees.
The fact, therefore, that a stall holder has ,exclusive possession of the stall is not conclusive evidence of his being a lessee.
If, however, exclusive possession to which a person is entitled under an agreement with a landlord is coupled with an interest in the property, the agreement would be construed not as a mere licence but as a lease.
(See Associated Hotels of India Ltd. vs R. N. Kapoor(2).
In the case before us, however, while it is true that each stall holder is entitled to the exclusive use of his stall from day to day it is clear that he has no right to use it as and when he chooses to do so or to sleep in the stall during the night after closure of the market or enter the stall during the night after 11 00 P.m. at his pleasure.
He can use it only during a stated period every day and subject to several conditions.
These circumstances, coupled with the fact that the responsibility for cleaning the stalls, disinfecting them and of closing the Market in which the stalls are situate is placed by the Act, the regulations made thereunder and the licence issued to the landlords, is on the landlords, would indicate that the legal possession of the stalls must also be deemed to have been with the landlords and not with the stall holders.
The right which the stall holders had was to the exclusive use of the stalls during stated hours and nothing more.
Looking at the matter in a slightly different way it would seem that it could never have been the intention of the parties to grant anything more than a licence to the stall holders.
The duties cast on the landlord by the Act are onerous and for performing those duties they were entitled to free and easy access to the stalls.
They are also required to see to it that the market functioned only within the stated hours and not beyond them and also that the premises were used for no purpose other than of vending comestibles.
A further duty which lay upon the landlords was to guard the entrance to the market.
These duties (1) I.L.R. at pp.
520 4.
(2) ; 654 could not be effectively carried out by the landlord by parting with possession in favour of the stall holders by reason of which the performance by the landlords of their duties and obligations could easily be rendered impossible if the stall holders adopted an unreasonable attitude,.
If the landlords failed to perform their obligations they would be exposed to penalties under the Act and also stood in danger of having their licences revoked.
Could, in such circumstances, the landlords have ever intended to part with possession in favour of the stall holders and thus place themselves at the mercy of these people? We are, therefore, of the opinion that the intention of the parties was to bring into existence merely a licence and not a lease and the word rent ' was used loosely for 'fee.
Upon this view we must allow the appeal, set aside the decree of the High Court and dismiss the suit of the respondents inso far as it relates to reliefs (ii) (e), (f) and (g) grantedby the High Court against the appellants are concerned.
So far as the remaining reliefs granted by the High Court are concerned, its decree will stand.
In the result we allow the appeal to the extent indicated above but in the particular circumstances of the case we order costs throughout will be borne, by the parties as incurred.
Appeal partly allowed.
| in disputes regarding extra fees in respect of meet stalls in a private market owned by the appellants, the respondents stall holders filed a suit alleging that the relationship between them and the appellants was that of lessees and lessors; while according to the appellants, the respondents 643 were only their licensees.
The stall holders have been executing agreements, signed by the stall holders alone, in which the payment is styled as rent.
Though the building in which the market is located is owned by the appellants it could not be used as a market for the sale of meat or comestibles without the permission of the municipal council, and a number of duties have been imposed upon the owners including that of closing the market and that market functioned only within 'he stated hours.
The City Civil Court Judge finding that the respondents were bare licensees dismissed their suit.
His decision was affirmed in appeal.
On a further appeal the High Court reversed the findings of the Courts below holding that from the general tenor of the document the terms created only a tenancy in respect of the stalls and not a mere licence or permissive occupation saying that if the occupation of the stall holders was only permissive the condition as to the payment of rent, eviction for default in payment of rent for more than 3 days, the provision for annual repairs being carried out by the landlord, the further provision that repairs that might be occasioned by the carelessness of the respondents should be carried out at their expense and the adequate provision for 30 days notice for vacating the stalls if they were required by the landlord would all seem to be inconsistent and irrelevant.
On appeal by special leave: Held: (i) While it is true that the essence of a licence is that it is revocable at the will of the grantor the provision in the licence that the licensee would be entitled to a notice before being required to vacate is not inconsistent with a licence, and the mere necessity of giving such a notice would not indicate that the transaction was a lease.
Whether an agreement creates between the parties the relationship of landlord and tenant or merely that of licensor and licensee the decisive consideration is the intention of the parties, which has to be ascertained on a consideration of all the relevant provisions in the agreement.
In the absence, however, of a formal document the intention of the parties must be inferred from the circumstances and conduct of the parties.
(ii)The fact that a person has exclusive possession is not conclusive evidenceof his being a lessee.
If, however, exclusive possession to which a personis entitled under an agreement with a landlord is coupled with an interest in the property, the agreement would be construed not as a mere licence but as a lease.
Associated Hotels of India Ltd. vs R. N. Kapur, ; , Errington vs Errington and Woods, [1952] 1 K. B. 290, Cobb.
vs Lane, , Clove vs Theatrical Proprietors Ltd. and Westby & Co. Ltd. Smith & Son vs The Assessment Committee for the Parish of Lambeth, and vutrum Subba Rao vs The Eluru Municipal Council, I.L.R. [1956] A.P. 515, referred to.
(iii) In view of the duties cast upon the landlord and the circumstances of the present case the intention of the parties was to bring into existence merely a licence and not a lease and the word 'rent ' was used loosely for 'fee '.
|
Appeal No. 118 of 1955.
Appeal from the judgment and order dated May 26, 1954, of the P.E.P.S.U. High Court in Misc.
Case No. 31 of 1953.
G. N. Joshi and R. H. Dhebar, for the appellant.
The respondent did not appear.
May 17.
The Judgment of the Court was delivered by 149 1162 KAPUR J.
This is an appeal under certificate of the Pepsu High Court and the question for decision relates to the applicability of the Indian Incometax Act, 1922, to the erstwhile Pepsu area in the years of assessment 1948 49 and 1949 50.
The assessee company (the respondent before us), was incorporated in the Patiala State and had its registered office at Surajpur in Pepsu.
For the year of assessment 1948 49 the company failed to deduct from out of the remuneration paid to its managing agents, who were non residents, the income tax and the supertax which, it, under the law, was required to do.
It also paid to its auditors auditing fees and from out of this sum also it did not deduct the income tax and super tax under the provisions of the Patiala Incometax Act.
The two sums in dispute were Rs. 59,787 1 0 and Rs. 581, 40 respectively.
For the assessment year 1949 50 also the assessee company failed to make the deduction from the remuneration paid to its managing agents and the income tax deductible was Rs. 52,484 14 0 and super tax Rs. 21,611 6 0.
The Income tax Officer took action against the assessee company under sections 18(3A) and 18(7) of the Patiala Income tax Act and consequently issued two demand notices for the amounts above mentioned.
Against this order of the Income tax Officer the assessee company took an appeal to the Appellate Assistant Commissioner who reduced the amount demanded but did not decide the question whether the assessee company was bound to make the deductions or not.
The assessee company then appealed to the Income tax Appellate Tribunal and it held that under section 18(7) of the Patiala Incometax Act no order was required to be passed by the Income tax Officer and that no appeal lay to the Appellate Assistant Commissioner against the order under section 18(3A) as there was no provision for it under the Patiala Income tax Act.
Before the Tribunal it was contended that at the time when the appeals were decided by the Appellate Assistant Commissioner, the Patiala Income tax Act had ceased to be in force and therefore the appeals were sustainable under the provisions of the Indian Income tax Act which had been 1163 extended to all Part B States by section 13 of the Indian Finance Act of 1950 (XXV of 1950) but this contention was repelled and the Tribunal held that the only remedy for the assessee company was to take a revision under section 33 of the Patiala Income tax Act to the Commissioner.
The Tribunal at the request of the assessee company referred the following three questions for the opinion of the High Court: (1)Whether the appeals before the Appellate Assistant Commissioner fell to be decided in accordance with the provisions of the Patiala Income tax Act or the Indian Income tax Act ? (2)Whether the appeals before the Appellate Tribunal fell to be decided in accordance with the provisions of the Patiala Income tax Act or the Indian ]Income tax Act ? (3)Whether, on the assumption that the assessee company was not bound to deduct tax, its appeals before the Appellate Assistant Commissioner were competent in law ? The High Court decided that in regard to the assessment year 1948 49, the law applicable was the Patiala Income tax Act and therefore no appeal Jay to the Appellate Assistant Commissioner but in regard to the assessment year 1949 50 the Indian law became applicable and therefore the order of the Income tax Officer was appealable.
The Revenue have come up in appeal under a certificate of the High Court and the submission is that to the assessment year 1949 50 also the Patiala Income tax Act applied and not the Indian Income tax Act and therefore the order of the Incometax Officer was not appealable.
In order to resolve the controversy, reference may be made to certain provisions of the Indian Income tax Act, 1922, and the Finance Act of 1950.
Section 13 of the Finance Act provides: section 13 " If immediately before the Ist day of April, 1950, there is in force in any Part B State other than Jammu and Kashmir or in Manipura, Tripura or Vindya Pradesh or in the merged territory of Cooch Behar any law relating to income tax or super tax or tax on profits of business, that law shall cease to have effect except 1164 for the purpose of the levy, assessment and collection of income tax and super tax in respect of any period not included in the previous year for the purpose of assessment under the Indian Income tax Act, 1922, for the year ending on the 31st day of March, 1951, or.
for any subsequent year or, as the case maybe, the levy, assessment and collection of tax on profits of business for any chargeable accounting period ending on or before the 31st day of March, 1949 ; " Section 13 of the Finance Act of 1950 shows that the Indian Income tax Act became applicable to the assessees residing, in any Part B State as from the assessment years 1950 51 or the accounting year 1949 50.
The provisions of section 2(14A) of the Indian Income tax Act, 1922, show that the Act became applicable to Part B States as from April 1, 1950.
The relevant provisions of this section are: S.2(14A) " taxable territories " means (d) as respects any period after the 31st day of March, 1950, and before the 13th day of April, 1950, the territory of India excluding the State of Jammu and Kashmir and the Patiala and East Punjab States Union.
Provided that the " taxable territories " shall be deemed to include (b) the whole of the territory of India excluding the State of Jammu and Kashmir (i). . . . . . . (ii) as respects any period after the 31st day of March, 1950,for any of the purposes of this Act and (iii) as respects any period included in the previous year for the purpose of making any assessment of the year ending on the 31st day of March, 1951, or for any subsequent year; It will be noticed that the language used in section 2(14A) proviso (b) (iii) is the same as the language under section 13 of the Finance Act of 1950.
The effect of the Finance.
Act of 1950 is that as regards assessment for the year ending March 31, 1951, the Indian Income tax Act 1165 would be applicable accounting year being the year ending March 31, 1950, and for any assessment year previous to that the Patiala Income tax Act would be applicable.
The effect of section 2(14A) proviso (b) (ii) & (iii) is that taxable territories would comprise the whole of India excluding the State of Jammu and Kashmir as respects any period included in the previous year for the purpose of making an assessment for the year ending March 31, 1951, i.e., for the assessment year 1950 51 or the accounting year 1949 50.
The application of the Indian Income tax Act as a result of section 13 of the Finance Act of 1950 was decided in The Union of India V. Madan Gopal Kabra (1) which was a case from Rajasthan where there was no income tax in the previous year but the assessee was sought to be assessed for the year 1950 51 under the Indian Income tax Act.
It was held 'that under sub cl.
(1) of cl.
(b) of the proviso to section 2(14A) the whole of the territory of India including Rajasthan would be deemed " taxable territory " for the purpose of section 4A of the Indian Income tax Act " as respects any period " meaning any period before or after March 31, 1950, and the assessee was therefore ' liable to income tax.
Patanjali Sastri, C.J., who delivered the judgment of the court said: " A close reading of that provision will show that it saves the operation of the State law only in respect of 1948 49 or any earlier period which is the period not included in the previous year (1949 50) for the purposes of assessment for the year 1950 51.
In other words, there remained no State law of income tax in operation, in any Part B State in the year 1949 50." This passage from the judgment supports the contention of the appellant that as regards income of the accounting year 1949 50 or the year of assessment 1950 51 no State law of income tax was operative in any Part B State.
It appears that the error which has crept in the judgment of the High Court has been due to misreading the year 1949 50 as being assessment year and not accounting year.
In another case D. B. Madhavakri shnaiah vs The Income Tax Officer (1) (1) ; , 552.
(2) ; 150 1166 section 13 of the Finance Act of 1950 was similarly interpreted.
Therefore both for the assessment years 1948 49 and 1949 50 the law applicable would be the Patiala Income tax law and not the Indian Income tax Act and consequently no appeal against the order of the ' Income tax Officer was competent.
The answers to the questions would be as follows:Questions Nos. 1 & 2: The Patiala Income tax Act was in operation and no appeals lay.
Question No. 3 In the negative.
The appeal is, therefore, allowed but as the respondent I company has not appeared and contested the appeal, there will be no order as to costs, in this court.
Appeal allowed.
APPENDIX Reference to the memory of Shri N. Chandrasekhara Aiyar, Ex Judge of the Supreme Court of India, by the Judges and members of the Bar of the Supreme Court of India, assembled at a meeting on April 1, 1957.
Shri section R. DAS, Chief Justice of India.
Solicitor General, it is with a heavy heart that I mention to you and the members of the Bar the passing away of Nagapudi Chandrasekhara Aiyar, who was an esteemed colleague and a very dear friend.
The melancholy news reached me yesterday evening.
Nagapudi Chandrasekhara Aiyar was born on January 25, 1888.
He was educated at Conjeevaram, Tirupati and Madras and was a student of the Christian College and the Madras Law College.
During his college days he was a keen sportsman, interested chiefly in Cricket.
This interest in sport he kept up even after he became a District Judge.
After a brilliant academic career, he was enrolled as a vakil of the Madras High Court in 1910.
He worked in the chambers of Dr. C. P. Ramaswami Aiyar whom he used to refer to as his master and for whom he had very high regard.
He picked up an extensive practice on the Original Side of the Madras High Court.
In July 1927 he became the City Civil Judge and in December of the same year he was appointed as a District and Sessions Judge.
He was raised to the Madras High Court Bench in July 1941 and worked there as a Judge until January 25, 1948.
The State utilised his mature experience in different spheres.
He was appointed as a member of the All India Industrial Tribunal (Bank Disputes).
He was later appointed as a member of the Indo Pakistan Boundary Disputes Tribunal.
Shortly thereafter he was appointed a Judge of this Court and was sworn in on September 23, 1950.
Immediately after his retirement from this Court on January 24, 1953, he was chosen as the Chairman of the Delimitation Commission.
Towards the end of his term in this Court he fell ill very 151 1168 seriously.
He responded to medical treatment and the devoted nursing of his good wife brought him round.
That illness, however, had undermined his otherwise robust health and had left him weak.
But undaunted by his physical ailments and in a true spirit of service he moved about from place to place all over India and successfully completed the work of the Commission.
Just at that time Chief Justice Mukherjea fell ill and on his advice Nagapudi Chandrasekhara Aiyar was called upon by the President to assist this Court as an ad hoe Judge.
This burden he cheerfully accepted and efficiently discharged to the satisfaction of all concerned.
Even after this he had to undertake, as Chairman, further work of delimitation consequent upon the re organisation of the States.
Nagapudi Chandrasekhara Aiyar was well grounded in legal principles.
To his legal acumen he added his deep insight into human nature and psychology and a robust common sense.
On all intricate legal problems presented before the Court he brought to bear a mental freshness, which often contributed to their solution.
The judgments written and delivered by him, which will be found reported in the Law Reports, will bear testimony to his legal learning and human sympathies.
In his behaviour towards the members of the Bar he was always kind and considerate.
Towards his colleagues he was systematically courteous.
Nagapudi Chandrasekhara Aiyar 's interest in life was not confined to law or within the cloistered compound of a court of law.
While he was a sound lawyer and a learned Judge, he was also a man of great erudition in Sanskrit and English literature.
He was, on the one hand, the editor of the latest edition of Mayne 's Hindu Law, he was, on the other hand, the author of " Anjaneya " which he had dedicated to his master and of Valmiki Ramayana.
For those of us, who came into close contact with him, his ready quotations from our ancient scriptures and literary works of our classical poets were indeed a matter of joy.
The Convocation addresses delivered by him were thoughtful and incisive, 1169 Nagapudi Chandrasekhara Aiyar above all was a warm hearted man, a man of genial temperament and a very friendly person.
His bubbling cheerfulness and refreshing sense of humor inevitably dispelled dullness and he had the kindly knack of putting everybody at ease.
He was a lively conversationalist, full of sparkling humor, and cheerful bon homie.
Those of us, who had the privilege of coming close to him, will always miss the glow and the warmth of his kind friendliness.
The passing away of an erstwhile esteemed colleague and a friend certainly brings to one 's mind a sense of loss and sadness.
We remember with gratitude the consideration, courtesy and kindness that we always received from him.
We request you to convey to his companion in life our sense of admiration for the constant care and devoted attention which she daily bestowed on him and our heartfelt sympathy for her in her dark and dismal day of sorrow.
We pray with her for the peace of his soul.
Shri C. K. DAPHTARY, Solicitor General of India.
My Lord, the news of the passing away of Shri Chandra.
sekhara Aiyar has come to most of us as an unexpected shock.
After his miraculous and seemingly complete recovery from illness a few years ago, it was hoped that he would be spared for many years to come, to continue his distinguished services to the State.
When he came to the Supreme Court Bench, he had behind him a record of work in the High Court and in other fields of public life and had won that admiration which is the just due of one who reaches the highest rung of the judicial hierarchy.
When he left he had won also respect and confidence by his forthright and robust dealing with problems uncluttered by oversubtlety.
He won too, affection by his hearty good fellowship and kindliness which embraced all alike, senior, junior and beginner.
By his death, the law has lost a notable personality and the state a citizen of outstanding quality, who laboured in its service, and had death not snatched him away would have continued to render valuable service.
1170 One behalf of the Bar and myself, I associate myself with the expression of regret and the tribute to Shri Chandrasekhara Aiyar 's memory which your Lordship the Chief Justice has so feelingly expressed.
Reference to the memory of late Justice ' Shri P. Govinda Menon, Judge of the Supreme Court of India by the Judges and members of the Bar of the Supreme Court of India, assembled at a meeting on October 17, 1957.
Shri section R. DAS, Chief Justice of India.
Additional Solicitor General and Mr. Vice President of the Supreme Court Bar Association, we have met here again under the shadow of death.
All of you must have read in the papers of the sudden demise of Mr. Justice P. Govinda Menon.
When I was with him yesterday afternoon, I never thought that his end was so near.
P. Govinda Menon was born in September 1896.
He received his early education in Ganpat High School, then in the Zamorin 's College, Kozhikode, and then in the Presidency College and the Law College in Madras.
He was enrolled as an Advocate in September 1920 and joined the Madras Bar and practised before the High Court.
In December 1940 he was appointed Crown Prosecutor.
He proceeded to Japan in April 1946 as the Indian representative before the International Military Tribunal for the Far East at Tokyo.
He acted as the Chief Indian Prosecutor from April to September 1946.
He ' was elevated to the Bench of the Madras High Court in 1947 and was there just over nine years before he was elevated to this Court in August 1956.
As a practitioner at the Bar, as Crown Prosecutor and as a Judge P. Govinda Menon acquitted himself with remarkable success.
His suavity of manners and his sweet and amiable disposition endeared him to the members of the Bar and to the Judges.
He had a wide circle of friends both at the Bar and outside the Bar.
As a Judge of the Madras High Court he presided over almost all the divisions of the Court and had to deal with various typos of cases, civil and 1171 criminal.
His work as Crown Prosecutor brought him valuable experience and insight into human nature and helped him to acquire a firm grasp of the principles of criminal law and jurisprudence.
While upholding the dignity and the majesty of the law, he had the capacity and courage of tempering justice with mercy.
He did not permit mere technicalities or senseless formalities to stand in the way of dispensing justice.
He also heard and disposed of heavy civil appeals and revisions.
He had a deep knowledge of Hindu Law and in particular, the Marumakattayam and Aliyasantana branches of it.
Indeed, the chapters on those subjects in the latest edition of Mayne 's Hindu Law were written by him.
He was generally helpful to the members of the Bar and in particular, to the junior section of it, who always would appear before him and make their submissions without fear or nervousness.
He was a man of studious habits and took interest in literary and cultural subjects.
When he came to this Court, he brought with him his mature judicial experience and learning and his sense of justice and fairplay.
My colleagues and I, who sat with him in Court, had his assistance and advice in dealing with matters coming up for decision before us. 'He was uniformly courteous lo the members of the Bar as well as to his colleagues on the Bench.
He was a conscientious worker, which is exemplified by the fact that although he felt definitely out of sorts for about a week before his death, he did not take rest lest the work in Court should be dis located and his colleagues and the members of the Bar engaged in the part heard cases should be inconvenienced.
Although I assured him that all arrangements had been made for carrying on the Court work, he kept on worrying for he did not feel at ease in his mind.
It was certainly a strain which, I am afraid, told upon his health.
My colleagues and 1, therefore, mourn the passing away of a sound lawyer, a good Judge, a loyal friend and a conscientious worker ' We shall be grateful if you will convey through his son, who fortunately was at his bedside at the time of his 1172 death, our sincerest condolences to the members of the bereaved family.
Shri H. N. SANYAL, Additional Solicitor General of India.
My Lords, the Indian Bar most respectfully associates itself with what has fallen from Your Lordship.
It expresses profound sympathy for the members of the family of Mr. Justice Menon.
It expresses its deepest sorrow and grief at the sudden death of Mr. Justice Menon.
In 1920, he became an Advocate of the Bar at Madras and within a short time he became one of its leading members.
In 1940, he was appointed Crown Prosecutor in Madras.
His name is remembered and will always be remembered that he acted with utmost fairness in conducting cases.
In 1946, he went to Tokyo on behalf of India.
There he discharged his duties with great ability.
He became a Judge in 1947 and within a short time he made himself very popular and won the respect and admiration of the profession.
Thereafter he came here as a Judge of the Supreme Court.
He had been here only for a short time but in this short time he had made a tremendous impression on the members of the Indian Bar by his unfailing courtesy and his keen desire of doing justice.
My Lords, Mr. Justice Menon was equipped with all the qualities which are essential for the discharge of the great judicial duties of the highest Tribunal in India.
In these days, when criticisms are so often made I feel it is my duty to point out that here was a Judge who died in harness and never spared himself in spite of illness for one day and up to the last moment when it was physically impossible for him to discharge the heavy duties of his office, he attended the Court and gave his very best for the sacred cause, that is to say, the administration of justice.
On behalf of the Indian Bar, I am offering our condolence and heart felt sym pathy to the members of his family, to his friends and to everyone near and dear to him.
Shri N. C. CHATTERJEE, Vice President, Supreme Court Bar Association.
My Lords, on behalf of the members of the Supreme Court Bar Association, it is my duty to voice the sentiments and feelings of the 1173 members of the Supreme Court Bar on this solemn occasion.
The unexpected and sudden demise of a great and good Judge is a great loss to this Court.
It ' is also a great loss to the State and to the Nation.
The Country has been deprived by the cruel hand of death of the services of an eminent and upright Judge, who maintained a very high reputation as a Judge of one of the most important High Courts of India and also a Judge of this august Tribunal.
As members of the legal profession we look upon an independent Judiciary as a symbol of sovereignty.
If there is one bulwark that guards the freedom of the average citizen, it is the Courts of Justice.
We are pledged to a strict adherence of the Rule of Law and in these days, when the work of the Judiciary is not properly appreciated, it gives us some comfort to remember that there are men like Mr. Justice Govinda Menon in India who sacrificed his health and life and fell a victim to the sacred cause of Law and Justice.
Those of us who had the privilege of enjoying his friendship should remember with gratitude that he was much greater as a man.
Unostentatious, gentle and kind hearted he won the affection of all who came into contact with him.
I am happy to bear testimony to his kindness, sympathy and consideration for myself and for many of my colleagues of the Bar.
A few years back when I had the privilege of associating myself with an important Bar function in South India, I discovered that Mr. Justice Menon 's courtesy, sweet temper and amiable disposition had endeared himself not only to his colleagues on the Bench but also to the members of the Bar.
I am happy to say that he maintained the same reputation as a Judge.
of this Court.
The Law Reports of Madras bear eloquent testimony to his erudition, his clear mind and his keen sense of justice.
Those of us, who had the privilege to appear in his Court, would bear testimony to his grasp of principles and the quiet and courteous attention he has bestowed on the cases argued before him.
His 1174 judgments were not mere collections of precedents but he dealt with principles with clarity and precision.
The highest tribute that I would like to pay to his memory to day is that the juniormost member of the Bar never felt uneasy for a single moment before him.
On behalf of the Supreme Court Bar we offer our sincere condolences to the members of the bereaved family.
We mourn his death and we pay our homage and tribute of appreciation and affection to the memory of this great Judge and this great gentleman.
May his soul rest in peace.
| The respondent was a company incorporated in the former Patiala State with its registered office in the territory of Pepsu, a Part B State.
For the assessment years 1948 49 and 1949 50 in respect of the amounts of income tax and super tax which it failed to deduct from out of the remuneration paid to its managing agents, the Income tax Officer took action under the provisions of section 18 of the Patiala Income tax Act.
The Act did not provide for an appeal against the orders of the Income tax Officer under that section and the question for determination was whether an appeal lay under the provisions of the Indian Income tax Act, 1922, which was extended to all Part B States with effect from April 1, 1950, by section 13 of the Finance Act, 1950, and section 2(14A) of the Indian Income tax Act, 1922: Held, that the result of the extension of the Indian Income tax Act, 1922, to Part B States was that that Act was applicable to the assessment years 1950 51 and subsequent years and that for the assessment years 1948 49 and 1949 50 the law applicable was the Patiala Income tax Act.
Accordingly, an appeal against the order of the Income tax Officer in question was not competent.
The Union of India vs Madan Gopal Kabra, ; and D. R. Madhavakyishnaiah vs The Income Tax Officer, ; , followed.
|
ivil Appeal No. 652 of 1982.
From the Judgment and Order dated 22.8.1980 of the Patna High Court in Second Appeal No. 125 of 1977 (R).
Ashok K. Sen and D.P. Mukherjee for the Appellants.
N.H. Hingorani, Ms. Kapila Hingorani and R.P. Wadhwani for the Respondents.
The Judgment of the Court was delivered by THOMMEN, J.
This civil appeal by special leave is brought by the defendants against the judgment of the Patna High Court, Ranchi Bench, in Second Appeal No. 125 of 1977 dismissing in limine their appeal against the judgment of the learned District Judge in Title Appeal No. 2/5 of 1977 whereby the decree for eviction granted by the learned Munsiff in Title Suit No. 3 of 1975 was in part affirmed.
The plaintiffs (respondents) instituted the suit against the defendants (appellants) for eviction under Section 11(1)(d) of the Bihar Buildings (Lease, Rent and Eviction) Control Act, 1947 on the ground that the defendants were in arrears of rent for the months of February 1974 and May 1974 to August 1974.
The defendants contested the suit on various grounds.
Their main defence was that they were not in ar rears of rent as alleged by the plaintiffs.
Decreeing the suit, the learned Munsiff found that rent for the months of February 1974 and May 1974 to August 1974 had not been paid by the defendants.
This decree was affirmed by the learned District Judge in part, that is, in respect of the alleged arrears for the months of May 154 and June 1974, and not for any other period.
The finding of the First Appellate Court was affirmed by the High Court by dismissing the defendants ' appeal in limine.
The question which arises for consideration is whether the courts below were justified in coming to the conclusion, which they did, and whether the impugned judgment of the High Court is liable to be interfered with in the present appeal brought by special leave under Article 136 of the Constitution.
Whether or not rent for the two months in question had been duly paid by the defendants is a question of fact, and with a finding of such fact, this Court does not ordinarily interfere in proceedings under Article 136 of the Constitu tion, particularly when all the courts below reached the same conclusion.
But where the finding of fact is based on no evidence or opposed to the totality of evidence and contrary to the rational conclusion to which the state of evidence must reasonably lead, then this Court will in the exercise of its discretion intervene to prevent miscarriage of justice.
The suit was instituted by the widow of Rameswarlal Sultania.
The plaint was verified by Rameswarlal Sultania 's nephew on behalf of the plaintiffs, and he deposed as PW 4.
Neither the first plaintiff, the widow nor the other two plaintiffs, her children testified in support of the plaint allegations.
The nephew, PW 4 frankly admitted in the box that he had no personal knowledge of the facts alleged in the plaint.
He did not know if the defendants were in arrears of rent or whether his aunt, the first plaintiffs or anybody else had demanded rent from the defendants.
None of the witnesses on the side of the plaintiffs had any personal knowledge of the facts alleged by the plaintiffs in regard to the arrears of rent.
PW 4 is, amongst the plaintiff 's witnesses, the only person who speaks to this fact, but admittedly speaks without any claim of personal knowledge.
In the circumstances, there is no reliable oral evidence on the side of the plaintiffs to support the plaint allegation regarding the arrears of rent.
Nor is there any documentary evidence in support of their case.
On the other hand, the defendants categorically stated that they had paid the rent for the two months in question to the first plaintiff.
At that time her husband was alive, but he was in no condition, on account of poor health, to give a receipt for the rents paid.
The defendants, in view of their personal relationship with him, did not insist upon a receipt.
155 DW 8 is one of the defendants.
He categorically stated that for the months of May and June 1974 he paid the rent in June 1974 by handing over the amount to the first plain tiff 's daughter when she went to his shop to collect the rent.
Since she was a minor he accompanied her to her house to make sure that the amount was received by her mother, the first plaintiff.
His evidence on the point is in the follow ing words: "It is incorrect to say that I have not paid the rent for May June 1974.
In June, the daughter of Rameshwar Babu had come to demand Rs.200 towards the rent for May June 1974 and I had given the (Illegible) at that time.
I had demanded the receipt,_ but he was unwell and as such did not give it". "Rameshwar Babu was not living in his senses in June, 74.
His brain was not in proper condition.
In June, 74 I gave Rs.200 to his wife (plaintiff), after taking the same to his house.
Even subsequently my brother had gone to pay the rent to the plaintiff, Gita Devi for two three times.
" This evidence is supported by DW 7.
He is the Accountant of the first defendant firm of which defendants Nos. 2 and 3 who are brothers are partners.
Referring to these partners, and a neighbour by name Nandi (DW 6), this is what he says: "In June 74, the defendants, Bibhuti and Prahalad Chandra Dutta had given Rs.200 two hundred rupees to the daughter of Rameshwar Babu.
Nandi Babu, Bibhuti Babu and I were (present) in the shop, at that time.
This money was paid towards the rent of the house".
Nandi (DW 6) also speaks on this point: "The defendants always used to pay the rent in my presence . .
In June, 1974, they had given Rs.200 as rent to the younger daughter of Ramesh Babu in my presence.
I told (them) that as she was a small girl, they should also accompany her.
Then Bibhuti Bhusan Dutta reached the girl.
" The evidence of these three defence witnesses is that the rent for the months of May and June.
1974 had been duly paid in June 1974 in 156 the sum of Rs.200 by the second defendant (DW 8) to the landlord, Rameswarlal Sultania by handing over the amount to his minor daughter who went to the defendants ' shop to collect the same and by accompanying her to her house to see to the safe delivery of the same to the first plaintiff, her mother who obviously received it on behalf of her husband, the landlord.
The evidence seems to be clear on the point and we see no contradiction in this.
The courts below did not appreciate that this much evidence was staring in the face, and there was total ab sence of evidence on the point on the side of the plantiffs to contradict the defence evidence.
The plaint allegation regarding arrears was not spoken to on the plaintiffs ' side by any person having personal knowledge.
The plaintiffs made no attempt to let in any reliable evidence on the point.
The evidence of PW 4 who admittedly had no personal knowledge on the point is no evidence at all.
On the other hand, the evidence of DW 8, supported by the evidence of his Account ant (DW 7) and his neighbour (DW 6) is categoric and clear.
The learned District Judge disbelieved this evidence on the assumption that DW 6 contradicted himself when he stated that the amount was paid to the daughter and also to her monther.
In his written statement he stated that the amount had been paid to the landlord, Rameswarlal Sultania.
In the light of what we have stated above, we see no contradiction in these statements.
The amount was, in our view, rightly stated to have been paid to Rameswarlal Sulta nia when it was handed over to the daughter to be paid over to her monther, viz., the first plaintiff who was reasonably understood to have received it for and on behalf of her husband.
If the statement is true, there is no contradiction in it and it is categoric and clear.
We see no reason to suspect that it is not true for there is no evidence on the side of the plantiffs to the contrary.
As stated earlier, there is no evidence at all on the side of the plaintiffs that rents were in arrears.
In the absence of any reason to disbelieve the clear and categoric testimony of the defence witnesses on the point, we see no reason to suspect that the rents remained in arrears.
In the circumstances, we are of the view that the courts came to the conclusion, as they did, without any evidence whatsoever to support it and contrary to the available evidence let in by the defence.
Their conclusion was, therefore, perverse, irrational and totally unjustified.
For this reason, we set aside the impugned decree and judgment of the courts below.
The appeal is allowed with costs.
P.S.S. Appeal allowed.
| The appellant defendants fell in arrears of rent for the months of February and May to August 1974 for the demised premises.
The respondent plaintiffs sought their eviction under section 11(1)(d) of the Bihar Buildings (Lease, Rent and Eviction) Control Act, 1947 on the grounds of default.
Decreeing the suit, the trial court found that rent for the said five months had not been paid.
The decree was affirmed by the appellate court in part, that is, in respect of May and June, 1974.
That finding was affirmed by the High Court.
Allowing the appeal by special leave, the Court, HELD: The Supreme Court does not ordinarily interfere in proceedings under Article 136 of the Constitution particu larly when all the courts below had reached the same conclu sion.
But where the finding of fact is based on no evidence or opposed to the totality of evidence and contrary to the rational conclusion to which the state of evidence must reasonably lead, then the Court will in the exercise of its discretion intervene to prevent miscarriage of justice.
[154C D] In the instant case, there was no reliable oral evidence on the side of the plaintiffs to support the allegation that rents were in arrears.
Nor was there any documentary evi dence in support of their case.
Neither the first plaintiff, the widow nor the other two plaintiffs, her children, testi fied in support of the allegation PW 4, who verified the plaint on behalf of the plaintiffs admittedly had no person al knowledge that the defendants were in arrears of rent or whether the first plaintiff or anybody else had demanded rent from the defendants.
[156F G] On the other hand, DW 8, one of the defendants, stated that for the months of May and June 1974 he had paid the rent in June 1974 by 153 handing over the amount to the first plaintiff 's daughter when she went to his shop tO collect the rent.
Since she was a minor he accompanied her to her house to make sure that the amount was received by her mother, the first plaintiff.
This evidence has been supported by DW 7.
He was the Ac countant of the first defendant firm.
DW 6 also spoke of the fact that in June 1974 the defendants had given Rs.200 as rent to the younger daughter of the plaintiff.
These state ments of defence witnesses were categoric and clear.
There was no contradiction in term for there was no evidence on the side of the plaintiffs to the contrary.
The conclusion arrived at by the courts below that rents remained in ar rears was, therefore, perverse and totally unjustified.
[155A B, E; 156D, F, G]
|
Civil Appeal No. 1381 of 1968.
(Appeal by Special Leave from the Judgment and Decree dated the 22 2 1967 of the Bombay High Court in First Appeal No. 12/1960).
M. N. Phadke, M. N. Shroff and section P. Nayar, for the appellant.
V. section Desai and D. Goburdhan, for the respondent.
981 The Judgment of the Court was delivered by BHAGWATI, J.
This appeal by special leave raises a short question as to whether the Watan held by the respondent at the date of coming into force of the Bombay Paragana and Kulkarni Watans (Abolition) Act, 1950 was a Watan of the soil, or a Watan of land revenue only, in respect of certain lands situate in village shirambe, Taluka Koregaon, District North Statara.
If the Watan was in respect of the soil, the respondent would not be entitled to any compensation for the resumption of the Watan lands, but if it was a Watan of land revenue only, the respondent would have a claim for compensation for a "a sum equal to ten times the amount of such land revenue" under section 6(2) of the Act.
The respondent claimed that the Watan was of land revenue only and not of the soil and he was, therefore, entitled to compensation as provided in section 6(2) of the Act and filed a suit for recovery of Rs. 15,074 4 0 by way of compensation against the State of Maharashtra in the Court of Civil Judge, Senior Division, Satara.
The claim was decreed by the learned Civil Judge, Senior Division and on appeal by the State of Maharashtra the High Court affirmed the view taken by the learned Civil Judge, Senior Division.
The High Court construed the Sanad granted by the British government in favour of the ancestors of the respondent in the light of the surrounding circumstances and particularly the entries contemporaneously made in the alienation register and came to the conclusion that the grant embodied in the Sanad was not a grant of the soil but was merely a grant of land revenue and the respondent was, therefore, entitled to claim compensation the basis laid down in section 6(2) of the Act.
The State of Maharashtra being aggrieved by the decree passed by the learned Civil Judge, Senior Division and affirmed by the High Court preferred the present appeal with special leave obtained from this Court.
We have carefully gone through the judgment of the High Court and we find ourselves completely in agreement with the conclusion reached there.
The judgment of the High Court is a well reasoned judgment and the learned counsel appearing on behalf of the State of Maharashtra has not been able to show any infirmity in it.
The opening part of the Sanad clearly shows that it was issued in recognition of a grant which was already made in favour of the ancestors of the respondent.
The Sanad undoubtedly used the word 'lands ' to describe the subject matter of the grant, but the word 'land ' is defined in Bombay Act 2 of 1863 to include share of land revenue and this meaning should apply in the construction of the word 'land ' in the Sanad, since the Sanad was apparently granted pursuant to the enquiry made under Bombay Act 2 of 1863.
The description of the subject matter of the grant as 'lands ' in the Sanad would not, therefore, necessarily indicate that it was a grant of the soil.
In fact, this description standing alone would rather indicate that it was a grant of land revenue only, since grant of the soil would ordinarily be accompanied by words such as 'Darobast ' or 'Jal ', 'Taru ', 'Truna ', 'Kastha ' and 'Pashan. ' Moreover, the entries contemporaneously made in the alienation register also showed that the grant referred to in the Sanad was a grant of land revenue only and not a grant of the soil.
The High 982 Court has discussed these entries and it is not necessary for us to reiterate what has been so ably said by the High Court.
The earlier documents relied upon by the respondent have also been referred to by the High Court and they clearly go to show that the grant was of land revenue and not of the soil.
This position was in fact accepted by the Revenue officers all throughout and that is evident from the order of the District Deputy Collector, Satara dated 19th August, 1937 (exhibit 28) and the decision dated 28th February, 1951 (exhibit 331) given by the Collector of North Satara allowing an appeal filed by the respondent.
We are, therefore, of the view that the High Court was right in holding that the grant in favour of the ancestors of the respondent was a grant of land revenue only and not a grant of the soil and since the Watan held by the respondent at the date of the coming into force of the Act was a Watan of land revenue, the respondent was entitled to compensation in the sum of Rs. 15,074 4 0 under section 6(2) of the Act.
It is indeed difficult to understand as to why the State of Maharashtra should have preferred the present appeal at all.
The judgment of the High Court was pre eminently a correct judgment based on a careful appreciation of the evidence on record and it did no more than adopt a construction of the grant which had throughout been accepted as the correct construction by the Revenue officers over the last 75 years.
The learned counsel appearing on behalf of the State of Maharashtra in fact found it impossible to assail the reasoning of the judgment.
It is evident that the appeal was filed by the State of Maharashtra without giving much thought to the question and caring to enquire whether the judgment of the High Court suffered from any errors requiring to be corrected by a superior court.
We do not think it is right that State Governments should lightly prefer an appeal in this Court against a decision given by the High Court unless they are satisfied, on careful consideration and proper scrutiny, that the decision is erroneous and public interest requires that it should be brought before a superior court for being corrected.
The State Governments should not adopt a litigious approach and waste public revenues on fruitless and futile litigation where there are no chances of success.
It is unfortunately a fact that it costs quite a large sum of money to come to this Court and this Court has become untouchable and unapproachable by many litigants who can not afford the large expense involved in fighting a litigation in this Court.
It is, therefore, all the more necessary that State Governments, which have public accountability in respect of their actions, should not lightly rush to this Court to challenge a judgment of the High Court which is plainly and manifestly correct and drag the opposite party in unnecessary expense, part of which would, in any event, not be compensated by award of cost.
The present appeal is an instance of the kind of unnecessary and futile litigation which the State Governments can and should avoid.
We accordingly dismiss the appeal with costs.
S.R. Appeal dismissed.
| For a long period of time prior to 1950 the text books for recognised schools in the State of Punjab were prepared by private publishers with their own money and under their own arrangements and they were submitted for the approval of the Government.
The Government approved some books on each subject as alternative text books, leaving it to the discretion of the Head Masters of different schools to select any alternative book on each subject.
In May 1950 books on certain subjects (like agriculture, history, social studies, etc.) were prepared and published by the Government themselves without inviting offers from private publishers.
With respect to other subjects, offers were invited from "publishers and authors".
The alternative method was given up and only one text book on ,each subject was selected.
The Government charged as royalty 5% on the sale price of all the approved text books.
In 1952 a notification was issued by the Government which omitted the word "Publishers" altogether and invited only "authors and others" to submit books for approval by the Government.
The "authors and others" whose books were approved, had to enter into an agreement in the form prescribed by the Government the principal term of the agreement was that the copyright in these books would vest absolutely in Government and the authors and others" would get a royalty of 5% on the sale price of the text books.
It was contended that the publishing, printing and selling of text books was thus taken by the Government exclusively into its own hands and the private publishers were altogether ousted from the business.
The petitioners, who purport to carry on the business of preparing, printing, publishing and selling text books for recognised schools in the Punjab, pro29 226 ferred the present petition under article 32 of the Constitution praying for writs of mandamus directing the Punjab Government to withdraw the notifications of 1950 and 1952 on the ground that they contravened the fundamental rights of the petitioners guaranteed under the Constitution.
Held that the action of the Government, whether it was good or bad, does not amount to an infraction of the fundamental right guaranteed by article 19(1)(g) of the Constitution.
In the present case no fundamental rights of the petitioners were violated by the notifications and the acts of the executive Government of the Punjab done by them in furtherance of their policy of nationalisation of the text books for the school students.
A more chance or prospect of having particular customers cannot be said to be a right to property or to any interest or undertaking within the meaning of article 31(2) of the Constitution and no question of payment of compensation can arise because the petitioners have been deprived of the same.
Articles 73 and 162 of the Constitution do not contain any definition as to what the executive function is and what activities would legitimately come within its scope.
They are concerned primarily with the distribution of executive power between the Union on the one hand and the component States on the other.
They do not mean that it is only when Parliament or the State Legislature has legislated on certain items appertaining to their respective lists that the Union executive or the State executive, as the case may be,can proceed to function in respect of them.
On the other hand, the language of article 162 Clearly indicates that the powers of the State executive do extend to matters upon which the State Legislature is competent to legislate and are not confined to matters over which legislation has been passed already.
The same principle underlies article 73 of the Constitution.
The Commonwealth and the Central Wool Committee vs The Colonial Combing, Spinning and Weaving Co. Ltd. (31 C.L.R. 421), Attorney General for Victoria vs The Commonwealth, ; and Motilal 1.
The Government of the State of Uttar Pradesh (A.I.R. 1951 Allahabad 257), referred to.
|
Appeal No. 222 (N) of 1973.
From the Judgment and Order dated 13.3.1972 of the Delhi High Court in Civil Writ No. 731 of 1971.
M.K. Dua, Aman Vachher and S.K. Mehta for the Appellants.
B. Datta, Additional Solicitor General, G.D. Gupta and Mr. C.V. Subba Rao for the Respondents.
The Judgment of the Court was delivered by KHALID, J.
1.
This appeal by certificate is directed against the Judgment of a Division Bench of the Delhi High Court, in C.W. No. 731 of 1971.
The prayer in the Writ Petition is for the issuance of an appropriate writ, order or direction declaring (a) the Police Forces (Restriction of Rights) Act No. 33 of 1966 (for short the Act) as ultra vires the Constitution, (b) the Police Forces (Restriction of Rights) Rules 1966 and Police Forces (Restriction of Rights) Amendment Rules, 1970 (for short the Rules) ultra vires of Act 33 of 1966 and the Constitution of India, (c) that the Circular dated 1st April, 1971 as invalid, illegal, ultra vires, null and void and (d) for a declara tion that the Delhi Police Non Gazetted Karmchari Sangh, petitioner No. 1 in the Writ Petition, is a legally and validly constituted service organisation.
350 2.
The first appellant is the Non Gazetted Karmachari Sangh (for short the 'Sangh ') and the appellant Nos. 2 to 7, its members.
The High Court dismissed the petition holding that the challenge was not sustainable and that neither the Act nor the Rules violated any provisions of the Constitu tion.
The High Court dealt at length with the preliminary objections that a challenge based on the violation of any fundamental right was not permissible in view of the emer gency declared by the President of India, in December, 1977.
This need not detain us now in this Judgment.
The appellants ' case is that the Act referred above violates Article 19(1)(c) of the Constitution of India and that the restrictions imposed by it., being arbitrary, violates Article 14 of the Constitution.
The Non Gazetted members of the Delhi Police Force wanted to form an organi sation of their own and for that purpose constituted the Karmachari Union in 1966 and applied for its registration under the Trade Union Act, 1926.
Initially the registration asked for was declined.
Then Act 33 of 1966 was enacted.
It came into force on 2nd December, 1966.
An application for recognition was again made on 9th December, 1966.
Recogni tion was granted by the Central Government on 12th December, 1966.
The Non Gazetted members of the Delhi Police Force were permitted to become members of the Sangh.
On 12th December, 1966, the Central Government made rules under the Act which were amended in December, 1970.
The Circular in question was issued under these rules.
The Circular attempts to derecognise the Sangh.
This occassioned the filing of the writ petition.
Before considering the rival contentions urged before us, it would be useful to refer to the salient features of the Act to appreciate its ambit and the restrictions imposed by its provisions.
The Act was enacted to delineate the restrictions imposed of the rights conferred by part III of the Constitution, in their application to the members of the forces charged with the maintenance of public order so as to ensure the proper discharge of their duties ' and the mainte nance of discipline among them.
The Parliament obviously has this power under Article 33 of the Constitution of India.
The provisions of the Act seek to place certain restrictions on members of the police force in exercise of their funda mental rights guaranteed by Article 19(1)(c) to form Associ ation or Unions.
Section 3 of the Act reads as follows: "3(1) No member of a police force shall with out the express sanction of the Central Gov ernment or of the prescribed authority (a)be a member of, or be associated in any way with, any trade union, labour union, political association or with any class of trade unions, labour unions or political 351 associations; or (b) be a member of, or be associated in any way with, any other society, institution, association or organisation that is not recognised as part of the force of which he is a member or is not of a purely social, recretional or religious nature; or (c) communicate with the press or publish or cause to be published any book, letter or other document except where such communication or publication is in the bona fide discharge of his duties or is of a purely literary, artistic or scientific character or is of a prescribed nature.
Explanation: If any question arises as to whether any society, institution, association or organisation is of a purely social, recre tional or religious nature under clause (b) of this subsection, the decision of the Central Government thereon shall be final.
(2) No member of a police force shall partici pate in or address, any meeting or take part in any demonstration organised by any body of persons for any political purposes or for such other purposes as may be prescribed.
" Section 4 of the Act provides for penalties if Section 3 is contravened by any person.
Section 5 gives power to the Central Government by notification in the official gazette, to amend the schedule by including therein any other enact ment relating to a force charged with the maintenance of public order or omit therefrom any enactment already speci fied therein.
Section 6 gives the rule making power to the Central Government.
The only contention that now survives is whether the impugned statute, rules and orders are violative of the fights of the appellants guaranteed under Article 19(1)(c) of the Constitution of India.
This appeal could be disposed of by a short Order.
Appellants No. 2 to 7 are no longer in service.
They have been dismissed.
As such they do not have the necessary locus standi to sustain this petition.
But the appellants ' counsel submitted that the first petitioner the Sangh, was still interested in pursuing this appeal and that persuaded us to hear the appeal on merits.
It is true that recognition was given to the Sangh originally.
Subsequently by order dated 1 st April, 1971, the Sangh was derecognized.
This was pursuant to the amended rules.
Rule 3 provided that "no member of the police forces shall participate in, or address, any meeting or take part in any demonstration organised by any body of persons (a)for the purpose of protesting against any of the provisions of the Act or these rules or any other 352 rules made under the Act; or (b)for the purpose of protest ing against any disciplinary action taken proposed to be taken against him or against any other member of a police force; or (c)for any purpose connected with any matter pertaining to his remuneration or other conditions of serv ice or his condition of work or living condition, or the remuneration, other conditions, of any other member or members of a police force. "Provided that nothing contained in clause(c) shall preclude a member of a police force from participating in a meeting convened by an association of which he is a member and which has been accorded sanction under sub section (1) of section3 of the Act, where such meeting is in pursuance of or for the furtherance of, the objects of such associa tion.
" The above rules were amended by a notification dated 19th December, 1970 the material change for our purpose being an amendment in the proviso to clause (c) of rule 3.
The original proviso to clause(c) was substituted by another proviso which reads as follows: "Provided that nothing contained in clause (c) shall preclude a member of a police force from participating in a meeting (i) which is convened by an association of police officers of the the same rank of which he is a member and which has been granted recognition under clause (b) of sub section (1) of section 3 of the Act; (ii) which has been specifically provided for in the articles of association or/and has been, by general or special order, permitted by the Inspector General of Police having regard ' to the object of such meeting and other relevant factors; and (iv) which has been convened to consider the agenda circulated to all concerned according to the relevant provisions of the articles of association, after giving intimation in ad vance to the ' Inspector General of Police or an officer nominated by him." (Emphasis sup plied).
Rule 5 was added to the Rules by virtue of which minutes had to be recorded of the meetings of a recognised associa tion.
The Inspector General of Police could send observers by virtue of rule 6 to such meetings.
Outsiders were prohib ited from attending the meetings of the association without permission of the Inspector General of Police by Rule 7.
Rules 8, 9 & 11 may also be usefully read: 353 "8.
Recognition: Members of police force belonging to the same rank desiring to form an association may make an application for the grant of recognition under clause (b) of sub section (1) of section 3 and such application shall be in writing under the hand of a repre sentation of such association addressed to the Inspector General of Police who shall be the authority to grant, refuse or revoke such recognition; Provided that before refusing or revoking recognition, the Association shall be given a reasonable opportunity of making representation against the proposed action." "9.
Suspension of recognition: The Inspector General of Police may in the interests of the general public or for the maintenance of discipline in the police force and with the prior approval of the Central Government, the State Government or as the ease may be the Administrator of the Union Territory suspend the recognition granted under rule 8 for a period not exceeding three months which may be extended for a further period of three months by the Central Government, State Government or as the case may be the Administrator of the Union Territory so however that the total period for which such recognition may be suspended shall, not, in any case, exceed six months." "11.
Special provision regarding recognition already granted: Recognition granted prior to the commencement of the Police Forces (Restriction of Rights) Amendment Rules, 1970, to any association the articles of association of which are not in conformity with these rules shall, unless the said artides of association are brought in conformity with the provisions of these rules within a period of thirty days, stand revoked on the expiry of the said peri od.
It is the change effected by the new Proviso to Rule 3(c) which has come in for attack at the hands of the appel lants.
Previously all non gazetted officers of the Delhi Police Department could be members of the Sangh.
Now, the amended proviso to rule 3(c) mandates that only members of the Police Force having the same rank could constitute themselves into one Association.
The effect of this amended rule is that the Sangh will have to be composed of various splinter associations consisting of members holding differ ent ranks.
This according to the appellants violates not only Article 19(1)(c) which protects freedom of association, but also the provisions of the Act.
354 The immediate provocation for filing the writ petition was the Circular by which the recognition granted to the Sangh was revoked.
The operative part of the Circular reads as follows: "Rule 11 of the Police Force (Restriction of Rights) Amendment Rules, 1970 published vide extraordinary Gazette of India notifica tion No. GSR 2049 dated 19 12 70 lays down that recognition granted prior to the com mencement of these rules, to any association the articles of which are not in conformity with these rules shall unless the articles are brought in conformity with the provisions of these rules within a period of 30 days, stand revoked on the expiry of the said period.
Whereas the Constitution of the Delhi Police NonGazetted Karmchari Sangh which was granted recognition vide Government of India, Ministry of Home Affairs letter No.8/70/66 P.I., dated 12 12 66 and which contains a number of provisions not in con formity with the above rules, the recognition already granted to the Delhi Police Non Gazet ted Karmachari Sangh, stands revoked.
This may be brought to the notice of a11 ranks.
A copy of this circular may be published in the Delhi Police Gazette.
" The appellants ' counsel Submits that recognition of the association carries with it the right to continue the asso ciation as such.
It is a right flowing from the fact of recognition.
To derecognise the association in effect of fends against the freedom of association.
It is urged that once the Government had granted recognition to the Sangh and approved its constitution neither the Parliament nor any delegated authority can take away that recognition or dic tate to the association who could be its members.
The right available to the members of the association at the commence ment should continue as such without any hindrance.
Before considering the questions of law raised by the appellants ' counsel with reference to the decided cases, it would be useful to bear in mind the fact that this associa tion consists of members of Police Force who by virtue of this fact alone stands on a different footing from other associations.
The Constitution of India has taken care to lay down limitations on such, associations from exercising rights under Article 19(1)(c).
Article 33 read with 355 Article 19(4) of the Constitution offers an effective reply to the contention raised by the appellants.
Article 33 reads as follows: "Parliament may, by law, determine to what extent any of the rights conferred by this Part shall, in their application to the mem bers of the Armed Forces or the Forces charged with the maintenance of public order, be restricted or abroagated so as to ensure the proper discharge of their duties and the maintenance of discipline among them.
" Article 19(4) reads as follows: "Nothing in sub clause (c) of the said clause shall affect the operation of any existing law in so far as it imposes, or prevent the State from making any law imposing, in the interests of the sovereignty and integrity of India or public order or morality, reasonable restric tions on the exercise of the right conferred by the said sub clause.
" That the Sangh and its members come within the ambit of Article 33 cannot be disputed.
The provisions of the Act and rules taking away or abridging the freedom of association have been made strictly in conformity with Article 33.
The right under Article 19(1)(c) is not absolute.
Article 19(4) specifically empowers the State to make any law to fetter, abridge or abrogate any of the rights under Article 19(1)(c) in the interest of public order and other considerations.
Thus the attack against the Act and rules can be successful ly met with reference to these two Articles as members of the Police Force, like the appellants herein, are at a less advantageous position, curtailment of whose fights under Article 19(1)(c) comes squarely within Article 33 in the interest of discipline and public order.
This conclusion of ours is sufficient to dispose of this appeal.
However, we will deal with the submissions made before us for the com pleteness of the Judgment.
The scope of Article 19(1)(c) came up for considera tion before this Court in Damyanti Naranga vs The Union of India & Ors., ; The question related to the Hindi Sahitya Sammelan, a Society registered under the .
The Parliament enacted the Hindi Sahitya Sammelan Act under which outsiders were per mitted to become members of the Sammelan without the voli tion of the original members.
This was challenged and this Court held that any law altering the composition of the Association compulsorily will be a breach of the right to form the association because it violated the composite right of forming an association and the right to continue it as the original members desired it.
356 10.
Here we have an entirely different situation since we are dealing with a group distinct in its nature and composition from others.
Here we are dealing with a force that is invested with powers to maintain public order.
Article 33 enables Parliament to restrict or abrogate the fundamental rights in their relation to the Armed Forces including Police Force.
In Ous Kutilingal Achudan Nair & Ors., vs Union India & Ors., ; this Court had to consider two questions; whether the employees of the defence establishment such as cooks, barbers and like civil employees were "members of the Armed Forces" and if so whether they could be validly deprived of their right to form unions in violation of Article 19(1)(c).
This Court held that they fell within the category of members of the Armed Forces and that the Central Government was competent by notification to make rules restricting or curtailing their right to form associations, Article 19(1)(c) not withstanding.
In Raghubar Dayal Jai Prakash vs The Union of India and Ors., ; this Court had to deal with this question in relation to the functions of an incorporated body the objects of which were, interalia, to regulate forward transactions in the sale and purchase of various commodities, Freedom of association is a fundamental right.
It was contended that if a law regulated the recognition of an association under certain conditions subject to which alone recognition could be accorded or continued, such conditions were bad.
This Court had to consider whether the freedom of association implied or involved a guaranteed right to recognition also.
The contention was that if the object of an association was lawful, no restriction could be placed upon it except in the interest of public order and that freedom to form an association carried with it the right to determine its internal arrangements also.
Repelling this contention this Court held that restrictions cannot be imposed by statute for the purpose of regulating control of such associations.
While the right to freedom of association is fundamental, recognition of such association is not a fundamental right and the Parliament can by law regulate the working of such associations by imposing conditions and restrictions on such functions.
It cannot be disputed that the fundamental rights guaranteed by Article 19(1)(c) can be claimed by Government servants.
A Government servant may not lose its right by joining Government service.
Article 33 which confers power on the Parliament to abridge or abrogate such rights in their application to the Armed Forces and other similar forces shows that such rights are available to all citizens, including Government servants.
But it is, however, necessary to remember that Article 19 confers fundamental rights which are not absolute but are subject to reasonable restrictions.
What has happened in this case is only to impose reasonable restrictions in the interest of discipline and public order.
357 13.
The validity of the impugned rule has to be judged keeping in mind the character of the employees we are deal ing with.
It is true that the rules impose a restriction on the right to form association.
It virtually compels a Gov ernment servant to withdraw his membership of the associa tion as soon as recognition accorded to the said association is withdrawn or if, after the association is formed, no recognition is accorded to it within six months.
In other words, the right to form an association is conditioned by the existence of the recognition of the said association by the Government.
If the association affairs recognition and continues to enjoy it, Government servants can become mem bers of the said association; if the said association does not secure recognition from the Government or recognition granted to it is withdrawn, Government servants must cease to be members of the said association.
That is the plain effect of the impugned rule.
These rules are protected by Articles 33 and 19(4) of the Constitution.
Besides, it is settled law that the right guaranteed by Article 19(1)(c) to form associations does not involve a guaranteed right to recognition also.
The main grievance of the appellants is that the first appellant Sangh when recognised, comprised of Police Officers of various ranks, the common factor being that all its members were non gazetted police officers.
This composi tion was changed by the impugned rules.
Not only is the composition changed; the entire Sangh stood derecognised for failure to alter its constitution complying with the new rules.
This attack cannot be sustained.
Section 3 of the Act permits the rule making authority to define any group of Police Force that can form an Association.
It also gives power to prescribe the nature of activity that each ' such association of members can indulge in.
It, therefore, fol lows that if rules can be framed defining this aspect, a rule can also be framed enabling the authorities to revoked or cancel recognition once accorded, if the activities offended the rules.
The further grievance of the appellant is that non gazetted officers who once formed one block have been fur ther divided with reference to ranks and that this again is an inroad into their right under Article 19(1)(c).
This submission has been already met.
Besides, this classifica tion based on ranking has its own rationale behind it.
We are dealing with a Force in which discipline is the most important pre requisite.
Non gazetted officers consist of men of all ranks; the lowest cadre and officers who are superior to them.
If all the nongazetted officers are grouped together irrespective of rank, it is bound to affect discipline.
It was perhaps, realising the need to preserve discipline that the changes in the rule were effected.
We are not satisfied that there has been violation of any law in doing so.
358 On a careful consideration of the questions involved in this appeal, we hold that the High Court was right in its decision.
We accordingly dismiss the appeal.
S.R. Appeal dismissed.
| The non gazetted members of the Delhi police Force wanted to form an association of their own and for that purpose constituted the Karmachari Union in 1966 and applied for its registration under the Trade Union Act, 1926 and this was refused.
After the coming into effect from 2.12.1966 of the Police Force (Restriction of Rights) Act, 33 of 1966 another, application for recognition was again made on 9.12.1966 which was granted on 12.12.1966.
The non gazetted members of the Delhi Police Force were permitted to become members of the Sangh.
The Police Force (Restriction of Rights) Rules, 1966 made by the Central Government on 12.12.1966 were amended by the Amendment Rules of 1970.
Rule 11 thereof provides for revocation of the recognition grant ed to an association, if the said associations articles are not in conformity with the Rules or are not brought in conformity with the provisions of the amended Rules within a period of 30 days.
Since the Articles of Association of the appellant Sangh contained a number of provisions not in conformity with the rules and since the Sangh failed to bring the same in conformity, by a circular dated 1.4.1971 the recognition granted was revoked.
The appellants, there fore, filed a writ petition before the Delhi High Court challenging the constitutional validity of the Act, Rules and the impugned circular.
The writ petition having been rejected the appellants have come by way of special leave.
Dismissing the appeal, the Court, 348 HELD: 1.1 The Police Force (Restriction of Rights) Act (33 of) 1966, the Police Force (Restriction of Rights) Rules 1966 (as amended by the 1970 Rules) and the circular dated 1.4.1971 are all constitutionally valid.
They do not offend the provisions of Articles 14 and 19(1)(c) of the Constitu tion.
[350 C, 355 E F] 1.2 The right under Article 19(1)(c) is not absolute.
Article 19(4) specifically empowers the State to make any law to fetter, abridge or abrogate any of the fights under Article 19(1)(c) in the interest of public order and other considerations.
While the right to freedom of association is fundamental, recognition of such association is not a funda mental fights and the Parliament can by law regulate the working of such associations by imposing conditions and restrictions on such functions.
[355 E, 356 F] 1.3 The fundamental fights guaranteed by Article 19(1)(c) can be claimed by Government servants.
A government servant may not lose his right by joining government serv ice.
Article 33 which confers power on the Parliament to abridge or abrogate such rights in their application to the Armed Forces and other similar forces shows that such fights are available to all citizens, including government serv ants.
What has happened in this case is only to impose reasonable restrictions in the interest of discipline and public order.
[356 G H] 1.4 Rule 11 read with Rule 3(c) of the Amended Police Force (Restriction of Rights) Rules, 1966 has to be judged keeping in mind the character of the employees to whom it applies.
It is true that the rules impose a restriction on the right to form association.
It virtually compels a gov ernment servant to withdraw his membership of the associa tion as soon as recognition accorded to the said association is withdrawn or if, after the association is formed, no recognition is accorded to it within six months.
In other words, the right to form an association is conditioned by the existence of the recognition of the said association by the government.
If the association obtains recognition and continues to enjoy it, government servants can become mem bers of the said association, if the said association does not secure recognition from the government or recognition granted to it is withdrawn, government servants must cease to be members of the said association.
That is the plain effect of the impugned role.
These rules are protected by Articles 33 and 19(4) of the Constitution.
Besides, it is settled law that the right guaranteed by Article 19(1)(c) to form associations does not involve a guaranteed right to recognition also.
[357 A C] 1.5 Section 3 of the Police Force (Restriction of Rights) Act permits the rule making authority to define any group of Police Force that can form an Association.
It also gives power to prescribe the nature of activity that each such association of members can indulge in.
It, therefore, follows that if rules can be 349 framed defining this aspect, a rule can also be framed enabling the authorities to revoke or cancel recognition once accorded, if the activities offended the rules.
Besides the classification based on ranking has its own rationale behind it.
The Court is dealing with a Force in which disci pline is the most important prerequisite.
Non gazetted officers consist of men of all ranks; the lowest cadre and officers who are superior to them.
If all the non gazetted officers are grouped together irrespective of rank, it is bound to affect discipline.
It was perhaps, realising the need to preserve discipline that the changes in the rule were effected.
[357E, G ] Damyanti Naranga vs The Union of India & Ors., ; ; Ous Kutilingal Achudan Nair & Ors., vs Union of India & Ors., ; ; and Raghubar Dayal Jai Prakash vs The Union of India & Ors., ; fol lowed.
|
l Appeals Nos. 1302 to 1906 of 1968.
752 Appeals by special leave from the judgment and orders dated September 26, 27 and 29, 1967 of the Mysore High Court in Writ Petitions Nos.
907, 1004, 1005, 1175 and 1245 of 1967.
Jagadish Swarup, Solicitor General, C. R. Somasekharan 'and R. B. Datar for the appellants (in all the appeals).
M. Veerappa and G. Narayana Rao, for respondent No. 1 (in all the appeals).
section section Javali and section P. Nayar, for respondent No. 2 (in all the appeals).
The Judgment of the Court was delivered by Vaidialingam, J.
These five appeals, by special leave, by the City Municipal Council, Mangalore and the Commissioner of the City Municipal Council, are directed against the orders passed by the Mysore High Court in Writ Petitions Nos.
907, 1004, 1005, 1175 and 1245 of 1967, quashing the demand notices issued by the appellants against the first respondent in each of these appeals for payment of property tax for the half year ending September 30, 1966.
As the grounds of attack levelled against the demand notices by the said respondents are common, we will only refer to the averments contained in Writ Petition No. 907 of 1967 out of which Civil Appeal No. 1302 of 1968 arises.
buildings situated in Ward 11 and Ward XX, within Mangalore Municipality in the South Canara District, which originally formed part of the Madras State and which, on reorganisation of the States, became part of the State of Mysore.
The Mysore Municipalities Act, 1964 (Act XXII of 1964) (hereinafter referred to as the Mysore Act) came into force from April 1, 1965 as per the notification, dated September 23, 1965 issued by the State Government.
Certain sections had already come into force.
Till the Mysore Act came into force, the Mangalore Municipality was governed by the Madras District Municipalities Act, 1920 (Act V of 1920) (hereinafter called the Madras Act).
The Madras Act had provided for levy of property tax the procedure to be adopted for the same and as to how the annual value of a building was to be arrived at as well as the percentage at which the property tax was to be levied.
Similarly the Mysore Act had also provided for levy of property tax, prescribing the ascertainment of annual ratable value and also the rate at which the tax was to be levied.
Although the Mysore Act came into force from April 1, 1965 the appellants issued demand notices for property tax under the said Act for the assessment year 1965 66.
In those demand notices, the Municipal Council determined the ratable annual 753 value under section 101 (2) of the Mysore Act and assessed the tax on the basis of that annual ratable value, but at rates under the Madras Act.
The tax was paid as per the demand notices.
But on March 16, 1967 the appellant issued the impugned notices of demand under the Madras Act for payment of property tax for the year 1966 67.
The tax demanded on the basis of the Madras Act was considerably higher than that originally demanded and paid under the Mysore Act for the assessment year 1965 66.
Notwithstanding the protest made by the first respondent, the appellants threatened to collect the tax as per the demand notices and hence the first respondent filed Writ Petition No. 1907 of 1967 challenging the demand notices.
The main grounds of attack against the.
demand notices, as raised in the said Writ Petition were that after the passing of the Mysore Act the appellants had no power to levy property tax under the Madras Act and therefore the demands were illegal.
The demand notices were further attacked on the ground that section 382 of the Mysore Act, which related to the repeal of many Acts including the Madras Act and the saving provisions contained therein did not justify the issue of the demand notices.
The first respondent accordingly prayed for quashing the demand notices issued under the Madras Act.
He had also raised certain contentions regarding the levy of health cess included in the notices; but it is unnecessary to refer to those averments as the High Court has held against the first respondent and that question does not arise in these appeals.
The appellants pleaded that under the Mysore Act property tax, among other things, has been imposed after following the procedure prescribed in sections 95 to 97 therein and the imposition of tax has come into force from April 1, 1967, but for the period in question viz., the year 1966 67 the demands were legal and valid in view of the provisions contained in section 382 of the Mysore Act.
Notwithstanding the repeal of the Madras Act, the provisions contained in section 382 of the Mysore Act clearly saved the right of the appellants to levy property tax under the Madras Act to adopt both the annual value as well as the rate of tax as per the assess ment registers maintained under the said Act.
In particular, the appellants relied upon the second proviso in section 382(1) of the Mysore Act and the third proviso inserted in the said section with retrospective effect, by the Mysore Municipalities (Amendment) Act ', 1966 (Mysore Act XXXIV of 1966).
According to the appellants, as necessarily the imposition of property tax under the Mysore Act, after following the procedure contained therein will take time, the Legislature had made consequential provisions in section 382 with a view to enable the imposition of property tax under the repealed enactments during the interim period.
The High Court has, by and large, accepted the contentions of the first respondent.
According to the High Court, although 754 the higher rate of tax under the Madras Act is preserved by proviso 3 to section 382(1) of the Mysore Act, the provision for the determination of the annual value under section 82(2) of the Madras Act is not saved.
The High Court is further of the view that the second proviso to section 382(1) of the Mysore Act only continues the old impost and the third proviso preserves the old rates and that they do not continue the old annual value.
The net result of the decision of the High Court is that the Municipal Council has to determine the annual ratable value of the building as provided by section 10 1 (2) of the Mysore Act and to assess the property tax at the rate at which it is assessed under the Madras Act.
Finally the High Court quashed the demand notices issued by the appellants.
The learned Solicitor General, appearing for the appellants, urged that the High Court was in error in interpreting the second and third provisos to section 382(1) of the Mysore Act.
it was urged that as the levy of property tax after adopting the procedure indicated in the Mysore Act will take time, the Legislature had, by incorporating the necessary provisions in section 382, particularly the second and third provisos to sub section
(1), preserved the right of the, Municipal Council concerned to adopt not only the annual value but also the rate of property tax payable according to the assessment registers maintained under the Madras Act, till they are superseded by anything done under ' the Mysore Act.
The learned Solicitor General, further urged that the view of the High Court that the annual ratable value has to be determined under the Mysore Act and the computation of the rate 'of tax has to be under the Madras Act, was anomalous and was not warranted by the provisions of the Mysore Act.
On the other hand, Mr. Veerappa, learned counsel appearing for the first respondent in all the appeals, has supported the view taken by the High Court and urged that a proper interpretation had been placed on section 382 of the Mysore Act.
According to the learned counsel, normally, after the coming into force of the Mysore, Act, no assessments could be made under ' the Madras Act, but section 382 of the Mysore Act, repealing the Madras Act, had made certain special provisions the existence of which alone would attract certain actions taken under the Madras Act.
In order to appreciate the contentions, noted above, it is necessary to refer broadly to the scheme of the two Acts relating to the levy of property tax.
We shall first advert to the, Madras Act.
Under section 78(1) power given to the Municipal Council to levy, among other taxes, a property tax.
Under sub section
(3), a resolution of a municipal council determining to levy a tax has to 755 specify the rate at which such tax is to be levied and the date from which it shall be lived.
Section 81(1) provides that it a Council by resolution determines that a property tax shall be levied, such tax shall be levied on all buildings and lands within the municipal limits save those exempted by the statute or by any other law.
Sub section (2) states that the tax shall be levied at such percentages of the annual value or the buildings or lands as may be fixed by the Municipal Council, Subject to section 78.
under this section, we are informed that 25 % has been fixed as the maximum rate.
Sub section
(2) of section 82 provides that the annual value of the lands and buildings shall be deemed to be the gross annual rent at which they may reasonably be, expected to be let from month to month or from year to year less a deduction in the case or buildings, or ten per cent of that portion of such annual rent which is attributable to buildings alone.
it further provides that the sale deduction shall be in lieu or all allowance for repairs or on any other account.
Section 86 provides that the property tax shall be levied every halt year and shall, excepting as otherwise provided in schedule IV, be paid lay the owner within thirty days of the commencement of the half year.
Section 124 provides that the rules and tables embodied in Schedule IV shall be read as part of Chapter VI, dealing with Taxation and Finance.
Schedule IV deals with Taxation and Finance Rules.
Rule 2 provides for the preparation and maintenance of assessment books showing the persons and property liable to taxation under the Act and the assessment books being made available for inspection by the tax payers.
Rule 6 provides for the value of any land or building for purposes of property tax being determined by the executive authority.
Under rule 7, the executive authority has to enter in the assessment books the annual or capital value of all lands and building and the tax payable thereon.
Rule 8(1) states that the assessment books shall be completely revised by the executive authority once in every five years.
Sub rule (2) thereof provides for amending the assessment books at any time between one general revision and another in the manner indicated therein.
A. perusal of the provisions referred to above, shows that under the Madras Act the property tax is levied on the annual value of buildings which is deemed to be the gross annual rental value less a deduction of ten per cent of that portion of annual rent is attributable to the buildings alone.
The Municipal Council has to pass a resolution determining to levy the property tax and that resolution should also specify the rate at which such tax is to be levied as also the date from which it shall be levied and the tax is levied every half year.
The executive authority has to maintain the assessment books containing entries regarding the annual value as well as the tax payable thereon.
The executive authority is under an obligation to completely revise the assessment once in very five years.
L5SupCI 3 756 There is no controversy that the Madras Act was applicable to the City of Mangalore, even after it formed part of the Mysore State on me reorganization of the States.
The Madras Act, as we have mentioned earlier, was repealed by the Mysore Act, which came into force with effect from April 1, 1965.
Coming to the Mysore Act, Chapter VI deals with Municipal Taxation.
section 94 enables a municipal council to levy a tax on buildings or lands or both situated within the municipality, after complying with tile procedure indicated therein and subject to any general or special orders of Government and at rates not exceeding those specified in Schedules I to VII.
The maximum rate has been fixed at 24 % of the annual ratable value.
Section 2(1) defines annual retable value ' as the gross annual rent for which any building or land exclusive of furniture or machinery might reasonable be expected to be let from month to month or year to year.
Section 95 deals with the procedure to be adopted preliminary to imposing a tax.
Section 10 1 (2) provides that the annual ratable value of a building shall be the gross annual rent as defined in cl. (1) of section 2, less a deduction of sixteen and two thirds per cent of such annual rent.
It further states that the said deduction shall be in lieu of all allowances for repairs or on any other account whatsoever.
Section 103 deals with the preparation of an assessment list.
Section 382(1) repeals the various enactments referred to therein, including the Madras Act.
The first proviso, which saves certain matters, does not come into the picture in this case.
The second proviso as well as the third proviso, introduced by the Mysore Municipalities (Amendment) Act, 1966 are relevant for our purpose and they ire as follows "(2) Provided further that subject to the preceding proviso anything done or any action taken (including any appointment or delegation made, tax, fee or cess imposed, notification, order, instrument, or direction issued, rule, regulation, form, bye law or scheme framed, certificate obtained, permit or licence granted or registration effected) under the said laws shall be deemed to have been done or taken under the corresponding provisions of this Act and shall continue to be in force accordingly unless and until superseded by anything done or any action taken under this Act : (3) Provided further that notwithstanding anything contained in the preceding proviso where any tax, duty, fee or cess other than a duty on transfers of immovable properties has been imposed under the said laws at a rate higher than the maximum rate permissible under this Act.
such tax,.
fee or cess may continue to be 757 imposed and collected at such higher rate unless and Until superseded by anything done or any action taken under this Act.
" The third proviso has been introduced with retrospective effect by the Amending Act.
It is not really necessary for us to consider more elaborately the scheme of the Mysore Act because.
even according to the appellants, the procedure indicated therein whatever may be the procedure, about which we express no opinion has not been taken before the issue of the demand notices which were under challenge before the High Court.
On the other hand, the appellants have exclusively relied on the second and third provisos to section 382 (1) of the Act.
The learned Solicitor General has urged that the assesment books under the Madras Act were prepared on April 1, 1964 and, if so, under the second and third provisos to section 382(1) the property tax can be levied and collected as per the provisions of the Madras Act.
In particular, the learned Solicitor General placed reliance upon the provisions of the Madras Act relating to the maintenance of assessment books and the assessment books having to be revised only once in every five years and pointed out that in this case the assessment books having been prepared on April 1, 1964 they will have currency for a period of five years till March 31, 1969.
The second proviso to section 382(1) no doubt saves any tax which had been imposed under the Madras Act.
Similarly, under the third proviso, the Municipal Council will have authority to collect tax even at a rate higher than the maximum rate permissible under the Mysore Act; but the essential requisite for attracting the two provisos is that the tax should have been imposed under the Madras Act, as per the second proviso and tax at a higher rate should have been imposed again under the Madras Act as per the third proviso.
We are not inclined to accept the contention of the learned Solicitor General that by merely preparing the assessment registers under the Madras Act on April 1, 1964 it can be stated that a tax has been imposed under the second proviso or a tax at a higher rate has been imposed under.the third proviso.
We have already referred to the material provisions of the Madras Act relating to the ' levy of property tax.
Those provisions show that the municipal tax is an annual tax leviable for a particular official year and the assessment list on the basis of which the tax is assessed is for such official year.
This was the view expressed by this Court in Municipal Corporation vs Hiralal(1), while interpreting certain provisions of the Madhya Bharat Municipalities Act, 1954.
No doubt the wording in the Madhya Bharat Act in section 76, dealing with assessment list was slightly different but in our opinion the (1) ; 758 principle enunciated in that decision regarding the municipal tax being an annual tax leviable for a particular official year and the assessment list, on the basis or which the tax is assessed having currency for each such official year, is applicable also to the interpretation of the Madras Act.
No resolution passed by the Municipal Council regarding the levy of the property tax and the rate at which it is to be levied, having currency for the year 1966 67, has been brought to our notice.
The learned Solicitor General has drawn our attention to the minutes, dated September 15, 1966 as well as the Council 's resolution No. 1280 dated December 20, 1966 relating to the levy of property tax in the City of Mangalore for the period in question, under the Mysore Act.
Those proceedings will not assist the appellant as the necessary procedure, under the Mysore Act, has not been followed and therefore that resolution cannot have any legal validity, so as to justify the imposition of tax.
Normally, the municipal council will have to prepare a fresh assessment list, every year.
By virtue of section 124 of the Madras Act, the rules and tables embodied in Schedule IV have to be read as part of Chapter VI dealing with Taxation and Finance.
Though, ordinarily, the Municipality would have to prepare a fresh assessment list every year, rule 8 of Schedule IV permits the Municipal Council to continue the same assessment list for the next four succeeding years and to revise it once every five years.
But, in order to enable the Municipal Council to levy and collect a tax, it has to pass a resolution determining to levy a tax, the rate at which such tax has to be levied as also the date from which it shall be levied.
That the tax is an annual tax is also borne out by sub section
(2) of section 82.
If the contention of the learned Solicitor that the assessment list, once prepared, has to be adopted for five years, is accepted, it will result in the annual value on a particular building or house being static for five years, during which a municipal council can go on adopting the assessment list prepared in an earlier year and the owner or occupier of the building being deprived of the.
right to object to the valuation regarding the annual value or the tax assessed thereon.
This will be the result even though the annual value may have decreased for one reason or the other.
It follows that the contention that the preparation of the assessment books amounts to imposing of a tax so as to justify the issue of the demand notice, cannot be accepted.
Having due regard to the second and third provisos to section 382(1) and the other material provisions of the Mysore Act, the position is that a property tax must have been imposed by the Madras Act and even though the rates of such tax were higher than under the Mysore Act, the said higher tax could be collected.
But no such tax having been imposed under the Madras Act, the 759 second and third provisos to section 382(1) do not apply and hence the demands for payment of property tax for the period are not justified.
Though we are not in agreement with some of the reasons given by the High Court for issuing the writ, the conclusion arrived at by the High Court that the second and third provisos to section 382(1) of the Mysore Act do not justify the issue of the demand notices for the period in question, is correct.
The result is that the appeals fail and are dismissed with costs.
There will be only one hearing fee.
| A highway has its origin, apart from statute, in dedication either express or implied, by the owner of land of a right of passage over it to the public and the acceptance thereof by the public.
Dedication is presumed by long and uninterrupted user of a way by the public.
The presumption in such cases is so strong as to dispense with all enquiry into the actual ownership of the land or the intention of the owner about its user.
All public streets and roads vest in the State, but the State holds them as trustees on behalf of the public.
The members of the public are entitled as beneficiaries to use them as a matter of right and this right is limited only by the similar rights possessed by every other citizen to use the pathways.
The State as trustees on behalf of the public is entitled to impose all such limitations on the character and extent of the user as may be requisite for protecting the rights of the public generally; but subject to such limitations the the right of a citizen to carry on business in transport vehicles on public pathways cannot be denied to him on the ground that the State owns the highways.
G. section section Motor Service vs State of Madras ([19521 referred to with approval.
Within the limits imposed by State regulations any member of the public can ply motor vehicles on a public road.
To that extent he can also carry on the business of transporting passengers with the aid of vehicles.
It is to this carrying on of the trade or business that the guarantee in article 19(1) (g) is attracted and a citizen can legitimately complain if any legislation takes away or curtails that right any more than is permissible under clause (6) of that article.
Article 19(6) as the result of the Constitution (First Amendment) Act, 1951, enables the State to carry on any trade or business either by itself or through corporations owned or controlled by the State to the exclusion of private citizens wholly or in part.
This provision of article 19(6), which was introduced by the amendment of the Constitution in 1951, was not in existence when the U. P. Road Transport Act, 1951 (U. P. Act II of 1951), was passed and therefore the validity of the impugned Act is not to be decided by applying the provisions of the now clause.
Amendment of the Constitution which came later cannot be invoked to validate an earlier legislation which must be regarded as unconstitutional when it was passed, because a statute void for unconstitutionality is dead and cannot be vitalised by a subsequent amendment of the Constitution removing the Constitutional objection but must be reenacted.
Although the normal use of the word "restriction" seems to be in the sense of limitation and not extinction but (without expressing any final opinion on the matter) if the word " I restriction" does not include total prohibition then the impugned Act cannot be justified under article 19(6) of the Constitution and it would 709 be void unless supported by article 31.
If however the word Is restriction" in article 19(6) be taken in certain circumstances to include prohibition as well then the prohibition of the right of all private citizens to carry on the business of motor transport on public roads within the State of Uttar Pradesh as laid down by the impugned Act, cannot be justified as reasonable restrictions imposed in the interests of the general public.
Whether the restrictions are reasonable or not would depend to a large extent on the nature of the trade and the conditions prevalent in it.
There is nothing wrong in the nature of the motor transport trade in the present case which is perfectly innocuous.
The U. P. Road Transport Act, (II of 1951) which violates the fundamental rights of the private citizens guaranteed under article 19(1) (g) of the Constitution and is not protected by clause (6) of article 19 as it stood at the time of enactment must be held to be void under article 13(2) of the Constitution.
The effect of the prohibition of the trade or business of the citizens by the impugned legislation amounts to deprivation of their property or interest in a commercial undertaking within the meaning of article 31(2) of the Constitution and therefore U. P. Road Transport Act, 1951, offends against the provision of that clause inasmuch as no provision for compensation has been made in the Act.
The impugned Act is not void on the ground that it offends against the equal protection rule embodied in article 14 of the Constitution.
The contention whether the impugned Act conflicts with the guarantee of freedom of inter State and intra state trade, commerce and intercourse provided for by article 301 of the Constitution discussed and the points that could be raised and the possible views that could be taken indicated without expressing any final opinion thereupon.
Cooverjee vs The Excise Commissioner, etc.
([1954] S.C.R. 873) distinguished.
West Bengal vs Subodh Go pal Bose and Others ([1954] S.C.R. 587) and Dwarkadas Shrinivas vs The Sholapur Spinning and Weaving Co. Ltd. ([1954] S.C.R. 674) followed.
Packard vs Banton (68 L.E. 596; ; , Frost vs Railroad Commission (70 L.E. 1101), Stephenson vs Binford (77 L.E. 288), Motilal vs Uttar Pradesh Government (I.L.R. 1951 All. 257), Municipal Corporation of the City of Toronto vs Virgo ([1896] A.C. 88), A. K. Gopalan vs The State ([1950] S.C.R. 88), Lokanath Misra vs The State of Orissa (A.I.R. 1952 Orissa 42), Commonwealth of Australia and Others vs Bank of New South Wales and Others ([1950] A.C. 235) and P. and 0.
Steam Navigation Co. vs The Secretary of State (1861 5 B.H.C.R.
Appendix 1) referred to.
91 710
|
Civil Appeal Nos.
10160 10162 of 1983.
From the Judgment and Order dated 20.10.1983 of the Punjab and Haryana High Court in Writ Petition No. 2495 of 1983.
P.P. Rao, A. Mariarputham, K.S. Kendriya and R. Venkatarumani for the Appellants in C.A. No. 10160 of 1983.
G.L. Sanghi, S.K. Mehta, P.N. Puri, M.K. Dua and A.K. Vachar for the Appellants in C.A. No. 10161 of 1983.
A.K. Ganguli for the Appellants in C.A. No. 10162 of 1983.
M.K. Ramamurthi, Mahabir Singh, section Srinivasan and Vijay Hansaria for the Respondents Nos. 6 & 7 in C.A. No. 10160 of 1983.
R.K. Garg, Mahabir Singh, section Srinivasan and Vijay Hansaria for the Respondents Nos. 1, 2 and 16 in C.A. No. 10161 and Respondents Nos. 8 & 9 in C.A. No. 10162 of 1983.
The Judgment of the Court was delivered by BHAGWATI, J.
These appeals by special leave are directed against a judgment of the Division Bench of the Punjab & Haryana High Court quashing and setting aside certain selections made by the Haryana Public Service Commission to the Haryana Civil Service (Executive) and other allied services.
The judgment in part proceeds on surmises and conjectures and has made certain uncharitable observations against the Chairman and Members of the Haryana Public Service Commission without any warrant and hence it is necessary to set out the facts giving rise to the appeals in some detail.
Sometime in October 1980 the Haryana Public Service Commission invited applications for recruitment to 61 posts in Haryana Civil Service (Executive) and other allied Services.
The procedure for recruitment was governed by the Punjab Civil Service (Executive Branch) Rules, 1930 as applicable in the State of Haryana.
Rule 9 clause (1) of these Rules provided that a competitive examination shall be held at any place in Haryana in each year in or about the month of January for the purpose of selection by competition of as many candidates for the Haryana Civil Service (Executive), and others allied services as the Governor of Haryana may determine and 666 such competitive examination shall be held in accordance with the Regulations contained in Appendix I to the Rules.
Rule 10 laid down the conditions for eligibility to appear at the competitive examination but we are not concerned with these conditions of eligibility in the present appeals.
Regulation I in Appendix I provided that the competitive examination shall include compulsory and optional subjects and every candidate shall take all the compulsory subjects and not more than three of the optional subjects, provided that ex serviceman shall not be required to appear in the optional subjects.
The compulsory subjects included English Essay, Hindi Essay and General knowledge carrying in the aggregate 400 marks and there was also viva voce examination which was compulsory and which carried 200 marks and each optional subject carried 100 marks.
Vide Regulation 5.
The result was that the written examination carried an aggregate of 700 marks for candidates in general and for ex servicemen, it carried an aggregate of 400 marks while in case of both, the viva voce examination carried 200 marks.
Some argument has turned on the true interpretation of Regulation 3 and hence it would be desirable to set it out in extenso.
It read as follows: "3.
No candidate shall be eligible to appear in the viva voce test unless he obtains 45 per cent marks in the aggregate of all subjects including at least 33 per cent marks in each of the language papers in Hindi (in Devnagri Script) and Hindi Essay provided that if at any examination a sufficient number of candidates do not obtain 45 per cent marks in the aggregate the Commission may at their discretion lower this percentage to not below 40 per cent for the language papers remaining unchanged.
" It appears that in response to the advertisement issued by the Haryana Public Service Commission, about 6000 candidates applied for recruitment and appeared at the written examination held by the Haryana Public Service Commission.
Out of about 6000 candidates who appeared for the written examination, over 1300 obtained more than 45 per cent marks and thus qualified for being called for interview for the viva voce examination.
The Haryana Public Service Commission invited all the 1300 and more candidates who qualified for the viva voce test, for interview and the interviews lasted for almost half a year.
It seems that though originally applications were invited for recruitment to 61 posts, the number of vacancies rose 667 during the time taken up in the written examination and the viva voce test and test and ultimately 119 posts became available for being filled and on the basis of total marks obtained in the written examination as well as viva voce test, 119 candidates were selected and recommended by the Haryana Public Service Commission to the State Government.
It seems that there were some candidates who had obtained very high marks at the written examination but owing to rather poor marks obtained by them in the viva voce test, they could not come within the first 119 candidates and they were consequently not selected.
They were aggrieved by the selections made by the Haryana Public Service Commission and three out of them accordingly filed Civil writ No. 2495 of 1983 in the High Court of Punjab and Haryana challenging the validity of the selections and seeking writ for quashing and setting aside the same.
They also claimed that the marks given in the viva voce test should be ignored and selections should be made only on the basis of the marks obtained by the candidates at the written examination and they contended that if that was done, they would be within first 119 to be selected by the Haryana Public Service Commission.
Some other candidates who did not figure in the list of 119 selected candidates also filed Civil Writ Petition Nos.
2317, 3344, 3345, 3434, 3457, 3435 and 3719 of 1983 in the High Court of Punjab and Haryana challenging the validity of the selections on substantially the same grounds and claiming substantially the same reliefs as the petitioners in Civil Writ Petition 2495 of 1983.
The State of Haryana was joined as 1st respondent, the Haryana Public Service Commission as 2nd respondent and three out of the five members of the Haryana Public Service Commission, as respondents Nos. 3 to 5 in these writ petitions.
The Chairman and one other member of Haryana Public Service Commission, namely, Shri B.S. Lather and Shri Gurmesh Prakash Bishnoi were however not impleaded as respondents in the writ petitions.
None of the 119 selected candidates were also joined as respondents in the writ petitions.
Five our of the 119 selected candidates thereupon applied for being joined as respondents to these writ petitions and on their application, they were added as respondent Nos.
6 to 10 in the writ petitions.
This was broadly the array of parties in the writ petitions.
Since all the writ petitions raised substantially the same issues and the pleadings in the writ petitions also followed substantially the same pattern, one writ petition, namely, Civil Writ Petition 2495 of 1983 was treated as the main writ petition and the principal arguments were advanced in that writ petition, It would therefore be 668 convenient to refer only to Civil Writ Petition 2495 of 1983 and trace the course followed by it in the High Court because whatever we say in regard to this writ petition would apply equally to the other writ petitions.
So far as Civil Writ Petition No. 2495 of 1983 is concerned, the State of Haryana filed its counter affidavit in reply to the writ petition and so also did the Haryana Public Service Commission.
The five selected candidates who were impleaded as respondents Nos. 6 to 10 also filed their counter affidavit joining issue with the petitioners.
We do not propose to set out here at this stage the averments made in the writ petition or the answer to those averments made on behalf of the respondents, because we shall have to refer to them in some detail when we deal with the arguments advanced on behalf of the parties.
Suffice it to state that the avernments made in the writ petition and the answer sought to be given on behalf of the respondents raised issues of considerable importance affecting not only the Haryana Public Service Commission but also all other State Public Service Commissions and calling for formulation of principle and norms which should guide all State Public Service Commissions in the discharge of their functions.
We may briefly set out the grounds on which the petitioners challenged the validity of the selections made by the Haryana Public Service Commission.
There were several grounds on which the validity of the selections made by the Haryana Public Service Commission was assailed on behalf of the petitioners and a declaration was sought that they were entitled to be selected as falling within the first 119 candidates.
The first ground was that the Chairman and members of the Haryana Public Service Commission were not men of high integrity, calibre and qualification and they were appointed solely as a matter of political patronage and hence the selections made by them were invalid.
Secondly, it was urged on behalf of the petitioners that two of the selected candidates, namely, Mrs. Shakuntala Rani and Balbir Singh were related to one of the members of the Haryana Public Service Commission namely, Sh.
R.C. Marya, while the third selected candidate namely Trilok Nath Sharma was related to another member namely, Sh.
Raghubar Dayal Gaur and though these two members did not participate in the interview of their respective relatives they did participate in the interview of other candidates and the tactics adopted by the Chairman and the members of the Commission was to give high marks to the relatives and award low marks to the other candidates so as to ensure the selection of their relatives.
This, according to 669 petitioners, vitiated the entire selection process.
Thirdly, contended the petitioners, it was contrary to the well settled practice followed by the Union Public Service Commission and other selecting authorities to call for interview as many as 1300 candidates even though the number of vacancies required to be filled in was only 119.
The number of candidates called for interview was almost 20 times the number of vacancies and this not only imposed an intolerable burden on the Haryana Public Service Commission but also widened the scope for arbitrariness in selection by making it possible for the Haryana Public Service Commission to boost up or deflate the total marks which might be obtained by a candidate.
The argument of the petitioners was that the number of candidates to be called for interview should not exceed twice or at the highest, thrice the number of vacancies because otherwise the objective test of written examination would be considerably diluted by the subjective assessment made in the vive voce test and there would be considerable scope for arbitrariness in the process of selection.
This infirmity, submitted the petitioners, had the effect of invaliding the selections made by the Haryana Public Service Commission.
The fourth contention urged on behalf of the petitioners was that the allocation of 200 marks for the viva voce test out of a total of 900 marks for the generality of students and a total of 600 marks for ex servicemen, was arbitrary and excessive and it had the effect of distorting the entire process of selection by introducting in a preponderant measure subjective element which could facilitate arbitrariness and manipulation and it was accordingly unconstitutional as involving denial of equal opportunity in public employment.
Lastly, it was contended on behalf of the petitioners that the viva voce test was not conducted fairly and honestly and the selections made were vitiated on account of nepotism, favouritism and casteism and also political motivation.
These were broadly the grounds of attack levelled against the validity of the selections made by the Haryana Public Service Commission.
These ground of challenge were sought to be repelled on behalf of the respondents and it was contended that not only was it not competent to the court on the existing set of pleadings to examine whether the Chairman and members of the Haryana Public Service Commission were men of high integrity, calibre and qualification but also there was no material at all on the basis of which the Court could possibly come to the conclusion that they were men lacking in integrity, calibre or qualification.
It was also urged on behalf of the respondents that the Haryana Public Service Commission being 670 a constitutional authority it was not necessary for Sh.
R.C. Marya and Sh.
Raghubar Dayal Gaur to withdraw altogether from the interviews and they acted correctly in abstaining from participation when their relatives came to be interviewed.
This was according to the respondents, in conformity with the principles of fair play and did not affect the validity of the selections.
The respondents also contended that under Regulation 3 in Appendix I every candidate who obtained 45 per cent and more marks in the written examination was eligible to be called for interview and the Haryana Public Service Commission was therefore justified in calling for interview all the 1300 and odd candidates, who qualified by getting more than 45 per cent marks and in fact it would have been a denial of equal opportunity in public employment if some of them had not been called despited having qualified for the viva voce test.
So far as the allocation of 200 marks for the viva voce test is concerned, it was contended that this allocation of 200 marks for the viva voce test was made under the Punjab Civil Service (Executive Branch) Rules 1930 which had been in force since over 50 years and no one had raised any objection to it during this long period of half a century and it had stood the test of time and could not possibly be regarded as arbitrary or excessive.
The allegation that the selections were not made fairly and honestly and they were tainted by nepotism, favouritism casteism or political patronage was vehemently denied on behalf of the respondents and it was contended that there was nothing to show that any extraneous considerations had influenced the selection process.
The respondents accordingly submitted that the challenge to the validity of the selections was unfounded and the writ petitions were liable to be dismissed.
The writ petitions came to be heard by a Division Bench of the High Court of Punjab and Haryana.
The Division Bench after hearing the parties at great length delivered a judgment on 20th October 1983 allowing the writ petitions.
The Division Bench held that the Chairman and members of the Haryana Public Service Commission had been appointed purely on the basis of political partisanship and caste considerations and that they did not satisfy the stringent test of being men of high integrity, calibre and qualification.
The Division Bench actually went to the length of alleging corruption against the Chairman and members of the Haryana Public Service Commission and observed that they were not competent "to validly wield the golden scale of viva voce test for entrants into the prestigious public service.
" This ground alone, accordingly to the Division Bench, was sufficient to invalidate the selections made by 671 the Haryana Public Service Commission.
The Division Bench then proceeded to hold that it was not enough for Sh.
R.C. Marya and Sh.
Raghubar Dayal Gaur to abstain from participating in the interview when their relatives came up for the viva voce test and their presence and participation at the time of interview of the other candidates was sufficient to taint the selection process with a serious infirmity.
The Division Bench almost seemed to suggest, without there being the slightest warrant for it, that "it was a familiar and deliberate tactic adopted by the members of the Commission to abstain from participating in the interview of their close relatives which in effect made patent to the remaining members about their deep interest in them and further that each member of the Commission adjusted the relatives" of the other and awarded low marks in interview to other candidates who had secured high marks in the written examination in order to oust the latter and bolster up the former in the merit list.
The Division Bench also condemned out of hand the practice adopted by the Haryana Public Service Commission of calling for interview all the candidates who obtained more than 45% marks in the written examination and who thus proved themselves eligible for the viva voce test.
The view taken by the Division Bench was that the number of candidates to be called for interview should not exceed twice or at the highest, thrice the number of vacancies required to be filled up.
The Division Bench also observed that the allocation of 200 marks for the viva voce test was arbitrary and excessive, as it introduced a large amount of subjective discretion in the process of selection which subordinated the objective test of written examination and this, according to the Division Bench, constituted denial of equal opportunity in public employment.
The Division Bench also came to the conclusion that candidates who had obtained high marks in the written examination had been depressed by award of low marks in the viva voce test and candidates who had obtained low marks were pulled up by award of high marks in the viva voce test and the entire selection process was vitiated by an "obvious oblique motive" and tainted by nepotism, favouritism, caste considerations and political pressures.
The Division Bench on this view set aside the selections made by the Haryana Public Service Commission and directed the Haryana Public Service Commission and the State of Haryana" to forthwith declare the result of candidates of all categories on the basis of written examination alone, scrupulously excluding all considerations of the viva voce test.
Respondents No. 6 to 10 thereupon preferred Civil Appeal No. 10160 of 1983 with special leave obtained from this Court and similarly with special leave, Civil Appeal No. 10161 of 1983 was preferred by 672 the State of Haryana and the Haryana Public Service Commission against the judgment of the Division Bench.
Since disparaging observations were made against the Chairman and members of the Haryana Public Service Commission by the Division Bench in its judgment, three members of the Haryana Public Service Commission who were impleaded as respondents No. 3, 4 and 5 in the writ petitions also applied for special leave to appeal and on such leave being obtained, preferred Civil Appeal No. 10161 of 1983.
All these three appeals were heard together since they were directed against the same judgment of the Division Bench and we proceed to dispose them of by this common judgment.
The first question that arises for consideration in these appeals is whether the Division Bench of the High Court was right in condemning the Chairman and members of the Haryana Public Service Commission as men lacking in integrity, calibre and qualification and alleging corrupt motives against them.
The answer must plainly be in the negative and for more than one reason.
In the first place, it is common ground that the Haryana Public Service Commission consisted of 5 members including the Chairman and all of them participated in the interviews save and except Shri.
R.C. Marya, who did not participate in the interview of his daughter in law Shakuntala Rani and the brother of his son in law, Balbir Singh and Shri Raghubar Dayal Gaur who did not participate in the interview of the son in law of his sister, Trilok Nath Sharma.
The Division Bench of the High Court cast serious aspersions on all the members of the Haryana Public Service Commission including the Chairman and observed that "in the matter of appointments to the Haryana Public Service Commission, the actualities of work a day politics have wholly whittled away the ideal and the purpose" in which the constitutional institution of Public Service Commission was conceived.
The Division Bench of the High Court went to the length of holding that the appointments of the Chairman and the member of the Haryana Public Service Commission were made "wholly caste considerations and political affiliations" and all of them including the Chairman did not satisfy the stringent test of "men of high integrity, calibre and qualification".
These were highly disparaging observations made against the Chairman and member of the Haryana Public Service Commission and cast serious refection on their character and integrity.
Surprisingly, these condemnatory observations were made against the Chairman and all the members of the Haryana public Service Commission without their being party respondents to the writ petitions.
Three members namely S/Sh.
673 D. R. Chaudhary, Raghubar Dayal Gaur and R. C. Marya were joined as respondent Nos. 3, 4 and 5 but the Chairman Shri B. section Lather and another member Shri Gurmesh Parkash Bishnoi were not impleaded in the writ petitions and yet the most damaging observations were made against them.
This was clearly in violation of the principles of natural justice.
The observations made against Shri B. section Lather and Shri Gurmesh Prakash Bishnoi cannot therefore be allowed to stand and if these observations are obliterated from the judgment, the entire super structure of the argument assailing the constitution of the Haryana Public Service Commission as a whole must collapse.
Secondly, these observations against the Chairman and members of the Haryana Public Service Commission were made without any factual basis in the pleadings or the evidence.
There were no averments made in any of the writ petitions, save and except Civil Writ petition No. 3344 of 1983, regarding the Chairman or any of the members of the Haryana Public Service Commission.
It was nowhere alleged in any of these writ petitions that the Chairman and members of the Haryana public Service Commission were lacking in integrity, calibre and qualification or that they were appointed on the Haryana Public Service Commission purely on account of caste considerations or political affiliations without any merit or competence.
The only averments in regard to the appointments of the Chairman and members of the Haryana Public Service Commission were to be found in paragraph 9 of Civil Writ petition No. 3344 of 1983 where a direct allegation was made that all the members of the Haryana Public Service Commission including the Chairman had political links and backing and their appointments were "only due to political and caste considerations".
The petitioners in this writ petition proceeded to point out the relationship of the Chairman and members of the Haryana Public Service Commission to one or the other member of the political party ruling the State at the date of the respective appointments and sought to draw an inference from such relationship that their appointments were on account of caste considerations and political linkages and merit, competence and integrity were sacrificed.
The relationship alleged in paragraph 9 was not disputed on behalf of the respondents but the inference sought to be drawn there from was stoutly resisted and it was contended that there was no material at all on the basis of which it could be said that the Chairman and members of the Haryana Public Service Commission were appointed solely "due to political and caste considerations" without taking into account calibre, competence or 674 integrity.
In fact the State of Haryana in its counter affidavit seriously disputed that the Chairman and members of the Haryana Public Service Commission had any political affiliations.
Now it is difficult to see how on the basis of a mere averment in paragraph 9 of one of the writ petitions, which averment was disputed on behalf of the respondents, the Division Bench of the High Court could possibly come to the conclusion that politics had played a major role in appointment of the Chairman and members of the Haryana Public Service Commission and that they were men lacking in integrity, calibre and qualification, particularly when no such allegation was made by the petitioners in any of the other writ petitions.
We do not think that the Division Bench of the High Court was at all justified in drawing from the facts set out in paragraph 9 of Civil Writ petition No. 3344 of 1983 any inference that the Chairman and members were totally unfit to be appointed on the Haryana Public Service Commission or that they were not men of integrity calibre and qualification.
Merely because Shri B. section Lather was the brother of Shri Mahinder Singh Lather who was allegedly influential with the Government of Haryana when the Janta Party was in power or Shri R. C. Marya was close to Shri Chand Ram who was a Union Minister for State during the Janta regime or Shri D. R. Chaudhary was close to Ch.
Devi Lal former Chief Minister of Haryana and belonged to his caste as well as to his village or Shri Raghubar Dayal Gaur was close to and belonged to the caste of Shri Chiranji Lal Sharma who was a Congress Member of Parliament or Shri Gurmesh Prasad Bishnoi was close to and belonged the caste of Shri Bhajan Lal, present Chief Minister of Haryana, it does not necessarily follow that they were not fit to be appointed but were appointed solely on account of personal relationship and caste considerations.
The Division Bench of the High Court proceeded solely on surmises and conjectures and committed a grievous error in jumping to the conclusion that the Chairman and members of the Public Service Commission were lacking in integrity, calibre and qualification and were appointed solely on account of extraneous considerations.
It is a very serious matter to cast aspersions on the character, integrity and competence of men occupying the high office of Chairman and members of a Public Service Commission and we wish the Division Bench of the High Court had acted with care and circumspection in making such imputation against the Chairman and members of the Haryana Public Service Commission, when it was not even specifically alleged in paragraph 9 of Civil Writ Petition 3344 of 1983 that the Chairman and members of the Haryana Public Service Commission were unfit to hold the office to which they were appointed or 675 were lacking in integrity, character and qualification.
We may point out that even if the Chairman and members of the Haryana Public Service Commission were appointed on account of political and caste considerations, they could still be men of character, integrity and competence and the extraneous considerations which might have weighed with the appointing authority need not necessarily reflect upon their competence, character or fitness.
The condemnatory observations made against the Chairman and members of the Haryana Public Service Commission thus not only went beyond the averments made in the writ petitions but were also totally unjustified and unwarranted.
Thirdly, it is difficult to see how the Division Bench of the High Court could possibly undertake an inquiry into the question whether the Chairman and members of the Haryana Public Service Commission were men of integrity, calibre and qualification or not.
It was totally irrelevant inquiry, because even if they were men lacking in integrity, calibre and qualification, it would not make their appointments invalid, so long as the constitutional and legal requirements in regard to appointment were fulfilled.
Article 316 of the Constitution makes provision for appointment and term of office of members of a State Public Service Commission.
Clause (1) of this Article provides that the Chairman and members of a State Public Service Commission shall be appointed by the Governor of the State and the proviso to that clause enacts that "as nearly as may be one half of the members of every Public Service Commission shall be persons who at the dates of their respective appointments have held office for at least ten years" under the Government of a State.
Clause(2) of Article 316 declares that a member of a State Public Service Commission shall hold office for a term of six years from the date on which he enters upon his office or until he attains the age of sixty two years, which ever is earlier.
Article 319 lays down inter alia that on ceasing to hold office, the Chairman of State Public Service Commission shall not be eligible for any employment under the Government of India or the Government of a State, save and except that of Chairman or any other member of the Union Public Service Commission and similarly, a member of a State Public Service Commission.
These are the only provisions in the Constitution bearing on the appointment of Chairman and members of a State Public Service Commission.
Now concededly none of these constitutional provisions was violated in making appointments of the 676 Chairman and members of the Haryana Public Service Commission nor was any legal provision breached and the appointments of the Chairman and members of the Haryana Public Service Commission were in conformity with the constitutional and legal requirements.
If that be so, it passes our comprehension as to how the appointments of the Chairman and members of the Haryana Public Service Commission could be regarded as suffering from any infirmity or any selections made by them could be said to be vitiated, merely on the ground that they were not, in the opinion of the Division Bench of the High Court possessed of integrity, calibre or qualification.
We may take an analogy to illustrate the point we are making.
Suppose a District Judge is appointed by the Governor of the State in consultation with the High Court in accordance with the requirements of Article 233 and the appropriate rules made in that behalf.
Can a judgment delivered by him be assailed as invalid on the ground that he has not the requisite integrity, calibre or qualification ? The judgment may be set aside if it is wrong but not because it is given by a Judge who is lacking in integrity, calibre or qualification.
Similarly, selections made by the Chairman and members of the Haryana Public Service Commission may be quashed if they are found to be vitiated by the influence of extraneous considerations or are made in breach of the rules, but they cannot be invalidated merely by showing in a general sort of way that they were not men possessed of high integrity, calibre or qualification.
Lastly, we do not think that the Division Bench of the High Court was justified in going into the question whether the Chairman and members of the Haryana Public Service Commission were appointed an account of caste considerations and political patronage or were lacking in integrity, calibre or qualification, when the validity of their appointments was not challenged in the writ petitions nor was any relief claimed for setting aside their appointments.
The validity of their appointments could not be questioned collaterally while considering the challenge to the selections made by them.
This view receives support from the observations of Chinnappa 677 Reddy, J. speaking on behalf of the Court in C. Ranga Raju vs State of Andhra Pradesh ; There, the learned Judge pointed out: "The defective appointment of a de facto judge may be questioned directly a proceeding to which he be a party but it cannot be permitted to be questioned in a litigation between two private litigants, a litigation which is of no concern or consequence to the judge except as a judge.
Two litigants litigating their private title cannot be permitted to bring in issue and litigate upon the title of a judge to his office.
Otherwise as soon as a judge pronounces a judgment a litigation may be commenced for a declaration that the judgment is void because the judge is no judge.
A judge 's title to his office cannot be brought into jeopardy in that fashion.
Hence the rule against collateral attack on validity of judicial appointments.
" We wholly endorse these observations and conclude that the principle underlying these observations must be held to be equally applicable in the present case and the title of the Chairman and members of the Haryana Public Service Commission cannot be allowed to be placed in jeopardy in proceeding for challenging the selections made by them.
This ground of attack against the validity of the selections must therefore be rejected.
That takes us to the next ground of attack which found favour with the Division Bench of the High Courts, namely that the participation of Shri R.C. Marya and Shri Raghubar Dayal Guar in the process of selection introduced a serious infirmity in the selections.
It was not disputed and indeed on the record it could not be, than when the close relatives of Shri R.C. Marya and Shri Raghubar Dayal Guar came up for interview, but, according to the Division Bench of the High Court, such limited withdrawal from participation was not enough and both the members, said the Division Bench ought to have withdrawn from the selection process altogether.
The Division Bench of the High Court relied heavily on the fact that Trilok Nath Sharma, who was the son in law of the sister of Shri Raghubar Dayal Guar obtained 160 marks out of 300 in the viva voce test while Shakuntala Rani daughter in law of Shri.
R.C. Marya obtained 131 marks and Balbir Singh brother of the son in law of Shri R.C. Marya obtained 130 marks and observed that "these 678 admitted facts are obviously telltale".
The Division Bench went to the length of imputing nepotism and favouritism to the Chairman and members of the Haryana Public Service Commission by observing that each member of the Haryana Public Service Commissions adjusted the relatives of the others and awarded low marks in the interview to the other candidates with a view to ousting the latter and bolstering up the former in the merit list.
We are pained to observe that such a serious aspersion should have been cast on the Chairman and members of the Haryana Public Service Commission without any basis or justification.
Merely because Trilok Nath Sharma obtained 160 marks, Shakuntala Rani obtained 131 marks and Balbir Singh obtained 130 marks, no inference can necessarily be drawn that these high marks were given to them in viva voce examination undeservedly with a view to favouring them at the cost of more meritorious candidates.
There is nothing to show that these three candidates who happened to be related to Shri Raghubar Dayal Guar and Shri R.C. Marya were not possessed of any requisite calibre or competence or their performance at the viva voce examination did not justify the marks awarded to them.
The only circumstance on which the Division Bench relied for raising the inference that such high marks were given to these three candidates, not on merits, but as an act of nepotism with a view to unduly favouring them so that they can some within the range of selection, was that out of these three candidates, two were related to Shri R.C. Marya and one was related to Shri Raghubar Dayal Gaur.
This inference, we are constrained to observe, was wholly unjustified.
We cannot help remarking that the Division Bench indulged in surmises and conjectures in reaching the conclusion that high marks were given unjustifiably to these three candidates at the viva voce examination with a view to pushing them up and low marks were deliberately given to other more meritorious candidates with a view to pushing them down and thus facilitating the selection of these three candidates who would not otherwise have come within the range of selection.
We fail to appreciate what is the basis on which the Division Bench could observe that these three candidates got high marks at the viva voce examination only because they were elated to Shri R.C. Marya and Shri Raghubar Dayal Gaur.
Can a relative of a member of a Public Service Commission, Central or State, not get high marks at the viva voce examination on his own merit? Must he always get low marks, so that if high marks are awarded to him, that would necessarily be attributed to his relationship with the member of the Public Service Commission? 679 The Division Bench sought to draw support for its inference from an article written by Shri D.R. Chaudhari, a member of the Haryana Public Service Commission, who is arrayed as respondent No. 3 in the writ petition.
This article was captioned "Public Service Commissions under Pressures" and was written by Shri D.R. Chaudhari and published in the issue of Tribune dated 13th March 1981.
Shri D.R. Chaudhari was appointed a member of the Haryana Public Service Commission on 2nd December 1977.
He had been such member for over three years at the time of writing this article.
He pointed out in this article, and we are quoting here a passage which has been strongly relied upon by the Division Bench: "With political morality in our system at its lowest abb, the politicians are always in a hurry to pack the P.S. Cs with such persons who would be pliable tools in the matter of recruitment.
Academic worth, intellectual calibre, experience of men and matters, and integrity are of no relevance.
What is important is a person 's "dependability.
" Narrow caste, communal and regional issues dominate Indian Politics today and these considerations override questions of talent in the matter of recruitment.
In the process a member with little intellectual calibre and less integrity begin to serve his own interests a those of his political benefactor, No vender there is a widespread feeling in the States (mercifully, with the U.P.S.C. as a possible exception) that every post carries a price tag.
We have reached a state when the composition and functioning of our P.S. Cs should be critically evaluated.
This is necessary if the institution has to survive as a meaningful body.
Its functioning should be brought 680 under public gaze.
At present there is a halo of secrecy surrounding the P.S.C. and secrecy always breeds corruption.
It would be suicidal to treat the P.S.C. as a sacred cow.
There is nothing more sacred than the public interest and the public interest demands that the functioning of the P.S. Cs should be widely debated through the press and other forums.
I invite my, colleagues of the P.S. Cs and public spirited individuals to join the debate.
" We may reasonably assume that a person who write such an article would never be a party to any manipulations in the selection of candidates nor would he debase or demean himself by indulging in or even lending his support to, any acts of nepotism or favouritism.
It would be quite legitimate to infer that if there had been any attempt to manipulate the marks at the viva voce examination with a view to favouring the undeserving or pushing down the meritorious, Shri D.R. Chaudhuri would have protested against such improper and unholy attempt.
The very fact that Shri D.R. Chaudhari not only did not register any dissent in regard to the marks awarded at the viva voce examination but actually agreed with the evaluation made by his colleagues shows that there was nothing wrong with the marking nor was there any manipulation of marks indicating nepotism or favouritism.
In fact Shri D.R. Chaudhari filed an affidavit in these proceedings where he candidly said that this article written by him was based on his direct experience of working in the Haryana Public Service Commission and he proceeded to add boldly and courageously: "As a member of H.P.S.C., I noticed various forces trying to undermine the independent functioning of the Commission.
What irked me most was the political interference.
An attempt was made to convert this august body into a petty government department where politicians ' writ could rung large.
Besides this, caste lobbies and money bags were active to influence its decisions at every stage.
I was in a state of agony.
I decided to take the matter to the public through the medium of the press.
I knew 681 that I would incur the wrath of the powers that be and dismay caste lobbies and money bags.
I took a calculated risk and wrote the article under question.
It did infuriate the political posses as is evident from a news item published in the Tribune dated June 25, 1981 (clipping attached).
But at the same time it served the purpose I had in mind.
It started a public debate.
It created a furore.
It was read and debated widely.
A number of letters to the Editor appeared in the Tribune.
It also figured in the session of the Haryana Vidhan Sabha.
The article had a desired effect.
Pressures ceased.
Political operators and other manipulators were put on the alert.
As such I did not feel the necessity of writing again on the same issue though I continued writing on other matters.
" Then speaking specifically about the viva voce examination held by the Haryana Public Service Commission in the present case, Shri D.R. Chaudhari stated: "The interviews for the recruitment of H.C.S. and Allied Services, which is the subject of writ petitions in the Hon 'ble Punjab and Haryana High Court, were conducted about two years after the publication of the article.
No pressure, political or otherwise, was exercised on me, nor to the best of my knowledge, on any other colleague of mine in the commission during the course of this recruitment.
" There is no reason why this statement made by Shri D.R. Chaudhari should not be believed.
It is indeed surprising that the Division Bench accepted readily what was said by Shri D.R. Chaudhari in the article written by him on 13th March, 1981 but for some inexplicable reason, refused to believe the same Shri D.R. Chaudhari when he stated that this article had the desired effect and on account of the exposure made in this article, pressures, political or otherwise, ceased so far as the functioning of the Haryana Public 682 Service Commission was concerned and in awarding of marks at the viva voce examination, no pressure, political or otherwise, was exercised on Shri D.R. Chaudhari nor to the best of his knowledge, on any of his other colleagues.
We accept what has been stated by Shri D.R. Chaudhari in his affidavit and disapprove of the observation made by the Division Bench that high marks were undeservedly given to the three candidates related to Shri R.C. Marya and Shri Raghubar Dayal Gaur and low marks were deliberately given to the meritorious candidates with a view to manipulating the selection of the former at the cost of the latter.
We are of the view that there was no material whatsoever on record to justify such observation on the part of the Division Bench.
In fact, far from there being any material supportive of such observation.
We find that there is one circumstance, which, in our opinion, completely militates against the view taken by the Division Bench and that circumstance is that the marks obtained by the candidates at the written examination were not disclosed to the members of the Haryana Public Service Commission who held the viva voce examination.
If the members, who interviewed the candidates, did not know what were the marks obtained by the candidates at the written examination, it is difficult to see how they could have manipulated the marks at the viva voce examination with view to pushing up the three candidates related to Shri R.C. Marya and Shri Raghubar Dayal Gaur or any other candidates of their choice so as to bring them within the range of selection.
But the question still remains whether the selections made by the Haryana Public Service Commission could be said to be vitiated on account of the fact that Shri R.C. Marya and Shri Raghubar Dayal Gaur participated in the selection process, though Trilok Nath Sharma who was related to Shri Raghubar Dayal Gaur and Shakuntala Rani and Balbir Singh both of whom were related to Shri R.C. Marya, were candidates for selection.
It is undoubtedly true that Shri Raghubar Dayal Gaur did not participate when Trilok Nath Sharma came up for interview and similarly Shri R.C. Marya did not participate when Shakuntala Rani and Balbir Singh appeared for interview at the viva voce examination.
But, according to the petitioners, this was not sufficient to wipe out the blemish in the process of selection for two reasons: firstly, because Shri R C. Marya and Shri Raghubar Dayal Gaur participated in the interviews of the other candidates and that gave rise to a reasonable apprehension in 683 the mind of the candidates that Shri R.C. Marya and Shri Raghubar Dayal Gaur might tend to depress the marks of the other candidates with a view to ensuring the selection of the candidates related to them and secondly, because there could be reasonable apprehension in the mind of the candidates that the other members of the Haryana Public Service Commission interviewing the candidates might, out of regard for their colleagues, tend to give higher marks to the candidates related to them, The argument of the petitioners was that the presence of Shri R.C. Marya and Shri Raghubar Dayal Gaur on the interviewing committee gave rise to an impression that there was reasonable likelihood of bias in favour of the three candidates related to Shri R.C. Marya and Shri Raghubar Dayal Gaur and this had the effect of vitiating the entire selection process.
This argument was sought to be supported by the petitioners by relying on the decisions reported in D.K. Khanna vs Union of India & Ors.
Surinder Nath Goel vs State of Punjab and M. Ariffudin vs D.D. Chitaley & Ors.
We do not think this argument can be sustained and for reasons, which we shall presently state, it is liable to be rejected.
We agree with the petitioners that it is one of the fundamental principles of our jurisprudence that no man can be a Judge in his own cause and that if there is a reasonable likelihood of bias it is "in accordance with natural justice and common sense that the justice likely to be so biased should be incapacitated from sitting".
The question is not whether the judge is actually biased or in fact decides partially, but whether there is a real likelihood of bias.
What is objectionable in such a case is not that the decision is actually tainted with bias but that the circumstances are such as to create a reasonable apprehension in the mind of others that there is a likelihood of bias affecting the decision.
The basic principle underlying this rule is that justice must not only be done but must also appear to be done and this rule has received wide recognition in several decisions of this Court.
It is also important to note that this rule is not confined to cases where judicial power stricto sensu is exercised.
It is appropriately extended to all cases where an independent mind has to be applied to arrive at a fair and just decision between the rival claims of parties.
Justice is not the 684 function of the courts alone; it is also the duty of all those who are expected to decide fairly between contending parties.
The strict standards applied to authorities exercising judicial power are being increasingly applied to administrative bodies, for it is vital to the maintenance of the rule of law in a welfare state where the jurisdiction of administrative bodies in increasing at a rapid pace that the instrumentalities of the State should discharge their functions in a fair and just manner.
This was the basis on which the applicability of this rule was extended to the decision making process of a selection committee constituted for selecting officers to the Indian Forests Service in A.K. Kraipak vs Union of India happened in this case was that one Naquisbund, the acting Chief Conservator of Forests, Jammu and Kashmir was a member of the Selection Board which had been set up to select officers to the Indian Forest Service from those serving in the Forest Department of Jammu and Kashmir.
Naquisbund who was a member of the Selection Board was also one of the candidates for selection to the Indian Forest Service.
He did not sit on the Selection Board at the time when his name was considered for selection but he did sit on the Selection Board and participated in the deliberations when the names of his rival officers were considered for selection and took part in the deliberations of the Selection Board while preparing the list of the selected candidates in order of preference.
This Court held that the presence of Naquishbund vitiated the selection on the ground that there was reasonable likelihood of bias affecting the process of selection.
Hegde, J. speaking on behalf of the Court countered the argument that Naquisbund did not take part in the deliberations of the Selection Board when his name was considered, by saying: "But then the very fact that he was a member of the Selection Board must have its own impact on the decision of the Selection Board.
Further, admittedly, he participated in the deliberations of the Selection Board when the claims of his rivals . were considered.
He was also party to the preparation of the list of selected candidates in order of preference.
At every stage of his participation in the deliberation of the selection board, there was a conflict between his interest and duty .
The real question is not whether he was biased.
It is difficult to prove the state of mind of a person.
Therefore what we 685 have to see is whether there is reasonable ground for believing that he was likely to have been biased . .
There must be a reasonable likelihood of bias.
In deciding the question of bias we have to take into consideration human probabilities and ordinary course of human conduct." This Court emphasised that it was not necessary to establishes as but it was sufficient to invalidate the selection process if it could be shown that there was reasonable likelihood of bias.
The likelihood of bias may arise on account of proprietory interest or on account of personal reasons, such as, hostility to one party or personal friendship or family relationship with the other.
Where reasonable likelihood of basis is alleged on the ground of relationship, the question would always be as to how close is the degree of relationship or in other words, is the nearness of relationship so great as to give rise to reasonable apprehension of bias on the part of the authority making the selection.
The High Court of Himachal Pradesh in D.K. Khanna 's case (supra) drawing inspiration from A.K. Kraipak 's case, held that where one of the members of the Committee constituted for selecting members of the State Civil Service for promotion to the Indian Administrative Service, was the son in law of a candidate who was competing for inclusion in the list of selected candidates, the entire selection process was vitiated by the presence of such member, though he did not take any part in the consideration of his father in law 's candidature or in any manner try to influence his colleagues in regard to his father in law.
The High Court observed that the degree of relationship in this case was so close as to reasonably give an impression to the other candidates that there was a real likelihood of the son in law espousing the cause of his father in law as his own.
So also in Surinder Nath Goel 's case (supra), the High Court of Punjab and Haryana took the same view where it was found that two of the candidates appearing for selection were related to one of the members of the Selection Committee.
The same approach was adopted by the High Court of Andhra Pradesh in M. Aiffurdin 's case (supra) where one of the members of the Andhra Pradesh Public Service Commission who sat on the Commission and participated in the selection for the posts of Professor and Lecturer in the Andhra Pradesh Technical Education Service, was a partner with some of the candidates appearing for the selection and it was held that the 686 entire selection process was vitiated, because there was clearly reasonable likelihood of bias in favour of those candidates on the part of such member of the Commission.
We may point out that so far as this last decision is concerned, it does not appear that the member of the Commission who was a partner with some of the candidates, withdrew when those candidates came to be interviewed and did not participate in the consideration of their candidature.
We must straightaway point out that A.K. Kraipak 's case is a landmark in the development of administrative law and it has contributed in a large measure to the strengthening of the rule of law in this country.
We would not like to whittle down in the slightest measure the vital principle laid down in this decision which has nourished the roots of the rule of law and injected justice and fair play into legality.
There can be no doubt that if a selection committee is constituted for the purpose of selecting candidates on merits and one of the members of the Selection Committee is closely related to a candidate appearing for the selection, it would not be enough for such member merely to withdraw from participation in the interview of the candidate related to him but he must withdraw altogether from the entire selection process and ask the authorities to nominate another person in his place on the selection committee, because otherwise all the selections made would be vitiated on account of reasonable likelihood of bias affecting the process of selection.
But the situation here is a little different because the selection of candidates to the Haryana Civil Service (Executive) and allied services is being made not by any Selection Committee constituted for that purpose but it is being done by the Haryana Public Service Commission which is a Commission set up under Article 316 of the Constitution.
It is a Commission which consists of a Chairman and a specified member of members and is a Constitutional Authority.
We do not think that the principle which requires that a member of a Selection Committee whose close relative is appearing for selection should decline to become a member of the selection committee or withdraw from it leaving it to the appointing authority to nominate another person in his place, need be applied in case of a Constitutional Authority like the Public Service Commission, whether Central or State.
If a member of a Public Service Commission were to withdraw altogether from the selection process on the ground that a close relative of his is appearing for selection, no other person save a member can be substituted in his place.
And it may sometimes happen that no other member is available to take the place of such 687 member and the functioning of the Public Service Commission may be affected.
When two or more members of a Public Service Commission are holding a viva voce examination.
they are functioning not as individuals but as the Public Service Commission.
Of course, we must make it clear that when a close relative of a member of a Public Service Commission is appearing for interview, such member must withdraw from participation in the interview of that candidate and must not take part in any discussion in regard to the merits of that candidate and even the marks or credits given to that candidate should not be disclosed to him.
Chinnappa Reddy, J observed to the same effect in Javid Rasool Bhat vs State of J and K while dealing with a similar question which arose before him for consideration: "The procedure adopted by the Selection Committee and the member concerned was in accord with the quite well known and generally accepted procedure adopted by the Public Service Commission everywhere.
It is not unusual for candidates related to members of the Service Commission or Other Selection Committee to seek employment.
Whenever such a situation arises, the practice generally is for the member concerned to excuse himself when the particular candidate is interviewed.
We notice that such a situation had also been noticed by this Court in the case of Nagarajan vs State of Mysore where it was pointed out that in the absence of mala fides, it would not be right to set aside the selection merely because one of the candidates happened to be related to a member of the Selection Committee who had abstained from participating in the interview of that candidate.
Nothing unusual was one by the present Selection Committee.
The girl 's father was not present when she was interviewed.
She was one among several hundred candidates.
The marks obtained by her in the written test were not even known when she was interviewed.
In the case before us, the Principal of the Medical College, Srinagar, dissociated himself from the written test and did not participate in the proceedings when his daughter was interviewed.
When the other candidates were interviewed, he did not know the marks obtained either by his daughter or by any of the candi 688 dates.
There was no occasion to suspect his bona fides even remotely.
There was not even a suspicion of bias, leave alone a reasonable likelihood of bias.
There was no violation of the principles of natural justice.
" We wholly endorse there observations.
Here in the present case it was common ground between the parties that Shri Raghubar Gaur Dayal Gaur did not participate at all in interviewing Trilok Nath Sharma and likewise Shri R.C. Marya did not participate at all when Shakuntala Rani and Balbir Singh came to be interviewed and in fact, both of them retired from the room when the interviews of their respective relatives were held.
Moreover, neither of them took any part in any discussion in regard to the merits of his relatives nor is there anything to show that the marks or credits obtained by their respective relatives at the interviews were disclosed to them.
We are therefore of the view that there was no infirmity attaching to the selections made by the Haryana Public Service Commission on the ground that, though their close relative were appearing for the interview, Shri Raghubar Dayal Gaur and Shri R.C. Marya did not withdraw completely from the entire selection process.
This ground urged on behalf of the petitioners must therefore be rejected.
There was also one other contention which found favour with the Division Bench in support of its conclusion that there was reasonable likelihood of bias vitiating the "whole gamut of the selection process".
This contention was based on the fact that though only 61 vacant posts were advertised for being filled up, over 1300 candidates representing more than 20 times the number of available vacancies, were called for the viva voce examination.
The Division Bench pointed out that in order to have a proper balance between the objective assessment of a written examination and the subjective assessment of personality by a viva voce test, the candidates to be called for interview at the viva voce test should not exceed twice or at the highest, thrice the number of available vacancies.
This practice of confining the number of candidates to be called for interview to twice or at the highest, thrice the number of vacancies to be filled up, was being followed consistently by the Union Public Service Commission in case of Civil Services Examination, but in the present case, observed the Division Bench, a departure was made by the Haryana Public Service Commission and candidates numbering more than 20 times the available vacancies were called for interview.
The result, according to the Division Bench, was that the area of 689 arbitrariness in the viva voce test was considerably enlarged and even a student who had got poor marks in the written examination and who having regard to dismal performance at the written examination did not deserve to be called for interview, could get a chance of being called and he could then be pulled up within the range of selection by awarding unduly high marks at the viva voce examination.
This conclusion was sought to be buttressed by the Division Bench by relying on a comparison of the marks obtained by some of the petitioners in the written examination and at the viva voce test.
This comparison showed that eight of the petitioners secured "a percentage of around 60 per cent rising up to a highest of 68.5 per cent" in the written examination, but they were awarded "a disastrously low percentage of marks in the viva voce ranging from the rock bottom of 13 per cent to 21 per cent", making it impossible for them to bridge the difference so as to be able to come within the range of selection.
How could such brilliant candidates who had done so well in the written examination fare so poorly in the viva voce test that they could not get more than 20 per cent marks, asked the Division Bench? The Division Bench also pointed out that some out of these eight petitioners had appeared in an earlier examination held in 1977 78 and at the viva voce test held at that time.
they had secured more than 50 to 55 per cent marks and it was difficult to believe that during the next three succeeding years, they had deteriorated to such an extent that they slumpted down to 20 per cent marks.
The Division Bench also analysed the comparative marks obtained by the first 16 candidates who topped the list in the written examination and noted that on account of the poor marks obtained by them at the viva voce test, 10 out of these 16 candidates were "knocked out of the race" because their ranking, on the basis of the total marks obtained by them in them in the written examination and the viva voce test, went for below 61 and only 4 out of the remaining 6 could rank within the first 16 so as to be eligible for appointment in the Haryana Civil Service (Executive Branch) which is a superior service compared to other allied services.
It was also pointed out by the Division Bench that out of 16 candidates who topped the list on the basis of combined marks obtained in the written and viva voce examinations and who consequently secured appointment to posts in the Haryana Civil Service (Executive Branch), 12 could make it only on account of the high marks obtained by them at the viva voce examination, though they were not high up in ranking in the written examination.
On the basis of 690 these facts and circumstances, the Division Bench concluded that the petitioners had discharged the burden of showing that there was reasonable likelihood of bias vitiating the entire selection process.
We do not think we can agree with this conclusion reached by the Division Bench.
But whilst disagreeing with the conclusion, we must admit that the Haryana Public Service Commission was not right in calling for interview all the 1300 and odd candidates who secure 45 per cent or more marks in the written examination.
The respondents sought to justify the action of the Haryana Public Service Commission by relying on Regulation 3 of the Regulations contained in Appendix 1 of the Punjab Civil Service (Executive Branch) Rules 1930 which were applicable in the State of Haryana and contended that on a true interpretation of that Regulation, the Haryana Public Service Commission was bound to call for interview all the candidates who secured a minimum of 45 per cent marks in the aggregate at the written examination.
We do not think this contention is well founded.
A plain reading of Regulation 3 will show that it is wholly unjustified.
We have already referred to Regulation 3 in an earlier part of the judgment and we need not reproduce it again.
It is clear on a plain natural construction of Regulation 3 that what it prescribes is merely a minimum qualification for eligibility to appear at the viva voce test.
Every candidate to be eligible for appearing at the viva voce test must obtain at least 45 per cent marks in the aggregate in the written examination.
But obtaining of minimum 45 per cent marks does not by itself entitle a candidate to insist that he should be called for the viva voce test.
There is no obligation on the Haryana Public Service Commission to call for the viva test all candidates who satisfy the minimum eligibility requirement.
It is open to the Haryana Public Service Commission to say that out of the candidates who satisfy the eligibility critarion of minimum 45 per cent marks in the written examination, only a limited number of candidates at the top of the list shall be called for interview.
And this has necessarily to be done because otherwise the viva voce test would reduced to a farce.
It is indeed difficult to see how a viva voce test for properly and satisfactorily measuring the personality of a candidate can be carried out, if over 1300 candidates are to be interviewed for recruitment to a service.
If a viva voce test is to be carried out in a thorough and scientific manner, as it must be in order to arrive at a fair and satisfactory evaluation of the personality of a candidates, the interview must take anything between 10 to 30 691 minutes.
In fact, Herman Finer in his book on "Theory and Practice of Modern Government" points out that "the interview should last at least half an hour".
The Union Public Service Commission making selections for the Indian Administrative Service also interviews a candidate for almost half an hour.
Only 11 to 12 candidates are called for interview in a day of 51/2 hours.
It is obvious that in the circumstances, it would be impossible to carry out a satisfactory viva voce test if such a large unmanageable number of over 1300 candidates are to be interviewer.
The interviews would then tend to be casual, superficial and sloppy and the assessment made at such interviews would not correctly reflect the true measure of the personality of the candidate.
Moreover, such a course would widen the area of arbitrariness, for even a candidate who is very much lower down in the list on the basis of marks obtained in the written examination, can, to borrow an expression used by the Division Bench, 'gate crash ' into the range of selection, if he is awarded unduly high marks at the viva voce examination.
It has therefore always been the practice of the Union Public Service Commission to call for interview, candidates representing not more than twice or thrice the number of available vacancies.
Kothari Committee 's Report on the 'Recruitment Policy and Selection Methods for the Civil Services Examination ' also points out, after an indepth examination of the question as to what should be the number of candidates to be called for interview : "The number of candidates to be called for interview, in order of the total marks in written papers, should not exceed, we think, twice the number of vacancies to be filled.
" Otherwise the written examination which is definitely more objective in its assessment than the viva voce test will lose all meaning and credibility and the viva voce test which is to some extent subjective and discretionary in its evaluation will become the decisive factor in the process of selection.
We are therefore of the view that where there is a composite test consisting of a written examination followed by a viva voce test, the number of candidates to be called for interview in order of the marks obtained in the written examination, should not exceed twice or at the highest, thrice the number of vacancies to be filled.
The Haryana Public Service Commission in the present case called for interview all candidates numbering over 1300 who satisfied the minimum eligibility requirement by securing a 692 minimum of 45 per cent marks in the written examination and this was certainly not right, but we may point out that in doing so the Haryana Public Service Commission could not be said to be actuated by any malafide or oblique motive, because it was common ground between the parties that this was the practice which was being consistently followed by the Haryana Public Service Commission over the years and what was done in this case was nothing exceptional.
The only question is whether this had any invalidating effect on the selections made by the Haryana Public Service Commission.
We do not think that the selections made by the Haryana Public Service Commission could be said to be vitiated merely on the ground that as many as 1300 and more candidates representing more than 20 times the number of available vacancies were called for interview, though on the view taken by us that was not the right course to follow and not more than twice or at the highest thrice, the number of candidates should have been called for interview.
Something more than merely calling an unduly large number of candidates for interview must be shown in order to invalidate the selections made.
That is why the Division Bench relied on the comparative figures of marks obtained in the written examination and at the viva voce test by the petitioners, the first 16 candidates who topped the list in the written examination and the first 16 candidates who topped the list on the basis of the combined marks obtained in the written examination and the viva voce test, and observed that these figures showed that there was reasonable likelihood of arbitrariness and bias having operated in the marking at the viva voce test.
Now it is true that some of the petitioners did quite well in the written examination but faired badly in the viva voce test and in fact their performance at the viva voce test appeared to have deteriorated in comparison to their performance in the year 1977 78.
Equally it is true that out of the first 16 candidates who topped the list in the written examination, 10 secured poor rating in viva voce test and where knocked out of the reckoning while 2 also got low marks in the viva voce test but just managed to scrape through to come within the range of selection.
It is also true that out of the first 16 candidates who topped the list on the basis of the combined marks obtained in the written examination and the viva voce test, 12 could come in the list only on account of the high marks obtained by them at the viva voce test, though the marks obtained by them in the written examination were not of sufficiently high order.
These 693 figures relied upon by the Division Bench may create a suspicion in one 's mind that some element of arbitrariness might have entered the assessment in the viva voce examination.
But suspicion cannot take the place of proof and we cannot strike down the selections made on the ground that the evaluation of the merits of the candidates in the viva voce examination might be arbitrary.
It is necessary to point out that the Court cannot sit in judgment over the marks awarded by interviewing bodies unless it is proved or obvious that the marking is plainly and indubitably arbitrary or affected by oblique motives.
It is only if the assessment is patently arbitrary or the risk of arbitrariness is so high that a reasonable person would regard arbitrariness as inevitable, that the assessment of marks at the viva voce test may be regarded as suffering from the vice of arbitrariness.
Moreover, apart from the only three candidates, namely.
Trilok Nath Sharma, Shakuntala Rani and Balbir Singh one of whom belonged to the general category and was related to Shri Raghubar Dayal Gaur and the other two were candidates for the seats reserved for Scheduled Castes and were related to Shri R.C. Marya, there was no other candidate in whom the Chairman or any member of the Haryana Public Service Commission was interested, so that there could be any motive for manipulation of the marks at the viva voce examination.
There were of course general allegations of casteism made against the Chairman and the members of the Haryana Public Service Commission, but these allegations were not substantiated by producing any reliable material before the Court.
The Chairman and members of the Haryana Public Service Commission in fact belonged to different castes and it was not as if any particular caste was predominant amongst the Chairman and members of the Haryana Public Service Commission so as even to remotely justify an inference that the marks might have been manipulated to favour the candidates of that caste.
We do not think that the Division Bench was right in striking down the selections made by the Haryana Public Service Commission on the ground that they were vitiated by arbitrariness or by reasonable likelihood of bias.
That takes us to the next ground of challenge which found acceptance with the Division Bench.
This ground of challenge was strenuously urged on behalf of the petitioners and it was sought to be supported by reference to the decision of this Court in Ajay Hasia vs Khalid Mujjubudin.
The contention of the petitioners under this 694 ground of challenge was that in comparison to the marks allocated to the written examination, the proportion of the marks allocated to the viva voce test was excessively high and that introduced an irredeemable element of arbitrariness in the selection process so as to offend Articles 14 and 16 of the Constitution.
It is necessary in order to appreciate this contention and to adjudicate upon its validity to consider the relative weight attached by the relevant rules to the written examination and viva voce test.
We have already referred to the Punjab Civil Service (Executive Branch) Rules 1930 as applicable in the State of Haryana.
Rule 9 of these rules prescribes that a competitive examination shall be held in accordance with the Regulations set out in Appendix 1 for the purpose of selection by competition of candidates to the Haryana Civil Service (Executive Branch) and other allied services and under Regulations 1 and 5 every ex service officer has to appear in a written examination in 5 compulsory subjects carrying in the aggregate 400 marks and a viva voce test carrying 200 marks and likewise, every candidate belonging to the general category has to appear in a written examination in 8 subjects carrying in the aggregate 700 marks and for him also there is a viva voce test carrying 200 marks.
The argument of the petitioners was that in case of ex service officers the marks allocated for the viva voce test were 200 as against 400 allocated for the written examination so that the marks allocated for the viva voce test came to 33.3% of the total number of taken into account for the purpose of making selection.
So also in the case of candidates belonging to the general category, the marks allocated for the viva voce test were 200 as against 700 allocated for the written examination with the result that the marks allocated for the viva voce test came to 22.2% of the total number of marks for the competitive examination.
This percentage of 33.3% in the case of ex service officers and 22.2% in the case of other candidates was, according to the Division Bench, unduly high and rendered the selection of the candidates arbitrary.
The correctness of this view has been challenged before us on behalf of the respondents.
This Court speaking through Chinnappa Reddy, J. pointed out in Liladhar vs State of Rajasthan that the object of any process of selection for entry into public service is to secure the best and the most suitable person for the job, avoiding patronage and favouritism.
Selection based on merit, tested impartially and objectively, is the 695 essential foundation of any useful and efficient public service.
So open competitive examination has come to be accepted almost universally as the gateway to public services.
But the question is how should the competitive examination be devised? The competitive examination may be based exclusively on written examination or it may be based exclusively on oral interview or it may be a mixture of both.
It is entirely for the Government to decide what kind of competitive examination would be appropriate in a given case.
To quote the words of Chinnappa Reddy, J. "In the very nature of things it would not be within the province or even the competence of the court and the Court would not venture into such exclusive thickets to discover ways out, when the matters are more appropriately left" to the wisdom of the experts.
It is not for the Court to lay down whether interview test should be held at all or how many marks should be allowed for the interview test.
Of course the marks must be minimal so as to avoid charges of arbitrariness, but not necessarily always.
There may posts and appointments where the only proper method of selection may be by a viva voce test.
Even in the case of admission to higher degree courses, it may sometimes be necessary to allow a fairly high percentage of marks for the viva voce test.
That is why rigid rules cannot be laid down in these matters and not any courts.
The experts bodies are generally the best judges.
The Government aided by experts in the field may appropriately decide to have a written examination followed by a viva voce test.
It is now admitted on all hands that while a written examination assesses the candidate 's knowledge and intellectual ability, a viva voce test seeks to assess a candidate 's overall intellectual and personal qualities.
While a written examination has certain distinct advantages over the viva voce test, there are yet no written tests which can evaluate a candidate 's initiative, alertness, resourcefulness, dependableness, cooperativeness, capacity for clear and logical presentation, effectiveness in discussion, effectiveness in meeting and dealing with others, adaptability, judgment, ability to make decision, ability to lead, intellectual and moral integrity.
Some of these qualities can be evaluated, perhaps with some degree of error, by a viva voce test, much depending on the constitution of the interview Board.
Glenn Stahl has pointed out in his book on Public Personnel Administration that the viva voce test does suffer from certain disadvantages such as the difficulty of developing a valid and reliable oral test, the difficulty of securing a reviewable record of an oral test 696 and public suspicion of the oral test as a channel for the exertion of political influence and, as pointed out by this Court in Ajay Hasia ' case (supra), also of other corrupt, nepotistic or extraneous considerations, but despite these acknowledged disadvantages, the viva voce test has been used increasingly in the public personnel testing and has become an important instrument whenever tests of personnel attributes are considered essential.
Glenn Stahl proceeds to add that "no satisfactory written tests have yet been devised for measuring such personnel characteristics as initiative, ingenuity and ability to elicit cooperation, many of which are of prime importance.
When properly employed, the oral test today deserves a place in the battery used by the technical examiner.
" There can therefore be no doubt that the viva voce test performs a very useful function in assessing personnel characteristics and traits and in fact, tests the man himself and is therefore regarded as an important tool along with the written examination.
Now if both written examination and viva voce test are accepted as essential features of proper selection in a given case, the question may arise as to the weight to be attached respectively to them.
"In the case of admission to a college for instance", as observed by Chinnappa Reddy, J. in Liladhar 's case, "where the candidate 's personality is yet to develop and it is too early to identify the personal qualities for which greater importance may have to be attached in later lief, greater weight has perforce to be given to performance in the written examination" and the importance to be attached to the viva voce test in such a case would therefore necessarily be minimal.
It was for this reason that in Ajay Haisa 's case this Court took the view that the allocation of as high a percentage of marks as 33.3% to the viva voce test was "beyond all reasonable proportion and rendered the selection of the candidates arbitrary".
But, as pointed out by Chinnappa Reddy, J., "in the case of services to which recruitment has necessarily to be made from persons of mature personality, interview test may be the only way subject to basic and essential academic and professional requirements being satisfied".
There may also be services "to which recruitment is made from younger candidates whose personalities are on the thresh hold of development and who show sings of great promise" and in case of such services where sound selection must combine academic ability with personality promise, some weight has to be given to the viva voce test.
There cannot be any hard and fast rule regarding the precise weight to be given to the viva voce test as against the written examination.
It must vary from service to service 697 according to the requirement of the service, the minimum qualification prescribed, the age group from which the selection is to be made, the body to which the task of holding the viva voce test is proposed to be entrusted and a host of other factors.
It is essentially a matter for determination by experts.
The Court does not possess the necessary equipment and it would not be right for the Court to pronounce upon it, unless to use the words of Chinnappa Reddy, J. in Liladhar 's case "exaggerated weight has been given with proven or obvious oblique motives.
" We may now, in the background of this discussion, proceed to consider whether the allocation of as high a percentage of marks as 33.3 per cent in case of ex service officers and 22.2 per cent in case of other candidates, for the viva voce test renders the selection process arbitrary.
So far as ex service officers are concerned, there can be no doubt that the percentage of marks allocated for the viva voce test in their case is unduly high and it does suffer from the vice of arbitrariness.
It has been pointed out by the Division Bench in a fairly elaborate discussion that so far as the present selections in the category of ex service officers are concerned, the spread of marks in the viva voce test was inordinately high compared to the spread of marks in the written examination.
The minimum marks required to be obtained in the written examination for eligibility for the viva voce test are 180 and as against these minimum 180 marks, the highest marks obtained in the written examination in the category of ex service officers were 270, the spread of marks in the written examination thus being only 90 marks which works out to a ratio of 22.2 per cent.
But when we turn to the marks obtained in the viva voce test, we find that in case of ex service officers the lowest marks obtained were 20 while the highest marks secured were 171 and the spread of marks in the viva voce test was thus as wide as 151 in a total of 200 marks, which worked out to an inordinately high percentage of 76.
The spread of marks in the viva voce test being enormously large compared to the spread of marks in the written examination, the viva voce test tended to become a determining factor in the selection process, because even if a candidate secured the highest marks in the written examination, he could be easily knocked out of the race by awarding him the lowest marks in the viva voce test and correspondingly, a candidate who obtained the lowest marks in the written examination could be raised to the top most position in the merit list by an inordinately high marking in the viva voce test.
It is therefore obvious that the allocation of 698 such a high percentage of marks as 33.3 per cent opens the door wide for arbitrariness, and in order to diminish, if not eliminate the risk of arbitrariness, this percentage need to be reduced.
But while considering what percentage of marks may legitimately be allocated for the viva voce test without incurring the reproach of arbitrariness it must be remembered that ex service officers would ordinarily be middle aged persons of mature personality and it would be hard on them at that age to go through a long written examination involving 8 subjects and hence it would not be unfair to require them to go through a shorter written examination in only 5 subjects and submit to a viva voce test carrying a higher percentage of marks than that might be prescribed in case of younger candidates.
The personalties of these ex service officers being fully mature and developed, it would not be difficult to arrive at a fair assessment of their merits on the basis of searching and incisive viva voce test and therefore in their case, the viva voce test may be accorded relatively greater weight.
But in any event the marks allocate for the viva voce test cannot be as high as 33.3 per cent.
The position is no different when we examine the question in regard to the percentage of marks allocated for the viva voce test in case of persons belonging to the general category.
The percentage in the case of these candidates is less than that in the case of ex service officers, but even so it is quite high at the figure of 22.2.
Here also it has been pointed out by the Division Bench by giving facts and figures as to how in the case of present selections from the general category the spread of marks in the viva voce test was inordinately high compared to the spread of marks in the written examination so that a candidate receiving low marks in the written examination could be pulled up to a high position in the merit list by inordinately high marking in the viva voce test.
The viva voce test in the general category, too, would consequently tend to become a determining factor in the process of selection, tilting the scales in favour of one candidate or the other according to the marks awarded to him in the viva voce test.
This is amply borne out by the observations of the Kothari Committee in the Report made by it in regard to the selections to the Indian Administrative Service and other allied services.
The competitive examination in the Indian Administrative Service and other allied services also consists of a written examination followed by a viva voce test.
Earlier in 1948 the percentage of marks allocated for the viva voce 699 test was 22 and it was marginally brought down to 21.60 in 1951 and then again in 1964, it was scaled down to 17.11.
The Kothari Committee in its Report made in 1976 pleaded for further reduction of the percentage of marks allocated for the viva voce test and strongly recommended that the viva voce test should carry only 300 out of a total of 3000 marks.
The Kothari Committee pointed out that even where the percentage of marks allocated for the viva voce test was 17.11, nearly 1/4th of the candidates selected owed their success to the marks obtained by them at the viva voce test.
This proportion was regarded by the Kothari Committee as "somewhat on the high side".
It is significant to note that consequent upon the Kothari Committee Report, the percentage of marks allocated for the viva voce test in the competitive examination for the Indian Administrative Service and other allied services was brought down still further to 12.2.
The result is that since the last few years, even for selection of candidates in the Indian Administrative Service and other allied services where the personality of the candidate and his personnel characteristics and traits are extremely relevant for the purpose of selection, the marks allocated for the viva voce test constitute only 12.2 per cent of the total marks.
Now if it was found in the case of selections to the Indian Administrative Service and other allied services that the allocation of even 17.11 per cent marks for the viva voce test was on the higher side and it was responsible for nearly 1/4th of the selected candidates securing a place in the select list owing to the marks obtained by them at the viva voce test, the allocation of 22.2 per cent marks for the viva voce test would certainly be likely to create a wider scope for arbitrariness.
When the Kothari Committee admittedly an Expert Committee, constituted for the purpose of examining recruitment policy and selection methods for the Indian Administrative Service and other allied services took the view that the allocation of 17.1 per cent marks for the viva voce test was on the higher side and required to be reduced, it would be legitimate to hold that in case of selections to the Haryana Civil Services (Executive Branch) and other allied services, which are services of similar nature in the State, the allocation of 22.2 per cent marks for the viva voce test was unreasonable.
We must therefore regard the allocation of 22.2 per cent of the total marks for the viva voce test as infecting the selection process with the vice of arbitrariness.
But the question which then arises for consideration is as to what is the effect of allocation of such a high percentage of marks 700 for the viva voce test, both in case of ex service officers and in case of other candidates, on the selections made by the Haryana Public Service Commission.
Though we have taken the view that the percentage of marks allocated for the viva voce test in both these cases is excessive, we do not think we would be justified in the exercise of our discretion in setting aside the selections made by the Haryana Public Service Commission after the lapse of almost two years.
The candidates selected by the Haryana Public Service Commission have already been appointed to various posts and have been working on these posts since the last about two years.
Moreover the Punjab Civil Service (Executive Branch) Rules 1930 under which 33.3 per cent marks in case of ex service officers and 22.2 per cent marks in case of other candidates, have been allocated for the viva voce test have been in force for almost 50 years and everyone has acted on the basis rules.
If selections made in accordance with the prescription contained in these rules are now to be set aside, it will upset a large number of appointments already made on the basis of such selections and the integrity and efficiency of the entire administrative machinery would be seriously jeopardised.
We do not therefore propose to set aside the selections made by the Haryana Public Service Commission though they have been made on the basis of an unduly high percentage of marks allocated for the viva voce test.
Now if the allocation of such a high percentage of marks as 33.3 in case of ex service officers and 22.2 in case of other candidates, for the viva voce test is excessive, as held by us, what should be the proper percentage of marks to be allocated for the viva voce test in both these cases.
So far as candidates in the general category are concerned we think that it would be prudent and safe to follow the percentage adopted by the Union Public Service Commission in case of selections to the Indian Administrative Service and other allied services.
The percentage of marks allocated for the viva voce test by the Union Public Service Commission in case of selections to the Indian Administrative Services and other allied service is 12.2.
and that has been found to be fair and just, as striking a proper balance between the written examination and the viva voce test.
We would therefore direct that hereafter in case of selections to be made to the Haryana Civil Services (Executive Branch) and other allied services, where the competitive examination consists of a written examination followed by a viva voce test, the marks allocated for 701 the viva voce test shall not exceed 12.2 per cent of the total marks taken into account for the purpose of selection.
We would suggest that this percentage should also be adopted by the Public Service Commissions is other States, because it is desirable that there should be uniformity in the selection process throughout the country and the practice followed by the Union Public Service Commission should be taken as a guide for the State Public Service Commissions to adopt and follow.
The percentage of marks allocated for the viva voce test case of ex service officers may, for reasons we have already discussed, be somewhat higher than the percentage for the candidates belonging to the general category.
We would therefore direct that in case of ex service officers, having regard to the fact that they would ordinarily be middle aged persons with personalities fully developed the percentage of marks allocated for the viva voce test may be 25.
Whatever selections are made by the Haryana Public Service Commission in the future shall be on the basis that the marks allocated for the viva voce test shall not exceed 12.2 per cent in case of candidates belonging to the general category and 25 per cent in case of ex service officers.
Before we part with this judgment we would like to point out that the Public Service Commission occupies a pivotal place of importance in the State and the integrity and efficiency of its administrative apparatus depends considerably on the quality of the selections made by the Public Service Commission.
It is absolutely essential that the best and finest talent should be drawn in the administration and administrative services must be composed of men who are honest, upright and independent and who are not swayed by the political winds blowing in the country.
The selection of candidates for the administrative services must therefore be made strictly on merits, keeping in view various factors which go to make up a strong, efficient and people oriented administrator.
This can be achieved only if the Chairman and members of the Public Service Commission are eminent men possessing a high degree of calibre, competence and integrity, who would inspire confidence in the public mind about the objectivity and impartiality of the selections to be made by them.
We would therefore like to strongly impress upon every State Government to take care to see that its Public Service Commission is manned by competent, honest and independent persons of outstanding ability and high reputation who command the confidence of the people and who would not allow themselves to be deflected by 702 any extraneous considerations from discharging their duty of making selections strictly on merits.
Whilst making these observations we would like to make it clear that we do no for a moment wish to suggest that the Chairman and members of the Haryana Public Service Commission in the present case were lacking in calibre, competence or integrity.
We would also like to point out that in some of the States, and the State of Haryana is one of them, the practice followed is to invite a retired Judge of the High Court as an expert when selections for recruitment to the Judicial Service of the State are being made and the advice given by such retired High Court Judge who participates in the viva voce test as an expert is sometimes ignored by the Chairman and members of the Public Service Commission.
This practice is in our opinion undesirable and does not commend itself to us.
When selections for the Judicial Service of the State are being made, it is necessary to exercise the utmost care to see that competent and able persons possessing a high degree of rectitude and integrity are selected, because if we do not have good, competent and honest judges, the democratic polity of the State itself will be in serious peril.
It is therefore essential that when selections to the Judicial Service are being made, a sitting Judge of the High Court to be nominated by the Chief Justice of the State should be invited to participate in the interview as an expert and since such sitting Judge comes as an expert who, by reason of the fact that he is a sitting High Court Judge, knows the quality and character of the candidates appearing for the interview, the advice given by him should ordinarily be accepted, unless there are strong and cogent reasons for not accepting such advice and such strong and cogent reasons must be recorded in writing by the Chairman and members of the Public Service Commission.
We are giving this direction to the Public Service Commission in every State because we are anxious that the finest talent should be recruited in the Judicial Service and that can be secured only by having a real expert whose advice constitutes a determinative factor in the selection process.
We accordingly allow the appeals, set aside the judgment of the Punjab and Haryana High Court and reject the challenge to the validity of the selections made by the Haryana Public Service Commission to the Haryana Civil Services (Executive Branch) and other allied services.
But in view of the fact that an unduly large number of candidates were called for interview and the marks 703 allocated in the viva voce test were excessively high, it is possible that some of the candidates who might have otherwise come in the select list were left out of it, perhaps unjustifiably.
We would therefore direct that all the candidates who secured a minimum of 45 per cent marks in the written examination but who could not find entry in the select list, should be given one more opportunity of appearing in the competitive examination which would now have to be held in accordance with the principles laid down in this Judgment and this opportunity should be given to them, even though they may have passed the maximum age prescribed by the rules for recruitment to the Haryana Civil Services (Executive Branch) and other allied services.
We would direct that in the circumstances of the case the fair order of costs would be that each party should bear and pay his own costs throughout.
| One N. Kanti Lal had 28% share in a partnership firm.
The Partnership Deed, by cl.
(10) provided that the firm shall not stand dissolved on death of any of the partners and the partner dying shall have no right whatever in the goodwill of the firm.
On his death, the respondent accountable person filed necessary return under the without including the value of the share of the deceased in the goodwill of the firm.
The Assistant Controller of Estate Duty, however, held that the share of the deceased in the goodwill of the firm was liable to be included in the principal value of his property and added the same to the value of the interest which the deceased had in the partnership assets.
The Appellate Controller of Estate Duty confirmed the aforesaid order in appeal.
The accountable person preferred appeal before the Appellate Tribunal contending: (1) that the deceased had no interest in the assets of the firm and hence his share in the goodwill did not pass at all; (2) that in view of cl.
(10) of the Partnership Deed the share of the deceased partner in the goodwill did not pass and as such was not liable to the charge of estate duty; and (3) that when a partnership was a going concern, there could not be any separate valuation of the goodwill which went with the running business.
The Tribunal rejected all the contentions and held that in spite of cl.
(10) of the partnership agreement, the value of the goodwill to the extent of the share of the deceased passed on his death and it was liable to be charged to estate duty.
46 On reference by the Tribunal, the High Court held: (i) that the interest of the deceased in the firm was property within the meaning of the provisions of the ; and (ii) that the value of the interest of the deceased in the partnership firm would not include the goodwill of the partnership firm.
This Court, on the question: 'Whether the value of the interest of the deceased in a partnership firm would include the goodwill of the partnership firm and liable to estate duty ', allowing the Appeal of the Revenue, ^ HELD: 1.
In a partnership there is a community of interest in which all the partners take in the property of the firm.
But that does not mean that during the subsistence of the partnership a particular partner has any proprietary interest in the assets of the firm.
Every partner of the firm has a right to get his share of profits till the firm subsists, and he has also a right to see that all the assets of the partnership are applied to and used for the purpose of the partnership business.
All these rights of a partner show that he has got a marketable interest in all the capital assets of the firm including the goodwill asset even during the subsistence of the partnership.
This interest is 'property ' within the meaning of section 2(15) of the .
[53 D F] 2.
The goodwill of the firm is an asset in which the dying partner has a share.
It passes on the death of the dying partner and the beneficiary of such passing would be one who by virtue of the partnership agreement would be entitled to the value of that asset.
The fact that such interest might devolve not on the legal representatives but on a different group or category of persons or that from the goodwill the legal representatives might be excluded, would not make any difference for the purpose of assessment of estate duty.
The entirety of the interest of the deceased partner that would pass, which necessarily included goodwill, would be includible in the estate.
The valuation of such entire interest has to be determined as provided under section 36 of the read with Rule 7(2) of the Estate Duty Rules, 1953.
[61 E G] 3.
The share of the deceased in the partnership did not evaporate or disappear.
It went together with the other assets and should be valued in the manner contemplated under Rule 7(c) of the Estate Duty Rules.
The goodwill of the firm after the death of the dying partner does not get diminished or extinguished.
Whoever has the benefit of that firm has the benefit of the value of that goodwill.
Therefore, if by any 47 arrangement, for instance, clause (10) of the partnership agreement in the instant case, heirs do not get any share in the good will, the surviving partners who will have the benefit of the partnership will certainly have that benefit.
Therefore, as a result of the death of the dying partner, there is cesser of interest as well as accrual or arising of benefit of the said cesser.
B D] 4.
Difficulties in making apportionment do not make a taxable item non taxable.[58 C] Perpetual Executors and Trustees Association of Australia Ltd. vs Commissioner of Taxes, = 25 I.T.R. (ED) 47, Attorney General vs Boden and Another, 1912 (I) K.B. 539, Addanki Narayanappa & Anr.
vs Bhashara Krishnappa and 13 ors.
, A.I.R. 1966 S.C. 1330=[1966] 3 SCR 400, Commission of Income tax, Madras vs Best and Co. (Private) Ltd., 60 I.T.R.11 and Khushal Khemgar Shah vs Mrs. Khorshed Banu; , relied upon.
Controller of Estate Duty, Madras vs Ibrahim Gulam Hussain Currimbhoy, , State vs Prem Nath, , Controller of Estate Duty, Bombay City I vs Fakirchand Fatchchand Sachdev, , Controller of Estate Duty vs Kanta Devi Taneja, and Controller of Estate Duty, West Bengal vs Annaraj Mehta and Deoraj Mehta, , approved.
Attorney General of Ceylon vs AR.
Arunachalam Chettiar and Others, E.D., Alladi Kuppuswami vs Controller of Estate Duty, Madras, and Smt.
Surumbayi Ammal vs
Controller of Estate Duty, Madras, , distinguished.
Controller of Estate Duty vs Smt.
Ram Sumarni Devi, and P. Abdul Sattar vs Controller of Estate Duty, , overruled.
|
rl.) Petition No. 96 of 1989.
(Under Article 32 of the Constitution of India).
Nand Lal, S.K. Bagga and Mrs. S.K. Bagga for the Petitioner.
V.C. Mahajan Mrs. Indra Sawhney, Ms. A. Subhashini, Aruneshwar Gupta, Surya Kant and I. Makwana for the Respondents.
The Judgment of the Court was delivered by AHMADI, J.
Liberty is the life line of every human being.
Life without liberty is `lasting ' but not `living '.
Liberty is, therefore, considered one of the most precious and cherished possessions of a human being.
Any attempt to take liberties with the liberty of a human being is visited with resistance.
Since no human being can tolerate fetters on his personal liberty it is not surprising that the petitioner Ashok Kumar alias Golu continues to struggle for his liberty, premature release, not fully content with the enunciation of the law in this behalf 864 by this Court in Maru Ram vs Union of India, {1981] 1 SCR 1196.
The questions of law which are raised in this petition brought under Article 32 of the Constitution arise upon facts of which we give an abridged statement.
On the basis of a FIR lodged on October 21, 1977, the petitioner was arrested on the next day and he along with others was chargesheeted for the murder of one Prem Nagpal.
The petitioner was tried and convicted for murder on December 20, 1978 in Sessions Case No. 32 of 1978 by the learned Sessions Judge, Ganganagar, and was ordered to suffer imprisonment for life.
His appeal, Criminal Appeal No. 40 of 1979, was dismissed by the High Court of Rajasthan.
Since then he is serving time.
It appears that he filed a Habeas Corpus Writ Petition No. 2963 of 1987 in the High Court of Rajasthan at Jodhpur for premature release on the plea that he was entitled to be considered for such release under the relevant rules of Rajasthan Prisons (Shortening of Sentences) Rules, 1958, (hereinafter alluded to as `the 1958 Rules ') notwithstanding the insertion of Section 433A in the Code of Criminal Procedure, 1973 (hereinafter called `the Code ') with effect from December 18, 1978, just two days before his conviction.
His grievance was that he was being denied the benefit of early release under the 1958 Rules under the garb of the newly added Section 433A, on the ground that it places a statutory embargo against the release of such a convict `unless he has served atleast 14 years of imprisonment '.
He contended that the said provision could not curtail the constitutional power vested in the Governor by virtue of Article 161 of the Constitution which had to be exercised on the advice of the Council of Ministers which advice could be based on a variety of considerations including the provisions of the 1958 Rules.
The writ petition was, however, dismissed by the High Court on October 31, 1988, on the ground that it was premature inasmuch as the petitioner 's two representations, one to the Governor and another to the State Home Minister, were pending consideration.
The High Court directed that they should be disposed of within one month.
In this view of the matter the High Court did not deem it necessary to consider the various questions of law raised in the petition on merits.
After the rejection of his writ petition by the High Court, the petitioner through his counsel addressed a letter dated November 28, 1988 to the Governor inviting his attention to the earlier representation dated August 29, 1988 and requesting him to take a decision thereon within a month as observed by the High Court.
Failing to secure his early release notwithstanding the above efforts, the petitioner has invoked the extraordinary jurisdiction of this Court under Article 32 of the Constitution. 865 The petitioner 's case in a nutshell is that under the provisions of the 1958 Rules, a `lifer ' who has served an actual sentence of about 9 years and 3 months is entitled to be considered for premature release if the total sentence including remissions works out to 14 years and he is reported to be of good behaviour.
However, the petitioner contends, his case for premature release is not considered by the concerned authorities in view of the newly added section 433A of the Code on the interpretation that by virtue of the said provision the case of a `lifer ' cannot be considered for early release unless he has completed 14 years of actual incarceration, the provisions of sections 432 and 433 of the Code as well as the 1958 Rules notwithstanding.
According to him, even if the provisions of sections 432 and 433 of the Code do not come into play unless a convict sentenced to life imprisonment has completed actual incarceration for 14 years as required by section 433A, the authorities have failed to realise that section 433A cannot override the constitutional power conferred by Articles 72 and 161 of the Constitutional on the President and the Governor, respectively, and the State Government i.e., the Council of Ministers, could advise the Governor to exercise power under Article 161 treating the 1958 Rules as guidelines.
Since the petitioner had already moved the Governor under Article 161 of the Constitution it was incumbent on the State Government to consider his request for early release, notwithstanding section 433A, and failure to do so entitled the petitioner to immediate release as his continued detention was, wholly illegal and invalid.
In support of this contention the petitioner has placed reliance on the ratio of Maru Ram 's decision.
The petitioner brands section 433A of the Code to be a `legislative fraud ' inasmuch as the said provision was got approved by the Parliament on the assurance that the said provision is complementary to the various amendments proposed in the Indian Penal Code.
In the alternative it is contended that in any case this Court should by a process of interpretation limit the scope of section 433A of the Code to those cases only to which it would have been limited had the legislation proposing amendments in the Indian Penal Code gone through.
In any case after the decision of this Court in Maru Ram 's case, the efficacy of section 433A is considerably reduced and the petitioner is entitled to early release by virtue of the power contained in ARticle 161 read with the 1958 Rules even if guidelines are not formulated notwithstanding the subsequent decision of this Court in Kehar Singh vs Union of India, ; Counsel submitted that after the decision of this Court in Bhagirath vs Delhi Administration, ; whereunder this Court extended the benefit of section 428 of the Code even 866 to life convicts, the ratio in Gopal Godse vs State of Maharashtra, ; had undergone a change.
On this broad approach, counsel for the petitioner, formulated questions of law which may be stated as under: 1.
Whether the insertion of section 433A in the Code was a legislative fraud inasmuch as the connected legislation, namely, the Indian Penal Code (Amendment) Bill XLII of 1972 did not become law although passed by the Rajya Sabha as the IPC (Amendment) Act, 1978, on November 23, 1978? 2.
Whether on the ration of Maru Ram 's decision, in the absence of any guidelines formulated by the State under Article 72 of 161 of the Constitution, section 433A of the Code would not apply to life convicts and the 1958 Rules will prevail for the purpose of exercise of power under Article 72 of 161 of the Constitution? Inter connected with this question, the following .l questions were raised: a) Whether Maru Ram 's decision is in conflict with Kehar Singh 's Judgment on the question of necessity or otherwise of guidelines for the exercise of power under Article 7 and 161 of the constitution? b) Whether the use of two expressions "remission" and "remit" in Articles 72 and 161 convey two different meanings and if yes, whether the content f power in the two expressions is different? c) Whether the persons sentenced to death by Court, whose death sentence has been commuted to life imprisonment by executive clemency, form a distinct and separate class for the purpose of application of section 433A of the Code as well as for the purpose of necessity (or not) of guidelines for premature release in exercise of power under Articles 72 and 161, from the persons who at the initial stage itself were sentenced to life imprisonment by court verdict? And whether in the latter case guidelines are mandatory under Article 72 and 161 and a well designed scheme of remission must be formulated if the constitutional guarantee under Articles 14 and 21 is to be preserved? d) Whether the whole law of remission needs to be reviewed after Bhagirath 's case wherein this Court held that imprisonment 867 for life is also an imprisonment for a term and that a life convict is entitled to set off under section 428 Cr.
P.C.? e) Whether it is permissible in law to grant conditional premature release to a life convict even before completion of 14 years of actual imprisonment notwithstanding section 433A of the Code? If yes, whether the grant of such conditional release will be treated as the prisoner actually serving time for the purpose of section 433A of the Code? First the legislative history.
The Law Commission had in its 42nd Report submitted in June, 1971 suggested numerous changes in the Indian Penal Code (IPC).
Pursuant thereto an Amendment Bill No. XLII of 1972 was introduced in the Rajya Sabha on December 11, 1972 proposed wide ranging changes in the IPC.
One change proposed was to bifurcate section 302, IPC into two parts, the first part providing that except in cases specified in the second part, the punishment for murder will be imprisonment for life whereas for the more heinous crimes enumerated in clauses (a) to (c), of sub section (2) the punishment may be death or imprisonment for life.
A motion for reference of the Bill to the Joint Committee of both the Houses was moved in the Rajya Sabha on December 14, 1972 by the then Minister of State in the Ministry of Home Affairs and was adopted on the same day.
The Lok Sabha concurred in the motion of the Rajya Sabha on December 21, 1972.
The Joint Parliamentary Committee presented its report to the Rajya Sabha on January 29, 1976 recommending changes in several clauses of the Bill.
While retaining the amendment proposed in section 302, IPC, it recommended inclusion of one more clause (d) after clause (c) in sub section (2) thereof and at the same time recommended deletion of section 303, IPC.
It also recommended substitution of the existing section 57, IPC, by a totally new section, the proviso whereto has relevance.
The proposed proviso was as under: "Provided that where a sentence of imprisonment for life is imposed on conviction of a person for a capital offence, or where a sentence of death imposed on a person has been commuted into one of imprisonment for life, such person shall not be released from prison unless he had served at least fourteen years of imprisonment.
" The reason which impelled the Committee to introduce the above proviso was "That sometimes due to grant of remission even murderers sentenced or commuted to life imprisonment were released at the end 868 of 5 to 6 years.
" The Committee, therefore, felt that such a convict should not be released unless he has served atleast 14 years of imprisonment.
It is evident from the scheme of the aforesaid recommendations that the proviso was intended to apply to only those convicts who were convicted for a capital offence (this expression was defined by clause 15 of the Bill recommending substitution of section 40, IPC, as `an offence for which death is one of the punishments provided by law ') or whose sentence of death was commuted into one of imprisonment for life and not to those who were governed by the first part of the proposed section 302, IPC.
It was pointed out by counsel that similar benefit would have accrued to offenders convicted for offences covered under section 305, 307 or 396 if the proposed sections 305, 307(b) and 396(b) had come into being.
That, contends the petitioner 's counsel, would have considerably narrowed down the scope of the proposed proviso to section 57, IPC, and consequently the rigour of the said provision would have fallen on a tiny minority of offenders guilty of a capital offence.
Pursuant to the recommendations made by the Committee, two bills, namely, the IPC (Amendment) Bill, 1978, came to be introduced, the former was passed with changes by the Rajya Sabha on November 23, 1978 while the latter was introduced in the Lok Sabha on November 8, 1978, and in the Rajya Sabha on December 5, 1978.
The proposal to add a proviso to the proposed section 57, IPC did not find favour as it was thought that the said subject matter appropriately related to Chapter XXXII of the Code and accordingly the said provision was introduced as section 433A in the Code.
While the amendments to the Code became law with effect from December 18, 1978, the IPC amendments, though passed by the Rajya Sabha could not be got through the Lok Sabha and lapsed.
It may here be mentioned that the IPC Bill as approved by the Rajya Sabha contained the proposal to divide section 302 into two parts, in fact an additional clause was sought to be introduced in the second part thereof and sections 305, 307 and 396 were also sought to be amended as proposed by the Committee.
This in brief is the legislative history.
In the backdrop of the said legislative history, counsel for the petitioner argued that a legislative fraud was practised by enacting section 433A of the Code and failing to carry out the corresponding changes in sections 302, 305, 307, 396, etc., assured by the passing of the Indian Penal Code (Amendment) Act, 1978, by the Rajya Sabha on November 23, 1978.
According to him it is evident from the scheme of the twin Amendment Bills that the legislative intent was to apply the rigour of section 433A of the Code to a small number of heinous 869 crimes which fell within the meaning of the expression capital offence.
It was to achieve this objective that section 302, IPC was proposed to be bifurcated so that a large number of murders would fall within the first part of the proposed provision which prescribed the punishment of life imprisonment only and thus fell beyond the mischief of section 433A of the Code.
To buttress his submission our attention was invited to Annexure II to the petition which is a copy of the letter dated July 10, 1979, written by the Joint Secretary in the Ministry of Home Affairs to Home Secretaries of all the concerned State Governments explaining the purport of the newly added section 433A. After explaining that section 57, IPC, had a limited scope, namely, calculating fractions of terms of imprisonment only, he proceeds to state in paragraph 3 of the letter as under: "The restrictions imposed by section 433A applies only to those life convicts who are convicted for offences for which death is one of the punishments prescribed by law.
In the Indian Penal Code (Amendment) Bill, 1978 as passed by the Rajya Sabha and now pending in the Lok Sabha, section 302 is proposed to be amended so as to provide that the normal punishment for murder shall be imprisonment for life and that only in certain cases of aggravating circumstances will the court have discretion to award death sentences.
" Then in paragraph 4 he proceeds to clarify as under: "Even regarding these convicts the restriction imposed by section 433A is not absolute for, the Constitutional power of the Governor under Article 161 to commute and remit sentences remains unaffected and can be exercised in each case in which the exercise of this power is considered suitable.
" Then in paragraph 4 he proceeds to clarify as under: "Even regarding these convicts the restriction imposed by section 433A is not absolute for, the Constitutional power of the Governor under Article 161 to commute and remit sentences remains unaffected and can be exercised in each case in which the exercise of this power is considered suitable.
" In paragraph 6 of the detailed note appended to the said letter, the legal position was explained thus: "It may be pointed out that the restriction introduced by section 433A does not apply to all life convicts.
It applies only to those prisoners who are convicted of a capital offence i.e. an offence for which death is one of the punishments prescribed by law.
Once the Indian Penal Code (Amendment) Bill becomes the law, offenders sentenced 870 under proposed section 302(i) will not be covered by this provision as the offence will not be a capital offence.
Thus in future the restriction introduced by section 433A will not be applicable to them and will, in effect, cover only a very small number of cases.
Even in this small number of cases the restriction will not in any way curb the Constitutional power to grant remission and commutation vested in the President or the Governor by virtue of Articles 72 and 161.
" There can be no doubt that by this letter it was clarified that section 433A of the Code will apply to only those convicted of a capital offence and not to all life convicts.
It is equally clear that the said provision was expected to apply to exceptionally heinous offences falling within the definition of `capital offence ' once the Indian Penal Code (Amendment) Bill became law.
Section 433A was, therefore, expected to deny premature release before completion of actual 14 years of incarceration to only those limited convicts convicted of a capital offence, i.e., an exceptionally heinous crime specified in the second part of the proposed section 302, IPC.
Lastly it clarifies that section 433A cannot and does not in any way affect the constitutional power conferred on the President/Governor under ARticle 72/161 of the Constitution.
It cannot, therefore, be denied that this letter and the accompanying note does give an impression that certain provisions of the Indian Penal Code (Amendment) Boll were interlinked with section 433A of the Code.
Assuming the Criminal Procedure Code (Amendment) Bill and the Indian Penal Code (Amendment) Bill were intended to provide an integrated scheme of legislation, can it be said that the failure on the part of the Lok Sabha to pass the letter renders the enactment of the former by which section 433A was introduced in the Code, `a legislative fraud ' as counsel had liked to call it or to use a more familiar expression `colourable exercise of legislative power '? Counsel submitted that section 433A was got introduced on the statute book by deception, in that, when the former Bill was made law an impression was given that the twin legislation which had already been cleared by the Rajya Sabha on November 23, 1978 would in due course be cleared by the Lok Sabha also so that the application of section 433A would be limited to capital offences only and would have no application to a large number of `lifers '.
It must be conceded that such would have been the impact if the Indian Penal Code (Amendment) Bill was passed by the Lok Sabha in the form in which the Rajya and approved it.
871 This is not a case of legislative incompetence to enact section 433A.
No such submission was made.
Besides the question of vires of section 433A of the Code has been determined by the Constitution Bench of this Court in Maru Ram 's case.
This Court repelled all the thrusts aimed at challenging the constitutional validity of section 433A.
But counsel submitted that the question was not examined from the historical perspective of the twin legislations.
Counsel for the State submitted that it was not permissible for us to reopen the challenge closed by the Constitution Bench on the specious plea that a particular argument or plea was not canvassed or made before that Bench.
The objection raised by counsel for the State Government is perhaps not without substance but we do not propose to deal with it because even otherwise we see no merit in the submission of the petitioner 's counsel.
It is only when a legislature which has no power to legislate frames a legislation so camouflaging it as to appear to be within its competence when it knows it is not, it can be said that the legislation so enacted is colourable legislation.
In K.C. Gajapati Narayan Deo vs State of Orissa, ; the Orissa Agricultural Income tax (Amendment) Act, 1950, was challenged on the ground of colourable legislation or a fraud on the Constitution as its real purpose was to effect a drastic reduction in the amount of compensation payable under the Orissa Estates Abolition Act, 1952.
The facts were that a Bill relating to the Orissa Abolition Act, 1952 was published in the Gazette on January 3, 1950.
It provided that any sum payable for agricultural income tax for the previous year should be deducted from the gross asset of an estate for working out the net income on the basis whereof compensation payable to the estate owner could be determined.
Thereafter on January 8, 1950, a Bill to amend the Orissa Agricultural Income tax, 1947, was introduced to enhance the highest rate of tax from 3 annas to 4 annas in a rupee and to reduce the highest slab from Rs. 30,000 to Rs. 20,000.
The next Chief Minister, however, dropped this Bill and introduced a fresh Bill enhancing the highest rate to 12 annas 6 pies in a rupee and reducing the highest slab to rs.
15,000 only.
On the same becoming law it was challenged on the ground that the real purpose of the legislation was to drastically reduce the compensation payable to the estate owners.
Mukherjea, J., who spoke for the Court observed as under: "It may be made clear at the outset that the doctrine of colourable legislation does not involve any question of bona fides or mala fides on the part of the legislature.
The whole doctrine resolves itself into the question of competency of a particular legislature to enact a particular law.
If 872 the legislature is competent to pass a particular law, the motives which impelled it to act are really irrelevant.
On the other hand, if the legislature lacks competency, the question of motive does not arise at all.
Whether a statute is constitutional or not is thus always a question of power.
" Thus the whole doctrine resolves itself into a question of competency of the concerned legislature to enact the impugned legislation.
If the legislature has transgressed the limits of its powers and if such transgression is indirect, covert or disguised, such a legislation is described as colourable in legal parlance.
The idea conveyed by the use of the said expression is that although apparently a legislature in passing the statute purported to act within the limits of its powers, it had in substance and reality transgressed its powers, the transgression being veiled by what appears on close scrutiny to be a mere pretence or disguise.
In other words if in pith and substance the legislation does not belong to the subject falling within the limits of its power but is outside it, the mere form of the legislation will not be determinate of the legislative competence.
In Sonapur Tea Co. Ltd. vs Must.
Mazirunnessa; , it was reiterated relying on Gajapati 's case that the doctrine of colourable legislation really postulates that legislation attempts to do indirectly what it cannot do directly.
Such is not the case before us.
It is no body 's contention that Parliament was not competent to amend the Criminal Procedure Code by which section 433A was inserted.
Whether or not the connecting Indian Penal Code (Amendment) Bill ought to have been cleared or not was a matter left to the wisdom of the Lok Sabha.
Merely because the Criminal Procedure Bill was made law and the Indian Penal Code (Amendment) Bill was passed by the Rajya Sabha did not obligate the Lok Sabha to clear it.
The Lok Sabha to clear it.
The Lok Sabha could have its own views on the proposed Indian Penal Code amendments.
It may agree with the executive 's policy reflected in the Bill, with or without modifications, or not at all.
Merely because in the subsequent instructions issued by the letter of July 10, 1979 and the accompanying note (Annex.
II) the Joint Secretary had interlinked the two Bills, the Lok Sabha was under no obligation to adopt the measure as such representation could not operate as estoppel against it.
Even the indirect attempt on the part of the High Court of Himachal Pradesh in the ragging case to force the State Government to legislate, State of Himachal Pradesh vs A Parent of a student of Medical College, Simla, [1985] 3 SCC 169 was disapproved by this Court as a matter falling, outside the functions and duties of the judiciary.
It is, therefore, obvious that no question of mala fides on the part of the legislature was involved in the enactment of one legislation and failure to 873 enact another.
There is no question of `legislative fraud ' or `colourable legislation ' involved in the backdrop of the legislative history of section 433A of the Code as argued on behalf of the petitioner.
Counsel for the Petitioner, However, tried to seek support form the Privy Council decision in W.R. Moram vs Deputy Commissioner of Taxation for N.S.W., Wherein the question to be considered was whether the legislative scheme was a colourable one forbidden by section 5(ii) of the Australian Constitution.
There was no attempt to disguise the scheme as it was fully disclosed.
The Privy Council, while holding that the scheme was not a colourable legislation, observed that `where there is admittedly a scheme of proposed legislation, it seems to be necessary when the `pith and substance ' or `scope and effect ' of any one of the Acts is under consideration, to treat them together and to see how they interact '.
But that was a case where the scheme was carried out through enactments passed by the concerned legislatures.
It is in that context that the above observations must be read and understood.
In the present case also if both the Bills had become law, counsel would perhaps have been justified in demanding that in understanding or construing one legislation or the other, the scheme common to both must be kept in view and be permitted to interact.
But where the linkage does not exist on account of the Indian Penal Code (Amendment) Bill not having become law we are unable to appreciate how section 433A can be read down to apply to only those classes of capital offences to which it would have applied had the said Bill been passed by the Lok Sabha in the terms in which it was approved by the Rajya Sabha.
The language of section 433A is clear and unambiguous and does not call for extrinsic aid for its interpretation.
To accept the counsel 's submission to read down or interpret section 433A of the Code with the aid of the change proposed by the Indian Penal Code (Amendment) Bill would tantamount to treating the provisions of the said Bill as forming part of the Indian Penal Code which is clearly impermissible.
To put such an interpretation with the aid of such extrinsic material would result in violence to the plain language of section 433A of the Code.
We are, therefore, unable to accept even this second limb of the contention.
The law governing suspension, remission and commutation of sentence is both statutory and constitutional.
The stage for the exercise of this power generally speaking is post judicial, i.e., after the judicial process has come to an end.
The duty to judge and to award the appropriate punishment to the guilty is a judicial function which culminates by a judgment pronounced in accordance with law.
After 874 the judicial function thus ends the executive function of giving effect to the judicial verdict commences.
We first refer to the statutory provisions.
Chapter III of IPC deals with punishments.
The punishments to which the offenders can be liable are enumerated in section 53, namely, (i) death (ii) imprisonment for life (iii) imprisonment of either description, namely, rigorous or simple (iv) forfeiture of property and (v) fine.
Section 54 empowers the appropriate government to commute the punishment of death for any other punishment.
Similarly section 55 empowers the appropriate government to commute the sentence of imprisonment for life for imprisonment of either description for a term not exceeding 14 years.
Chapter XXXII of the Code, to which section 433A was added, entitled `Execution, Suspension, Remission and Commutation of sentences ' contains sections 432 and 433 which have relevance; the former confers power on the appropriate government to suspend the execution of an offender 's sentence or to remit the whole or any part of the punishment to which he has been sentenced while the latter confers power on such Government to commute (a) a sentence of death for any other punishment (b) a sentence of imprisonment for life, for imprisonment for a term not exceeding 14 years of for fine (c) a sentence of rigorus imprisonment for simple imprisonment or for fine and (d) a sentence of simple imprisonment for fine.
It is in the context of the aforesaid provisions that we must read section 433A which runs as under: "433A. Restriction on powers of remission or commutation in certain cases Notwithstanding anything contained in Section 432, where a sentence of imprisonment for life is imposed on conviction of a person for an offence for which death is one of the punishments provided by law, or where a sentence of death imposed on a person has been commutted under section 433 into one of imprisonment for life, such person shall not be released from prison unless he had served at least fourteen years of imprisonment.
" The section begins with a non obstante clause notwithstanding anything contained in section 432 and proceeds to say that where a person is convicted for an offence for which death is one of the punishments and has been visited with the lesser sentence of imprisonment for life or where the punishment of an offender sentenced to death has been commuted under section 433 into one of imprisonment for life, such offender will not be released unless he has served at least 14 years of imprisonment.
The reason which impelled the legislature to insert this provision has been stated earlier.
Therefore, one who could have been 875 visited with the extreme punishment of death but on account of the sentencing court 's generosity was sentenced to the lesser punishment of imprisonment for life and another who actually was sentenced to death but on account of executive generosity his sentence was commutted under section 433(a) for imprisonment for life have been treated under section 433A as belonging to that class of prisoners who do not deserve to be released unless they have completed 14 years of actual incarceration.
Thus the effect of section 433A is to restrict the exercise of power under sections 432 and 433 by the stipulation that the power will not be so exercised as would enable the two categories of convicts referred to in section 433A to freedom before they have completed 14 years of actual imprisonment.
This is the legislative policy which is clearly discernible from the plain language of section 433A of the Code.
Such prisoners constitute a single class and have, therefore, been subjected to the uniform requirement of suffering atleast 14 years of internment.
Counsel for the petitioner next submitted that after this court 's decision in Bhagirath 's case permitting the benefit of set off under section 428 in respect of the detention period as an undertrial, the ratio of the decision in Godse 's case must be taken as impliedly disapproved.
We see no basis for this submission.
In Godse 's case the convict who was sentenced to transportation for life had earned remission for 2963 days during his internment.
He claimed that in view of section 57 read with section 53A, IPC, the total period of his incarceration could not exceed 20 years which he had completed, inclusive of remission, and, therefore, his continued detention was illegal.
Section 57, IPC reads as follows: "57.
Fractions of terms of punishment In calculating fractions of terms of punishment, imprisonment for life shall be reckoned as equivalent to imprisonment for twenty years.
" The expression `imprisonment for life ' must be read in the context of section 45, IPC.
Under that provision the word `life ' denotes the life of a human being unless the contrary appears from the context.
We have seen that the punishments are set out in section 53, imprisonment for life being one of them.
Read in the light of section 45 it would ordinarily mean imprisonment for the full or complete span of life.
Does section 57 convey to the contrary? Dealing with this contention based on the language of section 57, this Court observed in Godse 's case at pages 444 45 as under: 876 "Section 57 of the Indian Penal Code has no real bearing on the question raised before us.
For calculating fractions of terms of punishment the section provides that transportation for life shall be regarded as equivalent to imprisonment for twenty years.
It does not say that transportation for life shall be deemed to be transportation for twenty years for all purposes; nor does the amended section which substitutes the words "imprisonment for life" for "transportation for life" enable the drawing of any such all embracing fiction.
A sentence of transportation for life or imprisonment for life must prima facie be treated as transportation or imprisonment for the whole of the remaining period of the convicted person 's natural life.
" This interpretation of section 57 gets strengthened if we refer to sections 65, 116, 120 and 511, of the Indian Penal Code which fix the term of imprisonment thereunder as a fraction of the maximum fixed for the principal offence.
It is for the purpose of working out this fraction that it became necessary to provide that imprisonment for life shall be reckoned as equivalent to imprisonment for 20 years.
If such a provision had not been made it would have been impossible to work out the fraction of an in definite term.
In order to work out the fraction of terms of punishment provided in sections such as those enumerated above, it was imperative to lay down the equivalent term for life imprisonment.
The second contention urged before the Court in Godse 's case was based on the Bombay Rules governing the remission system framed in virtue of the provisions contained in the .
This Court pointed out that the did not confer on any authority a power to commute or remit sentences.
The Remission Rules made thereunder had, therefore, to be confined to the scope and ambit of that statute and could not be extended to other statutes.
Under the Bombay Rules three types of remissions for good conduct were allowed and for working them out transportation for life was equated to 15 years of actual imprisonment.
Dealing with Godse 's plea for premature release on the strength of these rules this Court observed at page 447 as under: "The rules framed under the enable such a person to remission ordinary, special and State and the said remissions will be given credit towards his term of imprisonment.
For the purpose of working out the remis 877 sions the sentence of transportation for life is ordinarily equated with a definite period, but it is only for that particular purpose and not for any other purpose.
As the sentence of transportation for life or its prison equivalent the life imprisonment is one of indefinite duration, the remissions so earned do not in practice help such a convict as it is not possible to predicate the time of his death.
That is why the rules provide for a procedure to enable an appropriate Government to remit the sentence under section 401 (now section 432) of the Code of Criminal Procedure on a consideration of the relevant factors including the period of remissions earned.
The question of remission is exclusively within province of the appropriate Government; and in this case it is admitted that though the appropriate Government made certain remissions under section 401 of the Code of Criminal Procedure, it did not remit the entire sentence.
" On this line of reasoning the submission of counsel that if the Court were to take the view that transportation for life or imprisonment for life enures till the last breath of the convict passes out, the entire scheme of remissions framed under the or any like statute and the whole exercise of crediting remissions to the account of the convict would collapse, was spurned.
This Court came to the conclusion that the Remission Rules have a limited scope and in the case of a convict undergoing sentence of transportation for life or imprisonment for life it acquires significance only if the sentence is commuted or remitted, subject to section 433A of the Code or in exercise of constitutional power under Articles 72/161.
In Maru Ram 's case the Constitution Bench reaffirmed the ratio of Godse 's case and held that the nature of a life sentence is incarceration until death; judicial sentence for imprisonment for life cannot be in jeopardy merely because of long accumulation of remissions.
Release would follow only upon an order under section 401 of the Criminal Procedure Code, 1898 by the appropriate Government or on a clemency order in exercise of power under Articles 72/161 of the Constitution.
At page 1220 the Constitution Bench expressed itself thus: "Ordinary where a sentence is for a definite term, the calculus of remissions may benefit the prisoner to instant release at that point where the substraction result is zero.
878 Here, we are concerned with life imprisonment and so we come upon another concept bearing on the nature of sentence which has been highlighted in Godse 's case.
Where the sentence is indeterminate or of uncertain duration, the result of substraction from an uncertain quantity is still an uncertain quantity and release of the prisoner cannot follow except on some fiction of quantification of a sentence of uncertain duration.
" Referring to the facts of Godse 's case and affirming the view that the sentence of imprisonment for life enures upto the last breath of the convict, this Court proceeded to estate as under: "Since death was uncertain, deduction by way of remission did not yield any tangible date for release and so the prayer of Godse was refused.
The nature of a life sentence is incarceration until death, judicial sentence of imprisonment for life cannot be in jeopardy merely because of the long accumulation of remissions.
" It is, therefore, clear from the aforesaid observations that unless the sentence for life imprisonment is commuted or remitted as stated earlier by the appropriate authority under the provisions of the relevant law, a convict is bound in law to serve the entire life term in prison; the rules framed under the or like statute may enable such a convict to earn remissions but such remissions will not entitle him to release before he has completed 14 years of incarceration in view of section 433A of the Code unless of course power has been exercised under Article 7/161 of the Constitution.
It will thus be seen from the ratio laid down in the aforesaid two cases that where a person has been sentenced to imprisonment for life the remissions earned by him during his internment in prison under the relevant remission rules have a limited scope and must be confined to the scope and ambit of the said rules and do not acquire significance until the sentence is remitted under section 432, in which case the remission would be subject to limitation of section 433A of the Code, or constitutional power has been exercised under Article 72/161 of the Constitution.
In Bhagirath 's case the question which the Constitution Bench was required to consider was whether a person sentenced to imprisonment for life can claim the benefit of section 428 of the Code which, inter alia provides for setting off the period of detention undergone by the accused as an undertrial against the sentence of 879 imprisonment ultimately awarded to him.
Referring to section 57, IPC, the Constitution Bench reiterated the legal position as under: "The provision contained in Section 57 that imprisonment for life has to be reckoned as equivalent to imprisonment for 20 years is for the purpose of calculating fractions of terms in punishment.
We cannot press that provision into service for a wider purpose.
" These observations are consistent with the ratio laid down in Godse and Maru Ram 's cases.
Coming next to the question of set off under section 428 of the Code, this Court held: "The question of setting off the period of detention undergone by an accused as an undertrial prisoner against the sentence of life imprisonment can arise only if an order is passed by the appropriate authority under section 432 of section 433 of the Code.
In the absence or such order, passed generally or specially, and apart from the provisions, if any of the relevant Jail Manual, imprisonment for life would mean, according to the rule in Gopal Vinayak Godse, imprisonment for the remainder of life.
" We fail to see any departure from the ratio of Godse 's case; on the contrary the afore quoted passage clearly shows approval of that ratio and this becomes further clear from the final order passed by the Court while allowing the appeal/writ petition.
The Court directed that the period of detention undergone by the two accused as undertrial prisoners would be set off against the sentence of life imprisonment imposed upon them, subject to the provisions contained in section 433A and, `provided that orders have been passed by the appropriate authority under section 433 of the Code of Criminal Procedure '.
These directions make it clear beyond any manner of doubt that just as in the case of remissions so also in the case of set off the period of detention as undertrial would enure to the benefit of the convict provided the appropriate Government has chosen to pass an order under sections 432/433 of the Code.
The ratio of Bhagirath 's case, therefore, does not run counter to the ratio of this Court in the case of Godse or Maru Ram.
Under the Constitutional Scheme the President is the Chief Executive of the Union of India in whom the executive power of the Union vests.
Similarly, the Governor is the Chief Executive of the 880 concerned State and in him vests the executive power of that State.
Articles 72 and 161 confer the clemency power of pardon, etc., on the President and the State Governors, respectively.
Needless to say that this constitutional power would override the statutory power contained in sections 432 and 433 and the limitation of section 433A of the Code as well as the power conferred by sections 54 and 55, IPC.
No doubt, this power has to be exercised by the President/Governor on the advice of his Council of Ministers.
How this power can be exercised consistently with Article 14 of the Constitution was one of the Questions which this Court was invited to decide in Maru Ram 's case.
In order that there may not be allegations of arbitrary exercise of this power this Court observed at pages 1243 44 as under: "The proper thing to do, if Government is to keep faith with the founding fathers, is to make rules for its own guidance in the exercise of the pardon power keeping, ofcourse, a large residuary power to meet special situations or sudden developments.
This will exclude the vice of discrimination such as may arise where two persons have been convicted and sentenced in the same case for the same degree of guilt but one is released and the other refused, for such irrelevant reasons as religion, caste, color or political loyalty.
" Till such rules are framed this Court thought that extant remission rules framed under the or under any other similar legislation by the State Governments may provide effective guidelines of a recommendatory nature helpful to the Government to release the prisoner by remitting the remaining term.
It was, therefore, suggested that the said rules and remission schemes be continued and benefit thereof be extended to all those who come within their purview.
At the same time the Court was aware that special cases may require different considerations and `the wide power of executive clemency cannot be bound down even by self created rules '.
Summing up its findings in paragraph 10 at page 1249, this Court observed: "We regard it as fair that until fresh rules are made in keeping with the experience gathered, current social conditions and accepted penological thinking a desirable step, in our view the present remissions and release schemes may usefully be taken as guidelines under ARticles 72/161 and orders for release passed.
We cannot fault the Government, if in some intractably savage delinquents, section 881 433A is itself treated as a guideline for exercise of Articles 72/161.
These observations of ours are recommendatory to avoid a hiatus, but it is for Government, Central or State, to decide whether and why the current Remission Rules should not survive until replaced by a more wholesome scheme.
" It will be obvious from the above that the observations were purely recommendatory in nature.
In Kehar Singh 's case on the question of laying down guidelines for the exercise of power under Article 72 of the Constitution this Court observed in paragraph 16 as under: "It seems to us that there is sufficient indication in the terms of Article 72 and in the history of the power enshrined in that provision as well as existing case law, and specific guidelines need not be spelled out.
Indeed, it may not be possible to lay down any precise, clearly defined and sufficiently channelised guidelines, for we must remember that the power under Article 72 is of the widest amplitude, can contemplate a myriad kind of and categories of cases with facts and situations varying from case to case, in which the merits and reasons of State may be profoundly assisted by prevailing occasion and passing time.
And it is of great significance that the function itself enjoys high status in the constitutional scheme.
" These observations do indicate that the Constitution Bench which decided Kehar Singh 's case was of the view that the language of Article 72 itself provided sufficient guidelines for the exercise of power and having regard to its wide amplitude and the status of the function to be discharged thereunder, it was perhaps unnecessary to spell out specific guidelines since such guidelines may not be able to conceive of all myraid kinds and categories of cases which may come up for the exercise of such power.
No doubt in Maru Ram 's case the Constitution Bench did recommend the framing of guidelines for the exercise of power under Articles 72/161 of the Constitution.
But that was a mere recommendation and not a ratio decidendi having a binding effect on the Constitution Bench which decided Kehar Singh 's case.
Therefore, the observation made by the Constitution Bench in Kehar Singh 's case does not upturn any ratio laid down in Maru Ram 's case.
Nor has the Bench in Kehar Singh 's case said anything with regard to using the 882 provisions of extent Remission Rules as guidelines for the exercise of the clemency powers.
It is true that Articles 72/161 make use of two expressions `remissions ' with regard to punishment and `remit ' in relation to sentence but we do not think it proper to express any opinion as to the content and amplitude of these two expressions in the abstract in the absence of a fact situation.
We, therefore, express no opinion on this question formulated by the learned counsel for the petitioner.
Lastly the learned counsel for the petitioner raised a hypothetical question whether it was permissible in law to grant conditional premature release to a life convict even before completion of 14 years of actual imprisonment, which release would tantamount to the prisoner serving time for the purpose of section 433A of the Code? It is difficult and indeed not advisable to answer such a hypothetical question without being fully aware of the nature of conditions imposed for release.
We can do no better than quote the following observations made at page 1247 in Maru Ram 's case: ". . the expression `prison ' and `imprisonment ' must receive a wider connotation and include any place notified as such for detention purposes.
`Stone walls and iron bars do not a prison make ': nor are `stone walls and iron bars ' a sine qua non to make a jail.
Open jails are capital instances.
any life under the control of the State whether within high walled or not may be a prison if the law regards it as such.
House detentions, for example, Palaces, where Gandhiji was detained were prisons.
Restraint on freedom under the prison law is the test.
Licencsed where instant re capture is sanctioned by the law and likewise parole, where the parole is not free agent, and other categories under the invisible fetters of the prison law may legitimately be regarded as imprisonment.
This point is necessary to be cleared even for computation of 14 years under section 433A.
Therefore, in each case, the question whether the grant of conditional premature release answers the test laid down by this Court in the afore quoted passage, would depend on the nature of the conditions imposed and the circumstances in which the order is passed and is to be executed.
No general observation can be made and we make none.
883 In paragraph 10 of the memorandum of the Writ petition.
, three reasons have been assigned for invoking this Court 's jurisdiction under Article 32 of the Constitution, viz., (i) the questions involved in this petition will affect the right of a large body of life convicts seeking premature release; (ii) this Court 's judgment in Bhagirath 's case deviated from the ratio laid down in Godse 's case and, therefore, the entire law of remissions needed a review; and (iii) the High Court of Rajasthan had refused to examine the merits of the various important questions of law raised before it.
It is on account of the fact that this petition was in the nature of a representative petition touching the rights of a large number of convicts of the categories referred to in section 433A of the Code, that we have dealt with the various questions of law in extenso.
Otherwise the petition could have been disposed of on the narrow ground that even though in view of sections 433A of the Code, premature release could not be ordered under sections 432/433 of the Code read with the 1958 Rules until the petitioner had completed 14 years of actual imprisonment, his release could be considered in exercise of powers under Articles 72/161 of the Constitution treating the 1958 Rules guidelines, if necessary.
The relief claimed in the petition is two fold, namely, (a) to grant a mandamus to the appropriate Government for the premature release of the petitioner by exercising constitutional power with the aid of 1958 Rules and (b) to declare the petitioner 's continued detention as illegal and void.
The petitioner has not completed 14 years of actual incarceration and as such he cannot invoke sections 432 and 433 of the Code.
His continued detention is consistent with section 433A of the Code and there is nothing on record to show that it is otherwise illegal and void.
The outcome of his clemency application under the constitution is not put in issue in the present proceedings if it has been rejected and if the same is pending despite the directive of the High Court it would be open to the petitioner to approach the High Court for the compliance of its order.
Under the circumstance no mandamus can issue.
The writ petition must, therefore, fail.
It is hereby dismissed.
Rule discharged.
G.N. Petition dismissed.
| The petitioner was appointed as Excise Sub Inspector in February 1964 in the State of U.P. and was later promoted as Excise Inspector on ad hoc basis on February 24, 1972.
He was confirmed as Excise Sub Inspector w.e.f. April 1, 1967.
Though promoted on ad hoc basis, the petitioner has continuously been working as Excise Inspector since February 24, 1972.
Raghubir Singh and Ram Dhan, respondents are direct recruits to the post of Excise Inspector and they had joined the cadre later in point of time than the petitioner i.e. after 24.2.1972.
They were promoted to the post of Excise Superintendent on 29.9.1983 and the petitioner was ignored.
Being aggrieved the petitioner has filed this petition under Article 32 of the Constitution.
According to the State and other respondents, the petitioner 's promotion to the post of Excise Inspector being on ad hoc basis was against the 1967 rules, he continues to be an ad hoc appointed and as such is not a member of the Excise Inspectors service constituted under the rules.
His name has not been shown in the seniority list of Excise Inspectors.
According to them his case has rightly not been considered for further promotion.
On the other hand, it is contended on behalf of the petitioner that the 1967 Rules in as much as they confine the channel of promotion to Tari Inspectors and Clerks were wholly arbitrary and as such violative of Articles 14 and 16 of the Constitution.
It is submitted on his behalf that the petitioner is, in any case, entitled to be promoted substantively to the cadre of excise Inspectors under 1983 rules and he is also entitled to fixation of seniority by counting his entire service as Excise Inspector from 1972 onwards.
Respondents concede that the petitioner can be appointed under 1983 rules, but contend that he is not entitled to the benefit of past service for purposes of seniority.
885 Allowing the writ petition this Court HELD: When the 1967 rules were enforced on May 24, 1967 there was in existence a permanent cadre of Excise Sub Inspectors.
The nature of duties of both the cadres were similar.
The Excise Inspectors, on molasses duty of the ranges, used to supervise the work of excise Sub Inspectors under them.
The Excise Sub Inspectors were thus natural contenders for the post of Inspectors.
There was no justification whatsoever with the framers of the 1967 rules to have kept the Excise Sub Inspectors out of the channel of promotion to the post of Excise Inspectors.
Prime facie there is no escape from the conclusion that the Excise Sub Inspectors were dealt with in an arbitrary manner by the framers of 1967 rules.
[890H 891B] It is not disputed that under the 1983 rules, the petitioner is eligible to be promoted and appointed as Excise Inspector.
[891C D] The 1983 rules came into force on March 24, 1983.
There is nothing on the record to show as to why the petitioner was not considered for promotion under the 1983 rules till today.
Inaction on the part of the State Government is wholly unjustified.
The petitioner has been made to suffer for no fault of his.
He has been serving the State Government as Excise Inspector since February 24, 1972 satisfactorily.
[891E] Rule 21(i) of the 1983 rules specifically permits substantive appointment to the cadre of Excise Inspectors with back date.
In all probability the provision of back date appointment was made in the 1983 rules to do justice to persons like the petitioner.
The petitioner is eligible under the rules to be appointed as Excise Inspector by way of promotion.
Accordingly the Court directed that the petitioner shall be deemed to be appointed by way of promotion as substantive Excise Inspector under the 1983 rules with effect from February 24, 1972.
The petitioner shall be entitled to the benefit of his entire period of service as Excise Inspector from February 24, 1972 towards fixation of his seniority in the cadre of Excise Inspector.
The petitioner shall be considered for promotion to the post of Excise Superintendent from a date earlier than the date when respondents Ram Dhan and Raghubir Singh were promoted to the said post.
The petitioner shall also be entitled to be considered to the post of Assistant Excise Commissioner in accordance with the rules from a date earlier than the date when any of his juniors were promoted to the said post.
[891G, 892B E] None of the respondents who have already been promoted to the 886 higher rank of Excise Superintendents or Assistant Excise Commissioners be reverted to accommodate the petitioner or any other person similarly situated.
The State Government shall create additional posts in the cadre of Excise Superintendents and Assistant Excise Commissioners to accommodate the petitioner and other similar persons, if necessary.
[892F] Masood Akhtar Khan & Ors.
vs State of Madhya Pradesh, ; Direct recruits Class II Engineering Officers Association vs State of Maharashtra & Ors., ; ; P. Mahendran & Ors, etc.
vs State of Karnataka Singh & Ors.
, ; ; Krishena Kumar & Ors.
vs Union of India & Ors.
, ; ; A.K. Bhatnagar & Ors.
vs Union of India & Ors.
, ; ; Baleshwar Dass & Ors. etc.
vs State of U.P. & Ors.
, [1981] 1 S.C.C. 449; Narender Chadha & Ors.
vs Union of India & Ors.
, ; and Kumari Shrilekha Vidyarthi etc.
vs State of U.P. & Ors.
, , referred to.
|
Civil Appeal No. 1935 (NL) of 1974.
From the Award dated 8.5.1974 of the Ninth Industrial Tribunal of West Bengal, Durgapur in Case No. X 4 of 1973.
Dr. Shankar Gkosh and D.N. Gupta for the Appellants.
S.K. Nandy for the Respondents.
The Judgment of the Court was delivered by BALAKRISHNA ERADI, J.
This appeal by Special Leave has been preferred against the Award dated May 8, 1974 made by the Ninth Industrial Tribunal of West Bengal, Durgapur in Case No. X 4 of 1973 on its file.
The appellants are two companies incorporated 187 under the Indian Companies Act, 1913 having their registered office in Calcutta.
Both the appellants are engaged in the business of generation, transmission, distribution and sale of electricity in certain areas of Bengal and Bihar under licences granted by the concerned Governments.
Appellant No. 1 has a power station at Dishergarh and Appellant No. 2 has its power station at Sibpore.
In connection with their aforesaid business the two appellants were having at the relevant time 400 and 250 workmen respectively employed under them.
For the years 1965 66 to 1970 71 (inclusive) bonus was paid to the workmen on the basis of agreements entered into each year under Section 34(3) of the (hereinafter referred to as the 'Act ').
Concerning the bonus payable for the year 1971 72, a dispute was raised by the workmen of the two companies and it was referred to conciliation under Section 12(1) of the .
The contention of the workmen before the Conciliation officer was that they were entitled to bonus equivalent to three months ' basicwages as on March 31, 1972 as customary bonus or in any event as bonus payable under the provisions of the Act.
The appellant companies, on the other hand, contended that the workmen were entitled to only minimum bonus as provided under the Act on a computation being made in the manner laid in the said Act.
The said dispute was ultimately settled before the Conciliation officer inter alia on the following terms: "(1) Subject to usual adjustments made in 1969 70 and 1970 71, each eligible workmen will be paid an amount equal to three months ' basic wages as on 31.3.1970 .
(2) A sum of Rs.20,000 will be distributed equally among all workmen who were on the rolls on 15.8.1972 and have worked for at least 30 days.
This will be 'Silver Jubilee Year ' payment.
(3) The demand of the Union for bonus this year will be referred to as Tribunal for adjudication.
(4) The payment should be made by 12.10.1971 Eligible workmen under terms(1) of this settlement (a) Permanent and probationers.
Rest of workmen will be paid bonus under the .
" 188 Although the said settlement was an agreement under section 34(3) of the Act since under its very terms as incorporated in clause (3), the parties had stipulated for a reference of the question for adjudication by a Tribunal.
The issue was accordingly referred by the Government of West Bengal for adjudication to the Ninth Industrial Tribunal of West Bengal by an order of reference dated January 15, 1973.
In the written statement filed by the workmen before the Ninth Industrial Tribunal they claimed three months ' basic wages as on March 31, 1972 as customary bonus or in the alternative 20 per cent of the salary or wages as bonus payable under the Act.
The appellants reiterated before the Tribunal the same contentions which they had put forward before the Conciliation officer.
The Tribunal allowed the parties to adduce evidence.
After a detailed discussion of the evidence produced before it, the Tribunal recorded a clear finding that the workmen had failed to make out the claim of customary bonus put forward by them and that the said plea had therefore to fail.
It was further found by the Tribunal that the plea put forward by the appellant companies that there was no available surplus during the year in question and that only the minimum bonus was payable under the provisions of the Act had to be upheld.
The Tribunal, therefore, held that the unions representing the workmen had failed to make out the case put forward by the workmen that the workmen were entitled to maximum bonus of 20 per cent as provided under the Act.
After having recorded the aforesaid findings, the Tribunal, however, proceeded to accept the contention advanced before it by the Counsel appearing for the workmen that it was legally open to it to substitute for the agreement entered into between the parties before the Conciliation officer a new contract and pass an award on that basis, if such a step would be conducive to industrial peace.
On this reasoning the Tribunal proceeded to observe: "In my opinion, there would not be material alteration in the financial liability of the companies in case the agreement was modified by substituting for the words that the workmen will be paid the amount equal to three months ' basic wages as on 31.3.1970 by the words an amount equal to basic wages as on 31.3.1972.
I am, therefore, in agreement with this contention of the learned lawyer for the unions that the Tribunal should create a new contract and that is pass an award of three months ' basic wage as on 31.3.1972.
This is in my opinion would be con 189 ducive to industrial peace and it would not violate any existing industrial law.
" Accordingly, the Tribunal passed an award directing the appellant companies to pay to the workmen the balance amount by way of bonus as per the rates calculated by the Tribunal within a month from the date of publication of the award in the Calcutta Gazette.
It is the legality of this award that is under challenge in this appeal.
It has to be remembered that the claim of the workmen which the Tribunal was considering while making the aforesaid observations was one for Profit bonus only since the claim for customary bonus had been rejected by it.
The rights and liabilities of the parties regarding Profit bonus were governed by the provisions of the Act which are exhaustive on the subject and the adjudication had to be conducted by the Tribunal strictly in accordance with those provisions See Sanghi Jeevraj Ghewar Chand and Ors.
vs Secretary, Madras Chillies, Grains Kirana Merchants Workers ' Union and Anr., ; and Mumbai Kamgar Sabha, Bombay vs M/s Abdulbhai Faizullabhai & Ors., [1976] 3 S.C.R. 591.
As already noticed, the Tribunal has categorically found on a consideration of the evidence adduced before it that there was no "available surplus" in respect of the two companies for the year in question on a computation made under Section S of the Act.
The settlement entered into before the Conciliation officer constituted an agreement under Section 34(3) of the Act and but for the said agreement the liability of the appellants under the provisions of Act would have been only to pay minimum bonus under Section 10 of the Act.
Since the parties were at variance on the question of existence of liability for payment of customary bonus in the establishments as well as on the question regarding the existence of available surplus, provision was made in clause (3) of the agreement for reference under the industrial adjudication.
If the Tribunal found that the claim for payment of customary bonus was substantiated it could have passed an order in favour of the workmen for payment of such bonus.
That claim had been negatived.
The only question which remained for determination for the Tribunal was whether the claim of the workmen for payment of 20 per cent of the salary or wages as bonus payable under the Act was tenable or not.
That depended essentially on the question of existence of available surplus and its quantum, if any surplus was available.
In view of the finding recorded by the Tribunal accepting 190 the plea put forward by the appellant companies that the result of the working of the companies during the concerned year was a loss and there was no available surplus, the Tribunal could not have legally proceeded to make an award directing payment of bonus at any rate higher than the minimum bonus specified in Section 10 of the Act.
As pointed out by this Court in The New Maneck Chowk Spinning and Weaving Company Ltd. Ahmedabad and others vs The Textile Labour Association, Ahmedabad, ; , while "it is certainly open to an industrial court in an appropriate case to impose new obligations on the parties before it or modify contracts in the interest of industrial peace or give awards which may have the effect of extending Agreement or making new one, but this power is conditioned by the subject matter with which it is dealing and also by the existing industrial law and it would not be open to it while dealing with a particular matter before it to overlook the industrial law relating to that matter as laid down by the legislature.
" It is manifest that the impugned award made by the Tribunal is clearly inconsistent with the provisions of the which contemplate the imposition of an obligation for payment of only the minimum bonus where the employer has no allocable surplus in the concerned accounting year.
However, in as much as the appellant companies had entered into the settlement before the Conciliation officer agreeing to pay bonus at a rate higher than the minimum bonus, the said settlement would constitute an agreement under Section 34 of the Act and the terms of the settlement will govern the liability for bonus for the year in question.
It follows from the foregoing discussion that the impugned award passed by the Ninth Industrial Tribunal is not legally sustainable.
The appeal is accordingly allowed and the Award of the Industrial Tribunal will stand set aside.
The rights of the workmen for payment of bonus for the year in question will be governed by the terms of the agreement enterd into before the Conciliation officer on October 9. 1972.
In view of the condition imposed by the order of this Court dated November 21, 1974 while granting Special Leave, the appellants are directed to pay the costs of the respondents in this appeal.
M.L.A. Appeal allowed.
| A dispute regarding bonus payable to the workmen respondents of the two companies appellants for the year 1971 72 was referred to conciliation under section 12(1) of the .
The workmen contended before the Conciliation officer that they were entitled to bonus equivalent to three months ' basic wages as on 31st March, 1972 as customary bonus or in any event as bonus payable under the provisions of the Act.
The appellant companies, on the other hand, argued that the workmen were entitled to only minimum bonus as provided under the Act.
The said dispute was ultimately settled before the Conciliation officer on the terms: (a) that each eligible work man will be paid an amount equal to three months ' basic wages as on 31.3.1970; and (b) that the demand of the Union for bonus this year will be referred to a Tribunal for adjudication.
Accordingly, the Government referred the dispute for adjudication to the ninth Industrial Tribunal of West Bengal.
After a detailed discussion of the evidence produced before the Tribunal, it found (i) that the workmen had failed to make out the claim of customary bonus or that they were entitled to maximum bonus of 20 per cent as provided under the Act; and (ii) that there was no available surplus during the year in question and that only the minimum bonus was payable under the provisions of the Act.
However, after having recorded the aforesaid findings, it proceeded to hold that it was legally open to it to substitute for the agreement entered into between the 185 parties before the Conciliation officer a new contract and pass an award on that basis, if such a step would be conducive to industrial peace.
On this basis the Tribunal, held that there would not be material alteration in the financial liability of the companies in case the agreement was modified by substituting for the words "that the workmen will be paid the amount equal to three months ' basic wages as on 31.3.1970" by the words "an amount equal to basic wages as on 31.3.1372" and accordingly it passed an award in those terms.
In appeal to the Supreme Court, the appellants companies challenged the legality of this award.
Allowing the appeal, ^ HELD: 1.
The impugned award passed by the Ninth Industrial Tribunal is not legally sustainable and has to be set aside.
The rights of the workmen for payment of bonus for the year in question will be governed by the terms of the agreement entered into before the Conciliation officer on October 9, 1972.
[190F] 2.
The rights and liabilities of the parties regarding profit bonus are governed by the provisions of the payment of Bonus Act, 1965 which are exhaustive on the subject and the adjudication had to be conducted by the Tribunal strictly in accordance with those provisions.
[189C D] In the instant case, the Tribunal has categorically found that there was no "available surplus" in respect of the two companies for the year in question on a computation made under section 5 of the Act.
The settlement entered into before the Conciliation officer constituted an agreement under section 34(3) of the Act and but for the said agree ment, the liability of the appellants under the provisions of the Act would have been only to pay minimum bonus under section 10 of the Act.
[189E F] Sanghi Jeevraj Chewar Chand and Ors.
vs Secretary Madras Chillies, Grains Kirana Merchants Workers ' Union and Anr., [ ; and Mumbai Kamgar Sabha.
Bombay vs M/s Abdulbhai Faizullabhai & Ors., [ ; referred to.
It is certainly open to an Industrial Court in an appropriate case to impose new obligations on the parties before it or modify contracts in the interest of industrial peace or give awards which may have the effect 186 of extending the agreement or making new one, but this power is conditioned by the subject matter with which it is dealing and also by the existing industrial law and it would not be open to it while dealing with a particular matter before it to overlook the industrial law relating to that matter as laid down by the legislature. " [190B D] The New Maneck Chowk Spinning and Weaving Company Ltd. Ahmedabad and others vs The Textile Labour Association, Ahmedabad, ; relied upon.
In the instant case, in view of the finding recorded by the Tribunal that the result of the working of the companies during the concerned year was a loss and there was no available surplus, the Tribunal could not have legally proceeded to make an award directing payment of bonus at any rate higher than the minimum bonus specified hl section 10 of the Act.
Therefore, the impugned award made by the Tribunal is clearly inconsistent with the provisions of the Payment of Bonus Act which contemplate the imposition of an obligation for payment of only the minimum bonus where the employer has no allocable surplus in the concerned accounting year.
However, inasmuch as the appellant companies had entered into the settlement before the Conciliation Officer agreeing to pay bonus at a rate higher than the minimum bonus, the said settlement would constitute an agreement under section 34 of the Act and the terms of the settlement will govern the liability for bonus for the year in question.
[190D E]
|
Appeal No. 419 of 1958.
Appeal by special leave from the judgment and order dated August 20, 1957, of the Calcutta High a Court in Income tax Reference No. 1 of 1956.
Hardyal Hardy and D. Gupta, for the appellant.
N. C. Chatterjee, Dipak Choudhri and B. N. Ghosh, for the respondent.
November 28.
The Judgment of the Court was delivered by KAPUR, J.
This is an appeal by special leave against the judgment and order of the High Court of Judicature at Calcutta in a reference made by the Income tax Appellate Tribunal under section 66(1) of the Income tax Act.
The following question was referred: "Whether in the facts and circumstances of this case, the Appellate Tribunal was right in holding that Rs. 61,818 spent by the assessee to train Indian boys as jockeys, did not constitute expenses of the business of the assessee allowable under section 10(2)(xv)?" which was answered in favour of the respondent.
The Commissioner is the appellant before us and the assessee is the respondent.
The respondent is an association of persons whose business is to hold race meetings in Calcutta on a commercial basis.
It holds two series of race meetings during the two seasons of the year.
The respondent does not own any horses and therefore does not employ jockeys but they are employed by owners and trainers of horses which are run in the races.
It is a matter of some importance to the respondent that there should be jockeys available to the owners with sufficient skill and experience because the success of races to a considerable extent depends upon the experience and skill of a jockey who rides a horse in a race.
Because it was of the opinion that there was a risk of the jockeys becoming unavailable and that such unavailability would seriously affect its business which might result in its closing 731 down the business, the respondent considered it expedient to remedy that defect.
Therefore in 1948, it, established a school for the training of Indian boys as jockeys so that after their training they might be available for purposes of race meetings held under its auspices.
The school, however, did not prove a success and after having been in existence for three years it was closed down.
During the year ending March 31, 1949, the respondent spent a sum of Rs. 62,818 on the running of its school and claimed that amount as a deduction under section 10(2)(xv) of the Income tax Act and also in the assessment under the Business Profits Tax for the chargeable accounting period ending March 31, 1949.
This claim was disallowed by the Income Tax Officer and on appeal by Appellate Assistant Commissioner and also by the Income tax Appellate Tribunal.
At the instancc of the respondent the question already quoted was referred to the High Court and was answered in favour of the respondent.
This appeal is brought by special leave against that judgment.
The decision under the Business Profits Tax Act will be consequential upon the decision of the deduction under the Income tax Act.
The Tribunal found that it was not the business of the respondent to provide jockeys to owners and trainers, that the jockeys trained in the respondent 's school were not bound to ride only in the races run by the respondent and that the benefit, if any, which accrued was of an enduring nature.
It also found that the respondent had been conducting race meetings since long, that it was not the case of the assessee that if it did not train jockeys they would become unavailable and that the mere policy of producing efficient Indian jockeys was not a sufficient consideration for treating the expenditure as one incurred for the business of the respondent.
For these reasons the expenditure was disallowed.
Before the Appellate Assistant Commissioner, it was contended by the respondent, that the reason for incurring the expenditure was "to promote efficient Indian jockeys" and it was in the interest of the respondent to see that the races are not abandoned on 732 account of the scarcity of jockeys.
In the order of the Tribunal it is stated that this was not the case of the respondent, and therefore when the respondent wanted paragraph 5 of the statement to be substituted by the following: "It was the case of the assessee that unless it trained Indian Jockeys, time may come when there may not be sufficient number of trained jockeys to ride horses in the races conducted by the assessee.
" the Tribunal did not agree to do so.
Counsel for the appellant raised three points before us; (1) The question as to whether an item of expenditure is wholly and exclusively laid out for the purposes of business or not is a question of fact; (2) the connection between an expenditure and profit earning of the assessee should be direct and substantial and not remote and (3) to be admissible as revenue expenditure it should not be in the nature of a capital expense, i.e., it should not bring into existence an asset of an enduring nature.
As to the first question this court has held in Eastern Investments Ltd. vs Commissioner of Income tax, West Bengal (1) that "though the question must be decided on the facts of each case, the final conclusion is one of law".
In Commissioner of Income Tax vs Chandulal Keshavlal & Co. (2), this Court said: "Another test is whether the transaction is properly entered into as a part of the assessee 's legitimate commercial undertaking in order to facilitate the carrying on of its business; and it is immaterial that a third party also benefits thereby.
(Eastern Investment Ltd. vs Commissioner of Income Tax, (1951) 20 I.T.R. 1).
But in every case it is a question of fact whether the expenditure was expended wholly and exclusively for the purpose of trade or business of the assessee.
In the present case the finding is that it was laid out for the purpose of the assessee 's business and there is evidence to support this finding." But those observations must be read in the context.
In that case the assessee firm was the Managing Agent of a Company and at the request of the Directors of (1) ; , 598.
(2) , 610. 733 the latter agreed to accept a lesser commission for the year of account than it was entitled to.
It was found, by the Appellate Tribunal there that the amount was expended for reasons of commercial expediency and was not given as a bounty but to strengthen the managed company so that if its financial position became strong the assessee would benefit thereby, and an the evidence the Tribunal came to the conclusion that the amount was wholly and exclusively for the purpose of such business.
It was on this evidence that the expense was held to be wholly and exclusively laid out for the purpose of the assessee 's business and this was the finding referred to.
In that case the Tribunal had not misdirected itself as to the true scope and meaning of the words "wholly and exclusively laid out for the purpose of the assessee 's business".
In the present case the Income tax Appellate Tribunal had misdirected itself as to the true scope and meaning of these words.
In our opinion, in the circumstances of this case, it cannot be said that the finding of the Tribunal was one of fact.
The question as to whether the expenses of running the school for jockeys is deductible has to be decided taking into consideration the circumstances of this case.
The business of the respondent was to run race meetings on a commercial scale for which it is necessary to have races of as high an order as possible.
For the popularity of the races run by the respondent and to make its business profitable it was necessary that there were jockeys of requisite skill and experience in sufficient numbers who would be available to the owners and trainers because without such efficient jockeys the running of race meetings would not be commercially profitable.
It was for this purpose that the respondent started the school for training Indian jockeys.
, If there were not sufficient number of efficient Indian jockeys to ride horses its interest would have suffered, and it might have had to abandon its business if it did not take steps to make jockeys of the necessary calibre available.
Therefore any expenditure which was incurred for preventing the extinction 93 734 of the respondent 's business would, in our opinion, be expenditure wholly and exclusively laid out for the purpose of the business of the assessee and would be an allowable deduction.
This finds support from decided cases.
In Commissioner of Income tax vs Chandulal Keshavlal & Co. (1), this Court held that in order to justify a deduction the disbursement must be for reasons of commercial expediency; it may be voluntary but incurred for the assessee 's business; and if the expense is incurred for the purpose of the business of the assessee it does not matter that the payment also enures to the benefit of a third party.
Another test laid down was that if the transaction is properly entered into as a part of the assessee 's legitimate commercial undertaking in order to facilitate the carrying on of its business it is immaterial that a third party also benefits thereby.
In British Insulated and Helsby Cables vs Atherton (2), Viscount Cave L. C. held that a Bum of money expended, not of necessity and with a view to a direct and immediate benefit to the trade, but voluntarily and on the ground of commercial expediency and in order indirectly to facilitate the carrving on of the business may yet be expended wholly and exclusively for the purpose of the trade.
In a case more recently decided Morgan vs Tate & Lyle Ltd. (3) the assessee company was engaged in sugar refining business and it incurred expenses in a propaganda campaign to oppose the threatened nationalisation of the industry.
It was held by the House of Lords by a majority that the object of the expenditure being to preserve the assets of the company from seizure and so to enable it to carry on its business and earning profits, the expense was an admissible deduction being wholly and exclusively laid out for the purpose of the company 's trade.
Lord Morton of Henryton said: "Looking simply at the words of the rule I would ask:"If money so spent is not spent for the purpose of the company 's trade, for what purpose is it spent?" If the assets are seized, the company can no longer (1) , 610.
(2) (3) 735 carry on the trade which has been carried on by the use of these assets.
Thus the money is spent to preserve the very existence of the company 's trade".
See also Strong & Co. vs Woodifield(1), the observations of Lord Davey; and Smith vs Incorporated Council of Law Reporting (2).
Counsel for the appellant relied upon the judgment of the Privy Council in Ward & Co. Ltd. vs Commissioner of Taxes (3 ), but that decision proceeds on a different statute where the words were of a very restrictive character, the words being: ". . . .
Expenditure or loss of any kind not exclusively incurred in the production of the assessable income derived from that source. . .
This case was distinguished in Morgan vs Tate & Lyle(4) on the ground that the language of the Now Zealand statute was much narrower than the language of r. 3A in England.
Reference was also made by the appellant to Boarland vs Kramat Pulai Ltd. (5).
In that case Directors of three Companies engaged in tin mining in Malaya incurred expenditure on printing.
and circulating to shareholders a pamphlet containing remarks of the Chairman of the Company.
The pamphlet was an attack on the policy and acts of the Socialist Government and it was held that the question whether the money was wholly and exclusively laid out or expended for the purpose of trade within the meaning of rules applicable to the question was one of law but on a consideration of the question it was held that the expenditure was not solely incurred with that object.
It is not necessary to discuss that case at any length because what was held in that case was that the pamphlet was not wholly and exclusively for the purpose of the company 's trade.
Applying the law, as laid down in those cases, to the present case the conclusion is that the amount in dispute was laid out wholly and exclusively for the purpose of the respondent 's business because if the (1) ; (2) [19I4] 3 K.B. 674.
(3) [1923] A.C 145.
(4) (5) 736 supply of jockeys of efficiency and skill failed the business of the respondent would no longer be possible.
Thus the money was spent for the preservation of the respondent 's business.
As to the third point there is no substance in the submission that the expenditure was in the nature of a capital expense because no asset of enduring nature was being created by this expense.
In our opinion the High Court has rightly held that the expenditure claimed was one which was wholly and exclusively laid out for the purpose of the respondent 's business.
It was to prevent the threatened extinction of the business of the respondent.
In the result this appeal is dismissed with costs.
Appeal dismissed.
| The object with which the appellant company was formed was to promote and regulate the business in shares, stocks and securities etc., and to establish and conduct a Stock Exchange in order to facilitate the transaction of such business.
Its capital was divided into shares on which dividend could be earned.
it provided a building wherein business was to be transacted under its supervision and control.
It made rules for the conduct of business of sale and purchase of shares in the Exchange premises.
During the assessment year in question the company 's receipts consisted of certain amounts received as admission fee from Members and Authorised Assistants and the question stated to the High Court for its opinion was whether these fees in the hands of the appellant were taxable income.
The High Court answered the question in the affirmative.
It held that the appellant was not a mutual society, that dividends could be earned on its share capital, that any person could become a share holder but every share holder was not a member unless he paid the admission fee and the real object of the company was to carry on business of exchange of stocks and earn profits.
The case of the appellant, inter alia, was that as the amount received as membership fee was shown as capital in the books of the company and there was no periodicity, it should be treated as capital receipt exempt from assessment.
799 Held, that the High Court was right in its decision and the appeals must be dismissed.
It was wholly immaterial how the appellant treated the amounts in question.
It is the nature of the receipt and not how the assessee treated it that must determine its taxability.
AS: Since the fee received on account of Authorised Assisstants fall within the decision of this Court in Commissioner of Income tax vs Calcutta Stock Exchange Association Ltd., , it must be held to be taxable income.
The question as to whether the Members ' admission fee was taxable income was to be determined by the nature of the business of the company, its profits and the distribution thereof as disclosed by its Memorandum and Articles of Association and the rules made for the conduct of business.
They showed that the income of the company was distributable amongst its shareholders ;is in any other joint stock company, and the body of trading members who paid the entrance fees and share holders were not identical.
The element of mutuality was, therefore, lacking.
Liverpool Corn Trade Association vs Monks, (1926) 2 K. B. 110, applied.
Commissioner of Income tax, Bombay City vs Royal Western India Turf Club Ltd., ; and Styles vs New York Life Insurance Co., ; , referred to.
|
Appeals Nos. 220, 423 and 424 of 1962.
Appeals from the judgment and order dated January 12, 1960 and August 19, 1960 of the Andhra Pradesh High Court, in Writ Appeals Nos. 120 and 57 of 1960.
S.K. Bose and B. P. Maheshwari, for the appellant(in C. A. No. 220 of 1962).
M.C. Setalvad, section K. Bose and Sardar Bahadar, for the appellants (in C. As.
423 & 424 of 1962).
K. R. Chaudhuri and P. D. Menon, for respondent No, 1 (in all the appeals).
450 1963.
March 20.
The judgment of the Court was delivered by WANCHOO J.
These three appeals on certificates raise the same question and will be dealt with together.
It will be enough to refer to the facts of one appeal only i.e., No. 220, to understand the point arising for decision, the facts in the other appeals being similar.
Briefly the facts in appeal No. 220 are that an order referring certain disputes between the appellant and its workmen was made to the Industrial Tribunal, Andhra Pradesh on June 6, 1956.
The tribunal sent its award to Government in September, 1957.
Under section 17 of the Industrial Disputes Act, No. XIV of 1947 (hereinafter referred to as the Act), the award has to be published by the appropriate government within a period of thirty days from the date of its receipt by the government in such manner as the government thinks fit.
Before, however, the Government could publish the award under section 17, the parties to the dispute which had been referred for adjudication came to a settlement and on October 1, 1957, a letter was written to Government signed jointly on behalf of the employer and the employees intimating that the dispute, which had been pending before the tribunal, had been settled and a request was made to Government not to publish the award.
The Government, however, expressed its inability to withhold the publication of the award, the view taken by the Government being that section 17 of the Act was mandatory and the Government was bound to publish the award.
Thereupon the appellants filed writ petitions before the High Court under article 226 of the Constitution praying that the Government may be directed not to publish the award sent to it by the industrial tribunal.
The High Court held that section 17 was mandatory and it was not open to Government to withhold 451 publication of an award sent to it by an industrial tribunal.
Therefore it was not open to the High Court to direct the Government not to publish the award when the law enjoined upon it to publish it.
The writ petitions were thereforedismissed.
There were then application for certificats which were granted and that is how the matter has come up before us.
The main contention on behalf of the appellants before us is that section 17 of the Act when it provides for the publication of an award is directory and not mandatory.
In the alternative, it is contended that even if section 17 is mandatory some via media has to be found in view of the conflict that would arise between an award published under section 17 (1) and a settlement which is binding under section 18(1),and therefore where there is a settlement which is binding tinder section 18(1 ) it would be open to the Government not to publish the award in these special circumstance.
We are of opinion that the first contention on behalf of the appellants, namely, that the publication of the award under section 17 (1) is directory cannot be accepted.
Section 17 (1) lays down that every award shall within a period of thirty) days from the date of its receipt by the appropriate government be published in such manner as the appropriate government think fit.
The use of the word "shall" is a pointer to section 17(1 ) being mandatory, though undoubtedly in certain circumstances the word "shall" used in a statute may be equal to the word "may".
In the presentcase however it seems to us that when the word "shall" was used in section 17(1) the intention was to give a mandate to Government to Publish the award within the time fixed therein.
This is enforced by the fact that sub section
(2) of section 17 provides that "the award published under Sub section (1) shall be final and shall not be called in question by any 452 court in any manner whatsover".
Obviously when the legislature intended the award on publication to be final, it could not have intended that the Government concerned had the power to withhold publication of the award.
Further section 17A shows that whatever power the Government has in the matter of an award is specifically provided in that section, which allows the Government in certain circumstances to declare that the award shall riot become enforceable on the expiry of thirty days from the date of its publication, which under section 17 A is the date of the enforceability of the award.
Section 17 A also envisages that the award must be published though the Government may declare in certain con tingencies that it may not be enforceable.
Subsection (2) of section 17A also gives power to Government to make an order rejecting or modifying the award within ninety days from the date of its publication.
It is clear therefore reading section 17 and section 17A together that the intention behind section 17 (1) is that a duty is cast on Government to publish the award within thirty days of its receipt and the provision for its publication is mandatory and not merely directory.
This however does not end the matter, particularly after the amendment of the Act by Central Act XXXVI of 1956 by which section 18 (1) was introduced in the Act.
Section 18 (1) provides that a settlement arrived at by agreement between the employer and workmen otherwise than in the course of conciliation proceeding shall be binding on the parties to the agreement.
'Settlement" is defined in section 2 (p) as meaning a settlement arrived at in the course 'or conciliation proceeding and includes a written agreement between the employer and workmen arrived at otherwise than in the course of conciliation proceeding where such agreement has been signed by the parties thereto in such manner as may be prescribed and a copy thereof has been sent to the appropriate Government and the conciliation 453 officer.
When such an agreement has been arrived at, though not in the course of conciliation proceedings, it becomes a settlement and section 18 (1) lays down that such a settlement shall be binding on the parties thereto.
Further section 18 (3) provides that an award which has become enforceable shall be binding on all parties to the industrial dispute and others.
Section 19 (1) provides that a settlement comes into operation on such date as is agreed upon by the parties to the dispute, and if no date is agreed upon, on the date on which the memorandum of settlement is signed by the parties to the dispute.
In the present case the settlement that was arrived at between the parties to the dispute was signed on October 1, 1957, and as it had not fixed any date for its coming into force, it became operative from October 1, 1957 itself and was binding on the parties to the agreement who were also before the industrial tribunal and would be bound by the award after its publication.
The contention on behalf of the appellant in the alternative is this.
It is said that the main purpose of the Act is to maintain peace between the parties in an industrial concern.
Where therefore parties to an industrial dispute have reached a settlement which is binding under section 18 (1), the dispute between them really comes to an end.
In such a case it is urged that the settlement arrived at between the parties should be respected and industrial peace should not be allowed to be disturbed by the publication of the award which might be different from the settlement.
There is no doubt that a settlement of the dispute between the parties themselves is to be preferred, where it can be arrived at, to industrial adjudication, as the settlement is likely to lead to more lasting peace than an award, as it is arrived at by the free will of the parties and is a pointer to there being goodwill between them.
Even though this may be so, we have still to reconcile the mandatory 454 character of the provision Contained in section 17 (1) for the publication of the award to the equally mandatory character of the binding nature of the settlement arrived at between the parties as provided in section Is (1).
Ordinarily there should be Do difficulty about the matter, for if a settlement has been arrived at between the parties while the dispute is pending before the tribunal, the parties would file the settlement before the tribunal and the tribunal would make the award in accordance with the settlement.
In the State of Bihar vs D. N. Ganguly (1), dealing with an argument urged before this Court that where a settlment has been arrived at between the parties, village an industrial dispute is pending before a tribunal, the only remedy for giving effect to such a settlement would be to cancel the reference, this Court observed that though the Act did not contain any provision specifically authorising the industrial tribunal to record a compromise and pass an award in its terms corresponding to the provisions of O. XXIII, r. 3 of ' the Code of Civil Procedure, it would be very unreasonable to assume that the industrial tribunal would insist upon dealing with the dispute on the merits even after it is informed that the dispute has been amicably settled between the parties, and there can be no doubt that if a dispute before a tribunal is ambicably settled, the tribunal would immediately agree to make an award in terms of the settlement between the parties.
In that case this Court dealt with what would happen if a settlement was arrived at while the matter was pending before the tribunal.
The difficulty arises in the present case because the proceedings before the tribunal had come to an end, and the tribunal had sent its award to Government before the settlement was arrived at on October 1, 1957.
There is no provision in the Act dealing with such a situation ' just as there was no provision in the Act dealing with the situation which arose where the parties came (1) ; 455 to an agreement while the dispute was pending before the tribunal.
This Court held in Ganguly 's case (1), that in such a situation the settlement or compromise would have to be filed before the tribunal and the tribunal would make an award thereupon in accordance with the settlement.
Difficulty, however, arises when the matter has gone beyond the purview of the tribunal as in the present case.
That difficulty in our opinion has to be resolved in order to avoid possible conflict between section 18 (1 ) which makes the settlement arrived at between the parties otherwise than in the course of conciliation proceeding binding on the parties and the terms of an award which are binding under section 18 (3) on publication and which may not be the same as the terms of the settlement binding under section 18 (1).
The only way in our view to resolve the possible conflict which would arise between a settlement which is binding under section 18 (1) and an award which may become binding under section 18 (3) on publication is to withhold the publication of the award once the Government has been informed jointly by the parties that a settlement binding under section 18 (1) has been arrived at.
It is true that section 17 (1) is mandatory and ordinarily the Government has to publish an award sent to it by the tribunal ; but where a situation like the one in the present cases arises which may lead to a conflict between a settlement under section 18 (1) and an award binding under section IS (3) on publication, the only solution is to withhold the award from publication.
This would not in our opinion in any way affect the mandatory nature of the provision in section 17 (1), for the Government would ordinarily have to publish the award but for the special situation arising in such cases.
The matter may be looked at in another way The reference to the tribunal is for the purpose of resolving the dispute that may have arisen between employers and their workmen.
Where a settlement (1) ; 456 is arrived at between the parties to a dispute before the tribunal after the award has been submitted to Government butbefore its publication, there is in fact no dispute left to be resolved by the publication of the award.
In such a case, the award sent to Government mayvery well be considered to have become infructuous and so the Government should refrain from publishing Such an award because no dispute ramains to be resolved by it.
It is however urged that the view we have taken may create a difficulty inasmuch as it is possible for one party or the other to represent to the Government that the settlement has been arrived at as a result of fraud, misrepresentation or undue influence or that it is not binding as the workmen 's representative had bartered away their interests for personal considerations.
This difficulty, if it is a diffi culty, will always be there even in a case where a settlement has been arrived at ordinarily between the parties and is binding under section 18 (1), even though no dispute has been referred in that connection to a tribunal.
Ordinarily, however, such difficulty should not arise at all, if we read sections 2 (p), 18 (1) and 19 (1) of the Act together.
Section 2 (p) lays down what a settlement is and it includes "a written agreement between the employer and workmen arrived at otherwise than in the course of conciliation proceeding where such agreement has been signed by the parties thereto in such manner as may be prescribed and a copy thereof has been sent to the appropriate govern ment and the conciliation officer".
Therefore the settlement has to be signed in the manner prescribed by the rules and a copy of it has to be sent to the Government and the conciliation officer.
This should ordinarily ensure that the agreement has been arrived at without any of those defects to which we have referred above, if it is in accordance with the rules.
Then section 18 (1) provides that such a settlement would be binding between the parties and vs 19 (1) provides 457 that it shall come into force on the date it was signed or on the date on which it says that it shall come into force.
Therefore as soon ' as an agreement is signed in the prescribed manner and a copy of it is sent to the Government and the conciliation officer it becomes binding at once on the parties to it and comes into operation on the date it is signed or on the date which might be mentioned in it for its coming into operation.
In such a case there is no scope for any inquiry by Government as to the bona fide character of the settlement which becomes binding and comes into operation once it is signed in the manner provided in the rules and a copy is sent to the Government and the conciliation officer.
The settlement having thus become binding and in many cases having already come into operation, there is no scope for any inquiry by the Government as to the bona fides of the settlement.
In such a case in view of the possibility of conflict between the settlement in view of its binding nature under section 18 (1) and an award which might become binding on publication under section 18 (3), the proper course for the Government is to withhold the award from publication to avoid this conflict.
If any dispute of the nature referred to above arises as to a. settlement, that would be another industrial dispute, which the Government may refer for adjudication and if on such an adjudication the settlement is found not to be binding under section 18 (1) of the Act it will always be open to the Government then to publish the award which it had withheld, though we do not think that such instances are likely to be anything but extremely rare.
We are therefore of opinion that though section 17 (1) is mandatory and the Government is bound to publish the award received by it from an industrial tribunal, the situation arising in a case like the present is of an exceptional nature and requires reconciliation between section 18 (1) and section t8 (3), and in such a situation the only way to reconcile the two provisions is to withhold the publication of the award, as a binding 458 settlement has already come into force in order to avoid possible conflict between a binding settlement under section 18 (1) and a binding award under section 18 (3).
In such a situation we are of opinion that the Government ought not to publish the award under section 17 (1) and in cases where government is going to publish it, it can be directed not to publish the award in view of the binding settlement arrived at between the parties under section 18 (1) with respect to the very matters which were the subject matter of adjudication under the award.
We therefore allow the appeals and direct the Government not to publish the awards sent to it by the industrial tribunal in these cases in view of the binding nature of the settlements arrived at between the parties under section 18 (1) of the Act.
In the circumstances we order the parties to bear their own costs.
Appeals allowed.
| The facts of the three appeals are similar and the questions of law involved are identical.
Industrial disputes having arisen between the appellants and their workmen the disputes were referred for adjudication.
After the Tribunal forwarded their Awards to the Government the parties in each dispute came to settlement.
Thereafter letters were sent to the Government requesting them to withhold the publication of the Awards.
The Government replied that under section 17 of the Act it was mandatory for the Government to publish the Awards and they could not withhold publication.
Thereupon writ petitions were filed before the High Court under article 226 of the Constitution praying that the Government might be directed to withhold the publication.
The High Court held that since the provisions of section 17 of the Act were mandatory it was not open to the High Court to issue writs as prayed for and rejected, the petitions.
The present appeals are by way of certificate granted by the High Court.
The main contentions in the appeals were that the provisions of section 17 were not mandatory but were only directory and in the alternative that even if they were mandatory some via media had to be found in view of the conflict that would arise between an award published under section 17 (1) and a settlement which was binding under section 18 (1) and therefore where there was a settlement which was binding under section 18 (1) it would be open to the Government not to publish the award.
It was con.
tended on behalf of the respondent that if the argument of the appellants was accepted it would create a difficult situation in as much as it would be possible for one party or the other to represent to the Government that the settlement had been arrived at 449 as a result of fraud, misrepresentation or undue influence and corruption etc.
Held, that it is clear on a reading of section 17 and section 17A together that the intention behind section 17 (1) is that a duty is cast on Government to publish the award within thirty days of its receipt and the provision for its publication is mandatory and not merely directory.
When an agreement at has been arrived at between the parties, though not in the course course of conciliation proceedings, it becomes a settlement as per the definition under section 2 (p) and section 18 (1) lays down that such a Settlement shall be binding on all the parties to it.
If a situation like the one in the present case arises which may lead to a conflict between a settlement under section 18 (1) and an award binding under section 18 (3) on publication, the only solution is to withhold the award from publication.
This would not in any way affect the mandatory nature of the provisions in section 17 (1) for the Government would ordinarily have to publish the award but for the special situation arising in such cases.
If any dispute arises as to the binding nature of the settlement on grounds of fraud or misrepresentation etc.
that would be another industrial dispute, which the Government may refer for adjudication and if such a settlement is found not to be binding under section 18 (1) of the Act it will always be open to the Government to publish the Award which it had withheld.
State of Bihar vs D. N. Ganguly, ; , referred to.
|
Civil Appeal No. 854, of 1977.
Appeal by Special Leave from the Judgment and order dated 2 8 1976 of the Madhya Pradesh High Court in S.A. No. 440/71.
section section Khanduja and Lalit Kumar Gupta for the Appellant.
T. P. Naik and section K. Gambhir for the Respondent.
The Judgment of the Court was delivered by CHINNAPPA REDDY, J.
The respondent landlord sought eviction of the appellant tenant from the suit premises an two grounds: (i) failure to pay arrears of rent of Rs. 158.25 despite service of notice of demand and (ii) bonafide requirement of premises for landlord 's personal occupation.
The second ground was rejected by all the sub ordinate courts and we are no longer concerned with that ground.
In regard to the first ground, the trial Court found that the tenant was 336 in arrears of payment of rent but that the tenant was entitled to the Protection of section 12(3) of the Madhya Pradesh Accommodation Control Act, 1961, as the tenant had deposited the arrears of rent within the time allowed by the Court on his application.
When the appeal preferred by the landlord was pending before the Additional District Judge, Satna, the tenant filed an application for condonation of delay R in depositing the rent, month by month, which had become payable after the filing of the suit, as stipulated by section 13(1) of the Act.
It appears that, on several occasions, when the suit and the appeal were pending before the trial court and the appellate court respectively, the tenant had deposited the monthly rent a day or two or three, beyond the prescribed date.
The amount had been received by the court and drawn out by the landlord, apparently without any protest.
Taking advantage of the filing of the tenant 's application for condonation of delay, the landlord contended that the court had no power to extend the time for deposit of the monthly rent and that he was entitled to a decree for eviction consequent on the non compliance with the provisions of section 13 ( 1 ) of the Madhya Pradesh Accommodation Control Act.
The appellate court negatived the landlord 's contention and dismissed the appeal.
The landlord preferred a Second Appeal to the High Court of Madhya Pradesh.
The High Court, holding that the court had no power to extend time, decreed the suit for eviction.
The tenant, having obtained special leave, has appealed to this Court.
Shri Khanduja, learned counsel for the appellant, raised two contentions before us.
The first contention was that the High Court was wrong in holding that the Court had no power to condone the delay in depositing the monthly rent falling due after the filing of the suit for eviction.
The second contention was that, in the circumstances of the case.
the respondent must be considered to have waived or abandoned the right to insist on dis entitling the tenant of the protection to which he was otherwise entitled.
Shri Naik, learned counsel for the respondent, contended to the contrary on both the questions.
The Madhya Pradesh Accommodation Control Act, 1961, was enacted, as recited in the statement of objects and reasons, "for the purpose of controlling, letting of and rents of residential and nonresidential accommodation and giving adequate protection to tenants of such accommodation in areas where there is dearth of accommodation".
Section 12(1) of the Act provides that no suit shall be filed ill any civil court against a tenant for his eviction from any accommodation except on one or more of the grounds specified therein.
Several grounds are specified, such as, failure to pay the arrears of rent after the service of notice of demand, unlawful sub letting of the whole or 337 part of the accommodation, creation of a nuisance, bonafide requirement of the accommodation by the landlord for his own occupation, causing of substantial damage to the accommodation etc.
The ground with which we are concerned is that mentioned in section 12(1) (a) and it is: "that the tenant has neither paid nor tendered the whole of the arrears of rent legally recoverable from him within two months of the date on which a notice of demand for the arrears of rent has been served on him by the landlord in the prescribed manner".
Thus, where a tenant is in arrears of rent, a landlord is obliged, before instituting a suit for eviction on that ground, to serve a notice of demand calling upon the tenant to pay or tender the whole of the arrears of rent within two months of the date of service of the notice.
section 12(3) provides that an order for the eviction of a tenant shall not be made on the ground specified in section 12(1) (a), if the tenant makes payment or deposit as required by section 13.
section 13,sub sections
(1), (5) and (6) which are relevant for the present purpose are as follows: "13.
(1) on a suit or proceeding being instituted by the landlord on any of the grounds referred to in section 12, the tenant shall, within one month of the service of the writ of summons on him or within such further time as the Court may, on an application made to it, allow in this behalf, deposit in the Court or pay to the landlord an amount calculated at the rate of rent at which it was paid, for the period for which the tenant may have made default including the period subsequent thereto up to the end of the month previous to that in which the deposit or payment is made and shall thereafter continue to deposit or pay, month by month, by the 15th of each succeeding month a sum equivalent to the rent at that rate.
xx xx xx xx xx (5) If a tenant makes deposit or payment as required by sub section (1) or sub section (2), no decree or order shall be made by the Court for the recovery of possession of the accommodation on the ground of default in the payment of rent by the tenant, but the Court may allow such cost as it may deem fit to the landlord.
(6) If a tenant fails to deposit or pay any amount as required by this section, the Court may order the defence against eviction to be struck out and shall proceed with the hearing of the suit.
" 338 It is true that in order to entitle a tenant to claim the protection of section 12(3), the tenant has to make a payment or deposit as required by section 13, that is to say, the arrears of rent should be paid or deposited within one month of the service of the writ of summons on the tenant or within such further time as may be allowed by the court, and should further deposit or pay every month by the 15th, a sum equivalent to the rent.
It does not, however, follow that failure to pay or deposit a sum equivalent to the rent by the 15th of every month, subsequent to the filing of the suit for eviction, will entitle the landlord, straight away, to a decree for eviction.
The consequences of the deposit or payment and non payment or non deposit are prescribed by sub sections
(5) and (6) of section 13.
Since there is a statutory provision expressly prescribing the consequence of non deposit or non payment of the rent, we must look to and be guided by that provision only to deter mine what shall follow.
section 13 (6) does not clothe the landlord with an automatic right to a decree for eviction; nor does it visit the tenant with the penalty of a decree for eviction being straightaway passed against him.
section 13(6) vests, in the court, the discretion to order the striking out of the defence against eviction.
In other words, the Court, having regard to all the circumstances of the case, may or may not strike out the defence.
If section 13 were to be construed as mandatory and not as vesting a discretion in the Court, it might result in the situation that a tenant who has deposited the arrears of rent within the time stipulated by section 13(1) but who fails to deposit thereafter the monthly rent on a single occasion for a cause beyond his control may have his defence struck out and be liable to summary eviction.
We think that section 13 quite clearly confers a discretion, on the court, to strike out or not to strike out the defence, if default is made in deposit or payment of rent as required by section 13(1).
If the court has the discretion not to strike out the defence of a tenant committing default in payment or deposit as required by section 13(1), the court surely has the further discretion to condone the default and extend the time for payment or deposit.
Such a discretion is a necessary implication of the discretion not to strike out the defence.
Another construction may lead, in some cases, to a perversion of the object of the Act namely, 'the adequate protection of the tenant '.
section 12(3) entitles a tenant to claim protection against eviction on the ground specified in section 12(1) (a) if the tenant makes payment or deposit as required by section 13.
On our construction of section 13 that the Court has the power to extend the time for payment or deposit, it must follow that payment or deposit within the extended time will entitle the tenant to claim the protection.
of section 12(3).
One of the arguments advanced before us was that there was no express provision for extension of time for deposit or payment.
339 of monthly rent subsequent to the filing of the suit whereas there was such express provision for payment or deposit of arrears of rent that had accrued before the filing of the suit.
Obviously, express provision for extension of time for deposit or payment of rent falling due after the filing of the suit was not made in section 13(1) as the consequence of non payment was proposed to be dealt with by a separate sub section.
namely section 13(6).
Express provision had to be made for extension of time for deposit or payment of rent that had accrued prior to the filing of the suit, since that would ordinarily be at a very early stage of the suit when a written statement might not be filed and there would.
therefore, be no question of striking out the defence and, so, there would be no question of section 13(6) covering the situation.
In Jagdish Kapoor vs New Education Society, a full bench of the Madhya Pradesh High Court held that section 13((6) of the Madhya Pradesh Accommodation Control Act did not make it obligatory for the court to strike out the defence but vested in the court a discretion to strike out or not to strike out the defence.
Having so held, the full bench stopped short of giving full effect to their conclusion by holding D. that the Court could condone the default and refuse to strike out the defence but it could not give the benefit of section 12(3) or 13(5) to the tenant.
We do not see any justification for adopting this narrow construction of sections 12 and 13.
In our view the discretion given to the court under section 13(6) must be held to imply a discretion to condone the delay and extend the time in making deposit or payment under section 13(1).
In B. C. Kame vs Nem Chand Jain, a tenant had committed default both in payment of arrears as well as in payment of the monthly rent which became payable after the filing of the suit.
This Court took the view that on an application made by the tenant time for deposit or payment could be extended.
Though the observations made by the Court read as if they were made with reference to the default in payment.
Of arrears, a reference to the facts of the case as set out in the very judgment shows that there was default both in payment of the arrears of rent that had accrued before the filing of the suit and in payment of the monthly rent that fall due after the filing of the suit.
We are accordingly of the opinion that the Court has the jurisdiction to extend time for deposit or payment of monthly rent falling due after the filing of the suit.
In that view it is not necessary to express our opinion on the question of waiver or abandonment.
The appeal is allowed with costs and the suit for eviction is dismissed.
N.V.K. Appeal allowed.
| The respondent landlord sought eviction of the appellant tenant from the suit premises for failure to pay arrears of rent, despite service of notice of demand.
The trial court found that the tenant was in arrears o. payment of rent, but the tenant having deposited the arrears of rent within the time allowed by the court on his application the tenant was entitled to avail the protection of section 12(3) of the Madhya Pradesh Accommodation Control Act.
and dismissed the suit for eviction.
The landlord preferred an appeal and while the same was pending? the tenant filed an application under section 13(1) of the Act for condonation of delay in depositing,, the rent, month by month.
which had become payable after the filing of the suit.
On several occasions, when the suit and the appeal were pending before the trial court and the appellate court respectively, the tenant had deposited the monthly rent a day or two or three beyond the prescribed date, and the same had been received by the court and drawn out by the landlord, without any protest.
The landlord, taking advantage of the filing of the tenant s application for condonation of delay, contended that the court had no power to extend the time for deposit of the monthly rent and that he was entitled to a decree for eviction consequent on the non compliance with the provisions of section 13(1) of the Act.
The appellate court negatived this contention and dismissed the appeal.
In the second appeal preferred by the landlord, the High Court held that the Court had no power to extend time and decreed the Suit for eviction.
In the tenant 's appeal to this Court on the question whether the Court ha(l.
the power to condone the delay in depositing the monthly rent falling due after the filling of the suit for eviction.
^ HELD :1.
The court had the jurisdiction to extend time for deposit or payment of monthly rent falling due after the filing of the suit.
[338 G] 2.
In order to entitle a tenant to claim the protection of section 12(3).
the tenant had to make payment or deposit as required by section 13.
The arrears of rent should be paid or deposited within one month of the service of the writ of summons on the tenant or within such further time as may he allowed by the court, and should further deposit or pay every month by the 15th.
a sum equivalent to the rent.
[338 A B].
335 3.
Failure to pay or deposit a sum equivalent to the rent by the 15th of every month, subsequent to the filing of the suit for eviction will not entitle the landlord, straightaway, to a decree for eviction.
The consequences of the deposit or payment and non payment or non deposit are prescribed by subsection and (6) of section 13.
[338 B] 4.
A discretion is vested in the court under section 13(6) to order the striking out of the, defence against eviction.
[338 D] 5.
If the court has the discretion not to strike out the defence or a tenant committing default in payment or deposit of rent as required by section 13(1), the court surely has the further discretion to condone the default and extend the time for payment or deposit.
Such a discretion is a necessary implication of the discretion not to strike out the defence.
Any other construction may lead, to a perversion of the object of the Act.
namely, 'the adequate protection of the tenant. ' [338 F G] 6.
Section 12(3) entitles a tenant to claim protection against eviction on the ground specified in section 12(1)(a) if he makes payment or deposit as required by section 13.
As the court has under section 13, the power to extent: the time for payment or deposit, payment or deposit, within the extended time will entitle the tenant to claim the protection of section 12(3).
[338 H] 1 7.
Express provision for extension of time for deposit or payment or rent falling due after the filing of the suit was not made in section 13(1! as the consequence of non payment was dealt with by a separate sub section, section 13(6).
The discretion given to the court under section 13(6) must imply a discretion to condone the delay and extend the time in making deposit or payment under section 13(1).
[339A, E] Jagdish Kapoor vs New Education Society disapproved.
B. C. Kame vs Nem Chand Jain, A.I.R. 1970 S.C. 981.
referred to.
|
ition No. 449 of 1979 (Under Article 32 of the Constitution) R. K. Garg and D. K. Garg for the Petitioner.
The Order of the Court was delivered by KRISHNA IYER, J.
The adventurous petitioner imaginatively challenges the vires of Section 7 read with Section 16 of the Prevention of Food Adulteration Act and the relevant rules framed thereunder.
The gravamen of his charge is that the above provisions, read together, impose an inflexible minimum sentence of six months R.I. of offender 's guilty of sale of adulterated food, excluding in the process even the need to prove mens rea in the accused.
This absolute liability, with mandatory sentence, dependent on sophisticated chemical tests and complicated formulae, is oppressively unreasonable in the illiterate, agrestic realities of little Indian retail trade.
Such, in one sentence, is the submission of counsel.
The primary props to support this broad submission may be briefly noticed.
Counsel complains that there is no classification as between injurious pollutants and innocuous adulterants while proscribing the sentence.
Nor is there any intelligent differentiation between petty dealers and giant offenders, and vendors, big and small, are put on the Procrustean bed of stern punishment alike.
Articles 14, 19 and 21 are the constitutional artillery employed by counsel to shoot down the said provisions of the Act.
Frankly, we are not impressed with the consternation about the constitutionality even if the potential for victimisation affecting smaller people may be real and elicit our commiseration.
We may dwell for a moment on the latter grievance against the law a little later.
First, we will repel the vice of unconstitutionality.
Let us be clear about the basics.
Policy is for Parliament, constitutionality for the Court.
Protection of public health and regulation of noxious trade belong to the police power of the State and legislation like the Prevention of Food Adulteration Act is of that genre.
If a sentence, as here, is prescribed as a mandatory minimum and that is too cruel to comport with article 21 and too torturesome to be reasonably justifiable or socially defensible under article 19 then a case for judicial review may arise.
But we see none here.
Nor can we agree that judge proof sentencing is per se bad.
Sometimes judicial 257 fluctuations in punishment, especially on the softer side where white collar criminals are involved, induce legislative standardisation of sentences, to avoid giving societal protection in hostage to fortune.
There is a wide play still left for the court, and mandatory minima are familiar from the days of the Penal Code (Vide Sec. 302).
The prescription of equal protection is not breached either, because within the range of judicial discretion the court deals out to each what he deserves according to established principles.
Shri R. K. Garg feelingly urged that the poor and the weak, who are the larger, lower sector of retail traders, will have to suffer the standardised imprisonment if Food Inspectors can challan them in Court and, on some minor variation in the chemical composition of food sold, get them convicted sans mens rea merely because, along the chain, some bigger trader has fobbed off inferior commodities on them.
We are disturbed that it is possible that small men become the victims of harsh law when there is no executive policy which guides prosecution of offenders.
Petty victuallers and big sharks operate on society in different degrees and draconian equality will be tempered by flexible policy.
This is a matter of penal policy in constitutionality and so it is, in a sense, out of bounds for judicial advice.
Even so, we feel constrained to state that public authorities entrusted with the enforcement of regulatory provisions to protect society may, in proper cases, examine those prosecutions which are harassments to the humbler folk even if they technically violate the law and cause only minimal harm to society and decide whether they should at all sanction their prosecution.
The Legislature, in its wisdom, may also consider the advisability of resting power somewhere to reduce the sentence without the bigger offender escaping through these wider meshes meant for the smaller offenders.
Even otherwise, there is a general power in the Executive to commute sentences and such power can be put into action on a principled basis when small men get caught by the law.
We dismiss the Writ petition since there is no constitutional invalidity made out and the grounds urged are more appropriately an appeal to the Parliament and the Executive.
V.D.K. Petition dismissed.
| A Hindu undivided family consisting of the father (Karta) and his three sons carried on business.
Land was acquired in the name of the Karta and the price was paid out of the books of the family, and a building was constructed on the land.
Another building was constructed on another plot of land.
On a partial partition of the above Hindu undivided family its business was taken over by a partnership firm consisting of the Karta and the two elder sons and the firm debited a certain sum of money in the building account of the firm for the assessment year 1955 56 and a similar sum in respect of the other property for the assessment year 1956 57.
The appellants (assessees) who were members of the partnership firm, filed separate returns in their individual status for the assessment years 1955 56 and 1956 57 claiming that the two properties belonged to the four members of the family in their individual capacity.
The Income Tax Officer however regarded the properties as belonging to the partnership firm, and in the assessment proceedings of the firm for the said years, estimated the cost of construction at a higher figure, than the cost disclosed, and made additions accordingly to the returned income of the firm.
Allowing the appeals of the partnership firm the Appellate Assistant Commissioner deleted the additions holding that as the money was advanced by the firm and debited to the account of each co owner, the partnership firm was not the owner of the properties and therefore it could not be said to have earned any concealed income.
The Income Tax Officer then initiated proceedings under section 147(a) of the I.T. Act 1961 against the individual assessees for the assessment years 1955 56 and 1956 57 and the additions on account of concealed income originally made in the assessments of the partnership firm were divided between the assessees and included in their individual assessment, rejecting the plea of the assessees that there was no case for invoking the said section, as they had already disclosed that they had invested in the properties when filing their original individual returns.
On appeal the Appellate Assistant Commissioner though agreeing that there was no default on the part of the assessees to warrant proceedings under section 147(a) and though ordinarily the assessments would be barred by limitation, maintained the assessments on the ground that section 153(3)(ii) of the Act applied.
273 The Income Tax Appellate Tribunal though rejecting the contention that the assessees were not covered by the expression "any person" in section 153(3)(ii), pointed out that the provision could not be availed of by the Income Tax Officer as there was neither any "finding" nor a "direction" on the earlier order of the Appellate Assistant Commissioner in consequence of which, or to give effect to which, the impugned assessment could be said to have been made and that no opportunity had been afforded to the assessees of being heard as was required by Explanation 3 to section 153(3) before that earlier order was made.
It held that the Appellate Assistant Commissioner had no jurisdiction to convert the assessments made by the Income Tax Officer under section 147(a) to "assessments passed under section 153(3)(ii)".
The High Court on Reference by the Tribunal observed that the finding that the properties did not belong to the partnership firm and therefore the excess amount of the cost of construction could not be regarded as the concealed income of the firm, was necessary for the disposal of the appeals filed by the firm and as a corollary it was held that the buildings belonged to the co owners.
This necessitated the "direction" to the Income Tax officer that he was free to assess the excess amount in the hands of the co owners.
It held that the Appellate Assistant Commissioner could convert the provisions of section 147(i) into those of section 153(3)(ii) of the Act and that the provisions of section 153(3)(ii) of the Act applied to the case.
In the assessee 's appeals to this Court on the question whether section 153(3)(ii) can be invoked.
Allowing the appeals, ^ HELD: (1) The provisions of section 153(3)(ii) of the Income Tax Act, 1961 are not applicable to the instant case.
[280 C] (2) The expression "finding" and "direction" are limited in meaning.
A finding given in an appeal, revision or reference arising out of an assessment must be a finding necessary for the disposal of the particular case, that is to say, in respect of the particular assessee and in relation to the particular assessment year.
To be a necessary finding, it must be directly involved in the disposal of the case.
[277G] (3) Where the facts show that the income can belong either to A or B and to no one else, a finding that it belongs to B or does not belong to B would be determinative of the issue whether it can be taxed as A 's income.
A finding respecting B is intimately involved as a step in the process of reaching the ultimate finding respecting A.
If, however, the finding as to A 's liability can be directly arrived at without necessitating a finding in respect of B, then a finding made in respect of B is an incidental finding only.
It is not a finding necessary for the disposal of the case pertaining to A.
The same principles apply when the question is whether the income under enquiry is taxable in the assessment year under consideration or any other assessment year.
[278A B] (4) It is now well settled that the expression "direction" in section 153(3) (ii) of the Act must mean an express direction necessary for the disposal of the case before the authority or court.
It must also be a direction which the authority or court is empowered to give while deciding the case before it.
[278C] 274 5.
(i) Section 153(3) (ii) is not a provision enlarging the jurisdiction of the authority or court.
It is a provision which merely raises the bar of limitation for making an assessment order under section 143 or section 144 or section 147.
[278D] Income Tax Officer, A Ward, Sitapur vs Murlidhar Bhagwan Das, ; N. Kt.
Sivalingam Chettiar vs Commissioner of Income tax, Madras, ; referred to.
In the instant case all that has been recorded is the finding that the partner ship firm is not the owner of the properties.
The finding proceeds on the basis that the cost has been debited in the accounts of the four co owners.
But that does not mean, that the excess over the disclosed cost of construction constitutes the concealed income of the assessees.
The finding that the excess represents their individual income requires a proper enquiry and for that purpose an opportunity of being heard is needed to be given to the assessees.
That is plainly required by Explanation 3 to section 153(3).
The finding contemplated in Explanation 3, is a finding that the amount represents the income of another person.
[278H 279B, D] (ii) It is one thing for the partners of a firm to be required to explain the source of a receipt by the firm, it is quite another for them in their individual status to be asked to explain the source of amounts received by them as separate individuals.
[279C] (iii) The observation of the Appellate Assistant Commissioner cannot be described as such a finding in relation to the assessee.
[279D] (iv) It is also not possible to say that the order of the Appellate Assistant Commissioner contains a direction that the excess should be assessed in the hands of the co owners.
The observation that the Income Tax Officer "is free to take action" cannot be described as a "direction".
A direction by a statutory authority is in the nature of an order requiring positive compliance.
When it is left to the option and direction of the Income Tax Officer whether or not to take action it cannot be described as a direction.
[279E F] (v) The order of the Appellate Assistant Commissioner contains neither a 'finding ' nor a 'direction ' within the meaning of section 153(3)(ii) of the Act in consequence of which or to give effect to which the impugned assessment proceedings can be said to have been taken.
[279G] Commissioner of Income tax, Andhra Pradesh vs Vadde Pullaiah & Co., ; referred to.
|
N: Criminal Appeal No. 692 of 1983.
From the Judgment and order dated 29th November, 1983 of the Punjab & Haryana High Court at Chandigarh in Criminal Writ Petition No. 516 of 1983.
K. Parasaran, Attorney Genl.
of India, Bhagwant Singh, Advocate General (Punjab), Gurmukh Singh, Addl Adv.
of Punjab, D.S. Brar, Asstt Adv.
General, G.S. Mann.
Deputy Adv.
General, R.D. Aggarwal, Govt.
Advocate, Miss A. Subhashini and S.K. Bagga for the Appellants.
Hardev Singh, G.S. Grewal, N.S Das Behl, R.S. Sodhi and J.S. Sandhawalia, for the Respondent.
The Judgment of the Court was delivered by CHANDRACHUD, C. J.
This is an appeal by special leave against the judgment dated November, 29 1983 of a learned Single Judge of the High Court of Punjab and Haryana in Criminal Writ Petition No. 516 of 1983.
That Writ Petition was filed by the respondent.
Shri Jagdev Singh Talwandi, to challenge an order of detention passed by the District Magistrate, Ludhiana, on October 3, 53 1983 whereby the respondent was detained under section 3 (3) read with section 3 (2) of the .
The respondent was arrested in pursuance of the order of detention on the night between October 3 and 4, 1983.
He was first lodged in the Central Jail, Patiala and from there he was taken to Ambala, Baroda and Fathegarh (U.P.).
He filed a Writ Petition (No.463 of 1983) in the High Court to challenge his transfer and detention in a place far away from Ambala.
He withdrew that petition on an assurance by the Government that he will be sent back to Ambala, which the Government did on October 28.
The grounds of detention were served on the respondent on October 6, 1983.
Those grounds show that the petitioner was detained on the basis of two speeches allegedly made by him: one on July 8, 1983 at Nihang Chhowani, Baba Bakala, District Amritsar and the other on September 20, 1983 at Gurdwara Manji Sahib, Amertsar.
The grounds furnished to the petitioner read thus: "(1) That you in a Shaheedi Conference which was held from 11 a.m. to 4.45 p.m. on 8 7 1983 at a place known as 'Nihang Chhowani ' at Baba Bakala, District Amritsar, delivered a provocative speech to a Sikh gathering comprising about 2000/2200 Persons wherein you made a pointed reference to the incident dated 2 7 1983 of encounters between Nihangs and police at Baba Bakala and Taran Taran and stressed that in order to take revenge Sikhs would kill their (Police) four persons in lieu of the two Nihangs who had been killed in the said encounters.
(2) That while addressing a conference convened by the AISSF (All India Sikh Students Federation) on 20 9 1983 at Gurdwara Manji Sahib at Amritsar and attended by about 7000/8000 Sikh students, you made a provocative speech wherein you said that all efforts made for the success of the Akali Morcha having failed, it was still time to establish in Punjab a Government parallel to the Central Government and that you are in a position to form such a Government.
You further exhorted that the establishment of Khalsa Raaj was the only solution to the problems.
You also made a suggestion that the Government 54 will not accept any demand unless it was compelled by force to do so.
This statement was also published in the various newspapers.
A case F.I.R. No. 295 dated 27 9 1983 under section 124 A Indian Penal Code, and section 13 of the , was registered at Police Station 'E ' Division, Amritsar, which is under investigation.
" The detaining authority stated in the last paragraph of the detention order that the respondent was being supplied the grounds of detention in Punjabi (Gurmukhi script) together with an English translation thereof and the "supporting material forming the base of the grounds of detention".
The "supporting material", by which is meant particulars of the grounds of detention, was supplied to the respondent along with the grounds.
These particulars consist of what is alleged to be a report of the speeches made by the respondent, as recorded by the C.I.D. branch of the Punjab Police.
The particulars, of which an English translation was produced in the High Court at exhibit A1, read thus: "While speaking he said that on July 2 by bringing B.S.F., Punjab Police and other police the unarmed Nihangs were fired at.
There is no count as to how many of them were killed, because no rollcall is taken of the Sikhs; how many came and how many went.
Further said that in Punjab hundreds of innocent Sikhs have been made the target of bullets.
The Government has seen that the Sikhs go away after paying homage to the martyrs.
Now we will have to decide as to what steps should be taken.
The beloved army of Guru (Nihangs) have protected our dress and scriptures.
It is true that some of them do commit mistakes also.
They should be punished.
We should see that we should kill as many police man as they kill ours, otherwise they will slowly finish us.
The new Inspector General of Police Mr. Bhinder, has stated that there are no extremist in Darbar Sahib.
Further said that Congress wants to finish self respect among you.
The Morcha, which is launched by Akali Dal, is to save the Sikh appearance.
The awards have been given to police, have they won any war? Such a big attack upon the Nihangs was 55 on a pre planned programme.
I say if they have killed our two men, then you should kill four.
If they come to kill me like this, then I will die after killing them.
I will never go back.
Further said that if we get a judicial enquiry made, it becomes meaningless.
Nothing comes out of them.
Now the judicial power has been given to Executive Officers.
They may kill any body and they complete the enquiry and fill the file.
" One of the grounds on which the order of detention was challenged in the High Court was that the State Government had failed to discharge its obligation under Article 22 (5) of the Constitution by denying to the respondent an effective opportunity to make a representation to the Advisory Board against the order of detention.
On being asked by the learned Judge "to be more specific", counsel for the respondent stated in the High Court that the State Government had not supplied to the respondent the supporting material on which Ground No. 1 of the grounds of detention was based.
Shri Hardev Singh, who appears on behalf of the respondent, adopted that contention by clarifying that the case of the respondent is that the relevant facts stated in the 1st ground of detention are totally absent from the supporting material supplied to him and, therefore, no reasonable person could have possibly passed the detention order on the basis of that material.
The learned counsel urged that the order of detention was bad either because the detaining authority did not apply its mind to the material before it or, in the alternative, because there was some other material on the basis of which the detention order was passed and that material was not supplied to the respondent.
For the purpose of focussing attention on the true nature of the respondent 's contention and the prejudice said to have been caused to him, the learned Judge of the High Court resorted to an ingenious device.
He coined a conversation between the detaining authority and the detenu on the subject of their rival contentions in this case.
That imaginary conversation may be reproduced, at least for the merit of its novelty: "(The detaining authority and the detenu come face to face.) Detaining authority: (After reading out Ground No. 1 to the detenu) : You had made that objectionable speech.
56 Detenu: Sir, you seem to have been wrongly informed.
I did not deliver any speech, provocative or otherwise, in a Shaheedi Conference at any such time, date or place known as 'Nihang Chhowni ' at Baba Bakal, District Amritsar, before a Sikh gathering of 2000/2200, as read out by you from ground No. 1.
Detaining authority: (Being cock sure of its facts, takes out the C.I.D. report and puts it in the hands of the detenu.): Go through this C.I.D. report carefully, as ground No. 1 is based on that report.
Detenu: Sir, this report does not refer to any speech being made by me in a Shaheedi Conference at a given time, on a given date, at a given place, at Baba Bakala and before a Sikh gathering numbering 2000/2200.
Detaining authority: (Taking back the report from the detenu 's hand and subjecting it to a close scrutiny, says somewhat wryly): Yes, you are right.
The vital data which finds a mention in ground No. 1 is missing from the supporting materail.
(Regaining quickly his repose, the detaining authority continues): Never mind if the given vital facts are missing from the supporting material.
The supporting material at least reveals that you did utter the objectionable words somewhere, sometime, on some date and before some persons.
Detenu: Sir, but that was not the speech on which you were going to act.
You were going to take action against me on the basis of the speech mentioned in Ground No. 1.
Detaining authority: Very well.
(So saying, the detaining authority orders the detention of the detenu on two grounds by adding one more ground on the basis of another speech.
The detaining authority serves the order of detention upon the detenu, containing two grounds of detention.
Simultaneously, the detaining authority supplies the supporting material to the detenu.") 57 We must mention in order to put the record straight and in fairness to the learned Judge, that he has narrated this conversation in a manner which is slightly different in so far as the form, but not the substance; is concerned.
He has narrated the conversation in a running form.
We have reproduced it like a dialogue in a play, without adding anything of our own.
Indeed, we have taken care not to make any changes at all in the fictional conversation imagined by the learned Judge because, the questions and answers which suggested themselves to him are, in a sense, the heart of the matter and, in any case, constitute the essence of his judgment.
With respect to the learned Judge, the basic error of his judgment lies in an easy, unexamined assumption which he has made on a significant aspect of the matter.
The detenu reminded the detaining authority that the C.I.D. report did not refer to any speech made by him "in a Shaheedi Conference at a given time, on a given date, at a given place at Baba Bakala and before a Sikh gathering numbering 2000/2200".
The detaining authority could have not possibly replied to that question by saying merely that the detenu was right.
The detenu was right only formally or technically.
That is because, the C.I.D. report was supplied to him along with the grounds of detention with the express stipulation that it formed "the base of the grounds of detention".
The grounds mention every one of the details which need have been mentioned.
The C.I.D. report was furnished to the detenu as forming the source of information leading to the conclusion that he had made a speech which necessitated his detention in the interests of public order.
In the circumstances, the grounds and the material furnished to the detenu have to be read together as is the material in the form of the C.I.D. report was a continuation of the grounds of detention.
The unqualified reply given by the detaining authority to the detenu, as imagined by the learned Judge, betrays considerable unfamiliarity with the true legal position of the part on the detaining authority.
Not only that, but it shows that the detaining authority forgot that the particulars and the grounds were expressed to be interlinked, the former being the base of the latter.
The detaining authority should have explained to the detenu that though the particulars supplied to him did not mention those various details, the particulars were supplied to him along with the grounds, that it was expressly clarified contemporaneously that they related to the facts stated in the grounds, that the two had to be read together and that the grounds contained the necessary facts with full details.
The dialogue should 58 have ended there and the curtain rung down.
Indeed, the dialogue, though carefully improvised by the learned Judge, assumes what is to be decided, namely, whether the particulars furnished to the detenu suffer from the infirmity alleged.
Nevertheless, we will examine independently the argument of the respondent that he could not make an effective representation against the order of detention because the material supplied to him, that is to say, the C.I.D. report of the speech alleged to have been made by him at the Shaheedi Conference, did not contain the material particulars which formed an important constituent of the grounds served upon him.
His grievance is that the C.I.D. report of his speech does not mention that: (1) the Conference was held on July 8, 1983; (2) it was held at Nihang Chhowani; (3) it was held between the hours of 11.
A.M. and 4.45 P.M. (4) it was a "Shaheedi Conference"; (5) there was a gathering of 2000 to 2200 persons at the Conference; and that, (6) the speech made by him referred to an encounter at Baba Bakala and Tarn Taran.
Article 22 (5) of the Constitution, around which the argument or the respondent revolves, reads thus: "When any person is detained in pursuance of an order made under any law providing for preventive detention, the authority making the order shall, as soon as may be, communicate to such person the grounds on which the order has been made and shall afford him the earliest opportunity of making a representation against the order." This Article has come up for consideration before this Court in a large number of cases.
One of the earliest judgments of this Court on the interpretation of this Article is reported in Dr. Ram krishna Bhardwaj vs The State of Delhi,(1) in which Patanjali Sastri, C.J. observed that under Article 22 (5) of the Constitution, the detenu has the right to be furnished with particulars of the grounds of his detention, "sufficient to enable him to make a representation which, on being considered, may give relief to him".
Khudiram Das vs The State of West Bengal, 2 is a judgment of a four Judge Bench of this Court in a case which arose under the Main 59 tenance of Internal Security Act, 1971.
One of us, Bhagwati, J., who spoke for the Court, surveyed the decisions bearing on the question of the obligation of the detaining authority and explained the nature of that obligation thus: "The basic facts and material particulars, therefore, which are the foundation of the order of detention, will also be covered by 'grounds ' within the contemplation of article 22 (5) and section 8 and are required to be communicated to the detenu unless their disclosure is considered by the authority to be against the public interest.
This has always been the view consistently taken by this Court in a series of decisions.
" In Mohammad Yousuf Rather vs The State of Jammu & Kashmir,(1) Chinnappa Raddy, J., in a concurring judgment, dealt with the implications of Article 22 (5) of the Constitution thus: "The extent and the content of Article 22 (5) have been the subject matter of repeated pronouncements by this Court (Vide State of Bombay vs Atmaram (2), Dr. Ramkrishna Bhardwaj vs State of Delhi (1) Shibbanlal Saxena vs State of Uttar Pradesh (3) Dwarkadas Bhatia vs State of Jammu & Kashmir (4).
The interpretation of Article 22, consistently adopted by this Court, is, perhaps, one of the outstanding contributions of the Court in the cause of Human Rights.
The law is now well settled that a detenu has two rights under Article 22 (5) of the Constitution .
(1) To be informed, as soon as may be, of the grounds on which the order of detention is based, that is, the grounds which led to the subjective satisfaction of the detaining authority and (2) to be afforded the earliest opportunity of making a representation against the order of detention, that is, to be furnished with sufficient particulars to enable him to make a representation which on being considered may obtain relief to him." In Khudiram Das vs The State of West Bengal,(2) it was observed that these two safeguards "are the barest minimum which must be 60 observed before an executive authority can be permitted to preventively detain a person and thereby drown his right of personal liberty in the name of public good and social security".
The question which we have to consider in the light of these decisions is whether sufficient particulars of the first ground of detention were furnished to the respondent so as to enable him to exercise effectively his constitutional right of making a representation against the order of detention.
The obligation which rests on the detaining authority in this behalf admits no exception and its rigour cannot be relaxed under any circumstances.
Having given our anxious consideration to this question, it seems to us impossible to accept the view of the High Court that sufficient particulars of the first ground of detention where not furnished to the detenu so as to enable him to make an effective representation to the detaining authority, that is to say, a representation which on being accepted may give relief to him.
This is not a case in which the ground of detention contains a bare or bald statement of the conclusion to which the detaining authority had come, namely, that it was necessary to pass the order of detention in order to prevent the detenu from acting in a manner prejudicial to the interests of public order.
The first ground of detention with which we are concerned in this appeal, mentions each and every one of the material particulars which the respondent was entitled to know in order to be able to make a full and effective representation against the order of detention.
That ground mentions the place, date and time of the alleged meeting.
describes the occasion on which the meeting was held, that is, the 'Shaheedi Conference '.
It mentions the approximate number of persons who were present at the meeting.
Finally, it mentions with particularity the various statements made by the respondent in his speech.
These particulars mentioned in the grounds of detention comprise the entire gamut of facts which it was necessary for the respondent to know in order to make a well informed representation.
The inadequacies from which the supplementary particulars furnished to the respondent along with ground No. 1 suffer, cannot affect that position because, they do not introduce any obscurity in the facts stated in that ground or detract from the substance of the allegations mentioned in that ground.
The argument of the respondent that he could not make an effective representation in behalf of ground No. 1 because of the inadequacy of data in the particulars supplied to him, has therefore to be rejected.
However, we are somewhat surprised that in a matter of this nature, 61 the detaining authority should have adopted a somewhat casual and unimaginative approach to his task.
We asked the learned Attorney General to produce before us the original version of the C.I.D. report of which an extract was supplied to the respondent by way of particulars.
The original version contains almost every one of the material details pertaining to the meeting which are mentioned in ground No. 1 The detaining authority needlessly applied his scissors excising the data which mentioned the date, the place, the time and the occasion of the meeting.
It is this lack of thoughtfulness on the part of the detaining authority which furnished to the respondent the semblance of an argument.
This Court has observed in numerous cases that, while passing orders of detention, great care must be brought to bear on their task by the detaining authorities.
Preventive detention is a necessary evil but essentially an evil.
Therefore, deprivation of personal liberty, if at all, has to be on the strict terms of the Constitution.
Nothing less.
We will utter the of given warning yet once more in the hope that the voice of reason will be heard.
Shri Hardev Singh contended, in the alternative, that the order of detention suffers from a total non application of mind because, that order could not have been passed on the basis of the C.I.D. report which does not refer to any of the facts which are mentioned in the order of detention.
It is undoubtedly true that the case of the appellants is that the order of detention is founded upon the report of the C.I.D., relating to the speech made by the respondent at the Shaheedi Conference.
But the argument of the learned counsel overlooks that what was furnished to the respondent was an extract from the C.I.D. report and not the whole of it.
However, that has not caused any prejudice to the respondent since the grounds and the particulars were served upon him simultaneously and ground No. 1 mentions every conceivable detail which it was necessary to mention in order to enable the respondent to make a proper representation against the order of detention.
Evidently, the detaining authority had before it the whole of the C.I.D. report on the basis of which it passed the order of detention.
What was omitted from the extract furnished to the respondent was incorporated in ground No. 1.
It is therefore not possible to accept the argument that the order of detention is bad because the detaining authority did not apply its mind to the question as to whether there was material on the basis of which the respondent could be detained.
It was further argued by the learned counsel that the detaining authority should have disclosed the evidence on the basis of which 62 the order of detention was passed because, in the absence of knowledge of such evidence, the respondent could not have made an effective representation against the order of detention.
There is no substance in this contention.
It is not the law that the evidence gathered by the detaining authority against the detenu must also be furnished to him.
In Beni Madhob Shaw vs The State of West Bengal,(1) it was argued on behalf of the detenu that the details of the activities attributed to him were not disclosed to him, as a result of which his right to make a representation to the Government was seriously prejudiced.
It was held by this Court that since the activities forming the grounds of detention were disclosed to the detenu in clear terms and since such disclosure furnished adequate information to the detenu to enable him to make an effective representation against his detention, the non disclosure of sources of information or the exact words of the information which formed the foundation of the order of detention could not be complained of.
In Her Jas Dev Singh vs State of Punjab,(2) it was held that the conclusions drawn from the available facts constitute 'the grounds ' and that the ground must be supplied to the detenu.
The Court observed that the detenu is not entitled to know the evidence nor the source of the information: What must be furnished to him are the grounds of detention and the particulars which would enable him to make out a case, if he can, for the consideration of the detaining authority.
In Vakil Singh vs State of Jammu and Kashmir, (3) it was held that since the basic facts, as distinguished from factual details were incorporated in the material which was supplied to the detenu, nothing more was required to be intimated to him in order to enable him to make an effective representation.
These cases show that the detenu is not entitled to be informed of the source of information received against him or the evidence which may have been collected against him as, for example, the evidence corroborating that the report of the C.I.D. is true and correct.
His right is to receive every material particular without which a full and 63 effective representation cannot be made.
If the order of detention refers to or relies upon any document, statement or other material, copies thereof have, of course, to be supplied to the detenu as held by this Court in Ichhu Devi Choraria vs Union of India.(1) That question does not arise here since no such thing is referred to or relied upon in the first ground of detention.
Indeed the furnishing of the C.I.D. report, of which a truncated extract was furnished to the respondent, was a superfluous exercise in the light of the facts of the instant case.
Shri Hardev Singh relied upon the following passage in the judgment in Khudiram in support of his contention that the entire material which was before the detaining authority, including the evidence gathered by him, must be furnished to the detenu: "But if the grounds of detention are not communicated to him how can he make an effective representation ? The opportunity of making a representation would be rendered illusory.
The communication of the grounds of detention is, therefore, also intended to sub serve the purpose of enabling the detenu to make an effective representation.
If this be the true reason for providing that the grounds on which the order of detention is made should be communicated to the detenu, it is obvious that the 'grounds ' mean all the basic facts and materials which have been taken into account by the detaining authority in making the order of detention and on which, therefore, the order of detention is based.
" These observations cannot be construed as meaning that the evidence which was collected by the detaining authority must also be furnished to the detenu.
As the very same paragraph of the judgment at page 839 of the report shows, what was meant was that the basic facts and the material particulars which form the foundation of the order of detention must be furnished to the detenu since, in the true sense, they form part of the grounds of detention and without being apprised of the same, the detenu cannot possibly make an effective representation.
Shri Hardev Singh found serious fault with the fact that in answer to the writ petition filed by the respondent in the High Court, the counter affidavit was sworn by Shri K.C. Mahajan, Deputy Secretary in the Home Department of the Government of Punjab, and 64 not by the District Magistrate, Ludhiana, who had passed the order of detention.
We are not prepared to dismiss this submission as of no relevance or importance.
In matters of a routine nature, if indeed there are any matters of a routine nature in the field of detention, a counter affidavit may be sworn by a person who derives his knowledge from the record of the case.
However, in sensitive matters of the present nature, the detaining authority ought to file his own affidavit in answer to the writ petition and place the relevant fats before the Court which the Court is legitimately entitled to know.
In Shaik Hanif vs State of West Bengal, the counter affidavit on behalf of the State of West Bengal was filed by the Deputy Secretary (Home), who verified the correctness of the averments in his affidavit on the basis of the facts contained in the official records.
The District Magistrate; who passed the order of detention, did not file his affidavit and the explanation which he gave for not doing so was found to be unsatisfactory.
Following an earlier judgment in Naranjan Singh vs State of Madhya Pradesh, it was held by this Court that, in answer to a Rule issued in a habeas corpus petition, it is incumbent upon the State to satisfy the Court that the detention of the petitioner is legal and is in conformity not only with the mandatory provisions of the Act under which the order of detention is passed but is also in accord with the requirements implicit in Article 22(5) of the Constitution.
Sarkaria, Jobserved on behalf of the Court: "Since the Court is precluded from testing the subjective satisfaction of the detaining authority by objective standards, it is all the more desirable that in response to the Rule Nisi, the counter affidavit on behalf of the State should be sworn to by the District Magistrate or the authority on whose subjective satisfaction the detention order under s.3 was passed.
If for sufficient reason shown to the satisfaction of the Court, the affidavit of the person who passed the order of detention under section 3 cannot be furnished, the counter affidavit should be sworn by some responsible officer who personally dealt with or processed the case in the Government Secretariat or submitted it to the Minister or other Officer duly authorised under the rules of business framed by the Governor under Article 166 of the Constitution to pass orders on behalf of the Government in such matters.
" 65 After reviewing certain other decisions, the Court held that the failure to furnish the counter affidavit of the District Magistrate who had passed the order of detention, was an impropriety though in most of the cases it may not be of much consequence, especially if there was no allegation of mala fides against the detaining authority.
In the result, the absence of the affidavit of the District Magistrate was held not to vitiate the order of detention.
In this case too, there are no allegations of mala fides against the District Magistrate and so, his failure to file a counter affidavit will not vitiate the order of detention.
We cannot, however, leave this subject without emphasising once again the importance of the detaining authority filing his own affidavit in cases of the present nature.
There are degrees of impropriety and the line which divides grave impropriety from illegality is too thin to draw and even more so to judge.
Conceivably, there can be cases in which such impropriety arising out of the failure of the detaining authority in filing his own affidavit may vitiate the order of detention.
Finally, Shri Hardev Singh has contended that the respondent was unable to give proper instructions to his counsel when the matter was heard by the Advisory Board.
Counsel says that the respondent was transferred from place to place and ultimately.
he was produced before the Advisory Board an hour or so before the commencement of proceedings before the Board.
That left no time for him to instruct his counsel.
We do not see any substance in this grievance.
The respondent was represented by an advocate before the Advisory Board.
The learned advocate argued the case of the respondent along with the cases of two other detenus.
It does not appear that any grievance was made by him that he was not able to obtain instructions from the respondent so as to be able to represent his case effectively before the Advisory Board.
For these reasons, we allow the appeal and set aside the judgment of the High Court.
As desired by counsel for the respondent, we remand the matter to the High Court for disposal of the remaining contentions raised by the respondent in his Writ Petition.
We would like to take this opportunity to point out that serious difficulties arise on account of the practice increasingly adopted by the High Courts, of pronouncing the final order without a reasoned judgment.
It is desirable that the final order which the High Court intends to pass should not be announced until a reasoned judgment 65 is ready for pronouncement.
Suppose, for example, that a final order without a reasoned judgment is announced by the High Court that a house shall be demolished, or that the custody of a child shall be handed over to one parent as against the order, or that a person accused of a serious charge is acquitted, or that a statute is unconstitutional or, as in the instant case, that a detenu be released from detention.
If the object of passing such orders is to ensure speedy compliance with them, that object is more often defeated by the aggrieved party filing a special leave petition in this Court against the order passed by the High Court.
That places this Court in a predicament because, without the benefit of the reasoning of the High Court, it is difficult for this Court to allow the bare order to be implemented.
The result inevitably is that the operation of the order passed by the High Court has to be stayed pending delivery of the reasoned judgment.
It may be thought that such orders are passed by this Court and therefore there is no reason why the High Courts should not do the same.
We would like to point out respectfully that the orders passed by this Court are final and no appeal lies against them.
The Supreme Court is the final Court in the hierarchy of our courts.
Besides, orders without a reasoned judgment are passed by this Court very rarely, under exceptional circumstances.
Orders passed by the High Court are subject to the appellate jurisdiction of this Court under Article 136 of the Constitution and other provisions of the concerned statutes.
We thought it necessary to make these observations in order that a practice which is not very desirable and which achieves no useful purpose may not grow out of its present infancy.
| The respondent challenged the order of his detention passed by the District Magistrate, Ludhiana on October 3,1983 under section 3 (3) read with section 3 (2) of the , through Criminal Writ Petition No. 516 of 1983.
According to the petitioner respondent, the grounds of detention served on him on Oct. 6, 1983 showing that he was detained on the basis of two speeches made by him on 8.7.1983 and 20.9.1983 as recorded by the Crime Investigation Department of the Punjab Police contained certain particulars, which were totally absent from the supporting material and therefore no reasonable person could have possible passed the detention order on the basis of such material.
The High Court accepted the contention and made the rule absolute.
Hence the appeal by the State after obtaining special leave.
Allowing the appeal and remanding the matter to the High Court of Punjab, the Court ^ HELD: 1:1.
While passing orders of detaining great care must be brought to bear on their task by the detaining authorities.
Preventive detention is a 51 necessary evil but essentially an evil.
Therefore, deprivation of personal liberty, if at all, has to be on the strict terms of the Constitution.
Nothing less.
[61 B C] 1:2.
In the instant case, the detaining authority should not have adopted a somewhat casual and unimaginative approach to his task.
The original version contains almost every one of the material details pertaining to the meeting, which are mentioned in ground No.1.
The detaining authority needlessly applied his scissors excising the data which mentioned the date, place, the time and the occasion of the meeting.
It is this lack of thoughtfulness on the part of the detaining authority which furnished to the respondent the semblance of an arguments.
[61 A B] 2.
The contention of the respondent that he could not make an effective representation in behalf of ground No.1 because of the inadequacy of data in the supporting particulars supplied to him is incorrect.
The inadequacies from which the supplementary particulars furnished to the respondent along with ground No.1 suffer, cannot affect that position because, they do not introduce any obscurity in the facts stated in that ground or detract from the substance of the allegations mentioned in that ground.
The first ground of detention mentions that the detenu was right only formally or technically.
That is because, the C.I.D. Report was supplied to him along with the grounds of detention with the express stipulation that it formed "the base of the grounds of detention.
" The grounds mention every one of the details which need have been mentioned.
The C.I.D. report was furnished to the detenu as forming the source of information leading to the conclusion that he had made a speech which necessitated his detention in the interests of public order.
In the circumstances, the grounds and the material furnished to the detenu have to be read together as if the material in the form of the C.I.D. report was a continuation of the grounds of detention.
[57 C E, 60 F H] Dr. Ramakrishna Bhardwaj vs The State of Delhi, ; , Khudiram Das vs The State of West Bengal, ; , @ 838 & 840; Mohammed Yusuf Rowther vs The State of J & K, ; @ 268, 269; State of Bombay vs Atmaram, ; Shibbanlal Saxena vs State of Uttar Pradesh, ; ; Dwarkadas Bhatia vs State of Jammu & Kashmir, ; ; referred to.
The detenu is not entitled to be informed of the source of information received against him or the evidence which may have been collected against him as for example, the evidence corroborating that the report of the C.I.D. is true and correct.
His right is to receive every material particular without which a full and effective representation cannot be made.
If the order of the detention refers to or relies upon any document, statement or other material, copies thereof have, of course, to be supplied to the detenu.
It is not the law that evidence gathered by the detaining authority against the detenu must also be furnished to him.
[62 G H; 63 A B] Beni Madhob Shaw vs The State of West Bengal, A.I.R. Har Jas Dev Singh vs State of Punjab, ; @ 288; Vakil Vakil Singh vs State of Jammu & Kashmir, A.I.R. 1974 2337 @, 2341; Icchu Devi Choraria vs Union of India; , @ 650; referred to.
The failure to furnish the counter affidavit of the District Magistrate who had passed the order of detention, was an impropriety though in most of the cases 52 it may not be of much consequence, especially if there was no allegation of mala fides against the detaining authority.
There are no allegations of mala fides against the District Magistrate and so, his failure to file a counter affidavit will not vitiate the order of detention.
[65 A B] Shaik Hanif vs State of West Bengal, [1974]3 SCR 258; Naranjan Singh vs State of Madhya Pradesh, A.I.R. 1972 S.C. 2215, referred to.
[The Court emphasised the importance of the detaining authority filing his own affidavit in cases of the present nature and observed that "There are degrees of impropriety and the line which divides grave impropriety from illegality is too thin to draw and even more so to judge.
Conceivably, there can be cases in which such impropriety arising out of the failure of the detaining authority in filing his own affidavit may vitiate the order of detention.] [65 C D] 5.
It is desirable that the final order which the High Court intends to pass should not be announced until a reasoned judgment is ready for pronouncement.
If the object of passing such orders is to ensure speedy compliance with them, that object is more often defeated by the aggrieved party filing a special leave petition in this Court against the order passed by the High Court.
That places this Court in a predicament because, without the benefit of the reasoning of the High Court it is difficult for this Court to allow the bare order to be implemented.
The result inevitably is that the operation of the order passed by the High Court has to be stayed pending delivery of the reasoned judgment.
[65 H; 66 A C]
|
201 of 1952) under article 32 of the Constitution for the enforcement of fundamental rights.
B. K. Varma.and G. C. Mathur for the petitioner.
M.C. Setalvad, Attorney General for India, (Porus A. Mehta, with him) for the respondent.
March 13.
The Judgment of the Court was delivered by BOSE J.
This is a petition under article 32 of the Constitution in which the petitioner seeks redress for what, according to him, is a breach of his fundamental rights under articles 14 and 16(1) of the Constitution.
It was argued at considerable length by the petitioner in person.
Then, when our judgment was nearly ready, he put in a petition asking for a rehearing and for permission to file some fresh papers.
When that was refused he came again on another,day and asked for leave to engage an agent and appear through counsel as he felt he had not been able to do justice to his case in person.
(It may be mentioned that though he had originally engaged an agent he dismissed him before the hearing when he appeared in person.) We granted his request and counsel reargued the case for him but has not carried the matter any further.
The facts are these.
657 In October,1945, the petitioner was employed by the Government of India on a five year contracting, the Directorate General of Resettlement and Employment of the Ministry of Labour.
This was after selection by the Federal Public Service Commission.
After a short period of practical training, he was posted in January, 1946, at Jabalpur as the Manager of the Sub Regional Employment Exchange and was later confirmed in this appointment.
This contract of service was due to expire in 1950.
Shortly before its expiration the Government of India made him a new offer, embodied in its letter dated the 30th June, 1950, to continue him in service on the expiry of his contract on the terms specified in that letter.
Among them were the following: (3) Other conditions of service: On the termination of your contract you will be allowed to continue in your post temporarily for the period of the Resettlement and Employment Organisation and will be governed by the Central Civil Services (Temporary Service) Rules, 1949, unless you are a permanent Government servant.
" He was asked in the letter to intimate to the Ministry of Labour whether he was willing to continue in service on those terms and he admits that he accepted the offer and continued in service, He was not a permanent Government servant though it was contended in argument that he was, for he was on a five year contract and the work for which he was employed, namely Resettlement and Employment, was itself only of a temporary character.
Therefore, the Temporary Service Rules applied.
On those rules, ' rule 5 is material.
It runs as follows: 5 (a) The service of a temporary Government servant who is not in quasi permanent service shall be liable to termination at any time by notice in writing given either by the Government servant to the appointing authority, or by the appointing authority to the Government servant.
658 (b) The period of such notice shall be one month, unless otherwise agreed to by the Government and by the Government servant.
" Quasi permanent service is defined in the rules and it is clear that the petitioner does not come within that class.
It is also an undisputed fact that there was no agreement between the petitioner and Government regarding the period of the notice.
Therefore, according to this rule, which was a term in the petitioner 's contract of further service, his services were liable to termination at any time by ' one month 's notice in writing.
This notice was given on 25th November, 1950, and he was told that his services would terminate on the expiry of one month from 1st December, 1950.
A large field was covered in the course of the arguments, and had the matter not been re argued we would, for the petitioner 's satisfaction, have dealt with the contentions raised more fully than will be necessary now that counsel has appeared.
The petition is under article 32(1) of the Constitution and so it must be shown that a fundamental right has been infringed.
It was argued that the rights infringed are the ones conferred by articles 14 and 16(1).
Taking article 14 first, it must be shown that the ,petitioner has been discriminated against in the exercise or enjoyment of some legal right which is open to others who are similarly situated.
The rights which he says have been infringed are those confered by article 31 1.
He says he has either been dismissed or removed from service without the safeguards which that article confers.
In our opinion, article 31 1 has no application because this is neither a dismissal nor a removal from service, nor is it a reduction in rank.
It is an ordinary case of a contract being termi nated by notice under one of its clauses.
The services in India have long been afforded certain statutory guarantees and safeguards against arbitrary dismissal or reduction in rank Under 659 section 240 of the Government of India Act, 1935, the safeguards were limited to those two cases.
Under.
the present Constitution, a third was added, namely removal from service.
In order to understand the difference between "dismissal" and "removal" from service, it will be necessary to turn to the Rule,; which governed, and with modifications still govern, the "services" in India because of article 313 of the Constitution.
Part XII of the Civil Services (Classification, Control and Appeal) Rules relating to Conduct and Discipline includes rule 49 which sets out the various penalties to which a member of the services can be subjected for indiscipline and misconduct.
They are seven in number and include censure, suspension, reduction in rank, removal from service and dismissal from service.
The Act of 1935 selected only two of these possible penalties as serious enough to merit statutory safeguards, namely reduction in rank and dismissal from service. 'The Constitution has added a third to the list.
The distinction which is drawn between the two is explained in rule 49.
There is first removal from service "which does not disqualify from future employment " and there is next dismissal from service "which ordinarily disqualifies from future employment.
" Then follows an Explanation: The discharge (c) of a person engaged under contract, in accordance with the terms of his contract, does not amount to removal or dismissal within the meaning of this rule.
" These terms are used in the same sense in article 3ll.
It follows that the article has no application here and so no question of discrimination arises, for the "law" whose protection the petitioner seeks has no application to him.
There was no compulsion on the petitioner to enter into the contract he did.
He was as free under the law as any other person to accept or to reject the 660 offer which was made to him.
Having accepted, he still has open to him all the right , and remedies available to other persons similarly situated to enforce any rights under his contract which have been denied to him, assuming there are any, and to pursue in the ordinary courts of the land such remedies for a breach as are open to him to exactly the same extent as other persons similarly situated.
He has not been discriminated against and he has not been denied the protection of any laws which others similarly situated could claim.
The remedy of a writ is misconceived.
Article 16(1) is equally inapplicable.
The whole matter rests in contract.
When the petitioner 's first contract (the five year one) came to an end, he was not a permanent Government servant and Government was not bound either to re employ him or to continue him in service.
On the other hand, it was open to Government to make him the offer it did of a continuation of his employment on a temporary and contractual basis.
Though the employment was continued, it was in point of fact, and in the eyes of the law, under a new and fresh contract which was quite separate and distinct from the old even though many of its terms were the same.
Article 16(1) deals with equality of opportunity in all matters relating to employment or appointment to any office under the State.
The petitioner has not been denied any opportunity of employment or of appointment.
He has been treated just like any other person to whom an offer of temporary employment under these conditions was made.
His grievance, when analysed, is not one of personal differentiation but is against an offer of temporary employment on special terms as opposed to permanent employment.
But of course the State can enter into contracts of temporary employment and impose special terms in each case, provided they are not inconsistent with the Constitution, and those who choose to accept those terms and enter into the contract are bound by them, even as the State is bound.
When the employment is permanent there are certain statutory guarantees but in the absence of 661 any such limitations government is, subject to the qualification mentioned above, as free to make special, contracts of, service with temporary employees, engaged in, works of a temporary nature, as any other employer.
Various matters relating to the merits of the case were referred to but we express no opinion about whether the petitioner has other rights which he can enforce in other ways.
We are dealing here with a writ under article 32 to enforce a fundamental right and the only point we decide is that no fundamental right has been infringed.
When the matter was first argued we had decided not to make any order about costs but now that the petitioner has persisted in reopening the case and calling the learned Attorney General here for a second time, we have no alternative but to dismiss the petition with costs.
Petition dismissed.
Agent for the petitioner: Bajinder Narain.
| In the 1967 election to the State Legislative Assembly, the appellant and the 1st respondent claiming to be Adi Dravidas, stood as candidates for a seat reserved for Scheduled Castes.
The respondent was declared elected.
The appellant`s election petition challenging the election was allowed by the High Court.
This Court dismissed the respondent 's appeal holding, (1) that the respondent was converted to Christianity in 1949, (2) that on such conversion he ceased to be an Adi Dravida, (3) that he was reconverted to Hinduism but 4) assuming that membership of a caste can be acquired on conversion or reconversion to Hinduism, the respondent had failed to establish that he became a member of the Adi Dravida caste after reconversion.
In the 1972 elections, the appellant and respondent again filed their nominations as Adi Dravidas for the seat reserved for Scheduled Castes.
On objection by the appellant, the Returning officer rejected the nomination of the respondent on the view that on conversion to Christianity, he ceased to be an Adi Dravida and that on reconversion, he could not claim the benefit of the Constitution (Scheduled Castes) order, 1950.
The appellant was declared elected.
The respondent challenged the election and the High Court held that the question (a) whether the respondent embraced Christianity in 1949, (b) whether on such conversion be ceased to be an Adi Dravida, and (c) whether he was reconverted to Hinduism, were concluded by the decision of this Court in the earlier case.
In fact, the respondent so conceded on the first two aspects.
The High Court, however, held that the respondent had established twelve cir circumstances, which happened subsequent to the earlier election showing that he was accepted into their fold by the members of the Adi Dravida caste, that he was, therefore, at the material time, an Adi Dravida professing Hindu religion as required by paragraphs 2 and 3 of the Constitution (Scheduled Castes) order, and that therefore, his nomination was improperly rejected.
Dismissing the appeal to this Court, ^ HELD: (1) The question whether the respondent abandoned Hinduism and embraced Christianity in 1949 is essentially a question of fact.
The respondent having conceded before the High Court, that in view of the decision of this Court in the earlier case, the question did not survive for consideration and the High Court, having acted on that concession, the respondent could not be permitted to raise an argument that the evidence did not establish that he embraced Christianity in 1949.
[89 D F] (2) Similarly.
the question whether the respondent was reconverted to Hinduism stands concluded by the decision of this Court in the earlier case and it must be held that since prior to January 1967, the respondent was reconverted to Hinduism, he was, at the material time, professing the Hindu religion so as to satisfy the requirement of para 3 of the Constitution (Scheduled Castes) order [94C D] 83 (3) The High Court was right in the view that on reconversion to Hinduism, A the respondent could once again reconvert to his original Adi Deavida caste if he was accepted, as such, by the other members of that caste; and that, in fact, the respondent after his reconversion to Hinduism, was recognised and accepted as a member of the Adi Dravida caste by the other members of that community [97A B, 98G] (a) Since a caste is a social combination of person governed by its rules and regulations, it may, if its rules and regulations so provide, admit a new B. member just as it may expel an existing member.
The rules and regulations of the caste may not have been formalised they may not exist in black and white: they may consist only of practices and usages.
If, according to the practice and usage of the caste any particular ceremonies are required to be performed for readmission to the caste, a reconvert to Hinduism would have to perform those ceremonies if he seeks readmission to the caste.
But, if no rites or ceremonies are required to be performed for readmission of a person as a member of the caste, the only thing necessary would be the acceptance of the person concerned by the other members of the caste.
[95 C F] C (b) The consistent view taken by the Courts from the time of the decision in Administrator General of Madras vs Anandachari (ILR , that is, since 1886, has been that on reconversion to Hinduism, a person can once again become a member of the caste in which he was born and to which he belonged before conversion to another religion if the members of the caste accept him as a member.
If a person who has embraced another religion can be reconverted to Hinduism, there is no rational principle why he should not be able to come back to his caste, if the other members of the caste are prepared to re admit him as a member.
It stands to reason that he should be able to come back to the fold to which he once belonged, provided the community is willing to take him within the fold.
[96 C R] Nathu vs Keshwaji I.L.R. Guruswami Nadar vs Irulappa Konar A.I.R. 1934 Mad.
630 and Durgaprasada Rao vs Sudarsanaswami, AIR 1940 Mad. 513, referred to.
(c) It is the orthodox Hindu Society, still dominated to a large extent, particularly in rural areas, by medievalistic outlook and status oriented approach which attaches social and economic disabilities to a person belonging to a Scheduled Caste and that is why, certain favoured treatment is given to him by the Constitution.
Once such a person ceases to be a Hindu and becomes a Christian the social and economic disabilities arising because of Hindu religion cease and hence, it is no longer necessary to give him protection; and for this reason, he is deemed not to belong to a Scheduled Caste.
But, when he is reconverted to Hinduism.
the social and economic disabilities once again revive and become attached to him, because, these are disabilities inflicted by Hinduism.
Therefore, the object and purpose of the Constitution (Scheduled Castes) order would be advanced rather than retarded by taking the view that on reconversion to Hinduism, a person can once again become a member of the Scheduled Caste to which he belonged prior to his conversion.
[96 F 97 A] (d) out of the 12 circumstances relied on by the High Court, 5 are not of A importance, namely, (1) that the respondent celebrated tho marriages of his younger brothers in the Adi Dravida manner; (ii) that the respondent was looked upon as a peace maker among the Adi Dravida Hindus of the locality; (iii) that the funeral ceremonies of the respondent 's father were performed " according to the Adi Dravida Hindu rites; (iv) that he participated in the first annual death ceremonies of another Adi Dravida; and (v) that the respondent participated in an All India Scheduled Castes Conference.
The other seven circumstances, however, establish that the respondent was accepted and treated as a member of the Adi Dravida community, namely, (1) that he was invited to lay the foundation stone for the construction of the wall of an Adi Dravida temple: (ii) that he was asked to take part in the celebrations connected with an Adi Dravida temple.
(iii) that he was asked to preside at a festival connected with an Adi Dravida temple; (iv) that he was a member of the Executive Committee of the Scheduled Caste Cell in the organisation of the Ruling 84 Congress; (v) that his children were registered in school as Adi Dravidas and that even the appellant had given a certificate that the respondent 's son was an Adi Dravida.
(vi) that he was treated as a member of the Adi Dravida caste and was never disowned by the members of the caste; and (vii) that a Scheduled Caste Conference was held in the locality with the object of re admitting the respondent into the fold of Adi Dravida Caste and that not only was the purificatory ceremony performed on him at the Conference with a view to clearing the doubt which had been cast on his membership of the Adi Dravida caste by the earlier decision of this Court, but also an address was presented to him felicitating him on the occasion.
[97 C 98 F] (4)(a) The question whether on conversion to Christianity the respondent ceased to be a member of the Adi Dravida caste is a mixed question of law and fact and a concession made by him in the High Court on that question does not preclude him from re agitating it in the appeal before this Court.
r[89 G H] (b) Further, the decision given in the earlier case relating to the 1967 elections on the basis of the evidence led in that case, cannot operate as res judicata ill the present case which relates to the 1972 election and where fresh evidence has been adduced by the parties and moreover, when all the parties in the present case are not the same as those in the earlier case.
[89 H 90 B] (c) When a 'caste ' is referred to in modern times, the reference is not to the 4 primary castes.
but to the innumerable castes and sub castes that prevail in Hindu society.
The general rule is that conversion operates as an expulsion from the caste, that is, a convert ceases to have any caste, because, caste is pre dominantly a feature of Hindu Society and ordinarily a person, who ceases to be a Hindu, would not be regarded by the other members of the caste as belonging to their fold.
But it is not an invariable rule that whenever a person renounces Hinduism and embraces another religious faith, he automatically ceases to be a member of the caste in which he was born and to which he be longed prior to his conversion.
Ultimately, it must depend on the structure of the caste and its rules and regulations whether a person would cease to belong to the caste on his abjuring Hinduism.
If the structure of the caste is such that its members, must necessarily belong to Hindu religion, a member, who Ceases to be a Hindu, would go out of the caste, because, no non Hindu can be in the caste according to its rules and regulations.
Where, on the other hand, having regard to its structure, as it has evolved over the years, a caste may consist not only of persons professing Hinduism but also persons professing some other religion as well, conversion from Hinduism to that other religion may not involve loss of caste, because, even persons professing that other religion ca be members of the caste.
This might happen where caste is based on economic or occupational characteristics and not on religious identity, or the cohesion of the caste as a social group is so strong that conversion into another religion does not operate to snap the bond between the convert and the social group.
This is indeed not an infrequent phenomenon in South India, where, in some of the castes, even after conversion to Christianity, a person is regarded as continuing to belong to the caste.
What is, therefore, material to consider is how the caste looks at the question of conversion.
Does it outcaste or excommunicate the convert or does it still treat him as continuing within its fold despite his conversion.
If the convert desires and intends to continue as a member of the caste and the caste also continues to treat him as a member notwithstanding his conversion, he would continue to be a member of the caste, and the views of the new faith hardly matter.
Paragraphs 2 and 3 of the Constitution (Scheduled Castes) order.
read together.
also recognise THAT there may be castes specified as Scheduled Castes which comprise persons belonging to a religion different from Hindu or Sikh religion.
In such castes, conversion of a person from Hinduism cannot have the effect of putting him out of the caste, though.
by reason of para 37 he would be deemed not to be a member of the Scheduled Caste.
B G; 93 C E, F H] Cooppoosami Chetty vs Duraisami Chetty, I.L.R. 33 Mad. 67; Muthusami vs Masilamani, I.L.R. G. Michael vs section Venkateswaran.
AIR 1952 Mad.
Kothapalli Narasayya vs Jammana Jogi, ; K. Narasimha Reddy vs G. Bhupathi, ; Gangat vs Returning Officer, [1975 85 1.
S.C.C. 589 and Chatturbhuj Vithaldas Jasani vs Moreshwar Prasahram, , referred to.
[It would therefore, prima facie, seem that on conversion to Christianity, the respondent did not automatically cease to belong to the Adi Dravida caste; but in view of the decision that on reconversion he was readmitted to the Adi Dravida faith, no final opinion was expressed on this point.] [94 B C]
|
Civil Appeal No. 59 of 1952.
Appeal from the Judgment and Order dated 3rd January, 1952, of the High Court of Judicature at Patna (Ramaswami and Sarjoo Prosad JJ).
in an application under article 226 of the Constitution registered as Miscellaneous Judicial Case No. 204 of 1950.
Original Petition No. 20 of 1952 under article 32 of the Constitution was also heard along with this appea.
P. R. Das (B. Sen, with him) for the appellants.
M. C. Setalvad, Attorney General for India, and Mahabir Prasad, Advocate General of Bihar (G. N. Joshi, with them) for the respondents.
February 20.
The court delivered judgment as follows : PATANJALI SASTRI C. J. I concur in the judgment which my learned brother Mukherjea is about to deliver, but I wish to add a few words in view of the important constitutional issue involved.
The facts are simple.
The appellants obtained a settlement of about 200 bikhas of land in a village known as Sathi Farm in Bettiah Estate, in Bihar, 1131 then and ever since in the management of the Court of Wards on behalf of the disqualified proprietress who is the second respondent in this appeal.
The lands were settled at the prevailing rate of rent but the salami or premium payable was fixed at half the usual rate as a concession to the appellants who are said to be distant relations of the proprietress.
The appellants paid the salami and entered into possession of the lands on the 2nd November, 1946, and ' have since been paying the rents regularly.
On the 13th June, 1950, the Bihar Legislature passed an Act called the Sathi Lands (Restoration) Act, 1950.
The genesis of this legislation is thus explained in the counter affidavit filed on behalf of the State of Bihar, the first respondent herein.
Report against the settlement of these lands with the petitioners as well as some other lands to Sri Prajapati Mishra and the unlawful manner in which these settlements were brought about, was carried to the Working Committee of the Indian National Congress, which body, after making such enquiry as it thought fit, came to the conclusion that the settlement of these lands with the petitioners was contrary to the provisions of law and public policy and recommended that steps should be to taken by the State of Bihar to have these lands restored to the Bettiah Estate.
In pursuance thereof a request was made to the petitioners and to the said Prajapati Mishra to return the lands to Bettiah Estate.
While Sri Prajapati Mishra returned the land settled with him, the petitioners refused to do so.
The Statement of Objects and Reasons of the Sathi Lands (Restoration) Bill runs thus: "As it has been held that the settlement of Sathi lands in the District of Champaran under the Court of Wards with Sri Ram Prasad Narayan Sahi and Shri Ram Rekha Prasad Narayan Sahi is contrary to the provisions of the law and as Sri Ram Prasad Narayan Sahi and Sri Ram Rekha Narayan Sahi have refused to return the lands to the Bettiah Estate, Government 1132 have decided to enact a law to restore these lands to the Bettiah Estate." The impugned Act consists of three sections.
Section 2(1) declares that "notwithstanding anything contained in any law for the time being in force" ', the settlement obtained by the appellants is "null and void", and that "no party to the settlement or his successor in interest shall be deemed to have acquired any right or incurred any liability thereunder".
Sub section (2) provides that the appellants and their successors in interest "shall quit possession of the said land from the date of commencement of this Act and if they fail to do so, the Collector of Champaran shall eject them and restore the lands to the possession of the Bettiah Wards Estate".
Subsection (3) provides for the refund of the amount of salami money and the cost of improvement, if any, to the lessees by the estate on restoration to it of the lands in question.
In the "case" lodged in this court for the State of Bihar, the legislation is sought to be justified and its validity maintained on the following grounds: " It is well settled that a Legislature with plenary powers so long as it enacts law, within the ambit of its powers, is competent to enact a law which may be applicable generally to society or to an individual or a class of individuals only .
It is submitted that grants of the lands belonging to the Bettiah Estate made by the Court of Wards were of doubtful validity; hence they have been dealt with by the impugned Act .
No evidence has been adduced by the appellants, except a bare allegation, which has not been substantiated, that about 2000 acres of land were settled to show that persons in similar circumstances with whom similar settlements were made, were treated differently.
It is submitted that in the context the impugned Act, has a reasonable basis of classification.
" The decision of the majority of this Court in Chiran vs The Union of India(1) is relied on in suport of these contentions, In that case, however, the (1) ; , 1133 majority felt justified in upholding the legislation, though it adversely affected the rights and interest of the shareholders of a particular joint stock company, because the mismanagement of the company 's affairs prejudicially affected the production of an essential commodity and caused serious unemployment amongst a section of the community.
Mr. Justice Das and I took the 'view that legislation directed against a particular named person or corporation was obviously discriminatory and could not constitutionally be justified even if such legislation resulted in some benefit to the public.
In a system of government by political parties, I was apprehensive of the danger inherent in special enactments which deprive particular named persons of their liberty or property because the Legislature thinks them guilty of misconduct, and I said in my dissenting opinion: "Legislation based upon mismanagement or other misconduct as the differentia and made applicable to a specified individual or corporate body is not far removed from the notorious parliamentary procedure formerly employed in Britain of punishing individual delinquents by passing bills of attainder, and should not, I think receive judicial encouragement.
" My apprehensions have come true.
Recently we had before us a case from Hyderabad (Civil Appeal ,No. 63 of 1952Ameerunnissa Begum vs Mahboob Begum) ' where the duly constituted legislative authority of that State intervened in a succession dispute between two sets of rival claimants to the estate of a deceased person and " dismissed " the claim of the one and adjudged the Property to the other by making a special " law " to that effect.
And now comes this case from Bihar of an essentially similar type.
The appellants assert title to certain lands in Bettiah Estate under a settlement which they claim to have lawfully obtained from the Court of Wards, while it is now alleged on behalf of the Estate that the settlement was not for the benefit of the Estate and was contrary to law, as the Court of Wards did not then " apply its (1) Since reported as ; 147 1134 mind " to that question.
This is purely a dispute between private parties and a matter for determination by duly constituted courts to which is entrusted, in every free and civilised society, the important function of adjudicating on disputed legal rights, after observing the well established procedural safeguards which include the right to be heard, the right to produce witnesses and so forth.
This is the protection which the law guarantees equally to all persons, and our Constitution prohibits by article 14 every State from denying such protection to anyone.
The appellants before us have been denied this protection.
A political Organization of the party in power decides after making such enquiry as it thought fit, that the settlement in question was " contrary to the provisions of law and public policy " and the State Legislature, basing itself on such decision, purports to declare the settlement " null and void " and directs the eviction of the appellants and the restoration of the lands to the Estate.
The reasons given for this extraordinary procedure are indeed remarkable for their disturbing implications.
It is said that "there was agitation amongst the tenants of the locality and opposition on the part of persons living in the locality against the appellants ' possession of the lands which led to breach of the peace and institution of criminal cases ".
Whenever, then, a section of the people in a locality, in 'assertion of an adverse claim, disturb a person in the quiet enjoyment of his property, the Bihar Government would seem to think that it is not necessary for the police to step in to protect him in his enjoyment until he is evicted in due course of law, but the Legislature could intervene by making a " law " to oust the person from his possession.
Legislation such as we have now before us is calculated to drain the vitality from the rule of law which our Constitution so unmistakably proclaims, and it is to be hoped that the democratic process in this country will not function along these lines.
MUKHERJEA J.
This appeal, which has come before us on a certificate granted by the High Court of 1135 Patna under article 132 (1) of the Constitution, is directed against a judgment of a Division Bench of that court, dated 3rd January, 1952, by which the learned Judges dismissed a petition of the appellants under article 226 of the Constitution.
The prayer in the petition was for a writ in the nature of mandamus, directing the opposite party, not to take any action, under an Act passed by the Bihar Legislative Assembly in 1950 and known as The Sathi Lands (Restoration) Act which was challenged as void and unconstitutional.
To appreciate the points in controversy between the parties to the proceeding, it may be necessary to narrate the material facts briefly.
Maharani Janki Koer, the respondent No. 2 in the appeal, is the present proprietress of an extensive Estate in Bihar known by the name of Bettiah Raj, which is held and managed on her behalf by the Court of Wards, Bihar, constituted under Bengal Act IX of 1879.
On 19th July, 1946, the appellants, who are two brothers and are distantly related to the Maharani, made a representation to the Government of Bihar through the Manager of the Estate, praying for settlement in raiyati right, of 200 bighas of land preferably in Sathi farm or Materia farm along with a certain quantity of waste lands.
On 20th July, 1946, the then Manager of the Wards Estate wrote a letter to the Collector of Champaran recommending that the applicants might be given settlement of the lands as prayed for, without payment of any selami.
The Collector, however, did not.
agree to this proposal, nor did the Commissioner of the Tirhut Division, and the matter then came up for consideration before the Board of Revenue which recommended that settlement might be made with the applicants provided they were agreeable to pay selami at half the usual rates.
On 14th October, 1946, the recommendation of the Revenue Board was accepted by the Provincial Government and six days later the Court of Wards accepted a cheque for Rs. 5,000 from one of the lessees, towards payment of the selami money and rent for the year 1354 F.S.
On the 2nd November, 1946, possession 1136 of the lands was given to the appellants and on the 18th of November following, the Manager of the Court of Wards recorded a formal order fixing the selami of the land at Rs. 3,988 annas odd and rent at Rs. 797 annas odd per year.
On the same day, a Hisab Bandobasti form, which is the usual form employed in the Estate for raiyati settlements, was signed by the Circle Officer on behalf of the Court of Wards and by one of the lessees for himself as well as the constituted attorney of the other lessees.
It is not disputed that the lessees continued to possess the lands since then on payment of the stipulated rent.
On the 3rd June, 1950, the Bihar Legislative Assembly passed an Act known as The Sathi Lands (Restoration) Act which received the assent of the Governor on the 13th June, 1950.
The object of the Act, as stated in the preamble, is to provide for restoration of certain lands belonging to the Bettiah Wards Estate which were settled contrary to the provisions of law in favour of certain individuals.
Section 2, which is the only material section in the Act, enacts in the first sub section that the settlement of Sathi lands (described in the schedule to the Act) on behalf of the Bettiah Court of Wards Estate with the appellants, as per order of the Manager of the Estate dated the 18th November, 1946, is declared null and void and no party to the settlement ,or his successor in interest shall be deemed to have acquired any right or incur any liability under the same.
The second sub section embodies a direction to the effect that the said lessees and their successor in interest shall quit possession of the lands from the date of the commencement of the Act and if they fail to do so, the Collector of Champaran shall eject them and restore the lands to the possession of the Bettiah Estate.
The third and the last sub section provides that the Bettiah Wards Estate shall on restoration to it of the lands pay to the lessees the selami money paid by them and also such amount as might have been spent by them in making improvements on the lands prior to the commencement of the Act.
1137 In substance, therefore, the Act declared the lease granted by the Bettiah Wards Estate to the appellants on the 18th November, 1946, to be illegal and inoperative and prescribed the mode in which this declaration was to be given effect to and the lessees evicted from the lands.
On the 28th August, 1950, the appellants filed the petition, out of which this appeal arises, under article 226 of the Constitution in the High Court of Patna, challenging the validity of The Sathi Lands Act and praying for a writ upon the respondents restraining them from taking any steps under the said Act, or from interfering with the possession of the appellants in respect of the lands comprised in the lease.
It was asserted by the petitioners that in passing the impugned legislation the Bihar Legislature actually usurped the power of the judiciary and the enactment was not a law at all in the proper sense of the expression.
The other material contentions raised were that the legislation was void as it conflicted with the fundamental rights of the petitioners guaranteed under articles 14, 19(1) (f) and 31 of the Constitution.
The respondents opposite parties in resisting the petitioners ' prayer stated inter alia in their counter affidavit that the settlement of the lands in question with the appellants by the Court of Wards, was not for the benefit of the estate or advantage of the ward and that the transaction was entered into by the Wards Estate without properly applying their mind to it.
It was stated further that after the settlement was made, there was a good deal of agitation among the tenants in the locality which led to the institution of certain criminal proceedings.
In these circumstances, the matter was brought to the notice of the Working Committee of the Indian National Congress and the Working Committee was of opinion that the settlement of these lands was against public interest.
The lessees, therefore, were asked to vacate the lands and on their refusal the legislation in question was passed.
The petition was heard by a Division Bench consisting of Ramaswami and Sarjoo Pershad JJ.
Ramaswami J. 1138 decided all the points raised by the petitioners against them and held that the Act was neither ultra vires the Bihar Legislature nor was void under article 13(1) of the Constitution.
The learned Judge was further of opinion that it was not a fit case for interference by the High Court under article 226 of the Constitution.
The other learned Judge expressed considerable doubts as to whether a legislation of this type, which in form and substance was a decree of a court of law, was within the competence of the legislature and warranted by the Constitution.
He agreed, however, with his learned colleague that the case was not such as to justify an interference of the High Court in exercise of its discretionary powers under article 226 of the Constitution.
The remedy of the petitioners might lie, according to him, in a regularly constituted suit.
The result, therefore, was that the appellants ' petition was dismissed and it is the propriety of this judgment that has been assailed before us in this appeal.
Mr. P. R. Das, who appeared in support of the appeal, put forward at the forefront of his arguments, the contention raised on behalf of his client in the court below that the impugned legislation was void by reason of its violating the fundamental rights of the appellants under article 14 of the Constitution.
The point appeared to us to be of substance and after hearing the learned Attorney General on this point we were satisfied that the contention of Mr. Das was well founded and entitled to prevail, irrespective of any other ground that might be raised in this appeal.
There have been a number of decisions by this court where the question regarding the nature and scope of the guarantee implied in the equal protection clause of the Constitution came up for consideration and the general principles can be taken to be fairly well settled.
What this clause aims at is to strike down hostile discrimination or oppression or inequality.
As the guarantee applies to all persons similarly situated, it is certainly open to the legislature to classify persons and things to achieve particular legislative objects; 1139 but such selection or differentiation must not be arbitrary and should rest upon a rational basis, having regard to the object which the legislature has in view.
It cannot be disputed that the legislation in the present case has singled out two individuals and one solitary transaction entered into between them and another private party, namely, the Bettiah Wards Estate and has declared the transaction to be a nullity on the ground that it is contrary to the provisions of law, although there has been no adjudication on this point by any judicial tribunal.
It is not necessary for our present purpose to embark upon a discussion as to how far the doctrine of 'separation of powers has been recognised in our Constitution and whether the legislature can arrogate to itself the powers of the judiciary and proceed to decide disputes between private parties by making a declaration of the rights of one against the other.
It is also unnecessary to attempt to specify the limits within which any legislation, dealing with private rights, is possible within the purview of our Constitution.
On one point our Constitution is clear and explicit, namely, that no law is valid which takes away or abridges the fundamental rights guaranteed under Part III of the Constitution.
There can be no question, therefore, that if the legislation in the present case comes within the mischief of article 14 of the Constitution, it has got to be declared invalid.
This leads us to the question as to whether the impugned enactment is, in fact, discriminatory and if So, whether the discrimination made by it can be justified on any principle of reasonable classification ? The appellants, it is not disputed, are only two amongst numerous leaseholders who hold lands in raiyati right under the Bettiah Wards Estate.
It cannot also be disputed that the lands were settled with them on the recommendation of the Board of Revenue after due consideration of the respective views put forward by the Manager of the Estate on the one hand and the Collector and the Divisional Commissioner on the other.
The appellants are admittedly paying rents which are normally assessed on lands of similar 1140 description in the locality.
The learned AttorneyGeneral referred in this connection to the provisions of section 18 of the Court of Wards Act and argued that the lease in dispute was granted in contravention of that section.
Section 18 of the Court of Wards Act provides as follows: "The Court may sanction the giving of leases or farms of any property under its charge . and may direct the doing of all such other acts as it may judge to be most for the benefit of the property and the advantage of the Ward".
Apparently it makes the Court of Wards the sole judge of the benefit to the estate or advantage of the ward.
But it is said that the Court of Wards did not apply its mind properly to this matter when it granted lease to the appellants at half the usual rate of selami.
The Wards Estate thus suffered loss to the extent of nearly Rs. 4,000 which could legitimately have been recovered from any other lessee.
This contention does not impress us much; the utmost that can be said is that this could have been put forward, for what it is worth and with what result, nobody can say, as a ground for setting aside the lease in a court of law.
But that is not the question which is relevant for our present purpose at all; we were not called upon to decide whether or not the lease was a proper one or beneficial to the estate.
The question for our decision is, whether the statute contains discriminatory provisions so far as the appellants are concerned and if so, whether these discriminations could be reasonably justified ? It is clearly stated in paragraph 9 of the affidavit made by the appellants in support of their petition that there are numerous other persons to whom leases on similar terms were granted by the Bettiah Wards Estate.
Clauses (b), (c) and (d) of paragraph 9 of the affidavit stand thus: "(b) In this long course of management by tile Court of Wards, leases or settlement of lands used to be made without any selami on proper rent.
This state of affairs continued down to recent times during 1141 which period thousands of bighas were so settled with numerous persons; (c) in 1945 the authorities decided to make settlements on large scale with war returned soldiers on a selami equal to 5 times the average rent prevailing in the locality for similar lands; (d) in 1946, 1947, 1948 and 1949 a good number of settlements covering about 2000 acres of lands were settled on the basis of IO years ' rental obtaining in the locality and in some cases for good reasons, at five years ' rental." In paragraph 12 of the counter affidavit put in on behalf of the respondents, these statements are not denied.
In fact, they are admitted and the only thing said is, that these leases were granted in due course of management.
Ramaswami J. has dismissed this part of the case by simply remarking that no details of these settlements were furnished by the appellants; but no details were at all necessary when the correctness of the statements was not challenged by the respondents.
It will be interesting to note that the respondents themselves in paragraph 10 of their counter affidavit mentioned the name of Shri Prajapati Mishra as one of the persons with whom similar settlement of lands was made by the Bettiah Estate.
It is stated in that paragraph that the cases of the appellants as well as of Prajapati Mishra were brought to the notice of the Working Committee of the Indian National Congress and the Committee came to the conclusion that both the settlements were contrary to the provisions of law.
Thereupon a request was made to both these sets of lessees to restore their lands to the Estate, but whereas Prajapati Mishra returned his lands to the Bettiah Estate, the appellants refused to do so.
In reply to this statement, the appellants stated in their rejoinder that the said Prajapati Mishra did not vacate the land,% but created a trust in respect of the same, he being the chairman of the board Of trustees and the lands were still in possession of the board of trustees.
Strangely, as it seems, the State of Bihar raked up this matter again in a 148 1142 further affidavit where it was admitted that the said Prajapati Mishra did execute a trust and that the trustees took possession of the property.
It was stated, however, that Prajapati Mishra, who was one of the trustees, did actually surrender the lands in two installments but the other trustees did not, and hence legal advice was being taken to find out ways and means of recovering the property from them.
The whole thing smacks of disingenuousness and the State of Bihar, it seems, was not well advised in rely ing upon facts like these in their attempt to repel the appellants ' attack on the legislation on the ground of discrimination.
Be that as it may, there is no doubt that the appellants were not the only lessees under the Bettiah Estate who got settlement of lands at a selami of five years ' rental.
On the sworn statements of the appellants, which are not challenged by the other side, it appears that there are numerous persons occupying the same position as the appellants, who however were not subjected to this expropriatory legislation.
But the vice in this legislation goes much deeper than this.
It is not merely a question of treating the appellants differently from the other lessees under the Wards Estate, with whom settlements of land have been made on similar or identical terms.
If a lease has been given by a Court of Wards, which is not for the benefit of the estate or advantage of the ward, it is for a court of ,law to decide whether it is warranted by the terms of the Court of Wards Act.
If the lessor proceeds to cancel the lease, the lessee has a legal right to defend his claim and satisfy the court that the lease is not in contravention of law.
If, on the other hand, the lessee is actually dispossessed, he has a right to sue in court for recovery of possession of the property on establishing that he has been illegally turned out.
The dispute here, is a legal dispute pure and simple between two private parties.
What the Legislature has done is to single out these two individuals and deny them the right which every Indian citizen possesses to have his rights adju dicated upon by a judicial tribunal in accordance with 1143 the law which applies to his case.
The meanest of citizens has a right of access to a court of law for the redress of his just grievances and it is of this right that the appellants have been deprived by this Act.
It is impossible to conceive of a worse form of discrimination than the one which differentiates a particular individual from all his fellow subjects and visits him with a disability which is not imposed upon anybody else and against which even the right of complaint is taken away.
The learned Attorney General, who placed his case with his usual fairness and ability, could not put forward any convincing or satisfactory reason upon which this legislation could be justified.
It is true that the presumption is in favour of the constitutionality of a legislative enactment and it has to be presumed that a Legislature understands and correctly appreciates the needs of its own people.
But when on the face of a statute there is no classification at all, and no attempt has been made to select any individual or group with reference to any differentiating attribute peculiar to that individual or group and not possessed by others, this presumption is of little or no assistance.
to the State.
We may repeat with profit what was said by Mr. Justice Brewer in Gulf Colorado etc.
Co. vs Ellis(1) that "to carry the presumption to the extent of holding that there must be some undisclosed and unknown reason for subjecting certain" individuals or corporations to hostile and discriminatory legislation is to make the protection clauses of the Fourteenth Amendment a mere rope of sand".
In our opinion, the present case comes directly within the principle enunciated by this court in Ameerunnissa, Begum vs Mahboob Begum(2 ).
The result is that we allow the appeal and set aside the judgment of the High Court.
A writ in the nature of mandamus shall issue directing the respondents not to take any steps in pursuance of The Sathi Lands (Restoration) Act of 1950 or to interfere with the possession of the appellants in respect to the lands (1) 165 U section 150.
(2) [1953] S.C.R 404.
1144 comprised in the lease referred to in that Act.
The appellants will have their costs in both courts.
VIVIAN BOSE J. I am in entire agreement with my Lord the Chief Justice and with my learned brother Mukherjea.
GHULAM HASAN J.
I agree with my Lord the Chief Justice and with my brother Mukherjea.
BHAGWATI J. I entirely agree with the judgment just delivered by my Lord the Chief Justice and my brother Mukherjea and there is nothing which I can usefully add.
Appeal allowed.
| The jurisdiction in contempt of court is not to be invoke a unless there is real prejudice which can be regarded as a substantial interference with the due course of justice.
The purport of the court 's action is a practical purpose and the Court will not exercise its jurisdiction upon a mere question of propriety.
During the pendency of proceedings against A and B under section 145, Criminal Procedure Code, in the court of a Sub Divisional Magistrate, A and B made an application to the District Magistrate alleging that the proceedings were not bona fide and 582 containing statements in the nature of a countercharge.
The 2nd appellant who was then officiating as the District Magistrate sent this application to the Sub Divisional Magistrate for report and on receiving a report from him that A and B should be asked to file a formal complaint before him, advised them to do so.
A brother of A sent a similar petition to the District Magistrate containing also allegations against the trying Magistrate.
The 1st appellant, who was the District Magistrate, forwarded them to the Sub Divisional Magistrate for report, and on receiving his report passed an order that he saw no reason to withdraw the file from the Sub Divisional Magistrate.
The High Court of Allahabad held that as the applications contained allegations which might interfere with the course of the trial of the proceedings under section 145, in transmitting the applications the appellants had acted without due circumspection and thought though they had no intention to influence the Sub Divisional Magistrate and the appellants were therefore guilty of contempt of court: Held, (i) that in transmitting the applications received by them to the Sub Divisional Magistrate and calling for a report the appellants were not in any way interfering with the course of justice but were only doing their duty as superior officers; (ii) it was not possible to hold that any prejudice had been caused by the two applications being sent by the appellants to the Sub,Divisional Magistrate or that any action was necessary to protect the Sub Divisional Magistrate who was hearing the case and the appellants were not guilty of any contempt of court.
Anantalal Singha vs Alfred Henry Watson ([1931] I.L.R. referred to.
|
minal Appeal No. 142 of 1968.
Appeal by special leave from the judgment and order dated September 8, 1967 of the Madhya Pradesh High Court in Criminal Appeal No. 81 of 1966.
I. N. Shroff, for the appellant U. P. Singh and Nur ud din Ahmed, for the respondent.
126 The Judgment of the Court was delivered by Sikri, C.J.
This appeal by special leave by the State of Madhya Pradesh is against the judgment of the High Court allowing the appeal of the respondents, Mr Basi Ali Khan, Mir Shahniwaz Ali khan and Mir Sarfaraz Ali Khan, and setting aside the conviction and sentences passed on them by the learned First Additional Sessions Judge, Bhopal, who had convicted them under Section 120B and Section 420, 1.
The respondents were, however, acquitted of the charge under Section 406, 1.
We may mention that there were two committal orders made by the learned Magistrate, First Class, Bhopal, on April 5, 1965 and on October 12, 1965, respectively, which gave rise to two Sessions Trials, No. 90 of 1965 and No. 98 of 1965.
The learned Sessions Judge disposed of both the trials by a single judgment as he was of the view that both the trials were in effect a single trial of a single conspiracy and of several incidents of cheating.
The respondents also filed one appeal before the High Court and the High Court disposed of that appeal by one judgment.
The facts are not very much in dispute.
The prosecution case, in brief, was that Mir Basit Ali Khan, the father, and his two sons, Mir Shahniwaz Ali Khan and Mir Sarfaraz Ali Khan. entered into a partnership which was registered on September 21, 1959, under the Indian Partnership Act of 1932 in the State of Andhra Pradesh at Hyderabad.
The registration number of the firm was 1468.
Mir Basit Ali Khan started a money circulation scheme known as Multi Purpose Constructive Circulation Scheme with its head office at Hyderabad, in the year 1960.
He, alongwith others, was prosecuted in the City Magistrate 's Court at Hyderabad, but they were acquitted and the acquittal was maintained in the High Court.
The Magistrate had come to the conclusion that though the scheme appeared to be speculative yet it could not be said that the accused were running the said scheme with a dishonest intention to cheat the public.
It is alleged that Mir Basit Ali Khan again organised the Multi Purpose Constructive Circulation Scheme on September 20, '1961, at Bhopal with its principal office at Bungalow No. 59, Roshanara Naka, T. T. Nagar, Bhopal.
The firm issued policies and printed pamphlets and handbills representing that it was a Government of India Registered firm No. 1468.
We may reproduce the pamphlet, exhibit P 9 / 1, which was one of the pamphlets issued by the firm : "1. Perform the marriage of marriageable girls by spending only 5.50 np.
127 2.
Only after spending once Rs. 5.50 np.
send your promising children to America or England for Education.
By spending Rs. 5.
50 nP. only once, you can meet your daily necessities.
By spending Rs. 5 50 nP. only once make provision for education, and books, stationery, etc., etc. 5.
By spending Rs. 5.50 nP. get a big sum of Rs. 2,309 for the progress of your business.
For obtaining all the above mentioned thing, you can get a big sum of Rs. 2,309 by spending only Rs. 5.50 nP. Please do come and meet on the address noted below so that you may know how to do it and how to utilise this golden opportunity.
Otherwise please do not say that you did not get intimation.
" It is necessary to reproduce another pamphlet, exhibit P 12, because according to the State there were clear misrepresentations of fact which amounted to cheating "Phone : 1266.
M. C. C. Bhopal M. P. Grams "Jansewak" Government of India 's Registered X X Firm, 1468.
The Government of India after establishing the social service Department are doing a great service for the public and to the nation as a whole by spending lacks of rupees.
The public have also been exerting manual labour in addition to giving their valuable time.
But this Public Service scheme of ours is so unique that without any difficulty every individual of the country receives direct benefit to the extent of Rs. 2,309 50 by sitting at home.
That is, remit your admission fee once through the de T. T. (sic.) and the Government postman will knock down at your doors several times to pay you up the amount.
The Founder of this unique formula has placed before you in such a way that a person with ordinary intelligence will be pleased to understand it.
HOW THIS IS POSSIBLE: Collect Rs.5.50 from each of your three friends, and out of this keep Rs. 5.50 for yourself and this remaining Rs. 11.00 may be remitted according to the schedule.
It is thus clear that you have received your original amount of Rs. 5.50 in full immediately after the sale of three Policies.
128 From the procedure explained above, it is very clear that this is neither a Gambling lottery, Riddle nor Satta.
There is not the least possibility of your losing the amount.
of course, such persons will be losers who will not be in a position to sell their three policies.
Therefore, those persons who do not have the capacity of selling their 3 Policies need not join this scheme.
But in our opinion we are confident that there Is no such an unfortunate person who is not having even three well wishing friends, or relatives in this vast world.
But the question of selling 3 policies by an individual is most important.
You should purchase one policy by paying Rs. 5.50 nP. from any person who has already enrolled in this scheme or write to the Firm for the policy, by sending M. 0. of Rs. 5.
Now select three energetic and enthusiastic friends, collect Rs. 5.50 from each of them and remit the M. Os.
to the members and the Firm as shown in the schedule.
Write down the names of your selected 3 friends with their address in full in BLOCK LETTERS ONLY.
Send the Policy along with the M. 0.
receipts to the firm by EXPRESS DELIVERY ONLY.
Never send M. Os.
to persons in column nos.
2 they will not get any amount to the extent of THIS POLICY ONLY BUT as and when this Policy goes in circulation they will automatically change their places and enjoy with their expected amount.
FIRM 'S RESPONSIBILITY: The firm will send you 3 policies in which you will stand in column No. 2 and that of the new member in column No. 1.
Hand over these policies immediately to your friends carefully.
As soon as you finish this job, YOUR RESPONSIBILITY IS OVER.
The chain of M. Os., will be continued in such a way that your neighbors will be fed up with postman 's voice.
Because the beauty of our scheme is that we allow 15 days period for the sale of the policy to each of our member after the expiry of the period we cancel such slack members and the same cancelled policy in which you stand in No. 2 is sold to other new members through our authorised agents and field officers, who are spread all over India thereby we try our utmost to continue your chain.
The cause of failure of other previous Schemes is only due to not having this wonderful arrangement of continuation of Chain to which we give much importance.
For this reason only we are having a very 129 good response & our to days membership number is more than a lack all over India.
Under unavoidable circumstances, extension of one week can be given on payment of extension fee of 0.37 nP. SCHEDULE section NO.
No. of Policies Amount payable Column No. 1 1 5.50 2 3 Nil 3 9 9.00 4 27 27.00 5 81 81.50 6 243 364.50 7 729 1822.50 Total No. of Policies 1093 2309.50 MOST IMPORTANT : If your chain of M. O.s. are discontinued for two weeks Please inform us immediately so that they may be continued.
MEER BASITH ALI KHAN Author of Dukhi Kisan approved by the Ministry of Agr.
of India, Founder of full House Talkie Formula Regd.
by Govt.
of India No. 104 Proprietor M. C. C. Govt.
of India 's Regd.
Firm No. 1468 Bhopal.
TIME IS MONEY : If you are inclined to become agent, contact us and enjoy with the commission of 3.50 np.
per member.
The Chief agent will get 75 P. M. salary as well as commission of Rs. 3.50 per member.
The advertisement expenses will also be borne by the The learned Sessions Judge had come to the conclusion that the respondents by using the expression "Government of India Registered Firm No. 1468" in their policies and pamphlets misled the public into believing that the scheme was sponsored by the Government of India or it had its approval.
He also came to the conclusion that there was a misrepresentation in the pamphlet that the scheme was neither a gambling, lottery, riddle or a satta, but was an ordinary financial scheme.
The learned 9 1 S.C. India/71 130 Sessions Judge had further found that as the remitter of the money orders was always Mir Basit Ali Khan,respondent No '.
I and the Proprietor of M. C. C., the, member of the policy was left only with a small piece of paper, exhibit P 69, the scheme 'contained a misrepresentation and suppression of material facts which made the respondents liable for conspiracy to cheat and cheating.
The High Court, however, held that it being not in dispute that the firm was registered and its number was 1468 there was no fraudulent or deceitful representation.
The High Court further held that most of the witnesses had clearly stated that they had known the fact that it was a private firm and the Government had nothing to do with it.
The High Court was of the view that the statement may be an exaggeration or a puffing.
The High Court, after going through the evidence and the various.
pamphlets came to the following conclusion: "There appears to be no misrepresentation or suppression of any material facts with a view to defraud or cheat.
How so ever speculative and unworkable the scheme may be, unless it is shown that there is a false representation or suppression of the material facts which might render it to be fraudulent, it cannot be said that the offence of cheating has been committed.
of course, to judge its effect, the policy and the pamphlet has to be read as a. whole.
" The High Court further observed, after referring to a number of cases which we will presently deal with "In this scheme as aforesaid, the purchaser also got his amount alright and one can expect to get even more provided the Chain continued.
As the policy with its rules and pamph let make it quite clear, the, appellants cannot be held guilty unless it is positively shown that some, deception had been practiced on the public with the result that they were deceived and they had paid the money.
The prosecution has not produced any witness to say that some money was due from the company and they have been in any way deceived and the amount has not been paid.
It is only the.
Jhua lot of witnesses who could not be, paid because of the police raid and the, Ms. being withheld by the Magistrate.
" The High Court further found that the name of.
Mir Basit Ali Khan, Proprietor, M. C. C., was mentioned simply because it was a chain scheme and that it may go on, working continuously, otherwise there is every possibility that some policy holder might not send the full amount or may not be traceable for one reason 131 or the other.
The High Court observed that nothing was kept secret from the policy holders and it was known to them alright that they had joined the scheme with the conditions laid down in the policy and the pamphlet.
The High Court did not think that the size, of the taken had anything to do with cheating.
The High Court accordingly came to the concl usion that the respondents had committed no offence.
Regarding the money which had been seized by the police the High Court said that the money belonged to the policy holders and the respondents and it was a case where the money in question had 'to go back to them and it could not be ordered to be confiscated.
The High Court accordingly directed that the respondents would be entitled to get back their amount which had .been withheld as property in the Sessions Trials referred to above.
It is common ground that the Scheme is highly speculative, and the question which arises is whether it amounts to cheating under Section 420, 1.
The learned counsel for the State ,stresses the following facts (1)None of the 2000 odd persons who purchased the policy had received Rs. 2309.50, the assured amount in the policy.
(2) The large amounts of Rs. 90,750 and Rs. 5,52,587 95 were obtained by the respondents showed the extent of wrongful gain by them.
(3)The policy holders had no control over other Policy holders which would assure continuance of the .scheme.
(4)Merely because some persons received some :amount it could not be inferred that the scheme was not fraudulent (5)The evidence showed that the names entered in columns 3, 4, 5, 6 and 7 were bogus and that 2696 money orders were sent back to the remitter, as the persons were not traceable because of wrong addresses on the form.
The learned counsel for the respondents contends that since the year 1939 similar schemes have been held not to fall within Section 420, I. P. C. , and the legislature must be deemed to have accepted the law as laid down in the cases.
The learned counsel has drawn our, attention to two decisions of the Calcutta High Court on similar schemes.
The earliest case pointed out by the learned counsel is Radha Ballav Pal, vs Emperor In that case (1) A. I. R. 132 the society was described as Government Registered No. 5934.
registered under Act 11 of 1932.
The High Court held that it was not a misrepresentation as this society was actually registered under that Act.
Regarding the scheme the High Court held on the facts of that case that the scheme was one of those snowball schemes which were speculative to the highest degree and unworkable but it was not dishonest or fraudulent in the sense that it either represented to the public something which was not true or, concealed from them something which should have been disclosed.
The High Court thought that it was an appeal to the gambling instinct of humanity but this cannot per se amount to cheating.
This case was followed by another Bench of the Calcutta High Court in Hari Das Barat vs Emperor (1).
The headnote brings out the decision thus : "Promoters of a financial snowball scheme, which could run only so long as there would be a continuous uninterrupted and enormously progressive increase in subscribers, but which could not go on indefinitely, would not be guilty of cheating, in the absence of false representations and dishonest concealment of facts either in the prospectus issued or in the conduct of the promoters, calculated to deceive the public and thereby induce it to contribute money to the scheme.
" These cases were distinguished in Nadir Barga Zaidi vs The State of U. P. (1) as the High Court felt that on the facts of that case there were misrepresentations made to the depositors and certain facts had been dishonestly concealed from them.
In re M. K. Srinivasan (3) the facts were slightly different and the case does not assist us.
It seems to us that the Calcutta cases, referred to above, were correctly decided and the High Court came to the correct conclusion.
This appeal must accordingly fail.
It is for the legislature to intervene if it wants to protect people who participate in these schemes knowing that sooner or later the schemes are bound to fail.
In the result the appeal fails and is dismissed.
G. C. Appeal dismissal.
(1) (2) A. 1.
R. 1960 All.
(3) A.I.R.1944Mad 410.
| The ruler of the erstwhile State of Jhabua granted jagirs to N and R. The Jagirs were forfeited in 1943.
On March.
30, 1948 the Ruler made an order purporting to declare a large number of immovable properties, including certain houses in the occupation of N and R as his private proper.
On April 1, 1948 the Ruler made another order purporting to grant to N and R the right to continue to occupy the said houses during their life time without any right to sell, mortgage or create any charge thereon.
On June 29, 1948 the State of Jhabua merged in the State of Madhya Bharat.
The Government of the State of Madhya Bharat did not recognise the claim of the erstwhile Ruler of Jhabua to all the properties claimed by him as his private properties.
The properties in the occupation of N and R were among those not recognised as the Ruler 's private property.
The possession of N on the properties in her occupation was not disturbed in her lifetime.
On April 30, 1962 the Executive Engineer District Dhar, submitted an application under section 3 read with section 4 of the Madhya Pradesh Government Premises (Eviction) Act, 1952 for the eviction of R and the successor in interest of N from the properties respectively occupied by them.
Orders of eviction made by the Sub Divisional Officer were upheld by the Collector in the appeals filed before him.
The high Court however allowed the writ petitions filed by N 's successors in interest and by R and quashed the orders of eviction against them.
The State of Madhya Pradesh appealed.
HELD: The appeal must be dismissed, The evidence showed that some only of the properties set forth the declaration of April, 1, 1948 and claimed by the Ruler as private property "were accepted as such by the Government of Madhya Bharat: there was no finding with regard to the others that they appertained to the Ruler as distinct from his private properties.
In order to succeed the, appellant had to show that the properties had been confiscated by the Ex ruler and had ceased to belong to N and R. [410E G].
As the properties originally belonged to N and R there must be some evidence of the displacement of their title before the Eviction Act could be made applicable to them.
The order of April 1, 1948 passed by the Ruler could not be interpreted as an order of confiscation.
It was not proved that the ownership of the properties had passed to the Ruler and thereafter first to the State of Madhya Bharat and then to the State of Madhya Pradesh [410G H] 408 In order to enable Government to take Proceedings successfully under either section 3 or 4 of the Act, it must satisfy the Court that the premises in respect whereof action was taken was Government premises.
As the State 'ailed to establish this fact the question of eviction under the Act could never arise.
[411E].
|
Appeal No. 1748 of 1967.
From the Judgment and order dated the 6th January 1961 of the Mysore High Court at Bangalore in.
Second Appeal No. 129 of 1956.
section C. Malik A. section K. Rao arid M. R. K. Pillai for the appellant.
K. Rajendra Chaudhuy, for the respondents Nos. 1 8.
The Judgment of the Court was delivered by ALAGIRISWAMI, J.
This is, an appeal by certificate against the judgment of the High Court of Mysore in a second appeal.
it, arises out 971 of a suit filed by respondents 1 and 2 (who,will hereafter be referred to as plaintiffs) for a declaration that the sale held in execution of the decree obtained by the appellant (who was the 9th defendant in the, suit) in O. section No. 31 of 1937 38 against their father and other members of their family was void ab initio.
O. section No. 31 of 1937 38 had been filed by the present appellant on, the basis of a promissory note executed as already mentioned by the father of the plaintiffs and other members of that family.
In execution all the sixteen items of property belonging to the family were sold.
The sale was in pursuance of an attachment before the judgment made on 25th September 1937.
The suit was subsequently decreed.
In the suit the only plea taken was that the defendants were agriculturists entitled to the benefit of the Mysore: Agriculturists Relief Act 1928.
The plaintiffs filed the suit for a mere declaration because they continued in possession of the properties which had been sold in execution and purchased by defendants 10 and, 11 in the suit and subsequently purchased by the appellant.
The Trial Court decreed the suit.
It should be mentioned that the suit was filed on 14 5 1952.
The plaintiffs were born respectively in.
the years 1944 and 1950.
On appeal the District Judge hold that the sale was void but allowed the appeal on the ground that the plaintiffs were not born on the date of the sale.
A Division Bench I of the Mysore High Court allowed the Second Appeal and restored the judgment of the Trial.
Court.
The main question for decision as to whether the execution sale was void ab initio depends on the interpretation to be placed on section 14.of the Mysore Agriculturists ' Relief Act which roads as follows:.
(1) Except as otherwise provided in subsections (2), (3), and (4) no agricultural land belonging to an agriculturist shall be attached or sold in execution of any decree or order passed after this Act comes into force, unless it has been specifically mortgaged for the payment of the debt to which such decree or order relates and the security still subsists, For the purposes of any such attachment or sale as aforesaid standing crops shall be deemed to be movable property.
(2) The Court may at the time of passing a decree for money directing payment by instalments or at any time during the course of execution of such decree direct the judgment debtor for sufficient cause to furnish security for the amount of the decree and if he fails to furnish the security required order the attachment of any agricultural land belonging to the judgment debtor.
(3) The procedure in respect of attachments ordered under subsection (2) shall be as far as may be in accordance with the procedure relating to attachment before judgment under Order XXXVIII of the Code of Civil Procedure 1908.
972 (4) No agricultural land ordered to be attached under sub section (2) shall be sold in pursuance of such attachment unless the judgement debtor is in arrears in respect of two or more instalments under the decree.
We are, in agreement with the view taken by the Courts below and the High Court that the attachment before judgement made in this case was not a valid one and therefore the sale in pursuance of that attachment was void.
We are unable to accept the argument on behalf of the appellant that s, 14 does no more than lay down the same procedure as Order 38 of the Code of Civil Procedure and therefore the attachment was valid.
Sub section
(1) of section 14 lays down that no agricultural land belonging to an agriculturist shall be attached or sold in execution of any decree or order unless it has been specifically mortgaged for the payment of the debt to which such decree or order relates.
The suit :filed by the appellant O.S. No. 31 of 1937 38 was not on the foot of a mortgage and therefore the sale effected in execution of the decree obtained by the appellant is clearly against the provisions of sub section
Sub section (2) permits an attachment only in execution of a decree and, therefore, there is no substance in the argument on behalf of the appellant that the attachment effected before judgment at the instance of the appellant is similar to an, attachment before judgment tinder Order 38 of the Code of Civil Procedure.
We are in agreement with the learned Judges of the High Court that the view taken by the District Judge that as the plaintiffs were not born on the date of the sale they cannot challenge its validity is wrong.
A void sale, as we have already held the sale in execution of the decree obtained by the appellant in this case to be, confers no title on the auction purchaser and, therefore, the joint family to which the properties belonged continued to be the owners of that property and did not lose their title there to.
The plaintiffs got a right to the property as soon as they were born, not by way of succession but by right of birth.
Therefore, plaintiffs were certainly entitled to file a suit questioning the sale.
The only other argument on behalf of the appellant, which was advanced before the High Court and rejected by it and was also put forward before us, was that the plaintiffs ' suit was barred by constructive res judicata.
It appears that the appellant filed a suit O.S. No. 535 of 1944 45 for partition of items 1 15 against defendants 1 and 2 and the widow and son of another of the original judgment debtors, as also defendants 3 and 4.
To that suit the plaintiffs were not parties.
Plaintiff No. 2 was not even born then.
There Was another suit, O.S. 973 No. 47 of 1942 43 filed by the 11th defendant in respect of item 16.To that suit also the plaintiffs were not parties.
As neither plaintiff was born at the time of O.S. No. 47 of 1942 43, they having been born on 22 9 1944 and 19 9 1950, and the second plaintiff was not born at the time O.S. No. 535 of 1944 45 was filed, and the first plaintiff though born Was not made a party there can be no question of res judicata as against them.
They are not representatives of their father as contemplated in section 11 of the Code of Civil Procedure.
It also appears that the earlier suits were filed before the Munsiff 's Court and were,.
therefore, not decided by a court of competent jurisdiction as the present suit has been filed in the Subordinate Judge 's Court.
We are, therefore, satisfied that the appellant cannot succeed in his plea of res judicata.
The appeal is, therefore, dismissed.
The appellant will pay the costs of respondents 1 and 2.
| The appellants, who are owners of Small Scale Industrial Units, employ mechanised process for decortication of retted coconut husks.
The respondent State issued a notification in July 1973, under r. 114(2) of the Defence of India Rules,, 1971, imposing a total ban on the use of machinery for defibring husks in the district of Trivandrum, Quilon and Alleppey.
The appellants, who were affected by the notification, challenged the validity of the notification.
The High Court dismissed the petition.
In appeal to this Court, it was contended : (1) that section 3(2)(21) of the Defence of India Act does not authorise r. 114; (2) that the formation of opinion by the State Government for the exercise of power under the rule is a justiciable issue, that the court should call for the material on which, the opinion had been formed, and examine it to find out whether a reasonable man or authority could have come to the conclusion that for securing equitable distribution and availability of retted husks at fair prices a regulation or prohibition of the manufacture of fibre by mechanical process was necessary; (3) that the reasons given in the notification imposing a total ban on the use of machinery were not justified; (4) that there was no application of the mind by the authority to any genuine materials or relevant considerations while exercising the power; (5) that section 38 of the Defence of India Act requires that, consonant with the purpose of ensuring the public safety, defence of India and Civil defence, there should be minimum interference by an authority or person, acting in pursuance of the Act with the ordinary avocations of life and enjoyment of property; (6) that the notification offended article 14; and (7) that it violated article 301, of the Constitution.
Dismissing the appeal, HELD : (1) Rule 114 is in complete consonance with the powers conferred, under section 3(2)(21).
[102 B] (2) Where powers are conferred on public authorities to exercise the same when "they are satisfied" or when "it appears to them," or when "in their opinion" a certain State of affairs exists, or when powers enable public authorities to take "such action as they think fit" in relation to a subject matter, the courts will not readily defer to the conclusiveness of an executive authority 's opinion as to the existence of a matter of law or fact upon which the validity of the exercise of the power is predicated.
Administrative decisions in exercise of powers conferred in subjective terms are to be made in good faith and on relevant considerations.
The courts can inquire whether a reasonable man could have come to the decision in question without misdirecting himself on the law or the facts in a material respect.
The standard of reasonableness to which the administrative body is required to conform may range from the court 's opinion of what is reasonable to the criterion of what a reasonable body might have decided; and courts will find out whether conditions precedent to the formation of the opinion have a factual basis.
But the onus of establishing unreasonableness rests upon the person challenging the validity of the acts.
[99 C D. E G] (3) The Committee appointed by the State Government in connection with, the revision of minimum wages in the coir industry reported that when unemployment is acute in the State it is not practicable to encourage mechanisation for fibre production till alternative sources of employment are developed, and 94 recommended that the Government might appoint a separate committee to study the various problems resulting from mechanisation in the industry.
Accordingly, a study group was appointed and that group reported that coir industry brings employment or partial employment to an area where there is chronic unemployment and under employment, and hence, any kind of mechanisation is bound to cause displacement of people.
The study group therefore suggested a composite plan by which the coir industry should be woven into the pattern of area development or regional development which will bring prosperity not only to the coir industry but also to many other ancillary industries and avocations, that the pace of mechanisation should be such that none should be thrown out of employment, and that for those who are displaced alternative work is to be found in the general development that is envisaged.
The State Government found that out of 414 mechanised units in the State, 282 units were in the three districts of Trivandrum, Quilon and Alleppey and that the balance were in the remaining eight districts of the State, and that the use of machinery for the purpose of extraction of fibre from husks in regions other than Trivandrum, Quilon and Alleppey districts had not affected the supply of and availability at fair prices of husks for extraction of fibre in the traditional sector.
The Government therefore, was of the 'opinion that it was necessary to prohibit the use of machinery only in those three districts, but that it was not necessary to prohibit the use of machinery for the production of fibre in the other eight districts.
[100 F 101 H] (4) It is a matter of policy for the State Government to decide to what extent there should be interference in relation to enjoyment of property.
Public interest is of paramount consideration and in, the present case the steps taken were in the larger interests of labour engaged in the coir industry.
The notification was based on a consideration of relevant and useful material. 'The opinion of the State Government could not be said to have been based on any matter extraneous to the scope and purpose of the relevant provisions of the statute.
The materials supporting the subjective satisfaction indicate that there were reasonable grounds for believing that the prescribed state of affairs existed and a course of action was reasonably necessary for the given purpose of equitable distribution of coconut husks at fair prices.
[102 C H] (5) The Government took notice of section 38 of the Defence of India Act and was satisfied about the public interest.
Further, the notification does not interfere with the avocations and enjoyment of property any more than is necessary for the purposes of equitable distribution of husks at fair prices 'to the traditional sector.
[103 A B] (6) The classification, in the circumstances, of the districts.
is reasonable and bears a nexus to the objects sought to be achieved by the impugned notification.
[103 D] (7) The Defence of India Act has been passed by Parliament and the Rules under the Act have legislative sanction.
The restrictions imposed by them are in the interest of general public and are authorised under Article 302, Therefore, there is no violation of article 301.
[103E G] Sadhu Singh vs Delhi Administration ; , Rohtas Industries vs section D. Agarwala ; , and Liversidge v Anderson ; , 228 229, referred to.
ARGUMENTS For the appellants : The Notification Annexure A, is justiciable.
The court is not deprived of jurisdiction to examine the validity of the order.
The grounds mentioned in Annexure A notification are irrelevant and there is no real and proximate connection between the ground given and the object which the Government has in view.
The State Government never applied its mind to the matter and the Notification is malafide in the sense that the statutory power has been exercised for some indirect purpose not connected with the object of the statute or the mischief it seeks to remedy.
(1) Jaichand Lall Sethia vs State of Bengal [1966] Suppl.
S.C.R. 464.
95 It is open to court to enquire whether grounds really existed which would have created that satisfaction on which alone the order could have been made in the mind of a reasonable person.
Though the satisfaction of the Government is subjective and its power is discretionary its exercise depends upon the honest formation of an opinion that in order to secure equitable distribution and availability at fair prices of husks for use for production of fibre in the traditional sector it is necessary to ban production of fibre by machines.
The existence of these circumstances is a condition precedent and must be demonstrable.
It is therefore open to the Court to examine the existence of such circumstances.
The Barium Chemicals Ltd. vs The Company Law Board , 357, Rhotas Industries Ltd. vs section D. Agarwala ; Rose Clutnis vs Papddo Poullous , Ridge vs Baldwin , 73.
There has been no application of the mind to all the relevant factors justifying total ban being imposed with reference to reliable data and materials in issuing the Notification and therefore the action is mala fide.
The action is not an action which is genuinely intended to implement the intention of the Defence of India Act or the rules and is not based on any enquiry or investigation or data made available to the Govt.
before such action was taken.
Nor was it made after any consultation or after reference to materials published by expert bodies like the State Planning Commission, the Coir Board, the Coir Advisory Committee appointed from time to time, nor based upon literature of a reliable nature published by such bodies aforesaid.
That being so, the notification is ultra vires the Defence of India Act and the rules and for a purpose extraneous to the intention of the Defence of India Act.
The purpose for which the notification has been issued is served by the Coconut Husks Control Order, dated 29 9 1973 and the notifications issued under the Order.
The above Order was issued by the Central Government in exercise of the powers conferred by section 3 of the Essential Commodities Act, Act (10 of 1953).
Two Notifications fixing the fair prices of the retted coconut husks were issued by the special officer for coir (Licensing Officer) constituted under cl. 4 of the Kerala Coconut Husks Control Order 1973.
There is no material before the Government to conclude that the price of coconut husks increased only because of mechanisation.
On the basis of section 38, Defence of India Act, the notification is beyond the needs of the situation.
It is obligatory on the Government to have examined the several alternative remedies to make available husks to the traditional sector without banning manufacture of fibre by machines.
The notification contravenes article 301 of the Constitution which guarantees that trade, commerce and inter course throughout the territory of India shall be free.
District Collector of Hyderabad vs M/s. Ibrahim & Co. Article 301 guarantees freedom of trade not only from geographical barriers but also from restrictions imposed on an individual to carry on trade or business, other than a regulatory measure.
; (233).
It is not open to the Parliament to delegate the power under article 302.
The law passed under article 302 has to be in the interest of the public.
There is nothing in the Defence of India Act to indicate that Parliament has imposed restrictions in the interest of public within the meaning of the Article.
If there is no provision in the Act, the power under article 302 cannot be delegated by rules to the Central Government or the State Government.
96 VII.
The Notification banning the machinery of defibering husks is violative of the fundamental rights of the petitioners under article 14.
It is highly discriminatory as its operation is confined to the 3 districts of Trivandrum, Quilon and Alleppey.
Owners of defibering machinery in other Districts are all similarly situated like the petitioners.
For the respondent : (1) Ext.
P. 1 order being issued in exercise of power conferred by law made by Parliament i.e. Defence of India Act 1971 & Defence of India 1971 there can be no violation or infringement of Fundamental Rights and other Constitutional rights.
As a measure of emergency legislation "the words in the opinion of" in Rule 114(2) should be given the same width of meaning as in "satisfied" in Rule 30 Defence of India Rules 1962 as expounded by this Hon 'ble Court in decisions namely. , 469 470. , 718, 719, 740.
These decisions show that the Courts are only entitled to look into the matter which if in terms of the Rule, then Court is bound to stay its hands and that the recital will be accepted in the absence of any inaccuracy.
It is open to the Court to satisfy itself, as to the accuracy of the recital only if the order suffers from any lacunas.
The meaning given to the expression, "the reason to believe" are in the sentence as explained above in the context of emergency although the meaning given to these expressions will be in the sense ruled by this Court in Bariunam, Chemicals case and Rohtas Industries case when these expressions occur in peaceful legislations.
For the Construction of these words in the context of emergency see ; , 718. ; , 132.
; , 122.
; , 128.
, 247.
; , 239, 251 252, 253, 256 257, 263, 239.
wade and Phiulip Constitutional Law, 1970 pp.
631, 632.
Smith Judicial Control and Administrative Action PP.
275, 276.
Waynes Legislative Executive and Judicial Powers 1970 4th Edn p. 213.
Halsbury 's Laws of England 4th Edn.
Vol I, p. 23. ; , 73. , 34 (e to g).
, 967 968 (h to a) at 970 (J) P. 972 (h) p. 973 982 (g h) P. 983 (a).
Assuming that the ratio of Barium Chemicals Case and of Rohtas Case ; is applicable to the notification it is submitted the materials furnished in paras 4 to 9 of the Counter affidavit are sufficient to sustain it.
The machines consume enormous quantity of coconut husks starving out the traditional section.
The owners of machinery are able to corner large quantity of husk at exorbitant pi ices to the detriment of traditional sector because of the large saving in wages resulting from the displacement of labour by mechanisation.
Due Compliance of section 38 is to be presumed.
; ; , 132.
|
Appeal No. 126 of 1966.
Appeal from the judgment and order dated November 29, and December 2, 1963 of the Gujarat High Court in Special Civil Application No. 641 of 1962.
736 K. R. Chaudhuri, for the appellant.
R. M. Hazarnavis, K. L. Hathi and section P. Nayar, for the respondents.
section T. Desai and I. N. Shroff, for the intervener.
The Judgment of the Court was delivered by Hegde, J.
The main controversy in this appeal by certificate is as to the constitutional validity of section 12A(4) of the Bombay Sales Tax 1946, to be hereinafter referred to as the Act.
As in our judgment that provision is void, the same being violative of article 19(1)(f) of the Constitution, we have not thought it necessary to examine the other contentions raised ' in the appeal.
The facts material for the purpose of deciding the question formulated above, are these: The appellants are dealers registered tinder the Act carrying on business in art silk, cotton and hand loom cloth.
During the period January 26, 1950 to March 31, 1950, the appellants effected various sales outside the State of Bombay.
As those sales were protected by article 286(1)(a) of the Constitution, they were outside the reach of the Act.
But yet the sales tax officer assessed the turnover relating to those sales.
The tax levied in respect of that turnover was Rs. 4,494/3/9.
In appeal, the order of the sales tax officer was affirmed by the Assistant Collector of sales,tax.
But the Additional Collector of sales tax in revision revised the levy to some extent and, ordered a refund of Rs. 2,238/0/6.
That amount was paid to the assessees.
Not being satisfied with the order of the Additional Collector of sales tax, the appellants took up the matter in revision to the Sales Tax Appellate Tribunal.
But even before they moved the Tribunal in revision, the Additional Collector of sales tax by his letter dated May 17, 1958, informed the appellants that unless they furnished to the sales tax officer proof of their having refunded the amount paid to them in pursuance of his order to the purchasers within a period of three months from the date of that notice, the same would be liable to be forfeited under section 12A(4) The Tribunal by its 'order dated November 26, 1958, allowed the claim of the appellants in full and directed ' the refund of an addi tional sum of Rs. 2,256/2/6.
During the period April 1, 1950 to March 31, 1951 the appel lants effected various sales outside the State of Bombay.
The turn, over relating to those sales was also brought to tax by the sales tax officer and in that connection a tax of Rs. 23,806/3/6 was levied on the appellants.
In appeal, the Assistant Collector of sale tax allowed the appellants ' claim in part and ordered a refund or.
Rs. 12,154/15/ but at the same time he informed them that that amount would be forfeited to the State Government if not refunded to the purchasers from whom the same had been collected.
No being satisfied with the relief obtained, the appellants went up in revision to the Additional Collector of sales tax.
That officer by 737 his order dated November 1, 1958 granted further relief by ordering refund of an additional sum of Rs. 3,588/1/9.
But the sales tax officer did not give effect to that order.
As the Additional Collector did not accept the appellants ' claim in full, they went up in revision to the Tribunal.
The Tribunal allowed their claim in full.
The Revenue took up the matter in reference to the High Court but that reference was rejected.
From the foregoing it is seen that in respect of the period April 1, 1950 to March 31, 1951 the appellants are entitled to get a refund of Rs. 23,806/3/6.
Despite the aforementioned orders, the sales tax officer did not pay the amounts ordered to be refunded.
On the other hand, he threatened to take steps to forfeit the same by having recourse to section 12A(4).
On June 27, 1962, the sales tax officer called upon the assessees to remain present in their office on July 2, 1962 with particulars of the amount collected by them by way of sales tax from the purchasers in 'other States during the period January 26, 1950 to March 31, 1951.
At that stage, the appellants approached the High Court of Gujarat by special civil application No. 641 of 1962 under article 226 of the Constitution.
In that application, they prayed for several reliefs, the most important of which was to direct the respondents to comply with the orders of refund and to refrain from taking any action against them under section 12A(4).
The High Court dismissed that application.
Hence.
this appeal.
The Act provides for the levy of tax on the sale of goods in the then State of Bombay.
It came into force on March 8, 1946.
Any person who carries on business of selling or supplying goods in the State of Bombay whether for commission, remuneration or otherwise, is defined as a dealer in section 2(c).
Section 8 and section 8(a) of the Act provide for the registration of dealers.
As mentioned earlier the appellants are registered ' dealers.
Under section 2(k) of the Act, the assessment year is the financial year.
Section 5 prescribes the incidence of taxation.
Section 10 prescribes the returns to be made by the dealers.
The assessment is made under section 11.
Section 11 (a) provides for taxing the turnover escaping assessment.
Section 12 provides for the payment and recovery of tax.
Section 12A is the one with which we are concerned in this appeal.
It reads: "(1) No person shall collect any amount by way of tax under this Act in respect of sales or supplies of any goods which are declared, from time to time, under section 7 as sales or supplies on which the tax is not payable.
(2) No person selling or supplying any goods shall collect from the purchaser any amount by way of sales tax unless he is a registered dealer and is liable to pay tax under this Act in respect of such sale or supply: Provided that this sub section shall not apply in cases where a person is required to collect such amount of tax separately in order to comply with the conditions 738 and restrictions imposed on him under the provisions of any law for the time being in force.
(3) Every registered dealer whose gross turnover exceeds Rs. 60,000 a year shall issue a bill or cash memorandum signed and dated by him or his servant, manager or agent to the purchaser in respect of the goods sold or supplied by him showing the particulars of the goods and the price at which the goods are sold or supplied shall keep the counterfoil or duplicate of such bill or cash memorandum duly signed and dated and preserve it for a period of not less than two years from such date.
(4) If any person collects any amount by way of tax in contravention of the provisions of sub section (1) or (2) or if any registered dealer collects any amount by way of tax in excess of the amount payable by him under this Act, the amounts so collected shall, without prejudice to any prosecution that may be instituted against such person or dealer for an offence under this Act be forfeited to the State Government and such person or dealer, as the case may be, shall within the prescribed period, pay such amount into a Government treasury and in default of such payment, the amount shall be recovered as an arrear of land revenue.
" In view of article 286(1)(a) of the Constitution as it stood at the relevant time, the appellants ' sales outside the State of Bombay were not exigible to tax.
Therefore if the appellants had collected any amount from their purchasers in respect of those sales by way of tax they had undoubtedly contravened sub section 2 of section 12A.
Sub section 4 of section 12A provides for the forfeiture to State government any amount collected by a dealer by way of tax in excess of the amount payable by him under the Act.
For the purpose of deciding the point in issue it is not necessary to find out the scope of the expression "collects any amount by way of tax" in section 12A(4).
We shall assume, without deciding, the collection made by the appellants, if any, was by way of tax.
It was not contended nor could it have been contended that the impugned provision is a taxation measure bringing to tax directly or indirectly the sales effected outside the State of Bombay.
In Abdul Quadar and Co. vs Sales Tax Officer, Hyderabad,(1) interpreting section 11(2) of, the Hyderabad General Sales Tax Act 1952, a provision somewhat similar to, the impugned provision, this Court observed that legislation under Entry 54 of List II of the Constitution (similar to Entry 48 of List 11 of the Government of India Act, 1935, the entry with which we are concerned in this case) proceeds on 'the basis that the amount concerned is not a tax exigible under the law made under that entry, but (1) ; 739 even so lays down that though it is not exigible under the law, it shall be paid over to the government merely because some dealers by mistake or otherwise have collected it as tax; hence, it is difficult to see how such a provision can be ancillary or incidental to the collection of tax legitimately due under a law made under the relevant taxing entry.
Therein it was held that it cannot be said that the State legislature was directly legislating for the imposition of sales or purchase tax under Entry 54 of List 11 when it made the provisions of section 11 (2), for on the basis of the provision the amount that was collected by way of tax was not exigible as tax under the law.
According to the Revenue section 12A(4) is a penal provision; and it provides for the imposition of penalty on those who contravene section 12A(1) and (2).
It was said on its behalf that power to enact such a provision is incidental to the power to tax sales.
In support of that contention reliance was placed on the decision of the Gujarat High Court in Ram Gopal vs Sales Tax Officer, Surat and Another(1).
That decision upheld the validity of section 12A(4).
If that decision lays down the law correctly, then the appellants are out of court.
But we think that the said decision cannot be sustained.
We shall not go into the question whether from the language of the impugned provision it is possible to hold that it is a penal provision.
For our present purpose we shall assume it to be so.
We shall also assume that the legislature had legislative competence to enact that provision.
But the question is whether it is violative of article 19(1)(f) which guarantees the freedom to hold property.
Prima facie the appellants are entitled to get the amount ordered to be refunded to them.
It is for the respondents to establish that the same is liable to be forfeited.
Even according to the respondents that amount can be forfeited only as a measure of penalty for the contravention of section 12A(1) and (2).
Under our jurisprudence no one can be penalised without a proper enquiry.
Penalising a person without an enquiry is abhorrent to our sense of justice.
It is a violation of the principles of natural justice, which we value so much.
The impugned provision which provides for the forfeiture of the amount in the hands of the dealers, does not lay down any procedure for ascertaining whether in fact the dealer concerned bad collected any amount by way of tax from his purchasers outside the State and if so what that amount is.
Neither section 12A(4) nor any rule framed under the Act contemplates any enquiry much less a reasonable enquiry in which the person complained of can plead and prove his case or satisfy the authorities that their assumptions are either wholly or partly wrong.
The Act is silent as to the machinery and procedure to be followed in determining the question as to whether there has been a contravention of sections 12A(1) and (2), and if so, to what extent.
(1) 16 S.T.C. 1005.
L/P(N)7SCI 8 740 Hence it would be open to the department to evolve all the requisite machinery and procedure which means that the whole thing, from the beginning to end, is treated as of a purely administrative character, completely ignoring the legal position.
The imposition of a penalty on a person is at least of a quasi judicial character.
The impugned provision does not concern itself only with the amount admittedly collected by a person in contravention of sub sections 1 and 2 of section 12A. Even if there is any dispute either as to the facturn of collection or as to the amount collected, such a case also comes within the scope of section 12A(4).
Yet that section does not provide for any enquiry on disputed questions of facts or law.
The forfeiture provided for in section 12A(4) prima facie infringes article 19(1)(f).
Therefore it is for the respondents to satisfy the Court that the impugned provision is a reasonable restriction imposed in the interest of the general public.
Section 12A(4) does not contemplate the making of any order.
As mentioned earlier, that section prescribes that if any registered dealer collects any amount by way of tax in excess of the amount payable by him under the Act, the amount so collected shall, without prejudice to any prosecution that may be instituted against him for an offence under the Act, be forfeited to the State government and he shall within the prescribed period pay such amount into a government treasury and in default of such payment the amount shall be recovered as arrears of land revenue.
This section does not contemplate adjudication.
Nor does it, provide for making any order.
Hence, it is doubtful whether any appeal can be filed against a demand made under that section under section 21.
The question whether appellants in the instant case had been afforded a reasonable opportunity to establish their case or riot is besides the point.
The constitutional validity of a provision has to be determined on construing it reasonably.
If it passes the test of reasonableness, the possibility of powers conferred being improperly used, is no ground for pronouncing it as invalid, and conversely if the same properly interpreted and tested in the light of the requirements set out in Part III of the Constitution, does not pass the test, it cannot be pronounced valid merely because it is being administered in the manner which might not conflict with the constitutional requirements.
On a reasonable interpretation of the impugned provision, we have no doubt that the power conferred under section 12A(4) is unguided, uncanalised and uncontrolled.
It is an arbitrary power.
As held by this Court in Dr. N.B. Khare vs State of Delhi(1), whether the restrictions imposed by a. legislative enactment upon a fundamental right guaranteed by article 19(1) are reasonable within the meaning of article 19(5) would depend as much on the procedural portion of the law as the substantive part of it.
(1) ; 741 Rao(1) wherein it was observed that in considering the reasonable That view was reiterated by this Court in State of Madras vs V. G. ness of laws imposing restrictions on fundamental rights both the substantive and procedural aspects of the impugned law should be examined from the point of view of reasonableness.
This Court has taken that view consistently.
A provision like the one with which we are concerned in this case can hardly be considered reasonable.
For the reasons mentioned above, this appeal is allowed.
The order of the High Court is set aside and a writ of mandamus will be issued to the respondents to comply with the refund order set out in the petition filed before the High Court and to refrain from proceeding against the appellants under section 12A(4).
The appellants are entitled to their costs both in this Court and in the High Court.
Y.P. Appeal allowed.
| A Hindu died bequeathing all his properties to his mother absolutely by a will executed three days before his death.
In the will he stated his age to he 19 years, and that he was thereby disposing of his entire properly, movable and immovable, in favour of his mother.
After his death, the nearest reversioner under the law as it then stood, filed a suit for a declaration that the will was not valid because it was executed by the testator when he was a minor and when he was not in a sound disposing state of mind.
The mother of the testator (legatee) contened the suit and asserted in her written statement that when he executed the will the testator was a major and was in a sound disposing state of mind.
The suit was compromised By the compromise, the reversioner admitted that testator when he executed the will was a major and was in a sound disposing state of mind, that the will was valid and genuine, and the testalor 's properties were divided between the reversioner and the legatee There was a decree in terms of the compromise.
Thereafter, the reversioner and the legatee conducted themselves as the absolute owners of their respective shares of the property.
The legatee executed settlement deeds in favour of her daughters with respect to part of the land received by her under the decree.
The daughters took passion of the properties accepting their mother as their absolute owner.
After the death of the legatee, the appellants.
who were the sons of those daughters obtained a deed of surrender from their mothers accepting the legatee as the absolute owner of the properties.
They then filed a suit against the respondents.
who were the descendants of the reversioner who filed the first suit contending that the compromise decree in the first suit was collusive.
that the testator was not a major nor of sound disposing state of mind when he executed the will, that the will did not.
cover all the properties of the testator and that the appellants were in any event entitled to those properties with respect to which there was an intestacy.
as the sisters sons of the last male holder under the Hindu Law of Inheritance (Amendment) Act of 1929.
The respondents contested the suit and case notice to the appellants to produce the original will alleging that it was in the posses 293 sion of the appellants, but the appellants denied the allegation, and the respondents, thereupon, relied upon a certified copy of the wilt produced from the records of the court filed in the first suit.
The trial court dismissed the suit and the High Court confirmed the dismissal in appeal.
In appeal to this Court, it was contended inter alia: (1) that the burden of proof that the will was validly executed by the testator and that he was a major at the time of executing it was upon the respondents ,red that they failed to discharge that burden; and (2) that there was an intestacy with respect to a portion of the land and that the appellants were entitled to it.
HELD:(1) (a) As the lower Courts held that the appellants deliberately withheld the original will, its certified copy could be admitted as secondary evidence of its contents under 8. 65 of the Evidence Act, 1872.
But the High Court was not justified in presuming under section 90 of the Evidence Act, that the will itself was duly executed and attested.
merely because the copy was more than thirty years old and was produced from proper custody.
Such a presumption arises only in respect of the original document and not with respect to a copy.
[297 H; 298 A, C. D, F] Harihar Prasad vs Must.
of Mttnshi Nath Prasad, [1956] S.C.R.1. followed.
Munnalal vs Krishobai, A.I.R. 1947 P.C. 15 and Basant Singh vs Bnj Pad, 62 I.A. 180, referred to.
But, apart from the presumption.
on the oral evidence adduced and from the conduct of the legatee, the High Court was justified, in concluding that the testator executed the will and was at that time in a sound disposing state of mind and in construing the contents of the will as disclosed by the certified copy and holding that it was natural and rational.
[298 G; 299 C, F G] Setthava vs Somayajulu, 56 I.A. 146, applied.
(b) The respondents who relied on the will had discharged the onus which lay on them, namely, of proving that the testator was a major at the time he executed the will.
[299 G H] The statement of the mother of the testator in the written statement of the earlier suit that the testator was a major was not relevant either under section 32(5) or 32(6) of the Evidence Act, because, it was made post litm motam.
The words in the sub ,section, namely, 'before The question in issue was raised ' do not mean before it was raised in the particular litigation in which such a statement is sought to be adduced in evidence.
They mean before the existence of any actual controversy.
When the legatee flied her written statement in the first suit a dispute had arisen as to the age of the testator, and the controversy having existed time when the statement was made; the statement was inadmissible.
1303 B D, F H] Bahadur Singh v, Mohan Singh, 29 I.A. 1 and Kalka Prasad vs Mathura Prasad, 35 I.A. 166, referred to.
But, the statement of the testator in the will that he was a major at the time he was executing it was relevant under the sub sections because.
294 the question of age fails within the sub sections as it indicates the commencement of relationship.
[303 A] Md. Syedol Arffin vs Yeohooi Gark, 43 I.A. 256, Rama Chandra Dutt vs Yogeshwar Narain Dec, I.L.R. , Oriental Govt.
Security Life Assurance Co. Ltd. vs Narisimha Chari, I.L.R. , Gulab Tharkur vs Fadali , Prolhad Chandra vs Ramsaran, A.I.R. 1924 Cal.
420, and Mst.
Naima Khatun vs Basant Singh, A.I.R. 1934 All. 406 referred.
Further the conduct of the appellants and their mothers was consistent only with the fact that it was understood amongst the members of the family that the testator was a major at the time of the execution of the will and that the will was validly made.
[303 H; 304 A D] The documents relied upon by the appellants, namely, a memorandum and an endorsement received from the Taluk Office showing that there were no entires relating to the birth of any children in the testators family in the birth register for the year in which the testator stated he was born, were not admissible in evidence as the writers of the documents were not examined to testify to the contents of those documents and to establish that notwithstanding their diligent efforts the original register was not traceable.
[301 B D] (2) In face of the expressly declared intention in the body of the will that he was disposing of the entire property it is impossible to hold that the testator desired to hold back a portion thereof from his mother and leave it intestate.
merely became, there was discrepancy between the total measurement mentioned in the body of the will and that in the schedule to the will.
[304 H; 305 A]
|
Appeal No. 520 of 1967.
Appeal from the judgment and order dated December 19, 1966 of the Punjab and Haryana High Court in Civil Revision No. 934 of 1966.
Rajinder Sachhar, Mahinderjit Singh Sethi and Ravinder Narain, for the appellant.
R.M. Haz arnavis, Rameshwar Nath and Mahinder Narain, for respondent No. 1.
The Judgment of the Court was delivered by Bachawat, J.
On March 28, 1966 the election of four members to the Council of States (Rajya Sabha) by the members of the Punjab Legislative Assembly (Vidhan Sabha) was held, and as a result of the election, respondent No. 1, Raghbir Singh and one Narinder Singh were declared elected.
Appellant Ravindra Nath was one of the unsuccessful candidates.
On May 10, 1966, the appellant filed an election petition asking for a declaration that the election of respondent No. 1 and Narinder Singh was void and for a further declaration that he be declared duly elected as a member of the Rajya Sabha to one of those seats.
On July 1, 1966, the date fixed for the respondents to the petition to appear before the Tribunal and answer the claims made in the petition, respondent No. 1 filed a written statement in reply to the election petition and gave a written notice under the proviso to 106 s.97(1) of the Representation of the People Act, 1951 of his intention to give evidence to prove that the election of the appellant would have been void if he had been the returned candidate and if a petition had been presented calling in question his election.
The notice under s.97(1) was accompanied by the prescribed statement and particulars and a treasury receipt evidencing the deposit of Rs. 1,000 as security under section 117 of the Act.
An objection was taken on behalf of the appellant that the amount of security deposited by respondent No. 1 was insufficient and consequently the notice under the proviso to s.97(1) was invalid.
On this objection, the Tribunal raised the following preliminary issue being issue No. 10: "Whether the notice under section 97 of the Representation of the People Act, 1951, given and the recrimination statement filed on behalf of respondent No. 1 are invalid because of the insufficiency, if any, of the security deposit made by res pondent No. 1 within the time allowed, if any?".
It is now common case that under the law as it stood at the relevant time respondent No. 1 was required to deposit a sum of Rs. 2,000 as security under s.117 of the Representation of the People Act, 1951.
On October 7, 1966, the date fixed for argument on the preliminary issues, respondent No. 1 deposited a further sum of Rs. 1,000 as security and produced the relevant treasury receipt before the Tribunal.
By its order dated October 11, 1966 the Tribunal held that as the production of a receipt showing the deposit of Rs. 2,000 as security along with the notice was the condition precedent to the right of respondent No. 1 under s.97(1) to lead evidence, this right was lost by his omission to file with the notice the treasury receipt showing a deposit of Rs. 2,000 and the subsequent deposit of Rs. 1,000 by him did not entitle him to lead any evidence under s.97(1).
The Tribunal answered the preliminary issue accordingly.
On or about October 24, 1966, respondent No. 1 filed in the High Court for the States of Punjab and Haryana at Chandigarh a petition under article 227 of the Constitution asking for an order quashing the order of the Election Tribunal dated October 11, 1966 and a direction that respondent No. 1 be allowed to lead evidence under s.97(1).
Several preliminary objections to the maintainability of the petition under article 227 of the Constitution were raised before the High Court, but they were subsequently abandoned and counsel for the appellant agreed that the High Court should deal with the order of the Tribunal on the merits.
By its order dated December 19, 1966 the High Court held that it is only in cases in which the provisions of ss.117 and 118 with regard to security of deposit were not complied with before the date fixed for recording evidence under s 97(1) that the Tribunal could refuse to admit the evidence, and where, as in the present case, the entire amount of the security had been deposited before the date fixed for recording evidence, the Tribunal must admit the evidence.
On this finding, the High Court 107 allowed the petition under article 227 and quashed the order of the Election Tribunal dated October 11, 1966 in so faras it related to issue No. 10.
From this order of the High Court, the present appeal has been filed by certificate.
The question in this appeal is what time limit, ifany, is prescribed for furnishing the security referred to in the proviso to s.97(1) read with ss.117 and 118 of the Representation of the People Act, 1951 as it stood before its amendment by the Representation of the People (Amendment) Act, 1966.
Section 97 is in these terms: "97(1).
When in an election petition a declaration that any candidate other than the returned candidate has been duly elected is claimed, the returned candidate or any other party may give evidence to prove that the election of such candidate would have been void if he had been the returned candidate and a petition had been presented calling in question his election.
Provided that the returned candidate or such other party as aforesaid shall not be entitled to give such evidence unless he has, within fourteen days from the date of commencement of the trial, given notice to the Tribunal of his intention to do so and has also given the security and the further security referred to in sections 117 and 118 respectively.
(2) Every notice referred to in sub section I shall be accompanied by the statement and particulars required by section 83 in the case of an.
election petition and shall be signed and verified in like manner.
" The Explanation to sub section
(4) of section 90 provided that for purposes of that sub section and of s.97 the trial of a petition would be deemed to commence on the date fixed for the respondents to appear before the Tribunal to answer the claim or claims made in the petition.
Sections 117 and 118 read: " 117.
The petitioner shall enclose with the petition a Government Treasury receipt showing that a deposit of two thousand rupees has been made by him either in a Government Treasury or in the Reserve Bank of India in favour of the Election Commission as security for the costs of the petition.
During the course of the trial of an election petition the Tribunal may at any time call upon the petitioner to give such further security for costs as it may direct, and may, if he fails to do so, dismiss the petition.
" It is to be noticed that the words "within fourteen days from he date of commencement of the trial" in the proviso to s.97(1) govern the giving of the notice and not the giving of the security.
108 Moreover, the period of fourteen days from the date of commencement of the trial cannot be the time limit for giving the further security under s 118.
The amount of the further security under section 118 and the time for giving it must be fixed by the Tribunal before it can be given by the recriminator.
He may be asked to furnish the further security at any time during the course of the trial if the original security is found to be insufficient.
We have to examine the provisions of ss.117 and 118 more closely to see if there is any time limit for the giving of security under the proviso to s.97(1).
The object of s.97 is to enable recrimination when a seat is claimed for the petitioner filing the election petition or any other candidate.
In his election petition the petitioner may claim a declaration that the election of all or any of the returned candidates is void on one or more of the grounds specified in sub section
(1) of s.100 and may additionally claim a further declaration that he himself or any other candidate has been duly elected on the grounds specified in section 101.
(see ss.81, 84, 98, 100 and 101).
It is only when the election petition claims a declaration that any candidate other than the returned candidate has been duly elected that s.97 comes into play.
If the respondent desires to contest this claim by leading evidence to prove that the election of the other candidate would have been void if he had been the returned candidate and an election petition had been presented calling in question his election, the respondent must give a formal notice of recrimination and satisfy the other conditions specified in the proviso to s.97.
The notice of recrimination is thus in substance a counter petition calling in question the claim that the other candidate has been duly elected.
In this background, it is not surprising that the legislature provided that notice of recrimination must be accompanied by the statement and particulars required by s.83 in the case of an election petition and signed and verified in like manner and the recriminator must give the security and the further security for costs required, under sections 117 and 118 in the case of an election petition.
Looking at the object and scheme of s.97 it is manifest that the provisions of ss.117 and 118 must be applied mutatis mutandis to a proceeding under s.97.
The recriminator must produce a government treasury receipt showing that a deposit of Rs. 2,000 has been made by him either in a Government Treasury or in the Reserve Bank of India in favour of the Election Commissioner as costs of the recrimination.
As the notice of recrimination cannot be sent by post, it must be filed before the Tribunal, and reading s.117 with consequential adaptations for the purposes of the proviso to s.97(1), it will appear that the treasury receipt showing the deposit of the security must be produced before the Tribunal along with the notice of recrimination.
It follows that the recriminator must give the security referred to in section 117 by producing the 109 treasury receipt showing the deposit of the security at the time of the giving of the notice under the proviso to s.97(1).
If the recriminator fails to give the requisite security under s.117 at the time of giving the notice of recrimination, he loses the right to lead evidence under s.97 and the notice of recrimination stands virtually rejected.
It was suggested that as under s.90(3) the Tribunal could not dismiss an election petition for non compliance with the provisions of s.117, the legislature could not have intended that the notice of recrimination would stand rejected for failure to give the security under s.117.
This argument overlooks the fact that under s.85 it is the duty of the Election Commission to dismiss the election petition for noncompliance with the provisions of s.117.
Likewise, reading s.118 with the proviso to s.97(1) it will appear that during the course of the trial of the recrimination the Tribunal may at any time call upon the recriminator to give such further security for costs as it may direct and may, if he fails to do so, reject the notice of recrimination given under the proviso to s.97(1).
It was suggested that the proviso to s.97(1) having enacted that the forfeiture of the right to lead evidence would be the penalty for failure to give the further security under s.118, the legislature could not have intended that the rejection of the notice of recrimination would be an additional penalty for this default.
This suggestion is based on fallacious assumptions.
The only right conferred on the recriminator satisfying the conditions of the proviso to s.97(1) is the right to lead evidence that the election of the other candidate would have been void if he had been the returned candidate.
If the recriminator fails to fulfil the conditions of the proviso, he loses this right, and the Tribunal is entitled to record an order to this effect.
An order recording that the recriminator has no right to give evidence under s 97 is tantamount to an order rejecting the notice of recrimination.
There is thus no substantial difference between the penalty prescribed by the proviso to s 97(1) and the penalty prescribed by s.118 for the default in giving the further security.
The High Court held that the recriminator loses his right to lead evidence under s.97 for failure to give security only in cases in which the provisions of ss.117 and 118 are not complied with before the date fixed for recording evidence.
In N. R. Shikshak vs R. P. Dikshit(1), a Full Bench of the Allahabad High Court also held that since, no period is fixed within which the security is to be given, the security may be given at any time before the recriminator gives evidence.
We are unable to agree with this decision on his point or with the judgment under appeal.
We have already seen that the time for giving the initial security for the recrimination is fixed on a combined reading of the proviso to s.97(1) and (1)[1965] A.L.J. 25, 41 42.
110 S.117 and the initial security must be given at.
the time of giving the notice of recrimination.
Other considerations also show that the date fixed for recording the evidence cannot be the date within which the security referred to in sections 117 and 118 is to be given under the proviso to s 97(1).
The recrimination starts on the giving of the notice under the proviso.
Though the taking of the recriminatory evidence may be postponed, preliminary directions for dis covery, inspection and other matters are given long before the evidence is taken.
It is, therefore, desirable that the initial security referred to in section 117 should be given along with the notice of recrimination at the very commencement of the recrimination proceeding.
Moreover, the date fixed for recording the evidence cannot be the time limit for giving further security under section 118.
The Tribunal may demand the further security under section 118 at any time in course of the trial of the recrimination even after the evidence has been partly taken.
The High Court thought that the decision in Kumaranand vs Brij Mohan(1) lends support to its conclusion that the Tribunal could not refuse to admit the evidence under s.97 if the security under s.117 is given before the date fixed for recording the evidence.
That decision turned on the construction of s.119 A and is not relevant on the questions under consideration in this appeal.
As section I 19 A did not expressly provide the penalty for failure to furnish the security for costs of an appeal at the time of filing the memorandum of appeal, the failure to furnish the security did not automatically result in dismissal of the appeal, and, it was for the High Court to decide having regard to the circumstances of each case whether it should decline to proceed with the hearing of the appeal.
But the proviso to s.97(1) expressly provides that the recriminator shall not be entitled to give evidence unless inter alia he gives the security referred to in section 117.
The Tribunal rightly held that the respondent No. 1 was re quired to produce with the notice under the proviso to s 97(1) a government treasury receipt showing a deposit of Rs. 2,000 as security for costs of the recrimination.
The High Court was in error in quashing this order.
In the result, the appeal is allowed with costs, the judgment and order of the High Court are set aside, and the 'petition under article 227 of the Constitution is dismissed.
| By an election petition filed on May 10, 1966, the appellant challenged the election of the first respondent held on March 28.
1966 to the Rajya Sabha by members of the Punjab Vidhan Sabha and sought a declaration that he be declared duly elected as a member of the Rajya Sabha instead.
On July 1, 1966 the date fixed for the respondents to appear before the Tribunal and answer the claims made in the petition, the respondent filed a written statement in reply to the election petition and gave a notice under the proviso to section 97(1) of the Representation of the People Act, 1951, of his intention to give evidence to prove that, the election of the appellant would have been void if he had been the returned candidate and if a petition challenging his election had been presented.
The notice under section 917(1) was accompanied by the prescribed statement and particulars and a treasury receipt evidencing the deposit of Rs. 1,000 as security under section 117 of the Act.
An objection was taken on behalf of the appellant that the amount of security deposited by the respondent was insufficient in that he should have deposited Rs. 2,000 and consequently the notice under the proviso to section 97(1) was invalid.
On October 7, 1966, the date fixed for argument on the preliminary issues, the respondent deposited a further sum of Rs. 1,000 as security and produced the relevant treasury receipt before the Tribunal, but the Tribunal upheld the appellant 's objection on the view that as the production of a receipt showing the deposit of Rs. 2,000 as security along with the notice was the condition precedent to the right of the respondent under section 97(1) to lead evidence in view of his failure to comply with this requirement, this right was lost to him and the subsequent deposit of Rs. 1,000 by him did not entitle him to lead in evidence under section 97(1).
The respondent thereupon filed a petition in the High Court under article 227 of the Constitution challenging the decision of the Tribunal and the High Court allowed the petition holding that it is only in cases in which the provisions of sections 117 and 118 with regard to deposit of security were not complied with before the date fixed for recording evidence under section 97(1) that the Tribunal could refuse to admit the evidence, and where, as in the present case, the entire amount of the security had been deposited before such date, the Tribunal must admit the evidence.
On appeal to this Court, HELD:Allowing the appeal: the Tribunal had rightly held that the respondent was required to produce with the notice under the proviso to section 97(1) a Government Treasury Receipt showing a deposit of Rs. 2,000 as security for costs of the recrimination and the High Court was in error in quashing this order.
[110 F G].
105 The notice of recrimination under section 97 is in substance a counter petition calling in question the claim that the other candidate has been duly elected.
Looking at the object and scheme of section 97 it is manifest that the provisions of sections 117 and 118 be applied mutatis mutandis to a proceeding under section 97.
The recriminator must produce a Government Treasury Receipt showing that a deposit of Rs. 2,000 has been made by him in favour of the Election Commissioner as cost of the recrimination.
As the notice of recrimination cannot be sent by post, it must be filed before the Tribunal, and reading s.117 with consequential adaptations for the purposes of the proviso to, S.97(1), it will appear that the Treasury Receipt showing the deposit of the security must be produced before the Tribunal along, with the notice of recrimination.
If the recriminator fails to give the requisite security under section 117 at the time of giving the notice of recrimination, he loses the right to lead evidence under s.97 and the notice of recrimination stands virtually rejected.
[18E H; 109A B.] N.R. Shikshak vs R. P. Dikshit, 1965 [A.L.J] 25, 4142, disapproved.
Kumaranand vs Brij Mohan, ; , distinguished.
There was no force in the contention that the proviso to section 97(1) having enacted that the forfeiture of the right to lead evidence would be penalty for failure to give the further security under section 118, the legislature could not have intended that the rejection of the notice of recrimination would be an additional penalty for this default, An order recording that the recriminator has no right to give evidence under section 97 is tantamount to an order rejecting the notice of recrimination and there is no substantial difference between the two.
[110 D F].
|
Appeal No. 172 of 1964.
Appeal from the judgment and decree dated July 6, 1962 of the Calcutta High Court in Appeal from Original Decree No. 213 of 1959.
section T. Desai, B. Sen and B.P. Maheshwari, for the appllant.
H. N. Sanyal, Solicitor General, Ajit Kumar Sen and S.N. Mukherjee, for the respondent No. 1.
April 15, 1964.
The judgment of the Court was delivered by DAs GUPTA, J.
The subject matter of this litigation is a piece of land in the heart of the business centre of the city of Calcutta.
This was part of a block of 52 cottahs of land taken on lease on January 21, 1950 from the Official Trustee, West Bengal, by a private limited company, Raghuvanshi Private Ltd. The lease was a building lease for a period of 75 years commencing from January 21, 1950.
The lessee was required to complete the construction of a three or four storeyed building on the land within 1O years.
In September 1960, Raghuvanshi Private Limited in its turn leased 10 1/2 cottahs out of the 52 cottahs to a public limited company, Land and Bricks Ltd. This lease by Raghuvanshi Private Ltd., (hereinafter referred to as "Raghuvanshi") in favour of Land & Bricks Ltd., (hereinafter referred to as "Land & Bricks") created a monthly tenancy commencing from the 1st October 1950.
Land and Bricks in its turn sub let the entire 10 1/2 cottahs to the present appellant, Rupchand Gupta in his business name of Hind Airways.
The lease was on the terms as settled by two letters dated August 19, 1950 and September 5, 1950 between Hind Airways and Land and Bricks.
By the terms of the sub lease, the sub lessee undertook not to sub let the land to anybody, to vacate the land as soon as it was required by Land and Bricks for any purpose and not to construct anything on the land but only to use the open land for "garage purpose for motor vehicles".
Inspite of this undertaking however the appellant constructed a pacca structure on the land.
Land and Bricks protested un successfully and then started proceedings under the Calcutta 762 Municipality Act for demolition of the structures.
Those proceedings were also unsuccessful.
Land and Bricks, it appears, also served on the appellant in February 1953 a notice to quit.
This was not followed up by any suit in court.
But a suit for arrears of rent was instituted by Land and Bricks against the appellant in September 1955 and another in 1957.
Consent decrees were passed in both of these suits.
It appears ,that in about May or June 1954, Raghuvanshi was desirous of getting possession of the land it has leased to Land and Bricks.
The difficulty was that Land and Bricks having sublet to the appellant was not in a position to deliver possession to its lessor Raghuvanshi until and unless possession was obtained from the appellant.
It was in these circumstances that Raghuvanshi determined its lease in favour of Land and Bricks by a notice to quit dated the 11th April 1955.
Raghuvanshi then instituted a suit No. 3283 of 1955 in the High Court of Calcutta against Land and Bricks for possession of the land.
The appellant was not impleaded in the suit and Land and Bricks did not contest it.
An ex parte decree was made by the Court in favour of Raghuvanshi on the 11th May 1956.
The necessary legal consequences of that decree is that the plaintiff as the sub lessee of Land and Bricks has no right to stay on the land and has become a trespasser.
It is to avoid the consequence of that decree, that the present suit was brought by Rupchand Gupta.
His case is that the decree had been obtained "by fraud and collusion between the de fendants in order to injure the plaintiff and to evict the plaintiff from the said premises without any decree being passed against the plaintiffs" Both Land and Bricks and Raghuvanshi have been impleaded in the suit Land and Bricks as the first defendant, and Raghuvanshi as the second defendant.
Both of them denied the allegations of fraud and collusion.
The case that the decree was obtained by fraud was given up at the hearing and only the allegation that it was a collusive suit was pressed.
The Trial Judge held that there was collusion between defendant No. 1 and defendant No. 2 in the matter of obtain ing an ex parte decree in suit No. 3283 of 1955 and that the plaintiff was not bound by that decree.
He gave a declaration that the plaintiff was still a tenant under defendant No. 1 and was not liable to be ejected under the ex parte decree.
He also ordered the issue of an injunction restraining the defendants from taking any steps in execution of the ex parte decree.
On appeal by the defendant No. 2, Raghuvanshi, the decree made by the Trial Judge was set aside.
The learned Judges, who heard the appeal, came to the conclusion that 763 the plaintiff had failed to prove that the decree in suit No. 3283 of 1955 had been procured collusively.
So, they held that the plaintiff was bound by the decree in that suit.
It is against this decree of the appellate Bench of the High Court that the present appeal has been filed by the plaintiff Rupchand Gupta.
The only question for decision in the appeal is whether the plaintiff had established his allegation that the ex parte decree had been obtained as a result of collusion between Raghuvanshi and Land and Bricks.
The main circumstances on which the plaintiff relied to prove collusion and which according to the learned Judge established his case were these: Raghuvanshi and Land and Bricks though distinct entities had the same persons as directors.
The construction of building in terms of indenture of lease with Official Trustee was necessarily in the interests of shareholders of Raghuvanshi and so this was in the interest of Land and Bricks also as the main shareholders were the same.
The Calcutta Thika Tenancy Act, 1949 was a serious impediment in the way of the plaintiff 's eviction in any suit by Land and Bricks.
So, Land and Bricks attempted to get possession of the land by obtaining an order of demolition of structures by proceedings under the Calcutta Municipality Act.
When these failed and it was apprehended that a suit for ejectment by Land and Bricks might not succeed against the plaintiff that this device of having a suit by Raghuvanshi against Land and Bricks was decided upon by agreement between Raghuvanshi and Land and Bricks.
By arrangement between the two, Land and Bricks did not contest the suit and to avoid any risk of any defence being raised by the plaintiff he was not impleaded in the suit at all.
All the circumstances taken together justify, it was urged by the appellant, the conclusion that the defendant No. 2 colluded with defendant No. 1 to procure the exports decree for the purpose of executing that decree against the plaintiff.
One of the simplest definitions of collusion was given by Mr. Justice Bucknill in Scott vs Scott(1).
"Collusion may be defined", said the learned Judge, "as an improper act done or an improper refraining from doing an act, for a dishonest purpose".
Substantially the same idea is expressed in the definition given by Whatron 's Law Lexicon, 14th Edition, p. 212.
viz., "Collusion in judicial proceedings is a secret arrangement between two persons that the one should institute a suit against the other in order to obtain the decision (1) [1913] Law Rerports (Probate Division) 52.
764 of a judicial tribunal for some sinister purpose".
This definition of collusion was approved by the Court in Nagubai Ammal & ors., vs B. Shamma Rao and ors.(1).
Thus the mere fact that the defendant agrees with the plaintiff that if a suit is brought he would not defend it, would not necessarily prove collusion.
It is only if this agreement is done improperly in the sense that It dishonest purpose is intended to be achieved that they can be said to have colluded.
There is little doubt that in the present case Land and Bricks agreed with Raghuvanshi that the suit for ejectment would not be contested.
When the suit was instituted Land and Bricks did not contest and the ex parte decree was passed.
Raghuvanshi did not implead this appellant in that suit.
Can any of these acts, viz., Land and Bricks agreeing with Raghuvanshi that it would not contest the suit, the actual refraining by Land and Bricks from contesting the suit or the act of Raghuvanshi in not impleading the appellant, be an improper act or improper refraining from an act? We do not see how any of these things can be said +to be improper.
Taking the last action first, viz., Raghuvanshi 's omission to implead the appellant, it is quite clear that the law does not require that the sub lessee need be made a party.
It has been rightly pointed out by the High Court that in all cases possession of the laid on the basis of a valid notice to quit served on the lessee and does not implead the sub lessee as a party to the suit, the object, of the landlord is to eject the sub lessee from the land in execution of the decree and such an object is quite legitimate.
The decree in such a suit would bind the sub lessee.
This may act harshly on the sub lessee; but this is a position well understood by him when he took the subleases The law allows this and so the omission cannot be said to be an improper act.
Nor is it possible, in our opinion, to say that the omission of Land and Bricks to contest the ejectment suit was an improper act.
It has not been suggested that Land and Bricks had a good defence against the claim for ejectment but did not take it for the mere purpose of helping Raghu vanshi to get possession of the land.
Even if it had a good defence, we do not think it was bound to take it.
It may be that if Land and Bricks had a defence and the defence was such which if brought to the notice of the court would have stood in the way of any decree being passed in favour of Raghuvanshi there would be reason to say that the omission to implead the sub lessee was actuated by a dishonest pur pose and consequently was improper.
It is not necessary for (1) ; 765 us however to consider the matter further as neither in the courts below nor before us was any suggestion made on behalf of the appellant sub lessee that Land and Bricks had even a plausible defence against Raghuvanshi 's claim for ejectment.
We have already mentioned the fact that one of the circumstances which the plaintiff claimed showed collusion was that the Calcutta Thika Tenancy Act stood in the way of the plaintiff 's eviction of Land and Bricks.
It is unneces sary for us to decide whether or not the appellant was a Thika tenant within the meaning of the Calcutta Thika Tenancy Act, 1949.
If he was, that Act would undoubtedly have protected him against eviction by Land and Bricks.
That Act could however have no operation in a suit brought by Raghuvanshi against Land and Bricks.
It has been held by the High Court of Calcutta that the Thika Tenancy Act was designed to protect the Thika tenant from eviction by his landlord only and not against eviction from any source.
Shamsuddin Ahmed vs Dinanath Mullick & ors.
, Appeal from Original Decree No. 123 of 1957, decided on August 13, 1959).
The correctness of this view has not been challenged before us.
Nor is it the appellant 's case that Land and Bricks was a Thika tenant of Raghuvanshi.
Obviously, this could not be suggested, because Land and Bricks never erected any structure at all.
(See the definition of a Thika tenant in section 2, cl. 5 of the Calcutta Thika Tenancy Act, 1949).
On the materials on the record we are satisfied that there was no defence that Land and Bricks could have raised for resisting Raghuvanshi 's claim for ejectment.
The crux of the matter is: Was this attempt by Raghuvanshi to get possession of the land a dishonest or sinister purpose? We are asked by Mr. Desai to spell dishonesty out 'of the fact that the directors of Raghuvanshi and Land and Bricks were common and so the persons who were interested in Land.
and Bricks were also interested in seeing that Raghu vanshi had not to suffer for forfeiture of his lease for failure to comply with the covenant to construct a building by 1960.
All this may be taken to be true.
But, we are unable to see how this would make Raghuvanshi 's attempt to get possession of the land dishonest or sinister.
It is not as if Raghuvanshi did not actually want to get possession of the land but wanted to help Land and Bricks to get possession.
It has also to be remembered that the identity of the directors and the identity of the main shareholders do not in any way affect the position that in law and in fact Raghuvanshi and Land and Bricks were distinct and separate entities.
It is not even remotely suggested that Raghuvanshi and Land and Bricks were really one and the same person with two names.
766 If that had been so, there might have been good reason for thinking that it was in an attempt to surmount the obstacle represented by the Calcutta Thika Tenancy Act, 1949, that this mode of Raghuvanshi suing Land and Bricks for ejectment was resorted to.
Indeed, if Raghuvanshi and Land and Bricks were one and the same person possession of Land and Bricks would be possession of Raghuvanshi and a suit by Raghuvanshi to eject Land and Bricks would be meaningless.
But, that is not the appellant 's case.
It appears from the High Court 's judgment that the plaintiff 's counsel made it plain before the court that it was not his client 's case that the plain tiff 's real lessor was Raghuvanshi Private Ltd., and not Land and Bricks Ltd. In the present appeal before us also Mr. Desai argued on the basis that Land and Bricks and Raghuvanshi were distinct entities and that the lease of Land and Bricks under Raghuvanshi was a real subsisting lease at the time of Suit No. 3283 of 1955.
In our judgment, the appellate Bench of the High Court has rightly come to the conclusion that the plaintiff has failed to establish that the decree in Suit No. 3283 of 1955 was procured collusively.
The suit was therefore rightly dis missed.
The appeal is accordingly dismissed with costs.
Appeal dismissed.
| The plaintiff appellant instituted a suit against the defen dants respondents for the recovery of a sum of Rs. 57,000/ .
The appellant was holding permanent lease hold rights over a certain colliery.
On January 31, 1949 the appellant granted a sub lease of the colliery to respondent No. 4 for a term of 5 years.
He joined respondents 1, 2 and 5 as defendants to the suit on the ground that these three persons along with respondent No. 4 formed a partnership firm known as Saurashtra Coal Concern which was joined in the suit as defendant No. 5.
The appellant 's case was that respondent No. 4 was a benamidar for the partnership firm and, therefore, all the respondents were liable for the claim.
Respondents 1 and 2 denied the appellant 's claim totally.
According to them, respondent No. 4 took the sub lease in his personal capacity and not on behalf of the other respondents.
Respondents 4 and 5 who are father and son, admitted the appellant 's case that the lease was obtained by respondent No. 4 on behalf of the partnership firm.
The trial court passed the decree against all the respondents.
On appeal, the High Court set aside the decree as against respondents 1 to 3 but affirmed the same against respondents 4 and 5.
Held: that Section 22 of the , clearly provides that in order to bind a firm by an Act or an ins trument executed by a partner on behalf of the firm, the Act should be done or the instrument should be executed in the name of the firm, or in any other manner expressing or implying an intention to bind the firm.
The sub lease was not executed in the name of the firm.
On the facts of this case it was held that in obtaining the sub lease, the parties to it did not intend to bind the firm by that transaction, and therefore the decree should be limited only against respondents 4 and 5.
Karmali Abdullah Allarakia vs Vora Karimji Jiwanji, I.L.R. , Gouthwaite vs Duckworth, (1810) 12 East 421, Mathura Nath Choudhury vs Sreejukta Bageswari Rani, 46 C.L.J. 362, Pandiri Veeranna vs Grandi Veerabhadi aswami.
T.L.R. , Lakshmishankar Devshankar vs Motiram Vishnuram, 6 B.L.R. 1106 and Gordhandas Chhotalal Seth v, Mahant Shri Raghubirdasi Gangaramji, 34 B.L.R. 1137, distinguished.
|
Civil Appeal No. 2040 of 1974.
Appeal by special leave from the Judgment and order dated the 13th June, 1974 of the Andhra Pradesh High Court in W.P. No. 2145 of 1972.
Niren De, Attorney General of India and P. P. Rao, for the appellant.
r A. Subba Rao for the respondent.
The Judgment of the Court was delivered by RAY, C.J.
This appeal is by special leave from the judgment dated 13 June, 19?4 of the Andhra Pradesh High Court quashing an order of dismissal.
The principal question canvassed by the Attorney General is that the High Court should not have interfered with the findings of the Tribunal.
The State Government in the year 1964 received certain complaints alleging misconduct against the respondent.
The Director of Anti Corruption Bureau was asked to inquire and make a report.
The Government in the light of advice tendered by the Vigilance Commission referred the matter to the Tribunal constituted under Andhra Pradesh Civil Services (Disciplinary Proceedings Tribunal) Act, 1960.
Three charges were framed against the respondent.
Broadly stated the charges were that the respondent claimed false travelling allowance on certain days in the months of January, April and September, 1964.
The respondent denied the charges and submitted a written statement on 4 November, 1968.
The Tribunal made inquiries and on 9 December, 1968 recommended dismissal of the respondent from the service.
The Government thereafter gave a notice to the respondent on 22 February, 1969 to show cause why the penalty of dismissal from service should not be imposed on him.
On 20 March, 1969 the respondent submitted his written explanation.
The Government after considering the explanation of the respondent, by an order dated 24 May, 1969 dismissed the respondent from service.
523 The respondent challenged the order of dismissal in the Andhra Pradesh High Court.
The High Court by judgment dated 27 July, 1970 set aside the order of dismissal on the ground that the recommendations of the tribunal were not communicated to the respondent alongwith the notice regarding the proposed punishment of dismissal.
The High Court observed that it was open to the punishing authority to issue a fresh show cause notice regarding the proposed punishment after communicating the enquiry report and the recommendations of the Tribunal The Government thereafter complied with the directions of the High Court.
The Government cancelled the order of dismissal dated 24 May, 1969.
The Government, however, ordered that the respondent shall be deemed to have been under suspension from service from 21 May, 1969 until further orders.
The order of suspension was challenged by the respondent and set aside by the Andhra Pradesh High Court on 22 March, 1970.
The Government then issued fresh notices dated 16 September, 1970 and 25 September, 1970 to the resplendent and communicated the report of the Tribunal and the recommendations of the Tribunal and the Vigilance Commission regarding the proposed penalty.
The respondent submitted his explanation on 6 and 23 October, 1970.
The Government considered the same.
The Commerce Department thereafter by an order dated S May, 1972 dismissed the respondent from service.
The charges against the respondent were that he made three false claims for travelling allowance for three journeys.
The first journey was on 3 January, 1969 from Rajahmundry to Hyderabad The second journey was on 19 April, 1964 from Rajamundry to Hyderabad and Hyderabad to Rajahmundry on 24 April, 1964.
The third journey was from Rajahmundry to Guntur on 13 September, 1964 and Guntur to Rajahmundry on 16 September, ]964.
The respondent in his written statement filed before the Tribunal denied the charges and maintained that he travelled by first class on the days mentioned in the claim for travelling allowance.
He stated that he travelled by first class from Rajahmundry to Hyderabad on 3 January, 1964 in accordance with his tour programme and claimed the travelling allowance.
He also said that he travelled by first class from Rajahmundry to Hyderabad on 19 April, 1964 and from Hyderabad to Rajahmundry on 24 April, 1964 and claimed travelling allowance.
In Exhibit P 45 which was his signed statement dated 8 January, 1967, he stated that on 3 January, 1964 he went with his Joint Director from Vijayorgram from Rajahmundry in a car.
In that statement he said that he went from Hyderabad to Waltair on 7 January, 1964 and he claimed travelling allowance from Vijayawada to Hyderabad.
In Exhibit P 45 he said that on 19 April, 1964 he travelled from Rajahmundry to Vijayawada by first class and he went to Hyderabad by first class on 19 April, 1964.
In Exhibit P 45 he said that he did not 524 travel on 24 April, 1964 from Hyderabad to Rajahmundry because.
A there was no accommodation.
He waited at Hyderabad.
On 28 April, 1964 he got reservation and travelled to Rajahmundry.
The Tribunal on enquiry found the respondent guilty of charges 1 and 2.
In the Enquiry Report dated 9 December, 1968, the Tribunal recommended dismissal of the respondent.
The respondent in the High Court challenged the order of dismissal.
The High Court set aside the order of dismissal on the grounds that the prosecution did not adduce every material and essential evidence to make out the charges and that the conclusion reached by the Tribunal was not based on evidence.
The High Court held that Exhibit P 45 was not admissible in evidence according to the Evidence Act and it was not safe to rely on such a statement as a matter of prudence.
The High Court said that corruption or misconduct under rule 2(b) of the Andhra Pradesh Civil Service (Disciplinary Proceedings Tribunal) Rules, has the same meaning as criminal misconduct in the discharge of official duties in section 5(1) of the Prevention of Corruption Act, 1947.
The High Court in that background discussed the evidence and findings of the Tribunal as to whether the prosecution placed evidence in respect of the ingredients of the charge under section 5(1)(d) of the Prevention of Corruption Act, 1947 The High Court referred to these features in regard to the finding of the Tribunal.
Four years elapsed between the journeys forming subject matter of the charge and the framing of the charge.
The respondent in his evidence said that he secured accommodation through the Conductor incharge of the first class compartment after the arrival of the train.
It was possible that the respondent might have converted his ticket to first class one once he found that first class accommodation was available on the train even though he had purchased a ticket of lower denomination.
The conductor 's chart is the only basis for showing whether a particular person travelled by first class by a particular train and not by a copy of the reservation chart kept at the starting station.
Though the prosecution produced evidence to show that the respondent did not purchase or reserve first class accommodation in advance, the prosecution failed to produce the Conductor 's charts relating to the trains in question.
According to the High Court "The prosecution utterly failed to adduce any evidence to exclude these possibilities".
The High Court said that it was doubtful whether Exhibit P 45 was admissible in evidence.
It was said to be taken during the course of investigation.
The High Court said that even if the statement is accepted, it only shows that the respondent did not actually travel on the days mentioned in the tour programme according to which travelling allowance was paid.
The respondent made the statement marked Exhibit P 45 on 8 January, 1967.
The charge sheet was framed on 17 November, 525 1967.
The respondent filed the written statement on 2 August, 1968.
He filed an additional written statement on 4 November, 1968.
It is apparent that the charge sheets were framed after investigation.
It transpired on evidence before the Tribunal that one first class ticket bearing No.03834 was collected at Hyderabad on 4 January" 1964.
The further evidence about ticket No. 03834 was that it was issued to one P. Ramachandra Raju who travelled from Rajahmundry to Hyderabad on the night of 3 January, 1964.
The further evidence before the Tribunal was that one first class ticket bearing No. 04049 for the journey from Rajahmundry to Hyderabad was sold to one A. section Murty for the journey an 19 April, 1964.
The Tribunal examined the respondent.
The respondent was given full opportunity to deal with Exhibit P 45.
The High Court was not correct in holding that the domestic enquiry before the Tribunal was the same as prosecution in a criminal case.
The High Court was also in error in holding that Conductor 's chart would show whether the respondent travelled or not.
The High Court accepted the explanation that Conductor 's charts were burnt and, therefore, they could not be produced.
Further, Conductor 'section chart could not show the name of the persons paying the money.
There was positive evidence before the Tribunal of tickets being purchased by persons other than respondent on 3 January, 1964 and 19 April, 1964.
These features figured prominently before the Tribunal.
The High Court all throughout treated the enquiry before the Tribunal as a criminal prosecution.
The scope of Article 226 in dealing with departmental inquiries has come up before this Court.
Two propositions were laid down by this Court in State of Andhra Pradesh vs section Sree Rama Rao(1).
First, there is no warrant for the view that in considering whether a public officer is guilty of misconduct charged against him,.
the rule followed in criminal trials that an offence is not established unless proved by evidence beyond reasonable doubt to the satisfaction of the Court must be applied.
If that rule be not applied by a domestic Tribunal o Inquiry the High Court in a petition under Article 226 of the Constitution is not competent to declare the order of the authorities holding a departmental inquiry invalid.
The High Court is not a Court of Appeal under Article 226 over the decision of the authorities holding a departmental enquiry against a public servant.
The Court is concern ed to determine whether the enquiry is held by an authority competent in that behalf and according to the procedure prescribed in that behalf, and whether the rules of natural justice are not violated.
Second, where there is some evidence which the authorities entrusted with the duty to hold the enquiry has accepted and which evidence may reason ably support the conclusion that the delinquent officer is guilty of the charge, it is not the function of the High Court to review the evidence (1) 526 and to arrive at an independent finding on the evidence.
The High A Court may interfere where the departmental authorities have held the proceedings against the delinquent in a manner inconsistent with the rules of natural justice or in violation of the statutory rules prescribing the mode of enquiry or where the authorities have disabled themselves from reaching a fair decision by some considerations extraneous to the evidence and the merits of the case or by allowing themselves to be influenced by irrelevant considerations or where the conclusion on the very face of it is so wholly arbitrary and capricious that no reasonable person could ever have arrived at that conclusion.
The departmental authorities are, if the enquiry is otherwise properly held, the sole judges of facts and if there is some legal evidence on which their findings can be based, the adequacy or reliability of that evidence is not a matter which can be permitted to be canvassed before the High Court in a proceeding for a writ under Article 226.
Again, this Court in Railway Board, representing the Union of India, New Delhi & Anr vs Niranjan Singh(1) said that the High Court does not interfere with the conclusion of the disciplinary authority unless the finding is not supported by any evidence or it can be said that no reasonable person could have reached such a finding.
In Niranjan Singh 's case (supra) this Court held that the High Court exceeded its powers in interfering with the findings of the disciplinary authority on the charge that the respondent was instrumental in compelling the shut down of an air compressor at about 8.15 a.m.
On 31 May, 1956.
This Court said that the Enquiry Committee felt that the evidence of two persons that the respondent led a group of strikers and compelled them to close down their compressor could not be accepted at its face value.
The General Manager did not agree with the Enquiry Committee on that point.
The General Manager accepted the evidence.
This Court said that it was open to the General Manager to do so and he was not bound by the conclusion reached by the Committee.
This Court held that the conclusion reached by the disciplinary authority should prevail and the High Court should not have interfered with the conclusion.
The jurisdiction to issue a writ of certiorari under Article 226 is a supervisory jurisdiction.
The Court exercises it not as an Appellate Court.
The findings of fact reached by an inferior court or Tribunal as a result of the.
appreciation of evidence are not reopened or questioned in writ proceedings.
An error of law which is apparent on the face of the record can be corrected by a writ, but not an error of facts however grave it may appear to be.
In regard to a finding of fact recorded by a Tribunal, a writ can be issued if it is shown that in recording the said finding, the Tribunal had erroneously refused to admit admissible and material evidence, or had erroneously admitted inadmissible evidence which has influenced the impugned finding.
Again if a finding of fact is based on no evidence, that would be regarded as an error of law which can be corrected by a writ of certiorary.
A finding of fact recorded by the Tribunal cannot be chal (1) ; 527 lenged on the ground that the relevant and material evidence adduced before the Tribunal is insufficient or inadequate to sustain a finding.
The adequacy or sufficiency of evidence led on a point and the inference of fact to be drawn from the said finding are within the exclusive jurisdiction of the Tribunal.
See Syed Yakoob vs K. section Radhakrishnan & ors(1).
The High Court in the present case assessed the entire evidence and came to its own conclusion.
The High Court was not justified to do so.
Apart from the aspect that the High Court does not correct a finding of fact on the ground that the evidence is not sufficient or adequate, the evidence in the present case which was considered by the Tribunal cannot be scanned by the High Court to justify the conclusion that there is no evidence which would justify the finding of the Tribunal that the respondent did not make the journey.
The Tribunal gave reasons for its conclusions.
It is not possible for the High Court to say that no reasonable person could have arrived at these conclusions.
The High Court reviewed the evidence, re assessed the evidence and then rejected the evidence as no evidence.
That is precisely what the High Court in exercising jurisdiction to issue a writ of certiorari should not do.
The respondent raised another contention that the State did not give the respondent a document described as 'B ' Report and Investigation Report of the Anti Corruption Bureau.
The ground advanced by the respondent in the petition before the High Court was that 'B ' Report and Investigation Report to which the reference is made by the Tribunal in its report and which are relied on to support the charges, were not made available to the respondent.
The High Court did not express any opinion on this question because the High Court set aside the dismissal in the ground that there was no evidence for the Tribunal to come to that conclusion.
The State in the affidavit filed in the High Court in answer to the respondent 's petition said that 'B ' Report and Investigation Report are secret reports which are intended for the reference of the Tribunal of Disciplinary Proceedings and the Government and, therefore, these reports are not supplied, to the officers.
We need not express any opinion on that answer of the State in the affidavit.
The respondent in answer to the affidavit of the State said that the Tribunal used the 'B ' Report and the Investigation Report against the respondent and did not supply copies.
It is because the respondent alleged in the writ petition that the Tribunal relied on 'B ' Report and Investigation Report, we looked into the Inquiry Report of the Tribunal to find out whether that was a correct statement.
We find that there is a reference to 'B ' Report by the Tribunal only because the respondent challenged the genuineness and authenticity of Exhibit P 45.
The respondent 's case was that if he made a statement like Exhibit P 45, the Investigating Officer would have sent it along with his report.
The Inquiry Officer says that the Investigating officer recorded the statement of the respondent.
The Tribunal has not relied on 'B ' Report or Investigation Report.
The (1) ; 528 respondent never demanded 'B ' Report and Investigation Report.
The A respondent was interested before the Tribunal to displace Exhibit P 45 by doubting its genuineness.
The Tribunal found that Exhibit P 45 was genuine and was a statement made and signed by the respondent in the presence of the Investigating Officer.
It does not appear that the Tribunal based its finding only on Exhibit P 45.
For these reasons we are of opinion that the High Court was wrong in setting aside the dismissal order by reviewing and re assessing the evidence.
The appeal is accepted.
The judgment of the High Court is set aside.
Parties will pay and bear their own costs.
V.P.S Appeal allowed.
| (1) The jurisdiction of the High Court to issue a writ of certiorari under article 226 is a supervisory jurisdiction, and not as an appellate court.
The findings of fact reached by an inferior court or tribunal as result of the appreciation of evidence are not reopened or questioned in these proceedings.
An error of law which is apparent on the face of record can be corrected but not an error of fact, however grave it may be.
In regard to a finding of fact recorded by a tribunal a writ can be issued if it is shown that the tribunal had erroneously refuged to admit admissible and material evidence or had erroneously admitted inadmissible evidence which has influenced the impugned finding.
Again, if a finding of fact is based on the evidence, that would be regarded as an error of law which can be corrected be a writ of ' certiorari, but if there is some evidence which may reasonably support the conclusion, its adequacy or sufficiency and the inference of ' fact drawn, are within the exclusive jurisdiction of the tribunal.
The Court is concerned to determine whether the inquiry is held by an authority competent in that behalf, and according to the procedure prescribed in that behalf, and whether the rules of natural justice are not violated.
Therefore, in departmental enquires relating to the guilt of delinquent officers, the High Court may interfere only where the departmental authorities have held tax proceedings against the delinquent officer in a manner inconsistent with the rules of natural justice or in violation of the statutory rules prescribing the mode of inquiry or where the authorities have disabled themselves from reaching a fair decision by some considerations extraneous to the evidence and the merits of the case, or by allowing themselves to be influenced by irrelevant considerations or where the conclusion, on the very face of it, is so wholly arbitrary and capricious that no reasonable person could ever have arrived at that conclusion.
[525 E 527B] State of Andhra Pradesh vs section Sree Rama Rao ; Railway Board, representing the Union of India New Delhi & Anr.
vs Niranjan Singh ; and Syed Yakoob vs K. section Radhakrishnan & Ors.
[1964] 5 S.C.R. 64, referred to.
(2) There is no warrant for the view that in considering whether a public officer is guilty of misconduct charged against him the rule followed in criminal trials, namely, that an offence is not established unless proved beyond reason able doubt, must be applied.
[525F G] In the present case, charges that the respondent fraudulently claimed travelling allowance were inquired into by the Disciplinary Proceedings Tribunal.
The Tribunal found him guilty and recommended dismissal.
The Government accept ed the recommendation and dismissed the respondent.
In a writ petition challenging the order of dismissal, the High Court equated the charge of mis conduct to a charge under s.5(1)(d) of the Prevention of Corruption Act, 1947 discussed the evidence and findings of the Tribunal on that basis and held that the prosecution did not adduce material and essential evidence namely; the conductor 's chart which would show whether the respondent travelled on a particular day, that a statement made by the respondent during investigation was not admissible in evidence, that it was not safe to rely on it and set aside the order of dismissal.
Allowing the appeal to this Court.
^ HELD .
(a) The High Court was not correct in holding that the domestic inquiry before the Tribunal was the same as prosecution is a criminal case.
[525C D] 3 L925SupCI/75 522 (b) The respondent was given full opportunity to explain the statement A made by him during investigation.
Further, the Tribunal did not base its findings only on that statement.
It had given its reasons for its conclusion and it is not possible for the High Court to say that no reasonable person could have arrived at that conclusion.
The High Court had accepted the explanation that the conductors ' charts were destroyed and therefore could not be Produced.
Moreover, the conductor 's chart would not show the names of the persons paying the money.
The High Court reviewed and re assessed the evidence and then rejected evidence as no evidence, and this is precisely what the High Court, in exercising jurisdiction under Art 226, should not do.
[525SC; 527B D] (c) The respondent 's contention that the Tribunal relied upon certain reports which were not available to the respondent is not correct.
A reference to the inquiry report of the Tribunal shows that the Tribunal had not relied upon those documents for finding the respondent guilty.
[527G 528B]
|
iminal Appeal No. 60 of 1962.
Appeal by special Leave from the judgment and order dated October 25, 1961, of the Punjab High Court in Criminal Appeal No. 890 of 1961 of Murder Reference No. 74 of 1961.
Jai Gopal Sethi, C. L. Sareen and R. L. Kohli, for appellant.
Gopal Singh, D. Gupta, P. D. Menon, for respondent.
April 27.
The Judgment of the Court was delivered by DAS GUPTA, J.
The Appellant was convicted by the Sessions Judge, Patiala, of an offence under s.302 of the Indian Penal Code for the murder of Gurdev Singh and sentenced to death.
The Punjab High Court dismissed his appeal and confined the sentence of death.
The present appeal is on the strength of special granted by this Court.
The prosecution case is that at about 2.30 p.m. on November 18, 1960 when Gurdev Singh was passing the tea stall of Cbaran Singh, not far from the courts at Barnala on a motor cycle, the appellant Sewa Singh, who was at that time in that shop with a double barrel gun stood up and fired a shot at him.
Gurdev Singh was hit on the right side of his chest and died instantaneously.
The appellant and one Gogar Singh, who was with him, ran away.
The accused pleaded not guilty.
It was not disputed that Gurdev Singh had died of a gun shot 547 injury at the time and place as alleged.
It was satr entiously contended, however, that he was not the culprit.
According to the prosecution this occurrence was witnessed by Charan Singh, the owner of the shop and Mukhtiar Singh, a Student, and Bakhtawar Singh, the two persons who were having tea in the shop.
At the trial Charan Singh denied any knowledge as to who had fired the shot and was declared hostile by the prosecution.
The other two witnesses gave evidence that they saw the present appellant, who was known to them from before, firing the shot from a double barrel gun.
Their evidence was believed by the Trial Judge and also by the High Court.
In support of the appeal it is contended by Mr. Sethi that we should look at the evidence ourselves as the High Court does not appear to have taken into consideration, in appreciating the evidence, the Characteristics of the injuries caused by the shot.
He has drawn our attention to a decision of this Court in Zora Singh vs The State of Punjab (Criminal Appeal No. 81 of 1957: Judgment delivered on 10.5 1957).
According to the learned Counsel these features of the injury as they appear from the Doctor 's evidence clearly show that when the gun was fired it was held in close contact with the body of the victim or within two or three inches of it.
This, argues the learned Counsel, shows that the witnesses who have claimed to have been the occurrence did not actually see the occurrence as they give a totally different version as regards the distance of the gun from the body of the victim.
It has to be mentioned that the judgment of the High Court contains no discussion on this point and it does not appear that the attention of the learned Judges was 548 drawn to the features of the injury on which we are now asked to hold that the shot which killed Gurudev Singh was fired from a very close range, not exceeding a few inches.
Even so, we have thought it proper to hear the Counsel on this question, ,.is in our view these features ought ordinarily to be taken into consideration in assessing the value of the evidence of the eye witnesses.
The doctor 's evidence shows: (1) that the wound caused was a roundish, wound 1 1/2"x 1 1/4" communicating with the right chest cavity; (2) that the wound was plugged with a cork wadding and card board disc of 12 bore cartridge; (3) that the right fourth and fifth ribs were blown off under the wound and also the right lung was punctured over an area 2 1/2"x 2" about in its middle lobe about its interior margin in the middle which was blown off, (4) that the woollen coat, which was on the body of the deceased, was bloodstained with a corresponding rent blackened charred; the shirt was also blood stained with a corresponding rent blackened.
The doctor gave the opinion that the distance from which the shot was fired might be three to four feet.
There was some cross examination of the doctor in the Committing Court but the correctness of this opinion was not challenged.
The doctor did not appear to give evidence before the Sessions Court.
His deposition as recorded by the Committing Court was treated as evidence in the Sessions Court under the provisions of s.509 of the Code of Criminal Procedure.
Turning first to the size of the wound it appears to us that far from supporting the theory of death having been caused by a contact shot it indicates that the shot was fired from about a yard away.
Speaking of ordinary shot guns, Sir Sidney Smith in his Forensic Medicine, 9th Edition; page 182 says : "At about a yard the charge of shot will enter as one mass,.
making a whole with irregular 549 edges about an inch in diameter." Major Sir Gerald Burrard in his Identification of firearms and Forenisic Ballistics says at P.73 : "It may be assumed for all practical purposes that if the diameter of the wound is an inch, or less, than the distance of the shot was 18 inches or under, irrespective of the gauge of the shotgun or the degree of choke.
Up to 2 feet there is very little difference in the spread between guns of various and different obokes, the hole at this distance being slightly over an inch in diameter.
At 3 feet the hole is nearly 1 1/2 inches in diameter, and the difference between the two extremes of boring, true cylinder and full choke, begins to be evident. ' In Lyon 's Medical Jurisprudence, 10th Edition, we find stated at p. 279 thus: "At a distance of 3 feet the shot mass begins to spread, the wound is an inch or slightly more in diameter.
" In Taylor 's Principles and practice of Medical Jurisprudence, 11th Edition, 'the matter is described thus at page 334: In the case of shot guns the distance from which the weapon was fired may be deduce d from the amount of scattering of the charge.
Up to about a yard the whole of the charge enters in a mass, producing a round hole about the size of the bore of the weapon. . .
In view of these authorities, it is reasonable to hold even without knowing whether the gun had an unchoked or a choked barrel that a roundish wound of 1 1 /2" x 1 1/4" would be caused if the gun is fired at a distance of about a yard.
We are unable to agree that the burning of the clothes as described by the doctor is any indication that the shot was fired from within a few inches.
Mr. Sethi has drawn our attention to the statement made in the several text books that whet the gun is fired from a distance of only a few inched; the wound would be surrounded by a zone of black ening and burning.
in the Present case no mark 550 of blackening or burning were noticed by the doctor on the skin round the wound or in the depths of the wound; but the rent in the woollen coat was found blackened and charged and the rent in the shirt blackened.
On this question it is important to mention the opinion as given in the Taylor 's Principle and Practice of Medical Jurisprudence, 10th Edition at p. 441 thus: "The amount or degree to which the clothes and body of a person may be burnt by the near discharge of firearms has given rise to a medico legal inquiry.
The facts in any given case can be determined only by experiments with the actual weapon used, and loaded as nearly as possible in the same manner as it was when used for the purpose which are being investigated.
It is impossible to state rules as to the precise distance from which it is possible to produce marks of burning, for this depends on the quantity and nature of the powder, the method of charging, and the nature of the weapon.
It is unusual, however, to get marks of burning beyond a yard or a yard and a half with a shot gun, or at more than half a yard with a revolver." According to this view therefore marks of burning may be found in the clothes or body of a person if the shot was fired at a distance of a yard or a yard and a half with a shot gun.
Even though this opinion is not reiterated in Taylor 's 11th Edition, it seems clear, in view of this opinion that the presence of the burning marks in the clothes cannot from a reasonable basis for holding that the gun was fired in this case from the close range of a few inches only.
It is necessary next to consider the fact that the cork was found lodged in the body.
Glaister 551 in Medical Jurisprudence and Texicology, 9th Edition at p. 265 says, while speaking of a shot fired close to the body surface up to a few inches that "the wad may be forced in the wound.
" It appeas to be clear that in a contact wound the wad is likely to enter the body.
But the authorities are not so clear to the maximum distance at which the wad may enter the body.
The nearest statement appears to be given by Sir Sidney Smith in his Forensic Medicine, 9th Edition at p. 182 thus : " 'the wads enter with the projectile in near discharges.
" Reading this statement in the light of the discussion in the previous paragraphs, it appears to us that a discharge up to yard has been considered by the learned author as a near discharge.
The fact that the wad was lodged in the wound appears therefore to be quite consistent with the shot having been fired from about a yard.
It remains to consider what the doctors has described as the "blowing off" of the ribs and a part of the right lung.
This description, if correctly given, indicates the entry of gas into the wound and that, it is true, ordinarily takes place only if the shot is fired within a few inches of the body, As we have already noticed however, the dimension of the wound itself is a clear indication that shot was fired at a distance of about a yard.
There is thus some apparent inconsistency between what is indicated by the size of the wound and what the doctors has described as "the blowing off" of the ribs and a par of the right lung.
As there is less likelihood of any mistake being made in the measurement of the wound than about the doctor 's view about the "blowing off" of the ribs.
, we are of opinion that what the doctor has described as "blowing off" is not a good reason for thinking that the shot was fired only a few inches off from the body.
552 On a consideration of all the features of the wound as described by the doctors together, we have come to the conclusion that the doctor 's opinion as given in his examination in chief, which was not challenged in cross examination before the Committing Magistrate, that the shot may have been fired about three to four feet away should be accepted as correct.
We find no reason therefore interfere with the assessment of evidence as made by the High Court and also with the order, of conviction and sentence passed by it.
The appeal is accordingly dismissed.
Appeal dismissed.
| The appellant had claims, for compensation against certain German firms in respect of machineries supplied by them to the appellant 's concerns.
The appellant went to Germany and arrived at settlements with the firms, under which the firms deposited certain sums of money with the Deutsche Bank in the account of the appellant with the stipulation that the money was only to be used by the appellant for purchases of new machineries from the same firms after obtaining import licenses from the Government of India.
The appellant had not obtained permission, general or special, of the Reserve Bank for opening this account.
Section 4(1) of the Foreign Exchange Regulation Act, 1947, prohibits a 'Person resident in India ', inter alia, from lending to any person outside India foreign exchange without the permission of the Reserve Bank.
Section 23 lays down the penalties for contravention of section 4(1) on adjudication by the Director of Enforcement and on conviction by a Court.
Section 23D confers upon the Director the power to adjudicate whether any person has contravened section 4 (1) and empowers him, if he is of the opinion that the penalty which he is empowered by impose would not be adequate in the circumstances of any particular case, to make a complaint in writing to the Court.
The Director inquired into the appellant 's Deutsche Bank account, held that the appellant had contravened s, 4(1) and imposed a penalty of Rs. 55 lakhs.
On appeal the Foreign Exchange Appellate Tribunal held that the deposits amounted 298 in law to loans by the appellant to the Bank and consequently section 4(1) was contravened but it reduced the penalty to Rs. 5 lakhs.
The appellant contended (i) that section 23(1) of the Act offended article 14 of the Constitution as two parallel procedures were provided for the same offence and it was left to the discretion of the executive to choose which was to be applied in.
a particular case, and (ii) that there was no loan by the appellant to the Bank and therefore there was no contravention of section 4(1).
Held, that the power conferred upon the Director under section 23D to transfer cases to a court is not unguided or arbitrary and, does not offend article 14 and section 23(1) cannot be assailed as unconstitutional.
A serious offence should not go without being adequately punished; and in such cases the accused should have the benefit of trial by a Superior Court.
Under section 23D the transfer is to a Court and that only when the Director considers that a more severe punishment than what he is authorised to impose should be awarded.
Held, further, that the appellant had not lent money to the Deutsche Bank and had not contravened the provisions of section 4(1) of the Act.
Though normally when moneys are deposited in a Bank, the relationship that is constituted between the Banker and the customer is one of debtor and creditor, there may be special arrangement under which the relationship may be different.
The right of the appellant to the amounts in deposit was contingent on the happening of certain events some of which were beyond his control and until then there was no debt due to him.
A contingent debt is no debt until the contingency happens, and as the right of the appellant to the amounts in deposit in his name in the Deutsche Bank arises only on the happening of the contingencies, i.e. granting of the import licenses by the Government of India, there was no debt due to him in presenti and there was no loan thereof within section 4(1) of the Act.
The fact that money has been put in a Bank does not necessarily import that it is a deposit in the ordinary course of banking.
The purpose of the deposits and the conditions attached to it indicated that the Deutsche Bank held the money under a special arrangement which constituted it not a debtor, but a sort of a stakeholder.
The words "a person resident in India" in section 4(1) has been used in the sense of "resident of India", and it was not necessary that at the time of the contravention of section 4(1) should be actually in India.
Foley vs Hill, (1848) 11 H. L. C. 28, Webb vs Stenton, and Tapp vs Jones, (1875) L. R. 10 Q.B. 591, referred to. 299
|
vil Appeal Nos.
1205 06 of 1987.
From the Judgment and Order dated 24.3.
1987 of the Andhra Pradesh High Court in Writ Petition No. 15582 of 1986.
Dr. Y.S. Chitale, B. Parthasarathy and K.V. Sreekumar for the Appellant.
T.S. Krishnamurthy Iyer, T.V.S.N. Chari, Ms. V. Grover and Ms. Sunita M. for the Respondents.
The Judgment of the Court was delivered by 952 JAGANNATHA SHETTY, J.
This appeal on a certificate raises a short but an important question as to the Constitu tional validity of the Andhra Pradesh Commissionerate of Higher Education Act, 1986 (Act No. 26 of 1986) (called shortly "The Commissionerate Act").
The question is whether the enactment falls within Entry 66 List I or Entry 25 List III Concurrent List of the Seventh Schedule to the Consti tution.
The High Court of Andhra Pradesh has upheld its validity by holding that the Act falls under the latter Entry, but granted a certificate for leave to appeal to this Court under Article 133(1) of the Constitution.
The said Act was enacted on the basis of the recommenda tions of a high power committee constituted by the State Government to study the higher education system in the State of Andhra Pradesh with special reference to its curricula, courses of study, finance and management.
The Committee in its report submitted to the Government observed, inter alia, that there is no proper coordination and academic planning among the various bodies like Universities, Directorate of Higher Education and University Grants Commission etc.
There is no policy perspective in the development of higher educa tion system.
The Committee said that in order to streamline the general working and oversee the development of higher education in the State, there is need to constitute a Com mission to advise the Government in that matter.
The Government appears to have accepted the said report of the Committee.
That is obvious from the Preamble to the Commissionerate Act.
It states that "Act is to provide for the Constitution of a Commissionerate to advise the Govern ment in matters relating to Higher Education in the State and to oversee its development with perspective planning and for matters connected therewith and incidental thereto." Section 2(e) defines "Higher Education" to mean interme diate education and education leading to a degree or post graduate degree including professional and technical educa tion.
Section 2(c) defines "Commissionerate" to mean the Andhra Pradesh Commissionerate of Higher Education consti tuted under subsection (1) of Section 3.
Thereunder, the Commissionerate has been constituted as a Corporate body.
The composition of the Commissionerate is provided under Section 4.
The Commissionerate shall consist of Chairman, Vice Chairman and not more than 10 members [Section 953 4(1)].
The Chairman and the Vice Chairman shall be appointed by the Government [Section 4(2)].
Of the ten members of the Commission, three are Secretaries to the Government: Educa tion Secretary, Labour Secretary and Finance and Planning Secretary.
Four of them shall be representing Professors and Vice Chancellors of any of the Universities in the State.
One shall represent industry and commerce, and another shall represent engineering or legal or medical education.
The last one shall be a distinguised educationalist.
All these persons are to be appointed only by the Government.
The Chairman and ViceChairman shall be whole time and salaried persons and their terms and conditions are provided under Section 5(1).
Section 9 gives overriding effect and power to the Commissionerate over all other authorities and bodies con nected with the Higher Education in the State.
Section 9(1) provides: "With effect on and from the Constitution of the Commissionerate under Section 3 and not withstanding anything contained in the Andhra Pradesh Intermediate Education Act, 1971, and the Andhra Pradesh.
Education Act, 1982, the Director of Higher Education, the Secre tary, Board of Intermediate Education and the Secretary to the Board of Technical Education shall function under the administrative con trol of the Commissionerate." Section 9(2) provides power to the Government to appoint a Secretary to the Commissionerate.
Rest of the Officers and employees are to be appointed from time to time by the Commissionerate but with the previous approval of the Gov ernment.
The Central power of the Commissionerate has been locat ed in Section 11.
We may give the gist of it here.
The Commissionerate shall (i) evolve a perspective plan for the development, of Higher Education in the State; (ii) monitor and evaluate the academic programmes in higher education and enforce accountability in the system; (iii) establish and develop resources centre for curriculam materials and continuing education of teachers; (iv) co ordinate the academic activities of various institutions of higher education in the State; 954 (v) undertake examination reforms; (vi) establish linkages between Universi ties industries and community development organisations: (vii) transfer teachers appointed in aided posts from one aided private college to anoth er such college subject to such rules as may be made by the Government in this behalf and generally encourage mobility of teachers;and (viii) perform any other functions neces sary for the furtherance and maintenance of excellence in the standards of higher educa tion in the State.
Section 11(2) provides: "Notwithstanding anything contained in any law relating to Universities in the State, the Board of Intermediate Education Act, 1971 and the Andhra Pradesh Education Act, 1982, every University or college including a private college in the State shall obtain the prior approval of the Commissionerate in regard to (i) creation of new posts; (ii) financial management; and (iii) starting of new higher educational institutions.
Section 13 is another important Section.
It provides power for inspection for ascertaining the financial needs of a University or its standards of teaching, examination and research.
The Commissionerate shall communicate to the University its views in regard to the result of any such inspection and may, after ascertaining the opinion of the University, recommend to the University the action to be taken as a result of such inspection and the University shall comply with any such direction.
Section 16 states that the Commissionerate shall be guided by such directions issued by the Government on ques tions of policy relating to State purposes or in case of any emergency as may be given to it by the Government.
Section 18 confers power to the Government to make rules to carry out all or any of the purposes of the Act.
Section 19 955 provides power to the Commissionerate to make regulations consistent with the Act and the rules made thereunder.
The sole contention of Dr. Chitale, learned counsel for the appellant is that the Commissionerate Act is just a duplicate of the University Grants Commission Act ("The UGC Act") and the State has no legislative power at all to enact it, since it squarely falls under Entry 66 List I.
But the contention of Mr. Krishnamurthy Iyer, learned counsel for the State of Andhra Pradesh, is to the contrary.
While supporting the judgement of the High Court, he submitted that the enactment in pith and substance falls within Entry 25 of List III and not under Entry 66 of List I of the Seventh Schedule.
For proper consideration of the conten tions we may set out these two Entries: Entry 66 List I: "Co ordination and determination of standards in institution for higher education or research and scientific and techni cal institutions.
" Entry 25 List III: "Education, including technical education, medical education and universities, subject to the provisions of entries 63, 64, 65 & 66 of List I, vocational and technical training of labour." Till January 3, 1977, Education was a State subject under Entry 11 in List II.
By the 42nd Amendment Act, 1976, Entry 11 was deleted and it was placed in the Concurrent List by enlarging the Entry 25, as set out above.
Entry 25 List III relating to education including tech nical education, medical education and Universities has been made subject to the power of Parliament to legislate under Entries 63 to 66 of List I. Entry 66 List I and Entry 25 List III should, therefore, be read together.
Entry 66 gives power to Union to see that a required standard of higher education in the country is maintained.
The standard of Higher Education including scientific and technical should not be lowered at the hands of any particular State or States.
Secondly, it is the exclusive responsibility of the Central Government to co ordinate and determine the stand ards for higher education.
That power includes the power to evaluate, harmonise and secure proper relationship to any 956 project of national importance.
It is needless to state that such a coordinate action in higher education with proper standards, is of paramount importance to national progress.
It is in this national interest, the legislative field in regard to 'education ' has been distributed between List I and List III of the Seventh Schedule.
The Parliament has exclusive power to legislate with respect to matters included in List I.
The State has no power at all in regard to such matters.
If the State legis lates on the subject falling within List I that will be void, inoperative and unenforceable.
In Kerala State Electricity Board vs Indian Aluminium Company, [1976] 1 SCR 552 this Court said: "The power of Parliament to legis late with respect to matters included in List I is supreme notwithstanding any thing contained in clause (3) (again leaving out of consi deration the provision of clause 2).
Now what is the mean ing of the words "notwithstanding" in clause (1) and "sub ject to" in clause 3; They mean that where an entry is in general terms in List II and part of that entry is in specific terms in List I, the entry in List takes effect notwithstanding the entry in List II.
This is also on the princi ple that the 'special ' excludes the 'general ' entry in List II is subject to the special entry in List I." We may now refer to some of the decisions dealing with the inter action of Entry 66 List I and Entry 25 List III.
In Gujarat Universi ty, Ahmedabad vs Krishna Ranganath, [1963] Suppl.
1 SCR 112, 137.
Shah J. speaking for the majority view of the Constitution Bench observed: "Item 63 to 66 of List I are carved out of the subject of education and in respect of these items the power to legislate is vested exclusively in the Parliament.
Use of the expression "Subject to" in item 11 of List II of the Seventh Schedule clearly indicates that legislation in respect of excluded mat ters cannot be undertaken by the State Legis latures.
In Hingir Rampur Coal Co. vs State of Orissa ; , this Court in consid ering the import of the expression "Subject to" used in an entry in List II in relation to an entry in List I observed that to the extent of the restriction imposed by the use of the expression "subject to" in an entry in List II the power is taken away from 957 the State Legislature.
Power of the State to Legislate in respect of education including Universities must to the extent to which it is entrusted to the Union Parliament whether such power is exercised or not, be deemed to be restricted.
If a subject of legislation is covered by items 63 to 66 even if it otherwise falls within the larger field of "education including Universities" power to legislate on that subject must lie with the Parliament." This decision turned on the interpretation of Section 4(27) of Gujarat University Act, and it was held that the University has no power to prescribe Gujarati or Hindi as exclusive medium of instruction in higher education.
The principles enunciated in the Krishna Rangnath case have been reiterated in D.A.V. College, Bhatinda etc.
vs State of Punjab & Ors., The power of the State to prescribe certain norms for admission to colleges came for consideration before this Court in R. Chitralekha & Anr.
vs State of Mysore & Ors.
, ; where Subba Rao J., as he then was, ob served: "that if the law made by the States by virtue of Entry 11 of List II of the Seventh Schedule to the Constitution makes impossible or diffi cult the exercise of the legislative power of the Parliament under the entry "Co ordination and determination of standards in institutions for higher education or research and scientif ic and technical institutions" reserved to the Union, the State law may be bad.
This cannot obviously be decided on speculative and hypo thetical reasoning.
If the impact of the State law providing for such standards on entry 66 of List I is so heavy or devastating as to wipe out or appreciably abridge the central field it may be struck down.
But that is a question of fact to be ascertained in each case.
" The learned Judge, however, upheld the impugned scheme of the State in that case for selection of students 'to colleges maintained by the State since it was found that that scheme only prescribed criteria for making admissions to colleges from among students who secured the minimum qualifying marks prescribed by the University.
It was held that the scheme did not encroach upon the field covered by Entry 66 List I of the Seventh Schedule to the Constitution.
Similar was the view expressed by this Court in State of Andhra Pradesh vs Lavu 958 Narendranath & Ors.
; , and in Ambesh Kumar vs Principal, LLRM College, Meerut, ; What do we have in the present case? There is no scheme for admission to colleges.
There is a corporate body estab lished under the State enactment with powers supreme in regard to all matters pertaining to higher education.
To mention a few, the Commissionerate constituted thereunder shall evolve a perspective plan for the development of higher education in the State.
It must monitor and evaluate the academic programmes.
It must co ordinate the academic activities of various institutions and universities.
It must oversee the development and streamline the higher education in the entire State.
It shall perform all functions neces sary for .the furtherance and maintenance of excellence in the standards of higher education in the State.
It also controls the entire fund meant for the universities includ ing grants given by the Central Government for higher educa tion.
Since it was argued that both these enactments are in parimateria, it will be useful to compare the UGC Act with the corresponding provisions of the Commissionerate Act by keeping them side by side: U.G.C. Act, 1956 The Commissionerate Act 1.
Statement of Objects and reasons: "The Constitution of India In order to bring a change vests Parliament with in the higher education exclusive authority in system in the State so as regard to Co ordination to make the courses of and determination of study more relevant to the standards in institutions needs of the modern society for higher education or and to provide opportu research and scientific nities of earning and and technical instituti learning simultaneously ons.
It is obvious at college level to all the that neither coordination students in the State, a nor determination of four man committee was standards is possible appointed in February, 1986 unless the Central by the State Government to Government has some voice study the higher education 959 in the determination of system in the State with standards of teaching special reference to curri and examination in cula and courses of studies, Universities, both old Finance and Management in and new.
the Higher Education system.
It is, therefore, The Committee in its proposed to establish report submitted to a University Grants Government observed Commission as a that there is no proper corporate body which co ordination and academic will inquire into the planning among the various financial needs of bodies like universities; universities and the Directorate of Higher allocate and disburse Eduation and the Univer grants to Universities sity Grants Commission etc.
for any general or and there is no policy specified purpose.
The perspective in the Commission will act as an development of the expert body to advise Higher Education system the Central Government in the State and in order on problems connected to streamline the general with the coordination of working of the higher facilities and Education system in the maintenance of standards State the Committee in Universities.
suggested to constitute The Commission, in consul a commission to advise tation with the University the Government in connected, will also have matters relating to the power to cause an higher education in the inspection or inquiry to State and to oversee be made of any university its development.
The established by law in Government have examined India and to advise the the above recommendations university on any matter and suggestions and which has been the decided to constitute subject of an inquiry or a Commissionerate of inspection.
The Commi Higher Education.
ssion shall also advise, whenever such advise is sought, on the establish ment of new Universities.
Establishment of Sec.
Constitution of the Commission: Commissionerate of Higher Education: (1) With effect from such The Government may, by date as the Central Govern notification, and with ment may, by notification effect on and from such in the official Gazettee, date as may be specified appoint, there shall be therein constitute a established a Commission Commissionerate for the by the name of the Univer purpose of this Act sity Grants Commission.
to be called The Andhra Pradesh Commissionerate of Higher Education.
(2) The said Commission (2) The Commissionerate shall be a body corporate shall be a body corporate having perpetual having perpetual success succession and a common ion and a common seal and seal, and shall by the shall sue and be used said name sue and be sued.
by the said corporate name.
(2)(b) xxx xxx xxx Sec.
5 Composition of the Sec.
4 Composition of the Commission: Comissionerate: (1) The Commission shall (1) The Commissionerate consist of: shall consist of: (i) A Chairman, and (i) A Chairman (ii) A Vice Chairman, and (ii) A Vice Chairman, and (iii) ten other members, to (iii) not more than ten be appointed by the members to be appointed by Central Government the State Government Sec.
9 Temporary Associa Sec.
8 Temporary Associa tion of person with the tion of persons with the Commission for particular Commissionerate for purpose particular purpose (Both these Sections are similar) Functions of the Sec.
11 Powers and Functions Commission: of the Commissionerate It shall be the general duty It shall be the general duty of the Commission to take, of the Commissionerate to: in consultation with the Universities or other a) evolve a prospective bodies.
concerned, all plan for the development such steps as it may of higher education in the think fit for the State; promotion and co ordi nation of University b) administer and release Education and for the grants in aid to Univer determination and main sities as private tenance of standards colleges in the State and of teaching, examina report the same to the tion and research in Government.
University and for the purpose of performing c) xxx xxx xxx its functions under this Act, the Commission d) monitor and evaluate may: the academic programmes in higher education and enforce accountability in the system.
a) Inquire into the finan e) xxx xxx cial needs of Universities f) xxx xxx b) Allocate and disburse, out of the fund of the g) co ordinate the Commission, grants to academic activities of Universities established various institutions of or incorporated by or higher education in the under a Central Act for State.
the maintenance and development of such xxx xxx universities or for any other general or p) Perform any other specified purpose.
functions necessary to the furtherance and c) Allocate and disburse maintenance of excell out of the fund of the ence in the standards of Commission, such grants higher education in the 962 to other Universities as State, it may deem necessary or appropriate for the development of such Universities or for the maintenance, or development or both, of any specified activities of such Universities or for any other general or specified purpose recommended to any University the measure necessary for the improvement of University education and advise the University upon the action to be taken for the purpose of implementing such recommendations.
13 Inspection: Sec.
13 Inspection: (1) For the purpose of (1) For the purpose of ascertaining the finan ascertrining the financial cial needs of a Univer needs of a University or its sity or its standards of standards of teaching, exami teaching, examination and nation and research.
the research, the Commission Commissionerate may, after may, after consultation with consultation with the Uni the University cause an versity, cause an inspection inspection of any department of any department or depart or departments thereof to ments thereof to be made in be made in such manner as such manner as may be may be prescribed and by prescribed and by such such person or persons as person or persons as it may it may direct.
direct.
(2) The Commission (2) The Commissionerate shall shall communicate to communicate to the University the University the date the date on which any inspec on which any inspection tion under sub section (1) under sub section (1) is shall be made and the Univer to be made and the sity shall be entitled to be University shall be associate with inspection 963 entitled to be associa in such manner as may be ted with the inspection prescribed.
in such manner as may be prescribed.
(3) The Commissionerate shall communicate to the University its views in regard to the result of any such inspection and may, after ascertaining the opinion of the University, recommend to the University, the action to be taken as a result of such inspection, and the University shall comply with any such direction.
16 Fund of the Sec.
12 Fund of the Commission Commissionerate: (1) The Commission shall (1) The Commissionerate shall have its own fund and have its own fund consisting all sum which may, from of the grants from Government time to time, be paid voted by the Legislative Ass to it by the Central embly of the State towards Government and all the grants to Universities, and receipts of the Commi aided Junior and Degree ssion (including any Colleges and grants received sum which any State from Central Government for Government or any other higher education.
authority or person may handover to the Commi (2) All moneys belonging to ssion) shall be carried the Fund shall be deposited to the fund and all in such banks or invested in payments by the such manner as may, subject Commission shall be to the approval of the made therefrom.
Government, be decided by the Commissionerate.
(2) All moneys belong ing to the fund shall (3) The Commissionerate may be deposited in such spend such sums as it thinks banks or invested in fit for performing its such manner as may, functions under this Act, subject to the approval and such sums shall be 964 of the Central Govern treated as expenditure ment be decided by payable out of the fund the Commission.
of the Commissionerate.
(3) The Commission may spend such sums as it thinks fit for performing its functions under this Act, and such sums shall be treated as expenditure payable out of the fund of the Commission.
18 Annual Report Sec.
14 Annual Report The Commission shall The Commissionerate shall prepare, once in every prepare once in every year, year in such form and at in such form and at such time such time as may be as may be prescribed an Annual prescribed, an annual Report giving a true and full report giving a true and account of its activities full account of its acti during the previous year, vities during the previous and copies thereof shall be year, and copies thereof forwarded to the Government shah be forwarded to the and the Government shall Central Government and the cause the same to be laid Government shall cause the before the Legislative same to be laid before Assembly of the State.
both Houses of Parliament.
19 Accounts & Audit Sec.
15 Accounts & Audit Sec.
20 Directions by Sec.
16 Directions by the the Central Government Governments (1) In the discharge of (1) In the discharge of its functions under this its functions under this Act, Act.
the Commission shall the Commissionerate shall be be guided by such direc guided by such directions tions on questions of on question of policy policy relating to relating to State purposes national purposes as may or in case of any emergency as be given to it by the may be given to it by the 965 Central Government.
Government.
(2) If any dispute arises (2) If any dispute arises between the Central between the Government Government and the Commi and the Commissionerate ssion as to whether a as to whether a question question is or is not a is or is not a question of question of policy policy relating to State relating to national purposes, or whether an purposes the decision of emergency has arisen, the the Central Government decision of the Government shall be final.
thereon shall be final.
25 Power to make Rules Sec.
18 Power to make Rules Sec.
26 Power to make Sec.
19 Power to make Regulations.
Regulations.
" We have extracted only such of the provisions similar to those contained in the UGC Act.
That is not all.
The Commis sionerate Act yet contains sweeping provisions encroaching on the autonomy of the Universities.
Under Section ll(1)(c) it is for the Commissionerate to decide on the need for, and location of new colleges and courses of study including Engineering Colleges.
Section 11(1)(f) provides power to the Commissionerate to establish and develop resources centre for curriculuam materials and continuing education of teach ers.
Section 11(1)(g) confers power on the Commissionerate to coordinate the academic activities of various institu tions of higher education in the State.
It is also the duty of the Commissionerate to undertake examination reforms and assume accreditation functions [Section 11(1)(h) & (i)].
Section 11(1)(j) states that it is the duty of the Commis sionerate to organise entrance test for University admis sion.
Section 11(1)(k) states that it shall administer and grant scholarship and organise work study programmes.
Sec tion 11(1)(0) provides power to transfer teachers from one aided private college to another such college, subject to the rules made by the Government.
There is yet a devastating provision on the autonomy of Universities.
section 11(2) states that every University or College including the pri vate college shall obtain the prior approval of the Commis sionerate in regard to: (i) creation of new posts; (ii) financial management; and (iii) starting of new higher educational institutions.
This 'Super Power ' has been pre served to the Commissionerate notwithstanding anything contained in any law relating to Universities in the State, the Board of Intermediate Education and the Andhra Pradesh Education Act, 1982.
It will be seen that the Commissionerate has practically taken over the academic programmes and activities of the Universities.
The Universities have been rendered irrelevant if not non entities.
It is apparent from this discussion that the Commission erate Act has been drawn by and large in the same terms as that of the U.G.C. Act.
The Commissionerate Act, as we have earlier seen also contains some more provisions.
Both the enactments, however, deal with the same subject matter.
Both deal with the co ordination and determination of excellence in the standards of teaching and examination in the Univer sities.
Here and there, some of the words and sentences used in the Commissionerate Act may be different from those used in the UGC Act, but nevertheless, they convey the same meaning.
It is just like referring the same person with different descriptions and names.
The intention of the legislature has to be gathered by reading the statute as a whole.
That is a rule which is now firmly established for the purpose of construction of statutes.
The High Court appears to have gone on a tangent.
The High Court would not have fallen into an error if it had perused the UGC Act as a whole and compared it with the Commissionerate Act or vice cersa.
In Prem Chand Jain vs R.K. Chhabra, ; this Court has held that the UGC Act falls under Entry 66 of List I.
It is then unthinkable as to how the State could pass a parallel enactment under Entry 25 of List III, unless it encroaches Entry 66 of List I. Such an encroachment is patent and obvious.
The Commissionerate Act is beyond the legislative competence of the State Legislature and is hereby declared void and inoperative.
In the result, these appeals are allowed with costs.
The judgment of the High Court is reversed.
There shall be a direction to the State not to enforce the provisions of the impugned Act.
Before parting with the case we may say a word more.
The impugned Act was the result of a report from a High Power Committee constituted by the State Government.
The Committee went into the affairs of the higher education in the State.
The Committee examined among other things, the curricula and courses of studies.
The Committee found as a fact that there is no proper coordination and academic planning among the various bodies.
It recommended to the State Government the need to pass a proper legislation to stream 967 line the higher education.
The State Government accepted the recommendations and passed the Act in question.
The Act now disappears for want of legislation competence.
What about the need to enact that Act? It will not vanish to the thin air.
The defects and deficiency pointed out by the High Power Committee in regard to higher education may continue to remain to the detriment of the interest of the State and the Nation.
Such defects in the higher education may not be an isolated feature only in the State of Andhra Pradesh.
It may be a common feature in some other States as well.
That apart, we often hear and read in news papers with disgust about the question papers leakage and mass copying in the University examinations.
It has stripped the univer sity degrees of all its credibility.
He indeed must be blind who does not see what is all happening in some of the Uni versities.
The Constitution of India vests Parliament with exclu sive authority in regard to co ordination and determination of standards in institutions for higher education.
The Parliament has enacted the UGC Act for that purpose.
The University Grants Commission has, therefore, a greater role to play in shaping the academic life of the country.
It shall not falter or fail in its duty to maintain a high standard in the Universities.
Democracy depends for its very life on a high standards of general, vocational and profes sional education.
Dissemination of learning with search for new knowledge with discipline all round must be maintained at all costs.
It is hoped that University Grants Commission will duly discharge its responsibility to the Nation and play an increasing to role bring about the needed transfor mation in the academic life of the Universities.
N.P.V. Appeal al lowed.
| The Andhra Pradesh Commissionerate of Higher Education Act, 1986 (Act No. 26 of 1986) providing for the constitu tion of a Commissionerate to advise the Government in mat ters relating to Higher Education in the State and to over see its development with perspective planning and for mat ters connected therewith and incidental thereto and to perform all functions necessary for the furtherance and maintenance of excellence in the standards of higher educa tion in the State was enacted on the basis of the recommen dations of a high power committee constituted by the State Government to study the Higher Education system in the State with special reference to its curricula, courses of study, finance and management.
The validity of the aforesaid Act was challenged in the High Court which, while upholding it, held that the Act fell under Entry 25 List III Concurrent List of the Seventh Schedule to the Constitution of India.
In the appeals to this Court, it was contended on behalf of the appellant that the Act was just a duplicate of the University Grants Commission Act and the State had no legis lative power at all to enact it since it squarely fell under Entry 66 List I.
On behalf of the Staterespondent it was submitted that the enactment in pith and substance fell within Entry 25 of List III and not under Entry 66 of List I of the Seventh Schedule.
Allowing the appeals, this Court, 950 HELD: 1.1 Entry 25 List III relating to education in cluding technical education, medical education and Universi ties had been made subject to the power of Parliament to legislate under Entries 63 to 66 of List I. Entry 66 List I and Entry 25 List III should, therefore, be read together.
[955F G] 1.2 Entry 66 gives power to the Union to see that a required standard of higher education in the country is maintained.
The standard of Higher Education including scientific and technical should not be lowered at the hands of any particular State or States.
It is the exclusive responsibility of the Central Government to co ordinate and determine the standards for higher education.
That power includes the power to evaluate, harmonise and secure proper relationship to any project of national importance.
It is needless to state, that such a coordinate action in higher education with proper standards, is of paramount importance to national progress.
It is in this national interest, the legislative field in regard to 'education ' has been distrib uted between List 1 and List 111 of the Seventh Schedule. ]955G H; 956A B] 1.3 Parliament has exclusive power to legislate with respect to matters included in List I.
The State has no power at all in regard to such matters.
If the State legis lates on the subject failing within List I that will be void, inoperative and unenforceable.
[956B] 1.4 The Commissionerate Act has been drawn by and large in the same terms as that of the U.G.C. Act.
Both the enact ments deal with the co ordination and determination of excellence in the standards of teaching and examination in the Universities.
Here and there, some of the words and sentences used in the Commissionerate Act may be different from those used in the UGC Act, but nevertheless, they convey the same meaning.
It is just like referring the same person with different descriptions and names.
[966B D] 1.5 The High Court has gone on a tangent, and would not have fallen into an error if it had perused the UGC Act as a whole and compared it with the Commissionerate Act or vice versa.
[966D] 1.6 The Commissionerate Act contains sweeping provisions encroaching on the autonomy of the Universities.
The Commis sionerate has practically taken over the academic programme and activities of the universities.
The universities have been rendered irrelevant if not nonentities.
[965D; 966A B] 1.7 It is unthinkable as to how the State could pass a parallel 951 enactment under Entry 25 of List III, unless it encroaches Entry 66 of List I Such an encroachment is patent and obvi ous.
The Commissionerate Act is beyond the legislative competence of the State Legislature and is hereby declared void and inoperative.
[966E F] 1.8 The Constitution of India vests Parliament with exclusive authority in regard to co ordination and determi nation of standards in institutions for higher education.
The Parliament has enacted the UGC Act for that purpose.
The University Grants Commission has, therefore, a greater role to play in shaping the academic life of the country.
It shall not falter or fail in its duty to maintain a high standard in the Universities.
Democracy depends for its very life on high standards of general, vocational and profes sional education.
Dissemination of learning with search for new knowledge with discipline all round must be maintained at all costs.
[967D E] The University Grants Commission, it is hoped will duly discharge its responsibility to the Nation and play an increasing role to bring about the needed transformation in the academic life of the Universities.
[967E F] Kerala State Electricity Board vs Indian Aluminium Company, [1976] 1 SCR 552; Gujarat University, Ahmedabad vs Krishna Ranganath, [1963] Suppl.
1 SCR 112; DAV College, Bhatinda etc.
vs State of Punjab & Ors.
, ; R. Chitralekha & Ant.
vs State of Mysore & Ors.
, ; ; State of Andhra Pradesh vs Lavu Narendranath & Ors, etc.; , ; Ambesh Kumar vs Principal, LLRM College, Meerut, ; and Prem Chand Jain vs R.K. Chhabra; , , referred to.
|
Civil Appeal Nos. 416 of 1973 and 572 of 1974.
(From the Judgment and Decree dated 22 12 1972 of the Allahabad High Court in F.A. No. 465/54 connected with F.A. 65/55).
A. K. Kirty, Yogeshwar Prasad, S.K. Bagga, Mrs. section Bagga Miss Rani Arora for the Appellant (in CA.Facts No. 416/73 and Respondent No. 1 in CA. No. 572/_74).
G.B. Pal, R.K. Mehta, Pramod Swarup and Miss Uma Mehta for the Appellants (in CA 572/74 and Respondents 1 3 in CA.No. 415/73).
B. Sen, S.M. Jain, Indra Makwana and Sushil Kumar Jain for Respondents 5/2, 5/3 and 6 (in CA.No. 416/73).
S.T. Desai, Rajinder Singh and S.K. Dhingra for Respond ents 7 & 8 (in CA.No. 416/73).
The Judgment of the Court was delivered by JASWANT SINGH, J.
These two appeals by certificates granted under Article 133 of the Constitution which are directed against the common judgment and decree dated Decem ber 22, 1972 of the High Court at Allahabad in two connected Civil First Appeals Nos. 465 of 1954 and 65 of 1955 pre ferred against the judgment and preliminary decree of the Second Additional Civil & Sessions Judge, Agra, dated April 5, 1954, in suit No. 76 of 1949 shah be disposed of by this judgment.
The facts material for the purpose of these appeals are: The appellant in Appeal No. 416 of 1973 and respondent No. 1 in appeal No. 572 of 1974, Seth Loonkaran Sethiya, (hereinafter referred to for convenience as 'the plain tiff ') is a financier living and carrying on business in Agra.
Respondents Nos. 1 to 3 in the first appeal and appellants Nos. 1 to 3 in the second appeal viz. Ivan E. John, Maurice L. John and Doris Marzano, grandsons and grand daughter of one A John, are partners of the regis tered, firm called 'John & Co. '.
There are three spinning mills and one flour mill at Jeoni Mandi, Agra, which are compendiously described as 'John Mills '.
Originally, the members of the John family were the exclu sive owners of all these mills which have been in existence since the beginning of the current century.
In course of time, some strangers acquired interest therein and by the time the present lis commenced, the following became the joint owners thereof to the extent noted against their names : 1.Ivan E. John, Maurice L. John and Doris Marzano, appellants Nos. 1 to 3 in Appeal No. 572 of 1974 and respondents Nos. 1 to 3 in .Appeal No. 416 of 1973 Partners of the firm 'John & Co. ', appellant No. 4 in Appeal No.572 of 1974 and respondent No. 4 in Appeal No. 416 of 1973:11/40th share.
2. Seth .Munilal Mehrs (respondent No. 6 in appeal No. 416 of 1973 and respondent No. 9 in Appeal No, 572 of 1974).and Hiralal Patni (respondent No. 5 in Appeal No. 416 of 197.
3, 'deceased 'and now represented by respondents Nos, 5/1 to 5/7 i3 the 'said appeal and represented by respondents Nos. 2 to 8 in Appeal No. 572 of 1974):19/40th share 3.Gambhirmal Pandya (P) Ltd. part ner in M/s. John Jain Mehra & Co,: 8/40th share .
4.Ivan E. John: 2/40th share Having run into financial difficulties, M/s John & Co. were driven to tap various sources for raising loans for their business and other requirements.
By virtue of the deed of agreement (Exn. 1321 ) dated June 14, 1947, they entered into a financial agreement with Sethira & Co., a partnership firm of the plaintiff and Seth Suganchand.
Under this agreement which was originally meant to last for five months but which was allowed to remain in force even after 'the expiry of that period Sethiya & Co. undertook to advance to M/s John & Co. funds to the extent of Rs. 8,00,000/ on the security of yarn and to act as sole selling agents of the latter.
On January 29, 1948, the Collector, Agra, attached moveable and immoveable properties of the mills pursuant to a certificate issued for reali zation of income tax dues for the years 1943 to 1945 out standing against M/s John &Co. which exceeded Rs. 20 lakhs.
On February 5, 1948, the Collector, Agra, appoint ed Ivan E. John, Maurice L. John and Doris Marzano as custo dians for running the mills.
On February 9, 1948, the aforesaid agreement (Exh. 1321) dated June 14, 1947, with Sethiya & Co. which continued to remain in operation beyond its original term was renewed upto the end of April, 1948, by agreement (Exh. 1320).
This agreement gave an option to the partners of Sethiya & Co. to allow it to continue in force until their dues were 857 paid in full by M/s John & Co. These financial agreements with Sethiya & Co. did not prove adequate to meet the mone tary requirements of M/s John & Co. Accordingly on the same day i.e. on February 9, 1948, they entered into another agreement (Exh. 1319) with the proprietory concern of the plaintiff carrying on business under the name and style of 'M/s. Tejkaran Sidkaran ' whereby the latter agreed to advance certain amounts to them against mortgage of cotton, its products and bye products which might be in their stock from time to time during the continuance of the agreement.
By this agreement, M/s John & Co. also undertook to pay to M/s Tejkaran Sidkaran a sum of Rs. 2,09,245 9 10 which, on going into the accounts, was found to be due to the latter in respect of the supply of cotton.
Nearly five months thereafter i.e. on July 6, 1948 the aforesaid partners of M/S. John & Co. succeeded in obtaining another financial accommodation from Sethiya & Co. vide agreement Exhibit 168: Exhibit A 1.
By this deed, the financiers agreed, for the efficient working of the mills, to advance loan, as and when required, upto the limit of Rs. 25 1/2 lakhs to the partners of M/s John & Co. on condition that they i.e. the financiers would have a floating and prior charge for all monies due to them for the time being including the amount due to them on the date of the agreement and all monies which they might choose to advance under the agreement, on all business assets including stores, coal, oil process etc of the aforesaid three spinning mills.
Describing himself as the sole proprietor of the firm 'Sethiya & Co.; and 'M/s. Tejkaran Sidkaran '.
Seth Loonkaran Sethiya flied in the Court of the Civil Judge, Agra on April 18, 1949 an original suit, being suit No. 76 of 1949 against M/s. John & Co. ' and its aforesaid partners (hereinafter referred to as 'the defendants first set ') as also against Munnilal Mehra, Hiralal Patm and Gambhirmal Pandya and M/s John.
Jain Mehra & Co., (hereinafter referred to as 'the defendants second set ') for recovery of Rs. 21,11,500/ with costs and pendente lite and future interest by sale o.f .the assets of M/s John & Co. and for permanent injunction re straining the defendants first set from committing any branch of the aforesaid agreement dated July 6, 1948 as also for declaration that he had a prior and floating charge on all the business assets of M/s John.& Co.
The suit was later on amended by the plaintiff with the permission of the trial Court.
By his amended petition of plaint, the plain tiff sought a decree against the defendants first set as also against the defendants second set.
The case of the plaintiff was that Mr. Ivan E. John, Mr. Maurice L. John and Doris Marzano who were part owners of the aforesaid three spinning mills and a flour mill as also certain other properties and had been carrying on their business and running the mills under the name and style of John & Co. being heavily indebted and in urgent need of money to pay arrears of income tax as well as other dues and to carry on day to day business of the milks approached him time and again for finances, loans etc.for the aforesaid purposes, that he 'lent considerable sums of money under various agreements executed by the defendants first set in his favour and in favour of the firm 'M/s Tejkaran Sidkaran of which he was the sole owner and in that of Sethiya & Co.; that on or about July 6, 1948 all accounts between his 858 firm 'Sethiya & Co. ' and defendants first set were gone into and after a full scrutiny thereof, a settled amount of Rs. 12,72,000/ was found to be due to Sethla & Co. from the defendants first set upto June 30, 1948; that this amount as admitted and accepted by the defendants first set and was as such debited in their account books and was also acknowl edged by them in the subsequent agreement entered into by them with him; that the aforesaid settlement, the de fendants first set solicited further financial help from him to run the mills and to meet their pressing liabilities which was acceded to by him on the terms and conditions set out in the agreement dated July 6, 1948 (Exh. 168); that by this agreement, he agreed inter alia to advance requisite funds to the defendants first set (for carrying on the business of the mills 'and payment of the claims of Raja Ram Bhawani Das and to meet other liabilities) up to the limit of Rs. 20 lakhs inclusive of the aforesaid amount admittedly found due to him from the defendants first set on the date of the agreement and to make a further advance of a sum of Rs. 5,50,000/ on the security of business assets and stocks other than bales of yarn and cotton; that it was also stipu lated that he would have a floating and prior charge for the entire amount due to him on the date of the agreement on all the business assets including stores, coal, oil process etc of all the three spinning mills of the defendants first set and that he would be paid interest at the rate 6 per cent per annum from date of including liability in respect of each individual item besides commission at the raw of 1 per cent on all sales of products of the three spinning mills whether sold directly or otherwise during the currency of the agreement and a luther commission at the rate of 12 per cent on value of all the purchases of cotton required for consumption of the three spinning mills and godown rent as might be agreed.
The plaintiff further averred that it was specifically agreed between him and the defendants first set that the agreement would be in operation for the minimum period of one year and would also continue to be in force thereafter until the entire amount due to him from the defendants first set was fully paid up.
The plaintiff further averred that the accounts of business done by him under the name of M/s Tejkaran Sidkaran with the defendants first set were gone into and finally the defendants first set admitted that a sum of Rs. 17,79,100/ was due from them to his firm 'M/s Tejkaran Sidkaran ' and that under their written authority, he transferred the above liability to his firm 'Sethiya & Co. ' and thus all accounts of the defendants first set with him were amalgamated in one account i.e. of Sethiya & Co. and the account of his firm 'M/s Tejkaran Sidkaran ' with the defendants first set was squared up and closed.
The plaintiff further averred that the defendants second set including Hiralal Patni, the ex financier of the John Mills who had not despite best efforts succeeded in securing possession of the mills as co proprietor thereof entered into partnership with the defendants first set under the name and style of M/s John Jain Mehra & Co. and mali ciously induced them to commit breaches of the agreement dated July 6, 1948 by forcibly turning out his representa tives who used to remain incharge of the stocks, stores, coal, waste etc of the mills and making them enter into a finance agreement contrary to the terms of the agreement with his firm.
The plaintiff also alleged that the defendants first set had at the instigation of the defendants second set unjustifiably closed the business of John & Co. 859 and were colluding with the latter who were guilty of misap propriation and conversion of the goods over which he had a prior and floating charge.
The plaintiff also averred that on April 4, 1949, accounts were again gone into between him and the defendants first set and a sum of Rs. 47,23,738/4/9 were found due to him from them; that agreement dated July 6, 1948 between him and the defendants first set still subsisted and would continue to subsist till July 6, 1949 and thereafter at his option till all his dues were paid up; and that a sum of Rs. 21,11,500/ was due to him from the defendants first set as per Schedule A of the plaint which both sets of the defendants were liable to pay.
The statement of account as contained in Schedule A annexed to the plaint was as follows: Rs. a. p. "1.
Settled balance on 4th April, 1949 according to accounts books of the def endants.
(The accounts upto 4th April, 1949 were fully gone through and se ttled by both the parties and confirmed by the defendants by making nec essary entries in their books 45,74,980 10 1 2.
Plaintiff 's charges of commission, interest, godown rent etc., according to the terms of the agreement and duly checked by the defendant 's accountant and chief Account officer as detailed below: From 13th October to 31st October, 1948 14,516 13 6 From 1st November to 12th December 33,783 4 3 From 13th December to 12th January 1949 34,100 3 3 From 13th January to 12th February, 1949 38,716 12 3 From 13th February to 12th March, 1949 27,632 9 2 Total 1,48,749 10 8 9th April, 1949 paid to Mahalaxmi Oil Mills through Kirpa Narayan advocate and others .
8,708 5 0 10th April 1949 paid to Bishambar Nath & Co. (for Cotton supplied to John & Co.) 1,57,005 3 0 Charges from 13th March to 12th April, 1949 62,804 12 3 Total 49,52,2489 0 9th April, 1949: Proceeds by sale of 5731 bales of yarn sold by defendants as per their authorities 28,40,748 9 0 Balance 21,11,500 0 0 Twenty one lacs, eleven thousand five hundred only.
5 /338SCI/76 860 The suit was contested by both sets of defendants on various grounds.
Defendants first set inter alia pleaded that there was no 'settlement of accounts between them and the plaintiff as alleged by the latter; that 'the accounts were liable to be reopened as they were tainted with fraud, obvious mistakes etc., and that on a true and correct ac counting a large sum of money would be found due to them; that though the plaintiff and Seth Sugan Chand (who owned Indra Spinning and Weaving Mills and had a covetous eye on John Mills) had obtained various documents, agreements, vouchers, receipts etc.at various times from them, the same were of no legal value as they were secured by the former by practising undue influence, fraud, coercion and misrepresentation.
It was further pleaded by the defendants that :the plaintiff had illegally and contrary to the agreement dated July 6, 1948 debited them with huge amounts which were not really due to them.
It was further pleaded by the said defendants that the cotton supplied to them by the aforesaid financiers was of inferior quality and the amounts charged by them in respect thereof were exorbitant and far in excess of the prevailing market rates.
The said defendants further pleaded that though under the terms of the agreement dated February 9, 1948 no commission on sales and purchases had been agreed to be paid by them to the financiers still they had been debited with huge amounts on that account and likewise though simple interest had been stipulated in the said agreement compound interest with monthly rests had been debited to their account which was not at all justified.
The said defendants also disputed their liability to pay certain items of expenditure like demurrage, wharfage etc.which had been debited to their account.
It was also pleaded by the said defendants that the plaintiff had no floating or prior charge on any of their stocks, stores etc.nor could any such charge be claimed by him in law; that the suit was barred by the provisions of Section 69 of the Part nershlp Act and that the agreement dated July 6, 1948 which was insufficiently stamped could not form the basis of the suit.
In the written statement filed by them the defendants second set denied the allegations and insinuations made against them by the plaintiff and raised a number of techni cal and other pleas.
They also pleaded that the plaintiff alone .was not entitled to file the suit concerning the firm M/s. Sethiya as it did not belong to his joint Hindu family but was a partnership firm.
The trial court framed as many as 21 issues and on a consideration of the evidence adduced by the parties it held inter alia that the suit as brought by the plaintiff was maintainable; that though the plaintiff had failed to prove that the dissolution of the partnership between him and Seth Sugan Chand took place on June 30, 1948, and no alternate date of dissolution subsequent to June, 30, 1948, had been set up by him, it was evident from the record that the dissolution took place some time after July 30, 1948, and before the institution of the suit; that the suit being one for recovery of the assets due to a dissolved partnership firm from a third party was not barred by Section 69 of the Partnership Act; that Seth Sugan Chand was not a necessary party to the suit; that agreement dated July 6, 1948, was duly stamped and that no undue influence etc.was exercised by the 861 plaintiff on the defendants first set in relation to the execution of the agreements between Sethiya & Company and the defendants first set.
The ,trial court also held that there was no accounting on April 4, 1949, as alleged by the plaintiff and that both the plaintiff and the defendants first set committed a breach .of agreement dated July 6, 1948.
The breach committed by the defendants first set according to the trial court lay in their unjustifiably handing over possession to M/s. John Jain Mehra & Co. of the goods on which the plaintiff held a charge thereby furnish ing him with a cause of action against both sets of defend ants.
The trial court also held that under clause 13 of the agreement dated July 6, 1948, a charge in favour of the plaintiff was created in respect of the entire business assets including stock in trade, stores, coal, oil etc.lying inside the three spinning mills which were being run by John & Company; that defendants first set utilised con sumed and otherwise dealt with the goods which were burdened with the floating charge from July 6, 1948, to April 13, 1949, when John & Co. ceased to be a going concern and there was a final rupture between the plaintiff and the defendants I st set and the plaintiff 's floating charge got fixed or crystalised.
It also found that defendants second set were not entitled to prior charge on the properties of John & Co. existing on April 13, 1948, and were liable to satisfy the plaintiff 's claim as despite notice of his floating charge they consumed, converted and misappropriated stocks and stores and other business assets of the defendants first set.
Finally, the trial court held the plaintiff to be entitled to a decree for Rs. 18,00,152/ against both sets of defendants but rejected his claim for specific perform ance and injunction.
It accordingly passed a preliminary decree against both the sets of defendants on April 5, 1954 directing them to deposit the said amount in Court within the prescribed time and in default, gave the plaintiff a right to apply for a final decree for the sale of all the business assets, goods, stocks, stores etc.of the three spinning mills as mentioned in the operative portion of its judgment.
The decree also gave a right to the plaintiff to apply for a personal decree against the defendants first set and the defendants second set for the balance of his claim in case the net sale proceeds of the said property were found insufficient to discharge his claim.
Aggrieved by the said judgment and decree of the trial court, the plain tiff preferred an appeal, 'being first appeal No. 465 of 1954, before the High Court at Allahabad claiming the following reliefs : "(a) A decree for a further sum of Rs. 64,082/3/5 by which amount his claim was reduced by the trial (b) Such rate of interest as he might be entitled to on the aforesaid sum of Rs. 64,082/3/5 under the agreement dated July 6, 1948; (c) Interest on the sum already decreed at the rate agreed to under the agreement dated July 6, 1948; (d) Injunction in terms of para 47(b) of the plaint and specific performance of the agreement dated July 6, 1948; 862 (e) Costs of the appeal and costs which the lower court wrongly disallowed or deducted and also interest on the costs already award ed; (f) A decree for sale of the shares of the defendants in the machinery over which he had a charge.
" M/s John Jain Mehra & Co., of which the defendants first set too were partners, also preferred an appeal against the aforesaid judgment and decree of the trial court, being first appeal No. 65 of1955, praying that the decree passed by the trial court in favour of the plaintiff be set aside and the suit dismissed with costs throughout.
The High Court allowed both the appeals No. 465 of 1954 and No. 65 of 1955 partially by its aforesaid judgment dated December 22,1972, holding inter alia that no fraud, undue influence, coercion or misrepresentation was prac tised by the plaintiff on the defendants first set in con nection with the execution of agreement dated February 9,1948, or agreement dated July 6,1948 (which is the basis of the suit); that the agreement dated July 6,1948, was neither insufficiently stamped nor did it require registra tion; that though it appeared that the deed of dissolution dated July 22, 1948, was prepared for the purpose of the case, there was sufficient evidence on the record to indi cate that Seth Suganchand had withdrawn from the partnership carried on under the name of Sethiya & Co. with effect from June 30, 1948, and had nothing to do with the transaction evidenced by the agreement dated July 6,1948, which was entered into by the plaintiff as the sole proprietor of Sethiya & Co., that the entire rights and liabilities flowing from the agreement dated July 6, 1948 having become the rights and liabilities of the plaintiff alone and the suit not being one for recovery of dues of a dissolved partnership firm arising out of a cause of action which accrued before the dissolution of the firm, neither Seth Suganchand was a necessary party to the suit, nor was the suit barred under section 69 of the Partnership Act; that the alterations in the deed of agreement dated July 6, 1948 pointed out by the defendants were not material alterations and did not render the agreement void; that the plaintiff had a floating charge over the business assets of John & Co., that it was the defendants first .set and not the plaintiff who committed breach of the agreement by wrongful ly delivering possession of the charged goods on or after April 13, 1949 i.e. after ceasing to be a going concern to M/s. John Jain Mehra & Co. a partnership firm of which the defendants first set became a constituent part by virtue of agreement dated April 11, 1949 that despite the knowledge of the aforesaid prior charge, M/s John Jain Mehra & Co. illegally intermeddled with the charge goods and used them for their own business; that the plaintiff 's floating charge on the assets of the defendants first set valuing Rs. 13,25,000/ became crystallised on April 13,1949 when on default of the defendants first set, he intervened by bring ing the suit to recover all his out standings by sale of the charged properties; that the charge of the plaintiff having become crystallised, as indicated above, the defendants first and second set held the properties as trustees and were liable to make them 863 available to the plaintiff for recovery of his dues; that keeping in view the legal position as well as the nature of the transactions involved, the practice of courts and the fact that the litigation between the parties had been suffi ciently protracted, it would be reasonable to award pendente lite as well as future simple interest from the date of the decree to the date of actual payment or realization at the rate of 4 per cent per annum on the principal sum adjudged; that though keeping in view the facts that no balance was struck on April 4, 1949 in the Rokar (Exh. 179) of Sethiya & Co. and the auditor 's report which showed that no specific figure was mutually agreed upon on accounting on that date, it could not be said that accounts were finally settled between the parties on April 4, 1949, the defendants first set had failed to point out which entry in the charts (Exh. 6103 to 6112) produced by the plaintiff was wrong; that Rs. 49,35,925/5/7 were advanced by Sethiya & Co. to the defend ants first set under the agreement dated July 6, 1948, from the date of its execution to the date of the suit; that a sum of Rs. 11,17,000/ was due to old Sethiya & Co. from the defendants first set upto June 30, 1948 under the agreements dated June 14, 1947 and February 9, 1948; that Rs. 1,55,000/were advanced by Sethiya & Co. on July 3, 1948 to the defendants first set for purchase of the share of Beni Madho; that in accordance with the obligation undertaken by it under para 1 (8) of the agreement dated July 6, 1948, Sethiya & Co. paid, on the basis of transfer voucher (Exh. 3039) dated February 28, 1949, drawn by the defendants first set, a sum of Rs. 17,79,100/ to Tejkaran Sidkaran in full satisfaction of the amount due to the latter under the agreement dated February 9, 1948; that whereas the aggregate of the debit items came to Rs. 82,47,380/15/4, the aggre gate of the credit items came to Rs. 71,13, 712/6/6 leaving a balance of Rs. 11,33,668 and paise 55 which the defend ants first set were liable to pay to the plaintiff; that since the receivers appointed by the court at the instance of the plaintiff after the institution of the suit were able to secure possession of the charged properties that existed prior to April .11, 1949 and it had not been estab lished that there was a removal from the mills ' premises of the said properties or dissipation thereof because of the aforesaid conversion and detention, the plaintiff was not entitled to the decree for money against the defendants second set; that the plaintiff could, no doubt, proceed against the charged goods which were in the custody of the receivers for recovery of his dues but as No. property on which he held a charge or on which his floating charge crystallised had remained in the custody of the defendants second set after the appointment of the receivers, no li ability for his dues could be fastened on them nor could he obtain a decree for specific performance against them.
In the result, in modification of the decree passed by the trial Court, the High Court passed a preliminary decree for Rs. 11,33,668.55 with proportionate costs and pendente lite and future interest from the date of the decree to the date of the actual payment or realisation at the rate of 4 per cent per annum on the principal sum of Rs. 10,87,674.05 in favour Of the plaintiff and against the defendants first set but dismissed the suit with costs as against the defendants second set.
The High Court made it obligatory for the defendants 864 first set to pay or deposit in Court the aforesaid sum of Rs. 11,33,668.55 together with interest within six mouths of the passing of the decree failing which it held the plaintiff entitled to apply for a final decree for sale of all the business assets, goods, movables, stocks, stores etc.mentioned in the inventory of Shri P.N. Raina, Commissioner, and the receivers ' inventories.
The High Court further directed that if the net sale proceeds of the said property were found insufficient to satisfy the plaintiff 's aforesaid amount, he would get a personal decree against defendants 1 to 3 for the balance of his claim remaining due after scale.
The High Court also directed that a sum of Rs. 28, 662/9/ . the sale proceeds of cotton waste over which the plaintiff had charge and which was in deposit with the Bank in the Court 's ac count would also be utilised towards the satisfaction of the aforesaid amount decreed in the plaintiff 's favour.
It is against this judgment and preliminary decree that the present appeals are directed.
We have heard counsel for the parties at length and gone through the entire record relevant for the purpose of the appeals before us.
As per contentions of the counsel, the following main questions arise for our determination : (1) Whether the first 'sethiya & Co. ' (of which the plaintiff and Seth Suganchand were partners) was dissolved with effect from June 30, 1948, as claimed by the plaintiff ?
(2) Whether the agreement dated July 6, 1948, was entered into by the plaintiff with the defendants first set as a sole proprietor of Sethiya & Co. or was it entered into by his as a partner of Sethiya & Co. '?
(3) Whether the suit is barred by section 69 of the Partnership Act ?
(4) Whether Seth Suganehand was a necessary party to the suit ?
(5) Whether any material alterations were made in the aforesaid agreement dated July 6, 1948, which rendered it void ?
(6) Whether the suit which was based upon accounts stated or settled could be dealt with in the manner in which it has been done ?
(7) Whether in addition to the imposition of burden on the charged business assets etc.of John & Co. for satisfaction of the decretal amount, the defendants second set could be saddled with any liability in that behalf ?
We shall take up these question seriatim.
Questions Nos. 1 & 2.
: As these two questions are inextricably linked up, they have to be dealt with together.
865 According to the plaintiff, the firm Sethiya & CO., which was formed by him in partnership with Seth Sugan chand for the specific purpose of providing money against pledge of goods to the defendants first set and to act as their sole selling agents and which consequently entered into financial agreements with the said defendants vide exhibits 1321 and 1320 on June 14, 1947, and February 9, 1948, respectively was dissolved with effect from June 30, 1948, and thereafter he alone carried on dealings with the said defendants in the name: of Sethiya & Co. and M/s Tejkaran Sidkaran as their sole proprietor and as such, the agreement (Exh. 168) dated July 6, 1948, was entered into by him with the said defendants as the sole proprietor of Sathiya & Co. On the contrary, the defendants assert that the firm 'Sethiya & Co. ' was in existence on July 6, 1948, and thereafter as well.
Let us examine the material on the record and see which of these contentions is correct.
While the plaintiff relied in support of his contention upon the deed of agreement (Exh. 168) dated July 6, 1948 and the deed of dissolution dated July 22, 1948 produced by him, the defendants strongly relied upon Exhibit A 1 and cer tain other documents.
A close scrutiny of these documents and other evidence adduced in the case clearly negatives the contention of the plaintiff and goes a long way to support the assertion of the defendants.
It would be noted that in the preamble of Exh.A 1 which is admittedly a counter part of Exh. 168, the word 'partner ' occurs after the word 'Sethiya ' and before the word 'of ' and in conso nance with its preamble, Exh.A 1 has been signed by the plaintiff, Seth Loonkaran Sethiya, as a partner of M/s Sethiya & Co. Now though the word 'partner ' occurring in the preamble of Exh.has been scored out, it has not been initialled either by the plaintiff or by any one of the partners of John & Co. It is also significant that while affixing his signatures on Exh. 168 and its counterpart Exh.A 1 the plaintiff described himself as a partner of M/s Sethiya & Co, The contention of the plaintiff that his partnership with Seth Suganchand came to an end with effect from June 30, 1948, and the agreement dated July 6, 1948 was entered into by him with the defendants first set as the sole proprietor of Sethiya & Co. is further falsified by the dissolution deed dated July 22, 1948, itself produced by him before the trial Court on December 13, 1949 which would have passed muster if the defendants had not been vigilant.
It seems that on seeing this deed written partly on an impressed stamp paper of Rs. 10/ which was not in use in July, 1948, the suspicion of the defendants about the spurious character of the deed was aroused and they hastened to make an application requesting the trial court that in view of the fact that the deed appeared to have been 'anti dated and manufactured for the purpose of the case ', the stamp papers on which it was written be sent to the officer in charge, India Security Press, Nasik, for examina tion and report as to when the said stamp papers were issued for sale from the press.
The reaction of the plaintiff to this application and his subsequent conduct in relation to the investigation sought to be made to get at the truth regarding the date of issue of the aforesaid impressed stamp Paper and consequently regarding the alleged dissolution of the firm 'Sethiya & Co. ' is revealing.
It is amazing that the 866 simple request made by the defendants which should have been readily agreed to by the plaintiff if he had been innocent was stoutly opposed by him.
The circumstances in which the so called deed of dissolution of partnership dated July 22, 1948, and the report dated February 27, 1950, of the Assistant Master, India Security Press, Nasik disclosing that 'the first high value (Rs. 10/ ) impressed stamp in the type of water marked paper as used in the document dated July 22, 1948,was printed in his Press on November 23, 1948, and as such couldnot have been, existence on July 22, 1948 the alleged date of execution of the document disap peared is very intriguing It is also remarkable that when during the cross examination of the plaintiff on March 29, 1950, in connection with the issue relating to the bar of section 69 of the Partnership Act the defendants wanted to make use of the aforesaid report from the India Security Press, Nasik, and it came to light that the report and the original deed of dissolution set up by the plaintiff were missing, the plaintiff came forward with an amusing applica tion stating therein that "in the interest of the early disposal of the case, he undertakes not to rely on that document in the suit and to argue the case without that.
The manner in which the plaintiff behaved when the defend ants attempted to have the duplicate copy of the aforesaid report of the Assistant Master,India Security Press obtained by the Court proved is no less interesting.
A reference to the minutes of proceedings of the trial Court shows that after the Court had, at the request of the de fendants and with the consent of the plaintiff 's counsel, passed the order on May 21, 1950, for issuing a commission to Nasik for examination of the said officer of the Press in respect of the aforesaid report about the impressed stamp paper, the plaintiff made an application for stay of that order and on Jully 4, 1950, his counsel, Shri Walter Dutt, made the following statement : ,lm15 "The court may for the purpose of deciding the issue under section 69, Partnership Act take into consideration the fact that the "document purporting to be a dissolution deed executed between the partners of Sethiya & Co. is not genuine although this fact is not admitted by the plaintiff and the court may therefore, discard such portions of the oral evidence of both plaintiff and Seth Suganchand as it considers would be rendered unreliable if the view be taken that the document in question was a fabricated one and the court may presume that the document was not executed on the date on which it purports to be executed.
" On a consideration therefore of the totality of the tell tale facts and circumstances especially the aforesaid description of the plaintiff as partner of Sethiya & Co. in the preamble and at the food of Exh.A 1 and Exh. 168, the clumsy attempt made to obliterate the aforesaid description in the preamble of Exh. 168.the execution of a part of the so called deed of dissolution of partnership dated July 22, 1948 on the aforesaid non judicial impressed stamp Paper of the denomination of Rs. 10/ which was not in existence on July 22, 1948, the 867 resistence offered by the plaintiff to the defendants ' application requesting the Court to call for a report from the India Security Press, Nasik, about the data of issue of the said stamp Paper, the aforesaid report No. 780/26 dated February 27, 1950 of the India Security Press, Nasik, that Rs. 10/ non judicial impressed stamp paper which had been used for part execution of the aforesaid deed of dissolution had not been printed before November 23, 1948, the disappearance of the said deed of dissolution of partnership of Sethiya & Co. set up by the plaintiff and the report of the Assistant Master of the India Security Press, Nasik, the defendants ' endeavour to ' have the dupli cate copy of the aforesaid report of the India Security Press, Nasik about the impressed stamp paper of the denomi nation of Rs. 10/obtained by the Court proved and the plain tiff 's frentic efforts to thwart the attempt firstly by making an application stating therein that he would not rely on the aforesaid deed of dissolution dated July 22, 1948, secondly, by making an application for stay of the order passed by the trial Court regarding issue of a commission to Nasik for formally proving the report of the India Security Press and thirdly, by asking his counsel, Shri Waiter Dutt to make the above quoted statement strongly incline us to think in agreement with the subdued findings of the trial Court that the aforesaid deed of dissolution was fabricated by the plaintiff with the dishonest intention of playing a fraud on the Court and gaining an undue advantage over the defendants.
In addition to the facts and circumstances set out above, the debit of items of Rs. 1,55,000/ and Rs. 1, 68, 552/12/6 to the account of the partnership firm 'Sethiya & Co. ' on July 3, 1948, and July 10, 1949, respectively and issue by the plaintiff of cheques No. BL 003628 dated July 16, 1948 (Exh.B 11)for Rs. 1,55,000/ , No. BL 003634 dated July 16, 1948 (Exh. B 12) for Rs. 25,000/, No. BL 004636 dated July 20, 1948 (Exh. B 13) for Rs. 73,000/, No. BL 003630 dated July 9, 1948 (Exh. B 14) for Rs. 10,000/ , No. BL 003635 dated July 17, 1948 (Exh. B 15) for Rs. 16,500/ , No. 'BL 003632 dated July 10, 1948 (Exh. B 16) for Rs. 1,30,000/ , and No. BL 003633 dated July 10, 1948 (Exh. B 17) for Rs. 1,68,552.14/6 as partner of Sethiya & Co. also go to demolish the theory of dissolution of the firm ' 'S ethiya & Co. ' on June 30, 1948 which the plaintiff sought to build up on sandy foundations and furnish as eloquent proof of the fact that the firm was very much in existence when the agreement (Exh. 168) dated July 6, 1948, came into being.
It has also to be borne in mind that service by post or advertisement in some paper of notice about the retire ment of a partner from a partnership firm on persons who are in know of the existence of the firm and have been carrying on dealings with it is of utmost importance to prevent them from assuming that the partnership continues.
In the in stant case, it is manifest from the evidence educed by the plaintiff himself that neither he nor Seth Suganchand gave notice in writing to the defendants first set that the latter had retired from Sethiya & Co. with effect from June 30, 1948.
The evidence also makes it clear that the con cerned persons and the general public were 868 not informed about the retirement of seth Suganchand from the partnership firm 'Sethiya & Co. ' by publication of a notice in some paper.
The absence of these notices further belie the plea of the plaintiff regarding dissolution of the partnership firm 'Sethiya & Co. ' on June 30, 1948.
That the plaintiff 's story regarding dissolution of the firm 'Sethiya & Co. ' is a complete myth also receives strong support from the fact that although approximately Rs.1,1 0,000/ are admitted by Seth Suganchand to be due to him from the partnership not a farthing appears to have been paid to him nor any document acknowledging the liability appears to have been passed on to him.
The letter (Exh. 21) addressed to the Manger, Bank of Bikaner Ltd., Agra, intimating to him that Seth Suganchand had withdrawn from the partnership of Sethiya & Co. on which strong reliance is placed on behalf of the plaintiff is not helpful to him as it was not sent to the Bank before July 20, 1948.
The alleged dissolution of the partnership between Seth Suganchand and the plaintiff not having been established, it can be safely presumed in view of the above circumstances that the partnership between them continued to subsist at least upto July 20, 1948.
We are accordingly of the opin ion that the firm 'Sethiya & Co. ' was not dissolved with effect from June 30, 1948, as claimed by the plaintiff, and that the agreement dated July 6, 1948, was entered into by the plaintiff with the defendants first set not as the sole surviving proprietor of Sethiya & Co. but as a partner of the firm 'Sethiya & Co. ' Question No. 3: For a proper determination of this question, it is necessary to refer to section 69 of the Partnership Act, 1932, the relevant portion whereof is reproduced below for ready reference : "69."(1) No suit to enforce a right arising from a contract or conferred by this Act shall be instituted in any Court by or on behalf of any person suing as a partner in a firm against the firm or any person alleged to be or to have been a partner in the firm unless the firm is registered and the person suing is or has been shown in the Register of Firms as a partner in the firm.
(2) No suit to enforce a right arising from a contract shall be instituted in any Court by or on behalf of a firm against any third party unless the firm is registered and the persons suing are or have been shown in the Register of of Firms as partners in the firm.
(3) The provisions of sub sectiOns (1) and (2) shall apply also to a claim of set off or other proceeding to enforce a right arising from a contract, but shall not effect (a) the enforcement of any fight to sue for dissolution of a firm or for accounts of a dissolved firm, or any right or power to realise the property of a dissolved firm, or . " 869 A bare glance at the section is enough to show that it mandatory in character and its effect is to render a suit by a plaintiff in respect of a right vested in him or acquired by him under a contract which he entered into as a partner of an unregistered firm whether existing or dissolved, void.
In other words, a partner of a erstwhile unregistered part nership firm cannot bring a suit to enforce a right arising out of a contract falling within the ambit of section 69 of the Partnership Act.
In the instant case, Seth Suganchand had to admit in unmistakable terms that the firm 'Sethiya & Co. ' was not registered under the Indian Partnership Act.
It cannot also be denied that the suit out of which the appeals have arisen was for enforcement of the agreement entered into by the plaintiff as partner of Sethiya & Co. which was an unregistered firm.
That being so, the suit is undoubtedly a suit for the benefit and interest of the firm and consequently a suit on behalf of the firm.
It is also to be borne in mind that it was never pleaded by the plain tiff, not even in the replication, that he was suing to recover the outstandings of a dissolved firm.
Thus the suit was clearly hit by section 69 of the Partnership Act and was not maintainable.
Question No. 4: It would be noticed that the present suit has been brought by the plaintiff alone and in spite of the objection raised on behalf of the defendants, he did not care to implead Seth Suganchand who was a necessary party to the suit.
Assuming without holding therefore, that section 69 of the Partnership Act did not apply to the present case, the plaintiff could not in any event maintain the suit for recovery of the aforesaid amount (which was made up of items, some of which were admittedly due to the old Sethiya & Co.) without impleading Seth Suganchand.
Question No. 5 : Before proceeding to determine this question it would be well to advert to the legal position bearing on the matter As aptly stated in paragraph 1378 of Volume 12 of Halsbury 's Law: of England (Fourth ' Edition) "if an alteration (by erasure, interli neation, or other wise) is made in a material part of a deed, after it execu tion, by or with the consent of any party to or person entitle, under it, but without the consent of the party or parties liable under it, but without the consent of the party or parties liable under it, the deed is rendered void from the time of the alteration so as to prefer the person who ' has made or authorised the alteration, and those claim ing under him, from putting the deed in suit to enforce against an party bound by it, who did not consent to the alteration, any obligation, covenant, or promise thereby undertaken or made.
A material alteration, according to this authoritative work, is on which varies the rights, liabilities, or legal position of the parties a ascertained by the deed in its original state, or otherwise varies the legal effect of the instrument as originally expressed, or reduces to certainty some provision which was originally unascertained and a such void, or which may otherwise prejudice the party bound by the deed as originally executed.
870 The effect of making such an alteration without the consent of the party bound is exactly the same as that of cancelling the deed.
" To the same effect are the observations made by the Privy Council on Nahtu Lal & Ors.vs Musarnat Gomti and Ors.(1).
Now a comparison of Exh.A I (produced by the defendants first et) with Exh. 168 (produced by the plaintiff)would show that besides the obliteration of the word 'partner ' from the preamble as stated above, the plaintiff made two other alterations in Exh.
Originally, the second proviso to sub clause (8) of clause 1 of the agreement stood as given in Exh.A 1 ran thus: "The payment for purchase of cotton will be made on the first (underlining is ours) day of its receipt in the mills of the partners.
" In Exh 168, however, the word 'first ' has been changed into 'tenth ' thus making it read as "the payment for pur chase of cotton will be made on the tenth (underlining is ours) day of its receipt in the mills of the partners.
" The third alteration is no less important.
As would be evident from Exh.A 1, sub clause (3) of clause 12 of the agreement as actually drawn up between the parties read as follows : "A commission of Rupee one percent on value of all sales of products of the above three spinning mills, viz. yarn, and newar, whether sold directly by the partners or otherwise but delivered and produced during the currency of this agreement." After the alteration, the clause has been made to read as follows on Exh.168 : "A commission of Rupee one percent on value of all sales of products of the above three spinning mills, viz. yarn, and newar, whether sold directly by the partners or otherwise but delivered or produced during the currency of this agreement.
" As a result of the last change, the word 'and ' has been substituted by the word 'or '.
As the above mentioned alterations sub stantially vary the rights and liabilities as also the legal position of the parties, they cannot be held to be anything but material alterations and since they have been made without the consent of the defendants first set, they have the effect of cancelling the deed.
Question No. 5 is, therefore, answered in the affirmative.
(1) A.I.R. 1940 P.C. 160.
871 Question No. 6 The plaintiff 's suit, as already indi cated, was for a specific and ascertained sum of money on the basis of settled account.
The courts below have con currently found that there was no settlement of account on April 4, 1949, as alleged by the plaintiff.
After this finding, it was not open to them to make out a new case for the plaintiff which he never pleaded and go into the ac counts and pass a decree for the amount which they consid ered was due from the defendants first set to the plaintiff.
They should have, in the: circumstances, either dismissed the suit or passed a preliminary decree fox accounts di recting that the books of account be examined item by item and an opportunity allowed to the defendants first set to impeach and falsify either wholly or in part the accounts on the ground of fraud; mistakes, inaccuracies or omissions for it is well settled that in case of fraud or mistake, the whole account is affected and in surcharging and satisfying the accounts, errors of law as well as errors of fact can be set right.
By adopting the latter course indicated by us, the defendants first set would have got a fair and adequate opportunity of scrutinizing the accounts and showing whether they were tained with fraud, mistake, inaccuracy or omission or of showing that any item claimed by the plaintiff was in fact not due to him.
Question No. 7 : The High Court has for cogent reasons held that the goods on which the burden of charge lay being available for the satisfaction of the liabilities, if any, under the agreement dated July 6, 1948, the defendants second set could not be held personally liable for payment of the decretal amount.
The opinion expressed by the High Court is correct and we see no warrant or justification to interfere with the same.
In view of the foregoing, we have no hesitation in holding that as material alterations have been made by the plaintiff in the agreement dated July 6, 1948 (which is the basis of the suit) rendering it void and as the bar of section 69 of the Partnership Act clearly applies to the case, the suit is clearly untenable and has to be dismissed.
the result, Appeal No. 572 of 1974 is allowed and the suit out of which it arose is dismissed.
Consequently, Appeal No. 416 of 1973 fails and is dismissed.
In the circumstances of the case, parties are left to Pay and bear their own costs of these appeals.
C.A. 572/74 allowed.
P.H.P. C.A. 416/73 dismissed.
| Messrs.John & Co. were in financial difficulties and, therefore, entered into a financial agreement with Sethia & Co. a partnership firm of the plaintiff and Seth Sugan Chand.
On 6th July, 1948 Messrs. John & Co. obtained anoth er financial accommodation from Sethia & Co. Messrs. Tejka ran Sidhkaran had also given some advances to Messrs. John & Co. The liability to the firm of Messrs. Tejkaran Sidhkaran was transferred to Sethia & Co. Seth Loonkaran Serbia filed a suit against John & Co. and his partners (defendants first set) as well as Messrs. John, Jain, Mehra & Co. and its partners.
(defendants second set) for recovery of Rs. 21,11,500/ with costs and future interest and for a declaration that the plaintiff had a prior and floating charge on all the business assets of Messrs. John & Co. It was alleged by the plaintiff that the defendants (second set) entered into partnership with the defendants (first set ) under the name and style of Messrs. John Jain, Mehra & Co and maliciously induced them to commit breach of the agreement dated 6 7 1948 by forcibly turning out his representatives who used to remain in charge of the stocks, stores.
coal, waste, etc., of the mills and making them enter into a financial agreement contrary to the terms of the agreement with his firm.
The plaintiff also alleged that accounts were again settled on 4 4 1949 and a sum of Rs. 47,23,738/ was found due to him from the defend ants.
The defendants (first set) contended that there was no settlement of accounts; that the accounts were tainted with fraud and obvious mistakes and that on a true and correct accounting a large sum of money would be found due to them; that the plaintiff and said Sugan Chand obtained various documents, agreements, vouchers, receipts etc., and that the same were of no legal value as they were secured by the former by practising undue influence, fraud, coercion and misrepresentation; that the plaintiff had illegally and contrary to the agreement dated 6 7 1948 debited them with huge amounts which were not really due to them; that the cotton supplied by the plaintiff was of inferior quality and that the rates charged were exorbitant.
It was also denied that the plaintiff had floating or prior charge on any of their stocks, stores, etc; that the suit was barred by the provisions Of section 69 of the Partnership Act and that the agreement dated 6 71948 which was insufficiently stamped could not form the basis of the suit.
The defendants.
(second set) also denied the claim of the plaintiff.
The Trial Court held that the suit was maintainable; that the firm of Messrs. Sethia & Co. was dissolved before the institution of the suit; that the suit being one for the recovery of the assets due to a. dissolved partnership firm from a third party, was not barred by section 69 of the Partnership Act: that Seth Sugan Chand was not a necessary party to the suit; that the agreement dated 6 7 1948 was duly stamped and that no undue influence etc., was exercised by the plaintiff on the defendants; that there was no ac counting on 4 4 1949 as alleged by the plaintiff and that both the plaintiff and the defendants (first set) committed a breach of the agreement dated 6 7 1948.
The Trial Court also held that a charge was created in favour of the plain tiff in respect of the entire business assets and that the defendants (second set) were liable to satisfy the plain tiff 's claim.
The Trial Court decreed the plaintiff 's suit to the extent of Rs. 18,00,152 but rejected his claim for specific performance and injunction.
The Trial Court accord ingly passed a preliminary decree against both the sets of defendants directing them to deposit 854 the said amount in the court within the prescribed time and in default gave the plaintiff a right to apply for a final decree for the sale of all the business assets, goods, stocks, stores, etc.
The decree also gave a right to the plaintiff to apply for a personal decree against the defend ants for the balance of his claim in case the net sale proceeds of the property of the firm were found insufficient to discharge his claim.
The plaintiff filed an appeal in the High Court of Allahabad and the defendants also filed an appeal against the judgment of the Trial Court.
The High Court allowed both the appeals partially holding that no fraud, undue influence, coercion or misrepresentation was practised by the plaintiff; that the agreement dated 6 7 1948 was neither insufficiently stamped nor did it require registration; that the deed of dissolution dated 22 7 1948 was prepared for the purpose of the case but there was sufficient evidence on the record to indicate that said Sugan Chand had withdrawn from the partnership carried on in the name of Serbia & Co. with effect from 30 6 1948; that Seth Sugan Chand was not a necessary party to the suit; that the suit was not barred.
by section 69 of the Partnership Act; that the alterations in the deed dated 6 7 1948 were not material alterations and did not render the agreement void; that the plaintiff had a floating charge over the business assets of John & Co.; that it was defendants (first set) and not the plaintiff who committed breach of the ' agreement.
The High Court, there fore, passed a preliminary decree for Rs. 11,33,668/ in favour of the plaintiff and against the defendants (first set) but dismissed the suit with costs as against the de fendants (second set).
The High Court granted certificate under Article 133 in both the appeals.
Dismissing the plaintiff 's appeal and allowing the appeal of the defendants (first set) held: (1) Section 69 of the Partnership Act is mandatory in character and its effect is to render a suit by a plaintiff in respect of a right vested in him or acquired by him under a contract which he entered into as a partner of an unregistered firm, whether existing or dissolved, void.
[869 A] (2) A partner of an erstwhile unregistered partnership firm cannot bring a suit to enforce a right arising out of a contract failing within the ambit of section 69 of the Partnership Act.
The suit out of which the appeals arise was for enforcement of the agreement entered into by the plaintiff as partner of Serbia & Co. It was never pleaded by the plaintiff not even in his replication that he was suing to recover the outstanding of a dissolved firm.
Thus the suit was clearly hit by section 69 ' and was not main tainable.
[869 B C] (3) A close scrutiny of the document and other evidence clearly negatives the plaintiff 's claim that the firm was dissolved with effect from 30th June 1948.
[865 C] (a) The agreement dated 6th July 1948 itself is signed by the plaintiff as a partner and the, expression partner also appears in the body of the agreement.
[865 D] (b) The alleged deed of dissolution dated 22nd July 1948 between the plaintiff and Seth Sugan Chand was prepared on a stamp paper printed in the Government Press in November, 1948.
The said Dissolution Deed was, therefore, clearly fabricated by the plaintiff.
The plaintiff signed various cheques in July, 1948 as the partner of Sethia & Co. [865 F H; 866 A C; 867 F] (c) No service by post or advertisement in the newspaper about the dissolution was given either by the plaintiff or by Seth Sugan Chand.
[867 F] (4) Seth Sugan Chand was a necessary party to the suit and in spite of the objections raised on behalf of the defendants the plaintiff did not care to implead ' Seth Sugan Chand.
The suit was bound to fail on that ground also.
[869 D E] (5) A material alteration in a document without the consent of a party to, it has the effect of cancelling the deed.
[870 A] Volume 12 of Halsburys Laws of England (Fourth Edition) referred to.
855 Nathu Lal & Ors.
vs Musammat Gomti & Ors.
(A.I.R. relied on.
In the present case there were many material alterations of the document.
The material alterations, therefore have the effect of cancelling the deed in question.
[870 B D] (6) The plaintiff 's suit was for a specific and ascer tained sum of money on the basis of settled account.
The Courts below found concurrently that there was no settlement of account as alleged by the plaintiff on 4th April 1949.
After that it was not open to the courts below to make out a new case for the plaintiff which he never pleaded.
The courts be.low could have either dismissed the suit or passed a preliminary decree for accounts directing that the books of account be examined item by item and an opportunity allowed to defendants to impeach and falsify the accounts.
[871 A C]
|
ition (Criminal) No. 1 45 1 of 1985.
(Under Article 32 of the Constitution of India. ) R.K. Jain and Yogeshwar Prasad, R.K. Khanna, R.K. Bha tt and Dalveer Bhandari for the Petitioner.
V.C. Mahajan, Tapas Ray, A.S. Nambiar, S.B. Bhasm e, Kapil Sibal, R.B. Misra, A. Subhashini, Y.P. Rao, Ms. section Janani, Ms. Urmila Kapur, D.K. Sinha, J.R. Dass, P.K. Man o har, Ms. section Vasudevan, M. Veerappa, Uma Nath, R.K. Mehta, V. Krishnamurthy, A.S. Bhasme, K.R. Nambiar, B.D Sharma, Ka i lash Vasudev, D.N. 62 Mukherjee, D. Goburdhan, Ms. Kamini Jaiswal, T.V.S.N. Char i, Mahabir Singh, Probir Chowdhry, M.N. Shroff, A. Subba Ra o, R.S. Suri, G. Probhakar, K. Ram.
Kumar, S.K. Bhattachary a, L.R. Singh, A.K. Sanghi, C.V. Subba Rao, R. Venkataraman i, Salman Khurshid, Gopal Singh, Mrs. Vimla Sinha and Mrs. H. Wahi for the Respondents.
The following Order of the Court was delivered: ORDER This writ petition filed in 1985 has been heard on different occasions and several orders and directions ha ve been made from time to time with a view to providing reli ef to delinquent children detained in jails.
On August 2 9, 1988, this Court made an order wherein so me such directions have been excerpted and it is not necessa ry to make any detailed reference to those directions now.
In 1986 the District Judges of the entire country in response to the directions made by this Court supplie d, inter alia, the particulars of under trial and convict ed children found in regular jails within their respecti ve jurisdiction.
On the basis of the said reports it was fou nd that in Assam, Bihar, Orissa, Punjab and West Bengal, t he number of such children in regular jails was 64, 247, 60, 63 and 437 respectively.
There was no such child in any regul ar jail of Gujarat but in varying numbers not exceeding 30 to 35 they were found in other States.
Thereafter some of t he States have filed affidavits indicating release from custo dy or transfer of such children from jails and have stated th at the position at present is very different and the number is either nil or negligible.
With the lapse of two years ' time since such reporti ng was done there is every likelihood of a change in th at position.
Even otherwise, in the intervening period t he Juvenile Justice Act, 53 of 1986, (hereinafter referred to as the 'Act ') has come into force in the whole of the cou n try excepting the State of Jammu & Kashmir with effect fr om 2.10.1987.
The Act provides for setting up of juveni le homes, special homes and observation homes by the Sta te Governments.
Chapter IV provides for dealing with delinque nt juveniles.
In this back drop it is necessary to get fre sh detailed reports from the District Judges and update t he figures as to the exact number of delinquent juveniles, as defined in section 2(a) of the Act, still detained in regul ar jails.
At the same time it is necessary that a report as to whether juvenile 63 Courts as required under section 5 of the Act have been set up and juvenile homes, special homes and observation homes ha ve been established as required by sections 9, 10, and 11 should be obtained.
Every District Judge is, therefore, directed by this order to report within 4 weeks from today to the Regi s try of this Court through the Registrar of the appropria te High Court as to the exact position obtaining on 28.2.
19 89 in regard to the particulars indicated above.
We would li ke to place on record that on the earlier occasion response to directions by this Court had taken more than six month s; repetitive adjournments had become necessary and complian ce was effected by indicating coercive steps.
We hope and tru st there would be no repetition.
Section 62 of the Act empowers the State Governments to make rules to carry out the purposes of the Act.
The sche me of the Act is such that it cannot be properly enforc ed unless apropriate rules are framed and brought into forc e. Counsel appearing before us for the different States are n ot in a position to make a definite statement that the Stat es they represent have framed rules and brought them in to force.
We, therefore, direct that the District Judges whi le making their reports shall also indicate whether rules ha ve been framed and whether such rules are already in forc e. Counsel appearing before us are also directed to inform t he Registry by written memorandum about the framing of rul es and bringing them into force in the respective States.
If such rules have not been framed in any State, by this ord er we direct such State or States to frame the same on or before 7th of April, 1989 and to bring them into for ce without any further delay thereafter.
Section 2(h) defines 'juvenile ' to mean: "a boy who has not attained the age of sixteen years or a girl who has not attained the age of eighteen years.
" Official reports indicate that 35 to 40 per cent of t he total population of the country would be covered by t he definition.
As such about 30 crores of young boys and gir ls come within the purview of the Act.
There can be no t wo opinions that these children of today are the citizens of tomorrow 's India and the country 's future would necessari ly depend upon their proper hygiene physical and mental.
T he problem is, therefore, gigantic; at the same time, there is demand for immediate attention.
Several counsel appeari ng before us have told us and we agree with their submissio ns that unless the importance of the matter is properly pe r ceived and the response is adequate both in 64 regard to sufficiency of actions and immediacy of attentio n, the purpose of the Act cannot be fulfilled.
Children requi re the protective umbrella of society for better growth a nd development as they are not in a position to claim the ir entitlement to attention, growing up, food, education a nd the like.
It is the responsibility of the society and is o ne of the paramount obligations of those who are in charge of governance of the country today to attend to the children to make them appropriate citizens of tomorrow.
We are of the view that in the setting indicated t he matter perhaps requires overseeing by the Court.
For coord i nation between the Union Government and the State Governme nt and between authorities within the State, at the initi al stage and it would be in the interest of children that t he matter is obverseen by this Court and when the machinery is properly geared the responsibility of overseeing may be entrusted to the respective High Courts.
With a view to working out the modality and to ma ke overseeing convenient, it is necessary that a scheme shou ld be evolved.
Counsel appearing before us have suggested th at a group of advocates should be entrusted with the work of making a draft scheme and place it before the Court for i ts consideration.
We accordingly nominate Messrs V.C. Mahaja n, Yogeshwar Prasad, R.K. Jain, Tapas Roy and Mukul Mudgal w ho are advocates appearing for some of the States to draw up a scheme and file it in the Registry of the Court by 7 th April, 1989.
As we pointed out earlier from the reports it has be en found that the number of children in regular jails were t he highest in West Bengal and Bihar.
Mr. Tapas Roy representi ng the State of West Bengal relies upon an affidavit fil ed before this Court to contend that the position has substa n tially changed subsequent to the reports and at prese nt perhaps the number of children in regular jails is eith er nil or very small.
He has personally undertaken to colle ct the particulars and furnish the same by way of the memora n dum to the Registry on or before 7th of April, 1989.
So f ar as the State of Bihar is concerned, Mr. Goburdhan is not in a position to make any statement.
From the analysis prepar ed based upon the report of the District Judges, it appea rs that there were 27 children in the District Jail of Deogar h, about 13 in the jails at Patna and 17 in the jails at Bh a galpur.
We are of the view that Mr. A.S. Nambiar, Sr.
Adv o cate of this Court should be appointed as Commissioner to visit these jails in the three districts of Bihar and co l lect the necessary particulars of juvenile delinquents 65 housed in those jails and report to this Court on or befo re 7th of April, 1989.
He shall be provided all facilities by the State Government and its officers as may be deem ed reasonable and necessary for implementing this direction.
He shall also be entitled to reimbursement of his expenses.
It becomes necessary that the Registry should ha ve appropriate funds to meet the expenses from time to tim e. We, therefore, direct that the Union of India shall depos it a sum of Rs.50,000 while each of the States of Bihar a nd West Bengal and Uttar Pradesh is directed to deposit a s um of Rs. 15,000.
Such deposits shall be made on or before 15 th of April, 1989.
The expenses have of course to be met by a ll the States but in due course an order directing other Stat es to pay to the fund and final apportionment, if necessar y, shall be ordered.
Notice be issued to the learned Attorney General to appear and assist the Court in this proceeding.
The directions indicated above must be worked out with in the time frame as we are fixing the case for further heari ng at 2.00 P.M. on 24th of April, 1989.
| The second respondent, who is the predecessor in inter est of the first respondent, had on.
26th September, 1946 leased out the land in dispute to the appellant at the first instance for a period Of 10 years.
The lease however provid ed to the lessee/appellants option of extension at enhanced rent, twice for successive periods of 5 years, and a third option of extension for a further maximum period of one year.
The appellants are stated to have exercised their option of extension for two successive periods of five years, hot failed to exercise the option of extension for one year thereafter.
On that ground the first respondent instituted a suit for ejectment khas, possession and mesne profits.
The appellants, as defendants, contested the malt stating, inter alia, that they did not exercise the option for renewal after the expiry of the original tern of 10 years as they became thika tenants from 28th February, 1949 i.e. the date of commencement of the Calcutta Thika Tenancy Act, 1949 as admitted by the second respondent in two judi cial proceedings before the Controller under the Calcutta Thika Tenancy Act, 1949.
It was further stated that they never paid any enhanced rent; and that the first respond ent 's claim for the differential rent was rejected in the first respondent 's suit, and ultimately the special leave petition filed in the Supreme Court in that matter was also dismissed.
402 The suit for ejectment in the present suit was decreed by the Trial Court.
The Appellate Court, while dismissing the appellants appeal, held that (1) the lease was for a period of 20 years and not for a period of less than 12 years, and hence sub section 5(b) of Section 2 of the Act had no application; and (2) the respondent were not barred by waiver, estoppel, res judicata or principles analogous thereto because of the earlier judicial proceedings filed by the second respondent as there could be no question of giving a status under the Act when in the facts of the case such a status was not available.
The High Court dismissed the appellants ' second appeal.
Before this Court it was urged on behalf of the appel lants that (1) there could be no controversy about the appellants ' status of thika tenants in view of the fact that the lease was at the first instance for 10 years only and its first and subsequent extensions were contingent on the appellants regular payment of rents, rates and taxes and enhancement of rent, which contingency did not happen as they did not pay any enhanced rent, but simply were holding over; (2) the second respondent admitted the Thika Tenants status of the appellants in the earlier proceedings before the Controller and were therefore estopped from questioning that status.
On the other hand, it was urged on behalf of the re spondent that the lease having clearly been for a period of 20 years, the appellants have rightly been held not to be thika tenants under the Act; and that there could be no estoppel against a statute.
Dismissing the appeal, it was, HELD: (1) Every contract is to be construed with refer ence to its object and the whole of its terms.
The best interpretation is made from the context.
The whole context must be considered to ascertain the intention of the par ties.
It is an accepted principle of construction that the sense and meaning of the parties in any particular part of instrument may be collected 'ex antecedentibus et consequen tibus '; every part of it my be brought into action in order to collect from the whole one uniform and consistent sense, if that is possible.
[409E G] N.E. Railway vs Hastings, (267), referred to.
(2) In the construction of a written instrument, it is legitimate and in order to ascertain the true meaning of the words used and, if that be doubtful, it is legitimate to have regard to the circumstances sur 403 rounding their creation and the subject matter to which it was designed and intended they should apply, [410A B] (3) It is pertinent to note that the word used is 'exte nsion ' and not 'renewal '.
To extend means to enlarge, ex pand, lengthen, prolong, to carry out further than its original limit.
Extension ordinarily implies the continued existence of something to be extended.
The distinction between 'extension ' and 'renewal ' is chiefly that in the case of renewal, a new lease is required, while in the case of extension the same lease continues in force during addi tional period by the performance of the stipulated act.
In other words, the word 'extension ' when used in its proper and usual sense in connection with a lease means a prolonga tion of the lease.
[411C E] (4) Construction of this stipulation in the lease in the above manner will also be consistent when the lease is taken as a whole.
The purposes of the lease were not expected to last for only 10 years as the Schedule specifically men tioned the lease as "for a stipulated period of twenty years." [411E] Kanai Lal vs Paramnidhi, ; ; Mahadeolal Kanodia vs Administrator General of West Bengal, ; ; Annapuma vs Tincowrie Dutt, ; ; Shaf fiuddin & Ors.
vs G.C. Banarjee, and Sheikh Gufan vs S.K. Ganguli, ; distinguished.
(5) No particular order from the previous judicial proceedings conferring the status of thika tenants on the appellants has been shown.
The special leave petition was dismissed by the Supreme Court "without going into the question whether the Thika Tenancy Act was applicable or not.
" Hence, no status could be said to have been deter mined.
[413D F] (6) The essential element of waiver is that there must be a voluntary and intentional relinquishment of a known right or such conduct as warrants the inference of the relinquishment of such right.
It means forsaking the asser tion of a right at the proper opportunity.
[413F G] (7) Waiver is distinct from estoppel in that in waiver the essential element is actual intent to abandon or surren der the right, while in estoppel such intent is immaterial.
The necessary condition is the detriment of the other party by the conduct of the one estopped.
An estoppel may result though the party estopped did not intend to lose any exist 404 ing right.
Thus voluntary choice is the essence of waiver for which there must have existed an opportunity for a choice between the relinquishment and the conferment of a right in question.
Nothing of the kind could be proved in this case to estopp the first respondent, who had filed the suit at the proper opportunity after the land was trans ferred to him.
[413G H; 414A B] Shanti Devi vs
A.K. Banerjee, , referred to.
|
ivil appeal Nos.
552 554 of 1991.
From the Judgment and Order dated 9.10.1989 of the Central Administrative Tribunal, New Bombay in Transfer Applications No. 430, 431 and 433 of 1987.
B.K. Mehta, C.P. Pandey, M. Chopra and V.S. Sharma for the Appellants.
K. Lahiri, Ms. Kitti Kumaramangalam and Ms. Sushma Suri (NP) for the Respondents.
The Judgment of the Court was delivered by AHMADI, J.
Special leave granted The appellants and the writ petitioners are presently serving in the Time Keeping Department of the Naval Dockyard, Bombay, which is under the administrative control of the Vice Admiral, Flag Officer, Commanding in chief, Western Naval Command, Bombay.
In the said department there are several posts of Junior Time Keepers and only two posts of Senior Time Keepers.
Since the promotional posts were limited in number there was stagnation at the base level of Junior Time Keepers.
With a view to removing this stagnation, the cadre of Time Keepers was sought to be amalgamated with the clerical cadre in the same department.
On 14th September, 1966, the Under Secretary to the Government of India, Ministry of Defence, wrote a letter to the Chief of Naval Staff on the subject of amalgamation of the Time Keepers cadre with the clerical cadre.
The text of the letter reads as under: "Sir, I am directed to convey the sanction of the President to the merger of the cadre of time keepers with the clerical cadre in all Naval Establishments.
Consequent on this merger, 223 Senior Time Keeper will be redesignated as Upper Division Clerks.
The authorised ratio of 1:4 between UDCs and LDCs will be maintained after this merger but where because of the merger and redesignation of Senior Time Keepers as Upper Division Clerks the number of Upper Division Clerks exceeds the authorised ratio, no reservations will be made and the excess vacancies of Upper Division Clerks will be adjusted against vacancies of Upper Division Clerks becoming available by way of increase in Establishment, retirement, etc.
The existing pay of the time keepers will be protected and they will continue to draw increments in the new cadre on the due dates: 3.
Any subsidiary instructions regarding seniority promotion etc.
will be issued by you.
4.This letter issue with the concurrence of Ministry of Finance (Defence/Navy) vide their u.o.
No. 3161 NA dated 31.8.1866.
" A few days later another letter dated 5th December, 1966 was issued by the office of the Rear Admiral, Western Naval Command, Bombay, on the same subject which reads as under; "In accordance with the Govt.
of India, Ministry of Defence letter No. CP(A)/4895/NHQ/8364/D/N II dated 14th September 1966 the Cadre of Time Keepers will be merged with that of LDC/UDC with effect from 1st December, 1966.
This merger is intended only to give promotion to the Time Keepers alongwith the LDC/UDC.
Their duties, terms and conditions of service will remain the same and their hours of work will also continue to be 45 in a week.
Consequent upon the issue of this order and in order to distinguish them from the UDC/LDC and UDC(s)/LDC(s) the suffix "T" will be added after their designation.
All records and correspondence relating to them should also be indicated by this suffix".
224 The employees working in the Time Keeping Department were entitled to the benefit of over time and productivity linked bonus since they were considered to belong to the industrial wing.
Lower Division Clerks and Upper Division clerks belonging to the clerical cadre who were working in different administrative offices of the Naval Dockyard were not entitled to this benefit.
Therefore, when one Thoppil Ramakrishnan was transferred in August, 1980 as UDC(T) in the Spare Parts Distribution Centre, he challenged his transfer by filing a Writ Petition No. 1065/80 in the High Court of Bombay on the ground that since he was appointed as Junior Time keeper in 1953 and was promoted as UDC(T) in 1967 he belonged to a special cadre and could not be transferred to the general cadre as that would entail loss of the benefit of over time and productivity linked bonus.
His petition was allowed by the High Court by the judgement and order dated 1st March, 1984.
The High Court, treating the letter of 5th December, 1966 as clarificatory, concluded that the merger was intended for the sole purpose of making available to the Time Keepers avenues of promotion in the clerical cadre but their terms and conditions of service were to remain in tact and it is for that purpose that they were to be designated by the suffix"T".
The High Court, therefore, held that there was no complete merger of the two cadres.
The High Court, however, realised that Time Keepers could not be given promotion to more responsible assignments unless they received the required experience of administrative work normally available to Lower Division Clerks and Upper Division Clerks, but rested content on the statement made by the counsel for the petitioner that the pertitioner will not claim the benefit of promotion in the clerical cadre.
On this statement the High Court made the rule absolute.
Against this judgement a Letters Patent Appeal was filed but without success.
Another Writ Petition No.1066/80 files by Chob Singh Tomar was similarly disposed of by the same learned Judge on the next day i.e. 2nd March 1984.
Both the above Judgement were mainly based on the language of the letter of 5th December, 1966.
Realising the difficulty created by the saidletter, the Flag Officer, Commanding in Chief, Western Naval Command, Bombay, cancelled the said letter by his communication dated 27th August, 1984.
The subsequent communication reads as under: "1.
Ministry of Defence Letter CP(A)/4895/NHQ/8634/D(N II) dated 14 Sep. 66 is reproduced as Annexure I to this order for information.
225 2.This Headquarters Civilian Establishment Order Part II of 1966 No.6 dated 05 Dec. 66 and 50/80 dated 23 Aug. 80 are hereby cancelled.
" By a subsequent letter dated 20th November, 1984 it was further directed that the suffix"S" and suffix "T" should bed removed from all records and the incumbents should be redesigned as LDCs/UDCs.
On the cancellation of the letter of 5th December, 1966 and the removal of the suffix "T", what survived was only the merger order of 14th September, 1966.
Consequently inter se transfers from the Time keeping Department to the various administrative departments of the Naval Dockyard became possible.
Thereupon, R.A. Sawant and R.D. Jawakar who were working in the Time Keeping Department were transferred on promotion as UDC by orders dated 17th April, 1985 and 5th October, 1985 respectively to other administrative departments of the naval establishment.
These transfers triggered off certain writ petitions in the High Court of Bombay.
On the constitution of the Central Administrative Tribunal for that area, those writ petitions were transferred to the Tribunal for disposal in accordance with law.
The Tribunal by its impugned common judgement dated 9th October, 1989 came to the conclusion that after the cancellation of the order dated 5th December, 1966 the field was held by the Presidential Order referred to in the letter of 14th September, 1966.
The Tribunal held that the employees in the Time Keeping Department no longer belonged to separate cadre and the authorities were entitled to transfer them to the other ministerial branches in the Naval establishment under the Merger Scheme.
In regard to the judgements delivered by the High Court of Bombay on 1st and 2nd March, 1984, it opined that on the cancellation of the order of 5th December, 1966 those decisions had lost their force and the question had to be answered solely on the basis of Presidential Order referred to in the letter of 14th September, 1966.
In this view of the matter the Tribunal dismissed the applications and vacated the interim orders.
It is against the said judgement of the Tribunal that the aforesaid appeals have been filed.
Certain other employees who apprehended transfer from the Time Keeping Department to other administrative departments in the Naval establishment approached this Court directly by way of a writ petition.
Their contention is identical to the contention raised in the appeals preferred against the impugned order of the Tribunal.
We will, therefore, dispose of the appeals as well as the writ petition by this common judgement.
226 Mr. Mehta, the learned counsel for the appellant petitioners contended that the employees working in the Time Keeping Department of the Naval establishment perform duties which are distinct from ordinary clerical duties and therefore they constitute a separate and distinct cadre to which are attached certain additional monetary benefits, such as, over time payment, productivity linked bonus, etc., which would be lost to them if they are transferred to other administrative departments of the naval establishment.
He submitted that since the Junior Time Keepers did not have sufficient avenues for promotion and were stagnating at the base leval and the Senior Time Keepers had no promotional avenue altogether, their grievance was sought to be redressed by providing them further avenues of promotion under the Presidential Order, without depriving them of their identity and special benefits available as belonging to the industrial wing of the establishment.
According to him the Presidential Order of merger contained in the letter dated 14th September, 1966 was issued for this limited purpose only of giving the Time Keepers an opportunity of career advancement which was available to their counter part in the administrative (Non industrial) departments of the Naval establishment but it was never intended to deprive them of the additional monetary benefits to which they were entitled as belonging to the industrial wing.
In other words according to Mr. Mehta the merger of the Time Keepers ' cadre with the clerical cadre was only notional and limited to opening avenues for promotion for the former but there was no actual merger in the sense of the Time Keepers losing their identity and that is why in the subsequent letter of 5th December, 1966 the department rightly observed that their duties, terms and conditions of service will remain the same and their hours of work will continue to be 45 in a week and they should be distinguished by the use of the suffix "T" after their designation.
The cancellation of the order of 5th December, 1966 by the subsequent order of 22nd August, 1984 does not alter the situation contended Mr. Mehta and, therefore, said he, the Tribunal was in error in coming to the conclusion that the earlier two decisions of the Bombay High Court had lost their force.
He, therefore, submitted that the Tribunal 's approach was clearly erroneous and this Court must correct the same.
Mr. Lahiri, the learned counsel for the department contended that the Presidential Order referred to in the letter of 14th September, 1966 had merged both the cadres and the Time Keepers were, therefore, redesignated as Lower Division Clerks and Upper Division Clerks.
He submitted that there was no indication in the Presidential Order that these Time Keepers who were redesignated as LDCs/ 227 UDCs will continue to constitute a separate cadre and yet be entitled to promotion in the clerical cadre.
He, therefore, submitted that the subsequent order of 5th December, 1966 was issued on an erroneous reading of the Presidential Order and when the department realised the mistake after the High Court 's judgements, it promptly cancelled the said order and restored the position as on the issuance of Presidential Order.
He, therefore, submitted that the Tribunal was right in coming to the conclusion that as the High Court 's judgements were based on the subsequent order of 5th December, 1966 and the same was since cancelled, the judgements no longer held the field and the appellants petitioners were not entitled to the benefit thereof.
He further pointed out that under the Presidential Order the ` pay ' of the Time Keepers has been protected and therefore, they can have no cause to complain but such of those LDCs/UDCs who are posted in the Time Keeping Department are allowed to draw overtime wages as well as bonus admissible under the relevant law.
These benefits are attached to the post and not the individual and the one who is manning the same is entitled to them and not others.
He, therefore, submitted that this Court should not interfere with the view taken by the Tribunal and should dismiss these appeals as well as the writ petition.
We have carefully considered the contentions urged before us by the learned counsel for the contesting parties.
The letter of 14th September, 1966 clearly refers to the Presidential sanction"to the merger of the cadre of Time Keepers with the clerical cadre in all Naval establishments".
Consequent on this merger the Junior Time Keepers were to be redesignated as Lower Division Clerks and there Senior Time Keepers as Upper Division Clerks.
There is nothing in this letter to convey that they were to retain their identity as Time Keepers.
The letter further states that their entry into the clerical cadre should not disturb the authorised ratio of 1:4 between UDCs and LDCs but where because of the merger and redesignation of Senior Time Keepers as UDCs, the numbers of UDCs exceeds the authorised ratio, there should be no revision but in the excess should be adjusted against vacancies becoming available by way of increase in establishment, retirement, etc.
Paragraph 2 of that letter states that the existing pay of the Time Keepers will be protected and they will continue to draw increments in the new cadre on the due dates.
It is clear from the above text of the letter of 14th September, 1966 that the intention was to merge the cadre of Time Keepers with the clerical cadre and to adjust the imbalance.
If any, caused on account of such merger in a manner so as not to disturb the authorised ratio.
The pay and increments of the Time Keepers were protected by the said order.
There 228 can, therefore, be no doubt that the plain language of the Presidential Order as reproduced in the letter of 14th September, 1966, clearly manifests an intention to merge the existing Time Keepers ' cadre with the clerical cadre, albeit with a view to opening avenues for promotion for the Time Keepers.
The subsequent order of 5th December, 1966 issued by the Western naval Command could not alter this Presidential Order.
If that subsequent order was found to be inconsistent with the Presidential Order, it had to be ignored for the simple reason that the officers of the Naval establishment were not competent to alter, vary or modify a Presidential Order.
The interpretation placed on that subsequent letter by the Bombay High Court in the judgements delivered on 1st and 2nd March, 1984 does give the impression that the High Court thought that there was no complete merger and the personnel meaning the Time Keeping Department retained their identity and were, therefore, entitled to the additional benefits of over time and productivity linked bonus.
After the judgements were delivered the department instead of approaching this Court thought it wise to undo the mischief by cancelling the subsequent order of 5th December, 1966 which was the source of trouble.
Since the conclusion reached by the High Court was based on the language of the subsequent order of 5th December, 1966, the Tribunal was not bound to follow the same on the cancellation of that order.
We may also state, with respect to the learned judge in the High Court, that we find it difficult to persuade ourselves to his point of view for diverse reasons.
Firstly, the plain language of the text of the Presidential Order manifests a clear intention to merge the cadre of Time Keepers with the clerical cadre on the establishment.
Secondly, the subsequent order of 5th December, 1966 had to be read consistently with the Presidential Order as to fulfil the purpose or objective and not to impede or stifle it.
Thirdly, even if the subsequent order was found to be inconsistent with the Presidential Order in certain respects, the inconsistency had to be ignored for the obvious reason that the officer issuing the order could not have altered or modified the Presidential Order and lastly, if there was any confusion caused by the subsequent order it should have been read harmoniously with the Presidential order Order so as to advance its objective or merger of the Time Keepers ' cadre with the clerical cadre.
In order to appreciate Mr. Mehta 's contention that by the Presidential Order only a notional merger for the limited purpose of providing the Time Keepers with promotional avenues was intended and not actual merger so as to deprive the Time Keepers of their distinct identity, it is necessary to realise that the sole purpose of the exercise 229 indisputably was to make career advancement possible for the Time Keepers.
At the time of issuance of the Presidential Order there were only two layers in the Time Keeping Department of the establishment.
The base level which was fairly large comprised Junior Time Keepers and above them were Senior Time Keepers.
Since there were only two posts of Senior Times Keepers, the prospects of promotion for Junior Time Keepers were very dim.
As there was no further promotional avenue for the Senior Times Keepers, the mobility was restricted and they too suffered on that account.
There was, therefore, large scale stagnation and with a view to overcoming the same the question of merger of the Time Keepers ' cadre with the clerical cadre was examined.
On the same being found feasible, the Presidential Order came to be issued.
The High Court realised that if the Time Keepers do not gather sufficient exprience of administrative work they would not be able to handle responsible work at higher levels in the heierarchy and hence their movement to the ministerial posts is absolutely necessary.
But the High Court resolved this situation by obtaining a statement from the incumbent that he would not claim the benefit of promotion to which he may otherwise be entitled by reason of the merger policy.
Would this advance the policy of merger or fulfil the purpose of opening avenues of promotion for the Time Keepers? If the mobility from Time Keepers ' post to the clerical post is halted on account of the former 's unwillingness to move to the clerical side to gain experience and equip himself to discharge higher responsibilities in future merely to retain the monetary benefit accruing from overtime wages and bonus, it is difficult to understand how even the limited objective of providing promotional avenues to Time Keepers would be satisfied.
And it is all the more difficult to understand how those incumbents who entered the Time Keepers Department after the Presidential Order became effective can claim that they have a vested right to continue in the department because they would suffer a monetary loss if they are transferred to the clerical posts.
The list Annexure C to the appeals would show that except for those at serial Nos.
1 to 3, 8 and 12, the rest of the incumbents had either joined as LDC in the Time Keeping Department after the Presidential Order became effective or had been transferred to that department from the other administrative departments where they were working as LDCs.
It is difficult to understand how those who entered that department after the merger via the other administrative branches of the establishment can refuse to go back on the specious plea that they would suffer a financial loss.
They can have no right to the post in the Time Keeping Department.
So long as they are posted there and are discharging the functions of the Keeper they would be entitled to overtime wages 230 and bonus but on that plea they cannot contend that they are not transferable to the ministerial posts on the establishments.
We have,therefore, no hesitation in concluding that those who joined the Time Keeping Department after the Presidential Order became effective,either by a direct posting in that department as LDC or on transfer to that department,have no right to continue in that department merely because their would entail economic loss since they are governed by the merger scheme which had become operative before their entry in that department.
, They were borne on the common cadreand werenever members of the earlier Time Keeper 's cadre.
But the case of those Time Keepers who were serving as such in the Time Keeping Department,such as, the incumbents at serial Nos.1 to 3, 8 and 12 (S.P.Jadhav,V.S.Khot,P.J. Rodrigues, B.J.Dhamba and V.S. Shinde), must be viewed differently.
They belonged to a separate cadre of Time Keepers at the date of the issuance of the Presidential Order.
Their terms and conditions of service couldnot be altered,varied ormodified to their detriment without giving them an opportunity to exercise their option.
If their transfer outside the Time Keeping Department becomes possible by the merger of their cadre with the clerical cadre but the same entails civil consequences in the form of loss of overtime wages and bonus, justice demands that they must be given an option to choose which course is beneficial to them and if they decide or opt in favour of the status quo they must be allowed to continue as Time Keepers and not be transferred outside that department without their consent, because to do so would render the scheme vulnerable unless the department agrees to make good the economic loss suffered on transfer.
Therefore,so far as those Time Keepers who were serving in the Time keeping Department on and before the date of the implementation of the Presidential Order and who continue to serve in the same department are concerned, the department should give them an option if they are proposed to be transferred outside that department or the department should undertake to make good the economic loss which they are likely to suffer on transfer.
Such a reading of the Presidential Order is permissible on the plain language of theorder and saves it from being rendered vulnerable.
See: The State of Kerala vs M.K.Krishnan Nair & Ors.
, ; at 571.
In the result we allow the appeals partly insofar as they concern the aforenamed five persons to the extent indicated above and dismiss them in respect of the remaining appellants.
Since the writ petitioners 231 are not shown to belong to the category of employees who were borne on the cadre of Time Keepers and were actually working in the Time Keeping Department on or before the issuance of the Presidential Order, their writ petition fails and is dismissed.
There will,however, be no order as to costs in the appeals as well as the writ petition.
| The petitioners, who were Central Government employees, on their absorption in a Central Public Sector Undertaking, retired from Central Government service on different dates prior to 31.3.1979, and commuted their original pension for a lump sum as permissible under the Civil Service (Pension) Rules, 1972.
The Central Government issued O.M. dated 13.2.1976, enabling an officer who commuted a portion of his pension to be eligible for relief and ad hoc reliefs on the full amount of his original pension, but persons who got themselves absorbed in Public Sector Undertakings were not eligible to the said benefits.
Taking note,of the erosion in the value of the rupee, the Government, by O.M. dated 25.5.1979, introduced the Liberalised Pension Formula, benefit of which, by this Court 's decision in D.S. Nakara 's case was extended to all Central Government pensioners irrespective of the dates of their retirement.
In order to implement the said decision, the Government issued O.M. dated 22.10.1983, but the benefit was not given to those persons who got them selves absorbed in Central Public Sector Undertakings and received/opted to receive commuted raise of 1/3rd of pension as well as 357 terminal benefits equal to the commuted value of the balance amount of pension left after such commutation.
The petitioners challenged the validity of the aforesaid O.Ms.
dated 13.2.1976 and 22.10.1983 and contended that for the purposes of grant of the full benefit of relief or ad hoc relief, the Rules do not make any distinction between an officer who has sought commutation of a portion of his original pension and one who has not sought any such commutation; and as the petitioners who opted for commutation of their original pension in accordance with the Rules were being arbitrarily and without just and reasonable cause deprived of the relief, the aforesaid Office Memoranda were vitiated by an inherent discrimination and were violative of Articles 14 and 16 of the Constitution.
The facts of the appeal were identical to those of the petitions except that the appellant came before this Court in appeal against the order of the High Court which dismissed his writ petition.
On the question: whether the petitioners/appellants fell in the category of Central Government pensioners for the purpose of entitlement to the benefit of the Liberalised Pension Formula or did they fall in a different class altogether and were not entitled to get any such benefit, Dismissing the writ petitions and the appeal, this Court, HELD: 1. Clause 5 of O.M. dated 22.10 1983 is clear that such Central Government employees who got themselves absorbed under Central Public Sector Undertakings prior to 1.4.1979 and opted to receive commuted raise for 1/3rd of pension as well as terminal benefit equal to the commuted value of the balance amount of pension were not entitled to any benefit as they were not Central Government Pensioners as on 1.4 1979.
[362B C] 2.Commutation brings about certain advantages.
The person who commutes his pension gets a lump sum which ordinarily he would have received in the course of his spread over period subject to his continuing to live The two advantages of the commutation are the availability of a lump sum and the risk factor.
The allowance of Family Pension to such person does not however make them entitled to get any benefit that is given to the pensioners on account of Liberalised Pension Rules taking note of the fallen value of the rupee.
[362F G, 363A B] 3.1 In the instant case, the petitioners had not only got 1/3rd of 358 their pension commuted but exercised the option of getting the entire pension commuted and in lieu thereof got a lump sum.
Such persons cannot fall in the category of Central Government pensioners for the purposes of getting benefit of the Liberalised Pension Rules which can be made applicable only to Central Government pensioners.
[362G H, 363A] 3.2 The petitioners fell in a different class altogether and were not entitled to claim any benefit granted to the Central Government Pensioners.
After getting a lump sum in lieu of entire pension, they did not fall in the class of Central Government pensioners and were not entitled to any benefit granted to such pensioners.
The case of the Central Government pensioners who got their 1/3rd pension commuted also fail in a different class inasmuch as they got 2/3rd pension, and after 15 years of such commutation or having attained the age of 70 years whichever was later, they became entitled to full pension.
[363C D] "Common Cause" a Registered Society & Ors.
vs Union of India, ; , distinguished.
D.S. Nakara & Ors.
vs Union of India, ; , referred to.
|
N: Criminal Appeal Nos.
107 108 of 1985 From the Judgment and Order dated 20.12.1984 of the Rajasthan High Court in D.B. Civil Habeas Corpus Petition Nos. 1489 and 1575 of 1984.
87 N.L. Jain, Advocate General and Badri Das Sharma for the Appellants.
Ram Jethmalani and Miss Rani Jethmalani for the Respondent.
M.R. Sharma, Dalveer Bhandari and R.N. Poddar for the Intervener, Union of India.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
The respondent, an Advocate, was ordered to be detained by the Government of Rajasthan under section 3(2) of the (hereinafter referred to as the Act), on August 14, 1984, and he was actually taken into custody and detained on the following day.
The grounds of detention were supplied to him when he was detained.
Respondent challenged his detention before the Rajasthan High Court by filing two applications under Article 226 of the Constitution on several grounds.
Both the writ applications were clubbed and heard together and disposed of by a common judgment.
The High Court found that the representation of the detenu respondent had not been placed before the Advisory Board within three weeks as required by section 10 of the Act and such violation vitiated the continued detention of the respondent.
It also found that the Advisory Board had not considered the documentary evidence produced by the detenu and the opinion formed by the Board that the respondent should be detained was, therefore, not an appropriate one.
The Court took the view that the materials in the record which had been considered by the Advisory Board in formulating its recommendation to the State Government had not been transmitted to the Government and the same was not available before the State Government when it made the order of confirmation.
The Court was also of the further view that the contents of the intelligence reports referred to in the grounds of detention had not been supplied to the detenu and he had, therefore, been deprived of the opportunity of making an effective representation against his detention.
On these findings the High Court held that the detention of the respondent cannot be upheld and the order of detention dated August 14, 1984, and the subsequent order dated October 22, 1984, directing him to be detained for one year be quashed.
The Court further directed: "In the interest of justice and in the interest of National Security, without curtailing seriously individual liberty, we give the following directions: 88 (1) that the detenu Shamsher Singh being entitled to liberty on account of the above order of ours will be released from the Central Jail, Ajmer; (2) that the detenu Shamsher Singh would be none theless kept either under house arrest or in a place like Dak Bungalow or Circuit House at Ajmer or a nearby place within the radius of 50 kms.
with the members of his family, which would consist of his wife and three minor sons; (3) that if the detenu is kept under house arrest, the expenses will be borne by the detenu, but if he is kept in some Dak Bangalow or other Circuit House, then his expenses will be borne by the State; (4) that the authorities would permit interview with other relatives also, if the detenu is kept outside his house.
In case no stay order is received staying the operation of the judgment of this Court, the detenu shall be released on expiry of three weeks, i.e. on 11.1.85.
" This Court granted special leave to appeal against the judgment of the High Court by its order dated January 18, 1985.
In the mean time, the High Court had suspended the operation of its order till January 21, 1985, and while granting special leave, this Court stayed operation of the judgment.
Learned Advocate General of the appellant State appearing in support of the appeal maintained that each of the four grounds accepted by the High Court in quashing the detention is wrong and not sustainable as a ground for such quashing while Mr. Jethmalani appearing for the respondent supported the reasonings and the ultimate conclusion of the High Court.
We have already stated that the High Court formulated the reasons for its order in the shape of four conclusions and we propose to deal with them seriatim for convenience.
The first ground of attack advanced by the respondent against the order which impressed the High Court is that there has been 89 violation in complying with the provisions of section 10 of the Act.
Indisputably the respondent was taken into custody on August 15, 1984.
On August 22, 1984, the State Government placed before the Advisory Board the grounds on which the order of detention had been made.
By then no representation had been made by the detenu and, therefore, there was no occasion for causing that also to be placed before the Board.
The respondent made a representation on August 28, 1984, which was received by the Superintendent of the Central Jail where the detenu had been lodged and the same was received by the State Government on August 30, 1984.
There is no dispute that the representation was placed before the Advisory Board on September 6, 1984.
As far as relevant, section 10 of the Act provides: ". in every case where a detention order has been made under this Act, the appropriate Government shall, within three weeks from the date of detention of a person under the order, place before the Advisory Board constituted by it under section 9, the grounds on which the order has been made and the representation, if any, made by the person affected by the order . " It is the contention of the respondent that his representation against the detention has been placed before the Advisory Board a day too late inasmuch as while section 10 requires the placing to be done within three weeks from the date of detention, the representation has been placed before the Advisory Board on the 22nd day.
There was no dispute before the High Court nor is there any challenge before us that there has been a day 's delay in placing the representation of the respondent before the Board.
The High Court has accepted the respondent 's submission that the requirement under section 10 of the Act was mandatory and failure to place before the Advisory Board the representation of the respondent has vitiated the detention.
While Mr. Jethmalani appearing for the respondent reiterates that stand, learned Advocate General in support of the appeal has contended that as a fact there has been compliance of section 10 of the Act within a week of commencement of the detention and as by than no representation from the respondent had been received, the same could not be placed before the Board along with the grounds of detention.
The State Government received the representation on the 30th August, 1984, and after looking 90 into the contents, caused it to be placed before the Board with due haste and that was done on September 6, 1984.
On the basis of the reference made on the 22nd August, 1984, the Advisory Board had already fixed the consideration of the respondent 's detention at the meeting on September 10, 1984, and as a fact, four days before the date of hearing fixed by the Board the representation was before it.
As a fact, no adjournment had to be given in the matter of consideration of the representation of the respondent on account of a day 's delay in the placing of the representation before the Board.
Learned Advocate General further submitted that when a representation from the detenu is received against his detention by the detaining authority (here the State Government), the contents of the representation are intended to be perused so that the detaining authority may consider whether continuing the detention is proper and expedient.
At that stage it is open to the detaining authority to rescind the order of detention and in that event no further reference to the Advisory Board is warranted.
Since the detaining authority is not a mere post office being required to receive the representation and have it placed before the Advisory Board a little time is bound to be taken in dealing with the representation.
Taking a practical view of the situation some time is bound to lapse between the receipt of the representation and the forwarding of the same for being placed before the Board.
A day 's delay in such process cannot indeed be taken to be fatal so as to warrant the quashing of the detention.
A Constitution Bench in A. K. Roy etc.
vs Union of India Anr.,(1) has upheld the vires of the Act.
It was pointed out in Ichhu Devi Choraria vs Union of India & Ors.(2) that "the burden of showing that the detention is in accordance with the procedure established by law has always been placed by this Court on the detaining authority because Article 21 of the Constitution provides in clear and explicit terms that no one shall be deprived of his life or personal liberty except in accordance with procedure established by law.
This constitutional right of life and personal liberty is placed on such a high pedestal by this Court that it has always insisted that whenever there is any deprivation of life or personal liberty, the authority responsible for such deprivation must satisfy the Court that it has acted in accordance with the law.
This is an area where the Court has been most strict and scrupulous in ensuring observance with the 91 requirements of the law, and even where a requirement of the law is breached in the slightest measure, the Court has not hesitated to strike down the order of detention or to direct the release of the detenu even though the detention may have been valid till the breach occurred.
" This Court in Khudi Ram Das vs State of West Bengal & Ors., (1) said: "The constitutional imperatives enacted in this article (22) are two fold: (1) the detaining authority must, as soon as may be, that is, as soon as practicable after the detention, communicate to the detenu the grounds on which the order of detention has been made, and (2) the detaining authority must afford the detenu the earliest opportunity of making a representation against the order of detention.
These are the barest minimum safeguards which must be observed before an executive authority can be permitted to preventively detain a person and thereby drown his right of personal liberty in the name of public good and social security.
" The view indicate in these decisions is well accepted and the same is not open to doubt or dispute.
We have already pointed out that within a week of detention of the respondent a reference to the Advisory Board had actually been made in this case but without the respondent 's representation as the same had not been made by then.
Section 10 stipulates that the grounds on which the order has been made and also the representation of the detenu, if any, have to be placed before the Board when the reference is made.
The legislative scheme contained in this section envisages the situation that there may be a case where no representation at all is made or within the time contemplated under section 10, the representation has not been forthcoming.
We agree with the submission of Mr. Jethmalani that the obligation cast under section 10 of the Act is paramount and the strictness with which such a mandate has to be complied with is absolute.
While making of the reference under section 10 with the grounds of detention is a must, furnishing of the representation is conditional upon it having been made and receipt thereof by the appropriate Government.
Though 92 under the general scheme of the Act definite and different periods have been prescribed for compliance with the step to step treatment of the matter, there is no obligation cast on the detenu to make a representation within any definite time.
We are, therefore, prepared to accept the submission of the learned Advocate General that while considering the compliance with section 10 of the Act emphasis has to be laid on making of the reference and forwarding of the grounds of detention, and the placing of the representation has to be judged on different basis.
We may not be understood to be of the view that it is open to the appropriate Government to withhold the placement of the representation unduly or indefinitely.
When the reference is received and the grounds of detention are available, the Board proceeds to fix a date of hearing for consideration of the justification of detention.
The procedure of the Advisory Board contained in section 11 of the Act indicates that the Board is to consider the materials placed before it and is entitled to call for such information as it may deem necessary from the appropriate Government or from any other person concerned and after hearing the detenu, if he wants to be heard in person, has to report to the appropriate Government within seven weeks from the date of detention in the manner indicatad in the remaining sub sections of that section.
While dealing with this aspect of the matter it is to be borne in mind that section 10 requires the reference to be placed before the Board within three weeks and section 11 requires the report to be submitted to the appropriate Government within seven weeks.
The legislative scheme in fixing the limit of three weeks in section 10 and the further limit of seven weeks in section 11 allows at least four weeks ' time to the Board to deal with the matter.
The Board on receipt of the reference on August 22, 1984, directed its sitting to be convened for September 10, 1984, for considering the justifiability of the respondent 's detention.
This had apparently been done on the basis of the reference from the appropriate Government but without the representation but the representation was received by the Board in the mean time on September 6, 1984.
The first meeting of the Advisory Board was thus fixed within four weeks from the date of detention and the consideration of the matter by the Board was not required to be adjourned on account of any delay in receiving the copy of the representation of the detenu.
We agree with the submission of Mr. Jethmalani that it is obligatory for the appropriate Government to forward the representation, when received, to the Board without delay because unless on 93 the basis of the representation the appropriate Government rescinds the order of detention, the representation is a document intended for the Board.
Where the representation has been received the same should, as expeditiously as possible, reach the Board.
In this case the State Government received the representation on August 30, 1984, and placed the same before the Board on September 6, 1984.
Six clear days have intervened between the receipt of the representation by Government and the placing thereof before the Board.
Admittedly, if the representation had reached the Board by September 5, 1984, respondent would not be entitled to raise any objection.
Can it, on the facts of the case and in the circumstances indicated, be said to be non compliance with section 10 of the Act? Mr. Jethmalani placed before us a passage from Broom 's Legal Maxims (p. 162), 10th Edn., where the doctrine of impossibility of performance (lex non cogit ad imporsibilia) has been discussed.
It has been indicated therein that however mandatory the provision may be, where it is impossible of compliance that would be a sufficient excuse for non compliance, particularly when it is a question of the time factor.
Keeping the attendant circumstances of this case in view, we find it difficult to hold that the time taken by the State Government can amount to withholding of the representation which resulted in non compliance of section 10 of the Act so as to vitiate the detention.
It is useful to refer to a paragraph from a judgment of this Court in Frances Corolie Mullin vs W. C. Khambra & Ors,(1) while we are on this point.
A Division Bench was dealing with a COFEPOSA detention.
Section 8 of the COFEPOSA requires the appropriate Government to make a reference to the Board within five weeks from the date of detention.
While dealing with an argument referring to this aspect of the matter, the Court observed: "The four principles enunciated by the Court in Jayanarayan Sukul vs State of West Bengal ; , as well as other principles enunciated in other cases, an analysis will show, are aimed at shielding personal freedom against indifference, insensibility, routine and red tape and thus to secure to the detenu the right to make an effective representation.
We agree: (1) the detaining authority must provide the detenu a very early opportunity to make a representation, (2) the detaining 94 authority must consider the representation as soon as possible, and this, preferably must be before the representation is forwarded to the Advisory Board, (3) the representation must be forwarded to the Advisory Board before the Board makes its report, and (4) the consideration by the detaining authority of the representation must be entirely independent of the hearing by the Board or its report, expedition being essential at every stage.
We, however, hasten to add that the time imperative can never be absolute or obsessive.
The Court 's observations are not to be so understood.
There has to be lee way, depending on the necessities (we refrain from using the word 'circumstances ') of the case.
One may well imagine, a case where a detenu does not make a representation before the Board makes its report making it impossible for the detaining authority either to consider it or to forward it to the Board in time or a case where a detenu makes a representation to the detaining authority so shortly before the Advisory Board takes up the reference that the detaining authority cannot consider the representation before then but may merely forward it to the Board without himself considering it.
Several such situations may arise compelling departure from the time imperative.
But no allowance can be made for lethargic indifference.
No allowance can be made for needless procrastination.
But allowance must surely be made for necessary consultation where legal intricacies and factual ramifications are involved.
" It is useful at this stage also to refer to a later decision of another Division Bench of this Court in Raisuddin alias Babu Tamchi vs State of Uttar Pradesh & Anr.(1) That was a case of detention under the Act and there was a delay of six days between the receipt by the District Magistrate (the detaining authority) of the comments from the Superintendent of Police on the representation and despatch of the representation to the State Government.
While negativing the contention founded on delay and the resultant effect on the order of detention, this Court observed: "In this context we consider it necessary to emphasise that the question whether the representation 95 submitted by a detenu has been dealt with all reasonable promptness and diligence is to be decided not by the application of any rigid or inflexible rule or set formula nor by a mere arithmetical counting of dates, but by a careful scrutiny of the facts and circumstances of each case; if on such examination it is found that there was any remissness, indifference or avoidable delay on the part of the detaining authority/State Government in dealing with the representation, the Court will undoubtedly treat it as a factor vitiating the continued detention of the detenu; on the other hand, if the Court is satisfied that the delay was occasioned not by any lack of diligence or promptness of attention on the part of the party concerned, but due to unavoidable circumstances or reasons entirely beyond his control, such delay will not be treated as furnishing a ground for the grant of relief to the detenu against his continued detention. " We agree with the principle indicated above and in our opinion, in the facts of the present case, it cannot be said that there has been any negligence or remissness on the part of the State Government in dealing with the representation of the detenu or in the matter of causing the same to be placed before the Advisory Board.
We are impressed by the fact that no prejudice has been caused to the detenu on account of the delay of a day beyond the statutory period in placing the representation before the Advisory Board inasmuch as the Advisory Board had caused the matter to be heard on the 10th September 1984 and before the appointed date the representation was before the Board.
The first ground on which the High Court came to hold that the detention was invalid has, therefore, to be negatived.
The next contention advanced on behalf of the respondent which has been accepted by the High Court in support of its conclusion against the detention is that the Advisory Board did not consider the documentary evidence produced by the detenu.
Under section 11 (2) of the Act the report of the Advisory Board has to specify in a separate part thereof the opinion of the Board as to whether or not there is sufficient cause for the detention of the person concerned and as sub section
(4) provides, the proceedings of the Board and its report, except that part of the report in which the opinion of the Advisory Board is specified, shall be confidential.
In view of the 96 specific plea raised by the detenu and the argument advanced before the High Court that the Board had not considered the documentary evidence, the State Government placed the report before the High Court and the same has been also placed before us as a part of the record.
On a reference to the report we find that the Advisory Board in the instant case was constituted by three Judges of the High Court, one of them being the Chairman.
That would justify our assumption that the members of the Board by their professional ability and acumen were capable to assess the matter in a proper way and form an objective opinion on the basis of materials produced.
The detailed conclusion with reasons given by the Board has also been disclosed.
That shows that the detenu made before the Board very lengthy arguments and cited a number of authorities in support of his submissions.
The detenu in the instant case is a practising advocate and we are impressed by the learned Advocate General 's submission that we could assume that such a practising advocate must have very properly placed his points before the Board.
The Board is not required to write out a judgment wherein one would expect mention of the respective pleas, materials produced by the parties, specification of contentions advanced and reasons for the conclusion as may have been drawn.
What is required is the unbiased and impartial conclusion on the materials available with reference to the grounds of detention as to whether the detention order when made and the continued detention of the person concerned are justified.
The High Court, in our view, had no justification to accept the submission of the detenu that the documentary evidence produced by the detenu had not been considered by the Board.
The second ground accepted by the High Court has, therefore, to be repelled as not sustainable.
We proceed to examine the next ground, viz., that all the records had not been sent to the State Government by the Board and, therefore, such records were not available for consideration of the State Government at the time of confirmation of the detention.
There is no dispute that the Board had not sent the entire record to the State Government.
Under section 11(2) of the Act, the Board is required to submit its report and there is no obligation cast by the Act that the entire record of the Board should be placed before the State Government.
It is, however, not disputed by learned Advocate General that the report of the Board is only a recommendation and 97 the ultimate decision on the basis of the report as to what further action has to be taken is for the State Government to make.
Section 12 in its two sub sections indicates two alternative courses open to the State Government on the basis of the report.
If the Board is of the view that there is no sufficient cause for detention of the person, the appropriate Government is obliged to revoke the detention and release the detenu.
On the other hand, where the Board is of the view that there is sufficient cause for the detention of the person, the appropriate Government may confirm the detention order and continue the detention.
The two provisions have been expressed in different languages.
Where the report is against the detention no option is left to the State Government and a duty is cast on it to release the detenu.
When the Board recommends that there is sufficient cause for detention, the State Government may confirm the detention or even revoke it.
Since the final order has to be made by the State Government, we are inclined to accept the submission of Mr. Jethmalani that the entire record or at least all relevant materials should be available to the State Government when it proceeds to apply its mind to decide whether the detention should be continued or revoked.
This view is in accord with produce and is also judicially supported by a decision of this Court.
In Nand Lal Bajaj vs The State of Punjab & Anr.(1), this Court observed: "We were informed that the Advisory Board did not forward the record of its proceedings to the State Government.
If that be so, then the procedure adopted was not in consonance with the procedure established by law.
The State Government while confirming the detention order under section 12 of the Act has not only to peruse the report of the Advisory Board; but also to apply its mind to the material on record.
If the record itself was not before the State Government, it follows that the order passed by the State Government under section 12 of the Act was without due application of mind.
This is a serious infirmity in the case which makes the continued detention of the detenu illegal.
" We have already indicated that the procedure established by law does not require the entire record to be sent by the Board to the State Government; yet it is certainly proper that the record should 98 be available for being looked into in such manner as the confirming authority considers appropriate before the final decision one way or the other is taken.
The grounds of detention were available with the State Government.
Materials referred to in the grounds of detention were also available in the file.
The only materials which the State Government did not have before it are the documents which the detenu claims to have produced before the Board.
With a view to forming a prima facie impression that there was any material document which would have a bearing on the question at issue, we sent for the record and the same has been produced before us.
On looking into the documents produced by the detenu before the Board, we have come to the conclusion that this did not contain any material which could persuade the State Government to act in a different way.
We are cognizant of the position that it is for the State Government and not for this Court to act as the confirming authority and non compliance with the procedure laid down by law makes the order of detention liable to be quashed.
But we have also already said that non placing of the record of the Board before the appropriate Government is not a failure of compliance with the prescribed procedure.
It is, therefore, that we looked at the record to find out if it can be said to be a defect having material bearing on the question and a matter of prejudice so far as the detenu is concerned.
We reiterate by agreeing with the view of our learned Brother Sen, J. expressed in Nand Lal Bajaj 's case (supra) that the appropriate Government should have the entire material before it along with the report of the Board when it is called upon to consider whether to confirm or not to confirm the detention on the basis of the report of the Board under section 12(1) of the Act.
The Board should therefore, forward the record containing the papers placed before it at the hearing of the matter along with its report so that the matter can be attended by the State Government with due despatch and on taking a full view of the matter.
Our conclusion with reference to the third ground, therefore, is that the High Court was not right in the facts of the case to hold that the order of confirmation of detention was bad.
The respondent contended and the High Court accepted the submission that not providing copies of intelligence reports to the detenu, though the same had been relied upon in the grounds of detention, vitiated the order of detention.
The grounds of detention were divided into two groups, one labelled as criminal activities and the other as extremist activities.
Against extremist activities it was 99 further indicated, ' on the basis of confidential reports '.
The facts by way of accusations were detailed but copies of the reports as such were not furnished.
It is the settled position in law and learned Advocate General did not attempt to contend to the contrary that the detenu has to be supplied all materials relied upon in making the order of detention with a view to being provided an adequate opportunity of making an effective representation.
Personal freedom is an invaluable treasure and the founding fathers took great care to protect it by making appropriate provisions in the Constitution.
Simultaneously taking into consideration the peculiar situations prevailing in the country, the right of the State to order preventive detention was also provided therein.
In order that personal freedom may not be curtailed beyond necessity and the executive administration may not make it an empty guarantee, detailed provisions were made in Article 22 providing an effective procedure in the matter of making of representation and scrutiny of the materials in the presence of the detenu and even hearing him, if he so desired, by an independent Board with adequate judicial bias.
While that is so, the detenu is not entitled to a disclosure of the confidential source of information used in the grounds or utilised for the making of the order.
What is necessary for the making of an effective representation is the disclosure of the material and not the source thereof.
By indicating that the facts have been gathered from confidential reports, a suggestive disclosure of the source has also been made.
The Constitution Bench in the case of State of Punjab & Ors.
vs Jagdev Singh Talwandi,(1) dealt with this aspect of the matter.
The learned Chief Justice, speaking for the Court, observed: "It was further argued by the learned counsel that the detaining authority should have disclosed the evidence on the basis of which the order of detention was passed because, in the absence of knowledge of such evidence, the respondent could not have made an effective representation against the order of detention.
There is no substance in this contention.
It is not the law that the evidence gathered by the detaining authority against the detenu must also be furnished to him".
Reference was made to Beni Madhob Shaw vs State of West Bengal(2) Har Jas Dev Singh vs State of Punjab(3), and Vakil Singh vs 100 State of J & K.(1), and the learned Chief Justice proceeded to state: "These cases show that the detenu is not entitled to be informed of the source of information received against him or the evidence which may have been collected against him as, for example, the evidence corroborating that the report of the C.I.D. is true and correct.
His right is to receive every material particular without which a full and effective representation cannot be made.
If the order of detention refers to or relies upon any document, statement or other material, copies thereof have, of course, to be supplied to the detenu as held by this Court in Ichhu Devi Choraria (supra).
" In view of what has been said by the Constitution Bench, there was no force in the submission of the respondent that there has been an infraction of the law in not supplying the respondent copies of the reports or disclosing the source thereof.
The respondent had actually been given in the grounds all material details necessary for making an effective representation.
The fourth ground accepted by the High Court in support of its order is also not tenable in law.
As all the grounds accepted by the High Court for its conclusion are not sustainable for reasons discussed above, the order of the High Court quashing the detention is not supportable.
The appeal is allowed and the order of the High Court is set aside.
In course of the hearing, Mr. Jethmalani had drawn our attention to the fact that many detenus like the respondent have been and are being released, and the respondent who has already under gone more than two thirds of the period should be released.
That is a matter entirely for the detaining authority to decide and we hope and trust that notwithstanding the reversal of the decision of the High Court, the State Government will proceed to review the matter expeditiously and make such appropriate directions as it consider fit.
N.V.K. Appeal allowed.
| The respondent, an Advocate, was ordered to be detained by the State Government under Section 3(2) of the National Security Act, 1950.
He was taken into custody and detained.
The grounds of detention were supplied to him when he was detained.
The respondent challenged his detention in the High Court.
The High Court found: (1) that the representation of the detenu respondent had not been placed before the Advisory Board within three weeks as required by section 10 of the Act and such violation vitiated the continued detention of the respondent.
(2) that the Advisory Board had not considered the documentary evidence produced by the detenu and therefore the opinion formed by the Board that the respondent should be detained was not an appropriate one, (3) that the materials in the record which had been considered by the Advisory Board in formulating its recommendation to the State Government had not been transmitted to the Government, and the same was not available before the State Government, when it made the order of confirmation, (4) that the contents of the intelligence reports referred to in the grounds of detention had not been supplied to the detenu and he had, therefore, been deprived of the opportunity of making an effective representation against his detention.
The High Court consequently held that the detention of the respondent cannot be upheld, and directed the order of detention directing him to be detained for one year be quashed.
In the appeal to this Court, it was contended on behalf of the State appellant, that the four grounds accepted by the High Court in quashing the detention was wrong and not sustainable as a ground for such quashing.
It was further contended that as a fact there had been compliance of section 10 of the Act within a week of commencement of the detention and as by then no representation from the respondent had been received, the same could not be placed before the Board along with the grounds of detention.
The respondent is a practising advocate and must have therefore properly placed his points 84 before the Advisory Board.
As the Board had not been sent the entire records, all the records were not available for the consideration of the State Government at the time of confirmation of the detention.
The respondent had actually been given in the grounds all the material details necessary for making an effective representation.
Allowing the Appeal, ^ HELD : 1(a) While making of the reference under section 10 with the grounds of detention is a must, furnishing of the representation is conditional upon it having been made and receipt thereof by the appropriate Government.
Though under the general scheme of the Act definite and different periods have been prescribed for compliance with the step to step treatment of the matter, there is no obligation cast on the detenu to make a representation within any definite time.
[91 H; 92 A] (b) The procedure of the Advisory Board contained in section 11 of the Act indicates that the Board is to consider the materials placed before it and is entitled to call for such information as it may deem necessary from the appropriate Government or from any other person concerned and after hearing the detenu, if he wants to be heard in person, has to report to the appropriate Government within seven weeks from the date of detention.
[92 D E] (c) The legislative scheme in fixing the limit of three weeks in section 10 and the further limit of seven weeks in section 11, allows at least four weeks ' time to the Board to deal with the matter.
[92 E] (d) It is obligatory for the appropriate Government to forward the representation, when received, to the Board without delay because unless on the basis of the representation the appropriate Government rescinds the order of detention, the representation is a document intended for the Board.
Where the representation has been received the same should, as expeditiously as possible, reach the Board.
[92 H; 93 A] In the instant case the Board on receipt of the reference on August 22, 1984, directed its sitting to be convened for September 10,1984 for considering the justifiability of the respondents detention.
The State Government received the representation on August 30,1984, and placed the same before the Board on September 6,1984.
Six clear days had intervened between the receipt of the representation by Government and the placing thereof before the Board.
Admittedly, if the representation had reached the Board by September 5, 1984, the respondent would not be entitled to raise any objection.
Keeping the attendant circumstances in view, it is difficult to hold that the time taken by the State Government can amount to withholding of the representation which resulted in non compliance of section 10 of the Act so as to vitiate the detention.
It cannot also be said that there has been any negligence or remissness on the part of the State Government in dealing with the representation of the detenu or in the matter of causing the same to be placed before the Advisory Board.
No prejudice has been caused to the detenu on account of the delay of a day 85 beyond the statutory period in placing the representation before the Advisory Board inasmuch as the Advisory Board had caused the matter to be heard on the 10th September, 1984 and before the appointed date the representation was before the Board.
B; D; 95 D E] A.K. Roy, etc.
vs Union of Indian & Anr.
, ; ; Ichhu Devi Choraria vs Union of India & Ors., ; ; Khudi Ram Das vs State of West Bengai & Ors.,[1975] 2 S.C.R. 832; Frances Coralie Mullin vs W.C. Khambra & Ors.,[1980] 2 S.C.R. 1095 and Raisuddin alias Babu Tamchi vs State of Uttar Pradesh & Anr., ; ; referred to. 2(a) Under section 11(2) of the Act the report of the Advisory Board has to specify in a separate part thereof the opinion of the Board as to whether or not there is sufficient cause for the detention of the person concerned and sub section
(4) provides, the proceedings of the Board and its report, except that part of the report in which the opinion of the Advisory Board is specified shall be confidential.
[95 G H] (b) The Board is not required to write out a judgment.
What is the unbiased and impartial conclusion on the materials available with reference to the grounds of detention as to whether the detention order when made and the continued detention of the person concerned are justified.
[96 E] In the instant case, the Advisory Board was constituted by three Judges of the High Court, one of them being the Chairman.
That justifies the assumption that the members of the Board by their professional ability and acumen were capable to assess the matter in a proper way and form an objective opinion on the basis of materials produced.
The detailed conclusions with reasons given by the Board show that the detenu made before the Board very lengthy arguments and cited a number of authorities in support of his submissions.
The High Court had therefore no justification to accept the submission of the detenu that the documentary evidence produced by the detenu had not been considered by the Board.
[96 B C; 96 F] 3.
(a) Under section 11(2) of the Act, the Board is required to submit its report and there is no obligation cast by the Act that the entire record of Board should be placed before the State Government.
Section 12 in its two subsections indicates two alternative courses open to the State Government on the basis of the report.
If the Board is of the view that there is no sufficient cause for detention of the person, the appropriate Government is obliged to revoke the detention and release the detenu.
On the other hand, where the Board is of the view that there is sufficient cause for the detention of the person, the appropriate Government may confirm the detention order and continue the detention.
The two provisions have been expressed in different language.
[96 G H; 97 A B] Nand Lal Bajaj vs State of Punjab & Anr.
1981 Cr. L.J. 1501, referred to.
86 (b) The procedure established by law does not require the entire record to be sent by the Board to the State Government; yet it is certainly proper that the record should be available for being looked into in such manner as the confirming authority considers appropriate before the final decision one way or the other is taken.
The grounds of detention were divided into two groups, one labelled as criminal activities and the other as extremist activities.
[97 H; 98 A] In the instant case, the documents produced by the detenu before the Board did not contain any material which could persuade the State Government to act in a different way.
The High Court was therefore not right to hold that the order of confirmation of detention was bad.
[98 F G] 4.
(a) Personal freedom is an invaluable treasure and the founding fathers took great care to protect it by making appropriate provisions in the Constitution.
Simultaneously taking into consideration the peculiar situations prevailing in the country, the right of the State to order preventive detention was also provided therein.
In order that personal freedom may not be curtailed beyond necessity and the executive administration may not make it an empty guarantee, detailed provisions were made in Article 22 providing an effective procedure in the matter of making of representation and scrutiny of the materials in the presence of the detenu and even hearing him, if he so desired, by an independent Board with adequate judicial bias.
[99 B C] (b) The detenu is not entitled to a disclosure of the confidential source of information used in the grounds or utilised for the making of the order What is necessary for the making of an effective representation is the disclosure of the material and not the source thereof By indicating that the facts have been gathered from confidential reports, a suggestive disclosure of the source has also been made.
[99 D E] State of Punjab & Ors. vs Jagdev Singh Talwandi, ; ; Beni Madhob Shaw vs State of West Bengal, AIR 1973 SC 2455; Har Jas Dev Singh vs State of Punjab, ; and Vakil Singh vs State of J & K, AIR 1974 SC 2337, referred to.
In the instant case, the grounds of detention were divided into two groups, one labelled as criminal activities and the other as extremist activities.
Against extremist activities it was further indicated, 'on the basis of confidential reports '.
The facts by way of accusations were detailed, but copies of the reports as such were not furnished.
The respondent had actually been given in the grounds all material details necessary for making an effective representation.
[98 H; 99 A]
|
Appeal No. 20 of 1960.
Appeal from the judgment and decree dated September 5, 1956, of the Judicial Commissioner 's Court at Ajmer in Civil First Appeal No. 3 of 1956.
B. D. Sharma, for the appellant.
M. C. Setalvad, Attorney General of India, C. L. Agarwala, M. K. Ramamurthy, R. K. Garg, D. P. Singh and section C. Agarwal, for the respondents I and 3. 1961.
April 3.
The Judgment of the Court was delivered by HIDAYATULLAH, J.
This is an appeal by the,, plaintiff against the judgment and decree of the Judicial Commissioner, Ajmer, confirming the decree of the trail Judge dismissing the suit.
it comes before us on a certificate under articles 132(1) and 133(1)(c) of the Constitution granted by the High Court of Rajasthan after the Reorganisatiion of the States.
The suit was filed by the appellant for recovery of Rs. 23,998 12 0 as price of goods supplied in the year 1947 to the Ruler of Jaipur State, (including interest) and damages suffered by the appellant due to the refusal of the defendants to take delivery of some other goods similarly ordered.
In addition to the ex Ruler of Jaipur, his Military Secretary and one Mohabat Singh, an employee of the ex Ruler, were also joined as defendants, on the plea that they had placed the orders as agents of, the ex Ruler.
The suit was filed on February 28, 1951.
The ex Ruler raised the plea that the suit was incompetent, as the consent of the Central Government under section 87 B of the Code of Civil Procedure was not obtained and asked that the suit be dismissed.
The other defendants denied the claim and also their lability on various grounds.
It may be mentioned the Military Secretary (second 704 defendant) has since died, and this appeal is now directed against the ex Ruler and Mohabat Singh only.
The Subordinate Judge held that though the suit was filed prior to the enactment of section 87 B by section 12 of the Code of Civil Procedure (Amendment) Act, 1951 (11 of 1951), it could not be continued against the ex Ruler.
He adjourned the hearing for four months to enable the appellant to obtain the necessary consent.
The appellant applied to the Central Government for its consent, but it was refused.
He also applied in revision to the Judicial Commissioner, contending that section 87 B of the.
Code of Civil Procedure offended the equality clause in article 14 of the Constitution and was thus void, but the Judicial Commissioner rejected the contention.
He also refused a certificate on the ground that there was no final order as required by article 132(l)of the Constitution.
The suit was subsequently dismissed against all the three defendants.
In regard to the ex Ruler, it was held that no suit lay against him without the consent of the Central Government, and in regard to the remaining defendants, it was held that they were protected by section 230 of the Indian Contract Act.
Sub section (3) of that section was held inapplicable, inasmuch as a suit could be filed against the ex Ruler with the consent of the Central Government.
The appellant appealed to the Judicial Commissioner, Ajmer, but the appeal was dismissed.
He obtained a certificate, as stated above, and this appeal has been filed.
Two main questions have been raised in this appeal.
The first is that the dismissal of the suit against the ex Ruler was erroneous.
In support of this contention, it is urged that section 87 B of the Code of Civil Procedure is ultra vires the Constitution in view of article 14, and, in the alternative, that section 87 B, even if valid, cannot apply to this suit, which was pending when the section was enacted.
The right to continue the suit being a substantive right, cannot, it is submitted, be taken away except by a law which is made applicable to pending actions, either expressly or by necessary intendment.
Against the other respondent, it is contended that he was liable as an agent or at least, as a 705 sub agent, in view of the provisions of section 230(3) of the Indian Contract Act.
We are not concerned with the merits of the claim, and they have not been mentioned at the bearing.
We shall begin by considering whether section 87 B is ultra vires and void.
It is said that it discriminates in favour of ex Rulers of Indian States by creating an immunity from civil actions.
Prior to the present Constitution, Part IV of the Code of Civil Procedure contained provisions in respect of suits in particular cases.
This was divided into three parts.
Sections 79 to 82 dealt with suits by or against the Crown or Public Officers in their official capacity and section 88 provided for suit of interpleader.
We are not concerned with them.
Sections 83 to 87 dealt with suits by aliens and by or against Foreign Rulers and Rulers of Indian States.
Sections 83 and 84 provided respectively when aliens and foreign States may sue.
Section 85 provided for the appointment by Government of persons to prosecute or defend Princes or Chiefs.
Section 86 provided for suits against Princes, Chiefs, Ambassadors and Envoys.
It created partial ex territoriality by granting them exemption from civil jurisdiction except when an action was brought with the consent of the Central Government.
The first sub section provided: "Any such Prince or Chief, and any ambassador or envoy of a foreign State, may in the case of the Ruling Chief of an Indian State with the consent of the Crown Representative, certified by the signature of the Political Secretary, and in any other case with the consent of the Central Government, certified by the signature of a secretary to that Government, but not without such consent, be sued in any competent Court.
" The remaining four sub sections dealt with the kinds of suits and the conditions under which they could be brought and certain other aspects Of ex territoriality.
Section 87 laid down the style of Princes or Chiefs as parties to suits.
After the coming into force of the Constitution, 89 706 certain adaptations were made by the President by the Adaptations of Laws Order 1950, but we are not concerned with them.
Suffice it to say that the protection continued in view of article 372 of the constitution (unless it was void under the Chapter on Fundamental Rights) till we come to the enactment of Act 11 of 1951.
The impact of the Fundamental Rights provisions on section 86 as originally enacted and on the new section 87 B being the same, we need not consider the matter separately.
When the Indian States integrated with British India, the Rulers of States and the Government of India entered 'Into covenants and agreements.
In those covenants, it was agreed that the privileges, dignities and titles of the Indian Princes would be continued to be recognised.
When the Constitution was enacted, the assurance in the covenants was respected, and article 362 was included in the Constitution.
It reads: "In the exercise of the power of Parliament or of the Legislature of a State to make laws or in the exercise of the executive power of the Union or of a State, due regard shall be had to the guarantee or assurance given under any such covenant or agreement as is referred to in clause (i) of Article 291 with respect to the personal rights, privileges and dignities of the Ruler of an Indian State." The reference to article 291 merely indicates that those covenants or agreements were meant which the Ruler of any Indian State had entered into with the Central Government before the commencement of the Constitution.
This description is not repeated in article 362, but is incorporated by reference.
The mention of article 291 in article 362 has no further significance, and the generality of the assurance in the latter Article is not lessened.
The privilege of ex territoriality and exemption from civil jurisdiction except with the consent of the Central Government was one of long standing, and when the Amendment Act of 1951 was passed, sections 83 to 87 were reenacted.
We are not concerned with all the changes that were made, and reference to some 707 of them is unnecessary.
Section 86 was amended by deleting all references to Ruling Chiefs of Indian States and the first sub section was reenacted as follows: "86.
(1) No Ruler of a foreign State may be sued in any court otherwise competent to try the suit except with the consent of the Central Government certified in writing by a Secretary to that Government:" (proviso omitted).
Sub section (3) gave protection against arrest and, except with the consent of the Central Government, against execution of decrees against the property of any such Ruler.
Section 87 laid down the style of foreign Rulers as parties to suits.
Section 87 A was added to define "foreign State" and "Ruler" and to make the exemption only available to a State and its head, recognised as such by the Central Government.
Section 87 B, with which we are concerned, was specially enacted in respect of suits against Rulers of former Indian States.
It provided: "87 B. (1) The provisions of section 85 and of sub sections (1) and (3) of section 86 shall apply in relation to the Rulers of any former Indian State as they apply in relation to the Ruler of a foreign State.
(2) In this section (a)former Indian State 'means any such Indian State as the Central Government may, by notification in the Official Gazette, specify for the purposes of this section; and (b) 'Ruler ' in relation to a former Indian State, means the person who, for the time being, is recognised by the President as the Ruler of that State for the purposes of the Constitution.
" By this provision, which is very much the same as the former section 86, the privilege previously enjoyed by the Rulers of Indian States was continued.
In this historical background, the question of dis crimination raised in the appeal must be examined.
It is easy to see that the ex Rulers form a class and the special legislation is based upon historical considerations applicable to them as a class.
The Princes 708 who were, before integration, sovereign Rulers of Indian States, handed over, after the foundation of the Republic, their States to the Nation in return for an annual Privy Purse and the assurance that their personal rights, privileges and dignities would be respected.
The Constitution itself declared that these rights, etc., would receive recognition.
A law made as a result of these considerations must be treated as based on a proper classification of such Rulers, who had signed the agreement of the character described above it is based upon a distinction which can be described as real and substantial, and it bears a just relation to the object sought to, be attained.
It is further contended that the Article speaks of privileges but not of immunities, and we were referred to certain other Articles of the Constitution where "immunities" are specifically mentioned.
It is not necessary to refer to those Articles.
Immunity from civil action may be described also as a privilege, because the word "Privilege" is sufficiently wide to ' include an immunity.
The Constitution was not limited to the choice of any particular words, so long as the intention was clearly expressed.
In our opinion, the words "personal rights and privileges" are sufficiently comprehensive to embrace an immunity of this character.
It is, therefore, clear that the section cannot be challenged as discriminatory, because it arises from a classification based on historical facts.
It is next contended that section 87 B only applies the provisions of sub sections
(1) and (3) of section 86, that tile words of the latter section are not retrospective, that the suit was filed before the enactment of section 87 B, and that the substantive right of the plaintiff to continue his suit could not be taken away in the absence of express language or clear intendment.
The words of section 86(l) are "No Ruler of a foreign State may be sued in any court.
This precludes, it is said, only the initiation of a suit and not the continuance of a suit already filed before the section was enacted.
In our opinion, these arguments cannot be accepted.
The word "sued" means not only the filing of a suit or a civil proceeding but also their pursuit through Courts.
A person 709 is sued not only when the plaint is filed, but is sued also when the suit remains pending against him.
The word "sued" covers the entire proceeding in an action, and the person proceeded against is sued throughout the duration of the action.
It follows that consent is necessary not only for the filing of the suit against the ex Ruler but also for its continuation from the time consent is required.
In view of the amplitude of the word "sued", it is not necessary to consider generally to what extent pending cases are affected by subsequent legislation or refer to the principles laid down in The United Provinces V.,, Atiqa Begum (1), Venugopala Reddiar vs Krishnaswamy Reddiar (2) or Garikapatti Veeraya vs N. Subbiah Choudhury (3).
If the language of section 86 read with section 87 B were applicable only to the initiation of a civil suit, these cases might have been helpful; but since the words "may sue" include not only the initiation of a suit but its continuation also, it is manifest that neither the suit could be filed nor maintained except with the consent of the Central Government.
In Atiqa Begum 's Case (1), Varadachariar, J. referred to the two principles applicable to cases where the question of retrospectivity of a law has to be considered.
They are that vested rights should not be presumed to be affected, and that the rights of the parties to an action should ordinarily be determined in accordance with the law, as it stood at the date of the commencement of the action.
But, the learned Judge pointed out that the language of the enactment might be sufficient to rebut the first, and cited the case of the Privy Council in K. C. Mukherjee vs Mst.
Ram Ratan Kuer (4).
Here, the matter can be resolved on the language of the enactment.
The language employed is of sufficient width and certainty to include even pending actions, and the contrary rule applies, namely, that unless pending actions are saved from the operation of the new law,they must be taken to be affected.
The word "sued ", as we have shown, denotes not only the start but also the continuation of a civil action, and the (1) [1940] F.C.R.110 (2) (3) [1957] S.C.R.4ss.
(4) Pat.
710 Prohibition, therefore, affects not only a suit instituted after the enactment of section 87 B but one which, though instituted before its enactment, is pending.
In our judgment, the present suit was incompetent against the first defendant, the ex Ruler of Jaipur.
It is contended that defendants 2 and 3 acted as the agents of the ex Ruler and placed the order with the appellant.
The position of the Military Secretary since dead) was on a different footing, but it is conceded that no cause of action against him survived, because the appeal has abated against him.
Mohabat Singh, who is the third defendant, cannot be described as an agent of the ex Ruler, because his connection with the orders placed was merely to sign the letters purporting to emanate from the Military Secretary.
Those letters he signed "for the Military Secretary".
He was not acting as the agent of the ex Ruler but was performing the ministerial act of signing the letters on behalf of the Military Secretary.
This cannot be said to have constituted him an agent.
The suit against him was, therefore, misconceived, whatever might have been said of the Military Secretary.
In our opinion, the dismissal of the suit was justified in the circumstances of the case.
The appeal fails, and is dismissed with costs.
The appellant will pay court fee on the memorandum of appeal, as he was allowed to file this appeal as a pauper.
Appeal dismissed.
| The appellant filed a suit for the recovery of money as price of goods supplied against the Ex Ruler of Jaipur.
Subsequently section 87 B was introduced in the Code of Civil Procedure making the provisions of section 86 in respect of suits against rulers of foreign States applicable to the rulers of former Indian States.
The Ex Ruler raised the plea that the suit was incompetent as the consent of the Central Government had not been obtained as required by section 87 B.
The appellant contended: (i) that section 87 B violated article 14 Of the Constitution and was void, (ii) that section 87 B did not apply to the continuation of a suit pending at the time when section 87 B was enacted but only to the filing of a suit after the enactment of that section.
Held, that section 87 B did not violate article 14 Of the Constitu tion and was not void.
Section 87 B of the Code of Civil Procedure merely continued the privilege which was formerly enjoyed by the Rulers of Indian States and in regard to which the covenants entered into by the Ex Rulers and the Government of India provided for their continuance.
This agreement about the privileges was further assured by article 362 Of the Constitution.
The Ex Rulers thus formed a class and the special legislation was based upon historical considerations applicable to them as a class.
The classification was based on a distinction which was real and substantial and it bore a just relation to the object sought to be attained.
Held, further, that the suit was incompetent against the Ex Ruler of Jaipur.
The protection of section 87 B read with section 86 applied both to the filing of a suit and to its, pursuit through the courts.
Section 86 provides that "No Ruler. . may be sued in any court. . .
A person is "sued" not only when the plaint is filed against him, but is "sued" also when the suit remained pending against him.
The word "sued" covers the entire proceedings in an action.
Consequently, the consent of the Central Government was necessary not only for the filing of the suit against the Ex Ruler but also for its continuation from the time consent was required.
703 Held, further, that section 87 B was on its terms applicable to pending suits and there was no saving in favour of pending actions.
K. C. Mukherjee vs Mst.
Rath Ratan Kuer, Pat. 268, applied.
|
ON: Criminal Appeals Nos.165 168 of 1962.
Appeals by special leave from the judgment and order dated August 25, 1962 of the Patna High Court in Criminal Revisions Nos.527 to 530 of 1962.
Nuruddin Ahmad and U. P. Singh, for the appellants.
section P. Varma and R. N. Sachthey, for the respondents.
The Judgment of the Court was delivered by Mudholkar, J.
This judgment will also govern Crl.No. 166 of 1962, 167 of 1962 and 168 of 1962.
A common question arises in these appeals from a judgment of the Patna High Court dismissing four revision applications preferred before it by four sets of appellants in the appeals before us.
Counsel on both the sides agree that since the relevant facts of all the proceedings are similar and the question of law arising from them is the same it will be sufficient to refer to the facts of Case No. TR 320/60.
Four informations were lodged at the police station, Ghora Saha on April 14, 1960 by different persons against the different appellants in these cases and a similar information was lodged against some of the appellants by one Mali Ram.
In all these cases the allegations made by the informants were that each set of the accused persons armed with deadly weapons went to the shops of the various informants, demanded from them large sums of money and threatened them with death if they failed to pay the amounts demanded by them.
The informations also stated that 742 some of these persons paid part of the money and were given time to pay the balance while some agreed to pay the amounts demanded.
Upon informations given by these persons offences under section 392, Indian Penal Code, were registered by the station officer and after investigation five challans were lodged by him, in the court of Magistrate.
First Class at Motihari.
One of the cases ended in an acquittal but we have not been informed of the date of the judgment in that case.
In the other four cases trial had come to a close in that all the prosecution witnesses and the defence witnesses had been examined and the cases had been closed for judgment.
In the case against the appellants in Crl. A. 165 of 1962 the challan was presented on October 27, 1960.
The order sheet of that date reads as follows: Date of order Order with the Office action section No. or proceeding signature of taken with the Court date 1.27 10 1960 All the 4 accused are present Heard both sides.
It is argued on behalf of the prosecution that it is a fit case for adopting procedure under Chapter XVIII Cr. P. C. and also that the entire occurrence relates to offences committed on 4 dates so that all of them cannot be dealt with in a single case.
Discussed law point "Charge u/s 302, I.P.C. framed against accused Thakur Ram and Jagarnath Pd. and explained to them.
They plead not guilty.
This case will constitute an independent case.
As for the other parts of the alleged occurrence accused Jagarnath, Kamal Ram and Bansi Rain are charged separately u/s 384, I.P.C. and further accused Thakur Ram u/s 384/109, I.P.C. and explained to the respective accused.
They plead not guilty.
These charges relating to three incidents on 3 dates will constitute a separate single case.
Start separate order sheet for both Summons P.W. for 26 10 60 and 27 11 60.Accused as before.
Sd/ O. Nath".
The trial dragged on for nearly 15 months and then the prosecution made an application to the court for framing a charge 743 under section 386 or section 387, Indian Penal Code and for committing the case to a court of Sessions.
This was disposed of by the learned Magistrate on January 25, 1962.
The relevant portion of his order sheet of that date reads thus "Accused absent.
A petition for their representation u/s 540 A, Cr P.C. is filed.
Allowed.
No reference book is produced.
Persued the record.
The prosecution has pressed to refer the case to the Court of Sessions u/s 386 or 387 I.P.C.
On close scrutiny I find that the robbery defined inside 390 I.P.C. fully cover the ingredients pointed out and asked by the prosecution side.
The case has entered in the defence stage.
This point was not introduced ever before.
The charge was framed u/s 392, I.P.C. after hearing the parties.
Although it may be referred to the superior court at any stage, I find no reason to do so.
Put up on 28 2 62.
All accused to appear with D.Ws without fail.
Accused as before.
" On February 28, 1962 the prosecution moved a petition for stay of proceedings on the ground that it wanted to prefer an application for revision of the order of January 25, 1962.
Stay was refused and the case was proceeded with.
On March 17, 1962 the defence case was closed and the case was fixed for March 29, 1962 for arguments.
On that date a second application was made for committing the case to a court of Sessions.
It would appear from the order sheet of March 29, 1962 that the Magistrate heard the parties and ordered the case to be put up on the next day, that is March 30, 1962.
On this day the Magistrate passed an order to the following effect "30 3 62 All the 2 accused persons are present.
Having carefully gone through the law points and section 236 Cr.P.C. I do not find that it is a case exclusively coming u/s 386 or 387 I.P.C. Hence the prosecution prayer is rejected."
Immediately thereafter a revision application was preferred, not by the prosecution, but by Sagarmal, an informant in one of the other three cases.
The Sessions Judge, Champaran, after briefly reciting the facts and reasons on which the order of the trying Magistrate was founded, disposed of the revision application in the following words: .lm15 "The cases are of very serious nature and the framing of charges under sections 386 or 387, I.P.C. can 744 not be ruled out altogether.
Consequently, I direct that each of these cases should be tried by a Court of Session.
The learned Magistrate will commit the accused persons for trial accordingly.
The applications are thus allowed.
" An application for revision was preferred by the appellants before the High Court and the main ground urged on their behalf was that the Sessions Judge had no jurisdiction to pass an order for commitment as there was no order of discharge by the Magistrate.
There is conflict of authority on the question whether under section 437, Cr.P.C. a Sessions Judge can, in the absence of an express order of discharge, direct commitment of a case to it while the trial is proceeding before a Magistrate in respect of offences not exclusively triable by a Court of Sessions.
After referring to some decisions and relying upon two decisions of the Allahabad High Court the learned Judge who disposed of the revision application observed as follows "As I have already indicated, in the instant cases, the trial Magistrate, after hearing the parties, refused to frame a charge for the major offence under section 386 or section 387 of the Indian Penal Code.
The refusal by the Magistrate to frame a charge under section 386 or 387 of the Indian Penal Code was a final order and it amounted to an order of discharge of the accused of the offence under those sections.
That being the position, the learned Sessions Judge had full jurisdiction to order for commitment."
The learned Judge further observed "Without expressing any opinion on the merits of the four cases, I would state, that, on the materials on record, the Sessions Judge was not unjustified in passing the impugned order for commitment of the accused in the four cases.
The order of the Magistrate refusing to frame a charge under section 386 or section 387 of the Indian Penal Code, which amounted to an order of the implied discharge of the accused, was improper in all the four cases." and dismissed the revision applications.
Am application was made for a certificate of fitness to appeal to this Court.
That was rejected and the appellants have come here by special leave.
745 The ambit of the powers of the Sessions Judge under section 437, Cr.P.C. has been considered by a Full Bench of the Allahabad High Court in Nahar Singh vs State(1).
In that case it was held that the powers conferred by that section are exercisable only in a case where a Magistrate by an express order discharges an accused person in respect of an offence exclusively triable by a court of Sessions.
The learned Judges constituting the Full Bench have taken the view that in the light of certain provisions of the Code to which they adverted, the failure of or refusal by a Magistrate to commit an accused person for trial by a court of Sessions does not amount to an implied discharge of the accused person so as to attract the power of the Sessions Judge under section 437, Cr.P.C. to direct the Magistrate to commit the accused person for trial by a court of Sessions on the ground that the offence is exclusively triable by a Court of Sessions.
The Full Bench decision has been followed in Sri Dulap Singh & ors.vs State through Sri Harnandan Singh(2).
Before us reliance is also placed on behalf of the appellants on the decision in Yunus Shaikh vs The State(3).
That decision, however, is of little assistance to them because the ground on which the High Court set aside the order of the Sessions Judge is not that he had no jurisdiction to make it under section 437, Cr.P.C. but that the action of the Magistrate in not framing a charge under section 366 of the Indian Penal Code but framing a charge only under section 498, T.P.C. did not, in the light of the material before him, amount to an improper discharge of the accused in respect of an offence triable by a Court of Sessions.
The view taken by the Allahabad High Court has been accepted as correct in Sambhu Charan Mandal vs The State(4 ) .
On the other hand a Full Bench of the Madras High Court has held in in re Nalla Baligadu(5) that where under section 209(1) a Magistrate finds that there are not sufficient grounds for committing the accused for trial and directs such person to be tried before himself or some other Magistrate, the revisional powers under section 437, Cr.P.C. can be exercised before the conclusion of the trial before such Magistrate.
The learned Judges expressly dissented from the view taken by the Full Bench of the, Allahabad High Court.
This decision has been followed in, Rambalam Pd.Singh vs State of Bihar(6).
Other decisions which take the same view as the Madras High Court are : Krishnareddi (1) I.L.R. [1952] 2 All. 152.(3) A.I.R. 1953 Cal.(5) A.I.R. 1953 Mad. 801.(2) A.I.R. 1954 All.(4) (6) A.I.R. 1960 Patna 507.746 v.Subbamma(1); Shambhooram vs Emperor(2); Sultan Ali vs Emperor( '); and in re Valluru Narayana Reddy & ors.(4 ) .
In order to decide the question which has been raised before us it would be desirable to bear in mind the relevant provisions of the Code of Criminal Procedure.
Section 207 provides that in every inquiry before a Magistrate where the case is triable exclusively by a Court of Sessions or High Court, or, which in the opinion of the Magistrate, ought to be tried by such Court, the Magistrate must in any proceeding instituted on a police report, follow the procedure specified in section 207 A. Under section 207 A the Magistrate, after perusing the police report forwarded under section 173, has to fix a date for hearing and require the production of the accused on that date.
He has also the power to compel the attendance of such witnesses or the production of any document or thing on that date if an application is made in that behalf by the officer conducting the prosecution.
On the date of hearing the Magistrate, after satisfying himself that copies of the documents referred to in section 173 have been furnished, has to proceed to take the evidence, of such persons, if any, as are produced as witnesses to the actual commission of the offence.
After the examination of those witnesses and after their cross examination by the accused the Magistrate may, if he thinks it necessary so to do in the interest of justice, take the evidence of any one or more of the other witnesses for the prosecution.
He has then to examine the accused for the purpose of enabling him to explain the circumstances appearing in the evidence against him and hear both the proseeution as well as the accused.
If at that stage he is of opinion that no round for committing the accused for trial exists, the Magistrate can, after recording his reasons, discharge the accused.
If, however, it appears to the Magistrate that such person should be tried by himself or some other Magistrate he must proceed accordingly.
This contingency will arise if the Magistrate forms an opinion that no case exclusively triable by a Court of Sessions is disclosed but a less serious offence which it is within the competence of the Magistrate to try is disclosed.
In that case he has to proceed to try the accused himself or send him for trial before another Magistrate.
Where the Magistrate is of opinion that the accused should be committed for trial he has to frame a charge and declare with what offence the accused should be charged.
With the remaining provisions of s, 207 A we are not concerned.
It will thus be seen that where the police report suggests the commission of an offence which is exclusively triable by a Court (1) I.L.R. (3) A.I.R. 1934 Lahore 164.(2) A.I.R. 1935 Sind 221.(4) A.I.R. 1955 Andhra 48.747 of Sessions, the Magistrate can nevertheless proceed to try the accused for an offence which is triable by him if he is of the view that no offence exclusively triable by a Court of Sessions is disclosed.
Similarly, even in a case where an offence is triable both by a Magistrate and a Court of Sessions, the Magistrate is of the view that the circumstances do not warrant a trial by a Court of Sessions he can proceed with the trial of the accused for that offence himself.
Section 347 which occurs in chapter XXIV headed "General provisions as to Inquiries and Trials" empowers a Magistrate to commit a person for trial by a Court of Sessions if in the course of the trial before him and before signing the judgment it appears to him at any stage of the proceeding that the case ought to be so tried.
These provisions would thus indicate that an express order of discharge is contemplated only in a case where a Magistrate comes to the conclusion that the act alleged against the accused does not amount to any offence at all and, therefore, no question of trying him either himself or by any other court arises.
They also show that where an accused person is being tried before a Magistrate in respect of an offence triable by that Magistrate it appears to the Magistrate that the act of the accused amounts to an offence which is triable either exclusively or concurrently by a Court of Sessions he has the power to order his committal.
This power, however, has to be exercised only before signing the judgment.
It cannot obviously be exercised thereafter because of the provisions of section 403(1) which bar the trial of the person again not only for the same offence but also for any other offence based on the same facts.
It would follow from this that where on a certain state of facts the accused is alleged by the prosecution to have committee an offence exclusively triable by a Court of Sessions but the Magistrate is of the opinion that the offence disclosed is only an offence which he is himself competent to try and either acquits or convicts him there is an end of the matter in so far as the very set of facts are concerned.
The facts may disclose really a very grave offence such as, say, one under section 302, I.P.C. but the Magistrate thinks that the offence falls under section 304 A which he can try and after trying the accused either convicts or acquits him.
In either case the result would be that the appropriate court will be prevented from trying the accused for the grave offence which those very facts disclose.
It is to obviate such a consequence and to prevent inferior courts from clutching at jurisdiction that the provisions of section 437, Cr.P.C. have been enacted.
To say that they can be availed of only where an express order of discharge is made by a Magistrate despite the wide language used in section 437 would have 748 the result of rendering those provisions inapplicable to the very class of cases for which they were intended.
When a case is brought before a Magistrate in respect of an offence exclusively or appropriately triable by a Court of Sessions what the Magistrate has to be satisfied about is whether the material placed before him makes out an offence which can be tried only by the Court of Sessions or can be appropriately tried by that Court or whether it makes out an offence which he can try or whether it does not make out any offence at all.
In Ramgopal Ganpatrai vs State of Bombay(1) this Court has pointed out : "In each case, therefore the Magistrate holding the preliminary inquiry, has to be satisfied that a prima facie case is made out against the accused by the evidence of witnesses entitled to a reasonable degree of credit and unless he is so satisfied, he is not to commit." It has, however, also to be borne in mind that the ultimate duty of weighing the evidence is cast on the court which has the jurisdiction to try an accused person.
Thus, where two views are possible about the evidence in a case before the Magistrate, it would not be for him to evaluate the evidence and strike a balance before deciding whether or not to commit the case to a Court of Sessions.
If, instead of committing the case to a Court of Sessions, he proceeds to try the accused upon the view that the evidence found acceptable by him only a minor offence is made out for which no commitment is required he would obviously be making an encroachment on the jurisdiction of the appropriate court.
This may lead to miscarriage of justice and the only way to prevent it would be by a superior court stepping in and exercising its revisional jurisdiction under section 437 Cr.P.C.
There is nothing in the language of section 437 from which it could be said that this power is not exercisable during the pendency of a trial before a Magistrate or that this power can be exercised only where the Magistrate has made an express order of discharge.
Express orders of discharge are not required to be passed by the Court in cases where, upon the same facts, it is possible to say that though no offence exclusively or appropriately triable by a Court of Sessions Judge is made out, an offence triable by a Magistrate is nevertheless made out.
One of the reasons given by the Allahabad High Court in support of the view taken by it is that a Magistrate has power even during the course of the trial to commit the accused to a Court of Sessions and that to imply a discharge from his omission to commit or refusal to commit (1) [1958] S.C.R.618.749 would not be consistent with the existence of the Magistrate 's power to order commitment at any time.
That does not, however, seem to be a good enough ground for coming to this conclusion.
The power to commit at any stage is exercisable by virtue of the express provisions of section 347 or section 236 and a previous discharge of an accused from a case triable by a Court of Sessions would not render the power unexercisable thereafter.
Moreover, even if an express order of discharge is made by a Magistrate in respect of an offence exclusively triable by a Court of Sessions but a trial on the same facts for a minor offence is proceeded with the Magistrate has undoubtedly power to order his commitment in respect of the very offence regarding which, he has passed an order of discharge provided of course the material before him justifies such a course.
There is nothing in section 347 which precludes him from doing this.
It will, therefore, be not right to say that the power conferred by section 437 is exercisable only in respect of express orders of discharge.
In this context it will be relevant to quote the following passage from the judgment of the Full Bench of the Madras High Court in Krishna Reddy 's case(1) : "I do not think that the order of the Sessions Judge was one which he had no jurisdiction to make.
In my view the decision of the Magistrate must be taken to be not only one of acquittal of an offence punishable under section 379, Indian Penal Code, but one of discharge so far as the alleged offence under section 477, Indian Penal Code is concerned.
The complaint against the accused was that he committed an offence punishable under section 477, Indian Penal Code.
Such offence is triable exclusively by the Court of Sessions.
The Magistrate could neither acquit nor convict him of such offence.
He was bound either to commit him to the Sessions Court or to discharge him.
He did not commit him.
The only alternative was to discharge him, and that, I take it, is what the Magistrate really did do.
It is not suggested that the charge under section 477 is still pending before the Magistrate.
It has been disposed of, and the only question is as to what the disposal has been.
It seems to me that the accused has been discharged so far as the charge under section 477 is concerned.
The Magistrate 's order, if stated fully,should have been 'I discharge him as regards the offence punishable under section 477, and I acquit him as regards the offence punishable under section 379 (1) L.L.R. 750
We agree and are, therefore, of the view that the High Court was right in holding that the Sessions Judge had jurisdiction to make an order directing the Magistrate to commit the case for trial by a Court of Sessions.
The provisions of section 437, however, do not make it obligatory upon a Sessions Judge or a District Magistrate to order commitment in every case where an offence is exclusively triable by a Court of Sessions.
The law gives a discretion to the revising authority and that discretion has to be exercised judicially.
One of the factors which has to be considered in this case is whether the intervention of the revising authority was sought by the prosecution at an early stage.
It would be seen that an attempt to have the case committed failed right in the beginning and was repeated not earlier than 15 months from that date.
The second attempt also failed.
Instead of filing an application for revision against the order of the Magistrate refusing to pass an order of commitment the prosecution chose to make a second application upon the same facts.
It may be that successive applications for such a purpose are not barred but where a later application is based on the same facts as the earlier one the Magistrate would be justified in refusing it.
Where the Magistrate has acted in this way the revisional court ought not to with propriety interfere unless there are strong grounds to justify interference.
While rejecting the application on January 25, 1962 the ground given by the learned Judge was that the case had already entered the defence stage and the attempt to have the committal was very belated.
Matters had advanced still further when a third attempt failed on March 30, 1962.
By that date not only had the defence been closed and arguments heard, but the case was actually closed for judgment.
It would be a terrible harassment to the appellants now to be called upon to face a fresh trial right from the beginning which would certainly be the result if the Magistrate were to commit the appellants for trial by a Court of Sessions now.
It is further noteworthy that after the last attempt failed it was not the prosecution which went up in revision before the Sessions Judge but the informants and, as pointed out earlier, in the matter concerning the appellants before us it was not even the informant Shyam Lall but one Sagarmal, the informant in another case who preferred a revision application.
In a case which has proceeded on a police report a private party has really no locus standi.
No doubt, the terms of section 435 under which the jurisdiction of the learned Sessions Judge was invoked are very wide and he could even have taken up the matter suo motu.
It would, however, not be irrelevant to bear in mind the fact that the court 's 751 jurisdiction was invoked by a private party.
The criminal law is not to be used as an instrument of wreaking private vengeance by an aggrieved party against the person who, according to that party, had caused injury to it.
Barring a few exceptions, in criminal matters the party who is treated as the aggrieved party is the State which is the custodian of the social interests of the community at large and so it is for the State to take all the steps necessary for bringing the person who has acted against the social interests of the community to book.
In our opinion it was injudicious for the learned Sessions Judge to order the commitment of the appellants particularly so without giving any thought to the aspects of the matter to which we have adverted.
Even the High Court has come to no positive conclusion about the propriety of the direction made by the Sessions Judge and has merely said that the Sessions Judge was not unjustified in making the order which he made in each of the applications.
For all these reasons we allow the appeals, quash the orders of the Sessions Judge as affirmed by the High Court and direct that the trials of each of the appellants shall proceed before the Magistrate according to law from the stages at which they were on the date on which the stay order became operative.
Appeals allowed.
| One Mst.
Raj Kaur was holding certain lands on different tenures under the Raja of Faridkot.
She had two daughters.
She adopted the son of one of them and put him in possession of all the lands.
He transferred a part of the lands to the second respondent who was son of the other daughter of Raj Kaur.
After Raj Kaur 's dearth the Raja filed suits for possession of the land, and in execution of the decree he obtained in those suits, took possession of the entire land, in October, 1938.
He then transferred the land, but the transferee was dispossessed by the appellants in June 1950, in execution of a decree they obtained, in a suit for preemption filed by them against the transferee.
The second respondent 's mother had died in 1938 and her sons the first and second respondents, filed a suit for possession of the entire land in February 1950, as heirs of Raj Kaur, but it was decreed only to the extent of their half share, and the decree was affirmed by the High Court.
In the appeal to this Court it was contended that the suit was governed either by article 142 or article 144 of the Indian Limitation Act, 1908, and on either basis, was barred by time.
HELD: (i) Article 142 would not be attracted to the suit.
In order that the article may be attracted the plaintiff must initially have been in possession of the property and should have been dispossessed by the defendant or some one through whom the defendant claims or alternatively, the plaintiff should have discontinued possession.
It was no one 's case that the first respondent was ever in possession of the property.
As regards the second respondent 's possession at one time of a part of the property, it was by reason of a transfer by the adopted son.
The claim in the instant case, however, was by succession, under a different title altogether, and so it must be held that the plaintiffs respondents, as heirs of Raj Kaur, were never in possession of the land.
[65H] (ii) Article 144 was applicable to the suit, but the suit was not barred by time.
Adverse possession against the respondents started in October.
1938, when the Raja took possession of the land.
To that adverse possession could be added that of his transferee and that of the appellants who had preempted the lands under the decree obtained by them against the transferee.
But, the sum total of the adverse possession of all those persons at the date of the respondent 's suit would be less than 12 years.
The adverse possession of the adopted son could not be tacked on to the adverse possession of the Raja and those who claim through him, because, in a suit to which Art 144 is attracted, the burden is on the defendant to establish that he was in adverse possession for 12 years before the date of suit, and for computation of that period, he can avail himself of the adverse possession of any person or persons through whom he claims but not the adverse possession of independent tres 64 passers.
The starting point of limitation in article 144 is the date when the possession of the defendant becomes adverse to the plaintiff.
The gist of the definition of the word "defendant" in section 2(4) of the Act is the existence of a jural relationship between the different persons referred to in the definition, and there can be no jural relationship between two independent trespassers.
[66 F H; 68C; 70B].
Ramayya vs Kotamma, Mad. 370, explained.
|
Appeal No. 791 of 1962.
Appeal by special leave from the judgment and order dated March 22, 1960, of the Bombay High Court in Award No. 18 of 1959.
section T. Desai and I. N. Shroff, for the appellant.
B. C. Misra, for the respondent.
April 29, 1964.
The Judgment of the Court was delivered by HIDAYATULLAH J.
This appeal by special leave is directed against an order of the High Court of Bombay dated March 22, 1960 in its ordinary original civil jurisdiction.
The facts are simple.
By a letter dated July 30, 1955, Messrs. Kajaria rraders (India) Ltd., who is the respondent here and Messrs. Foreign Import and Export Association (sole proprietory firm owned by the appellant Jagdish C. Gupta) entered into a partnership to export between January and June 1956, 10,000 tons of manganese ore to Phillips Brothers (India) Ltd., New York.
Each partner was to supply a certain quantity of manganese ore.
We are not concerned with the terms of the agreement but with one of its clauses which provided: "That in case of dispute the matter will be referred for arbitration in accordance with the Indian .
" The company alleged that Jagdish Chander Gupta failed to carry out his part of the partnership agreement.
After some correspondence, the company wrote to Jagdish Chander Gupta on February 28, 1959 that they had appointed Mr. R. J. Kolah (Advocate O.S.) as their arbitrator and asked Jagdish Chander Gupta either to agree to Mr. Kolah 's appointment as sole arbitrator or to appoint his own arbitrator.
Jagdish Chander Gupta put off consideration and on March 17, 1959 the company informed Jagdish Chander Gupta that as he had failed to appoint an arbitrator within 15 clear days they were appointing Mr. Kolah as sole arbitrator.
Jagdish Chander Gupta disputed this and the corn 53 pany filed on March 28, 1959 an application under section 8 (2) of the Indian for the appointment of Mr. Kolah or any other person as arbitrator.
Jagdish Chander Gupta appeared and objected inter alia to the institution of the petition.
Two grounds were urged (i) that section 8(2) of the Indian was not appli cable as it was not expressly provided in the arbitration clause quoted above that the arbitrators were to be by consent of the parties and (ii) that section 69(3) of the afforded a bar to the petition because the partnership was not registered.
The petition was refer red by the Chief Justice to a Divisional Bench consisting of Mr. Justice Mudholkar (as he then was) and Mr. Justice Naik.
The two learned Judges agreed that in the circumstances of the case an application under section 8 of the Indian was competent and that the court had power to appoint an arbitrator.
They disagreed on the second point: Mr. Justice Mudholkar was of the opinion that section 69(3) of the barred the application while Mr. Justice Naik held otherwise, The case was then referred to Mr. Justice K. T. Desai (as he then was) and he agreed with Mr. Justice Naik with the result that the application was held to be competent.
In this appeal it was not contended that the conclusions of the learned Judges in regard to section 8(2) were erroneous.
The decision was challenged only on the ground that section 69(3) was wrongly interpreted and the bar afforded by it was wrongly disallowed.
Section 69 of the may be reproduced here : "69.(1) No suit to enforce a right arising from a contract or conferred by this Act shall be instituted in any Court by or on behalf of any person suing as a partner in a firm against the firm or any person alleged to be or to have been a partner in the firm unless the firm is registered and the person suing is or has been shown in the Register of Firms as a partner in the firm.
54 (2) No suit to enforce a right arising from a contract shall be instituted in any Court by or on behalf of a firm against any third party unless the firm is registered and the persons suing are or have been shown in the Register of Firms as partners in the (3) The provisions of sub sections(1) and (2) shall apply also to a claim ofset off or other proceeding to enforce a rightarising from a contract, but shall not affect (a) the enforcement of any right to sue for the dissolution of a firm or for accounts of a dissolved firm, or any right or power to realise the property of a dissolved firm, or (b) the powers of an official assignee, receiver or Court under the , or the , to realise the property of an insolvent partner.
(4) This section shall not apply (a) to firms or to partners in firms which have no place of business in the territories to which this Act extends, or whose places of business in the said territories are situated in areas to which, by notification under section 56, this Chapter does not apply, or (b) to any suit or claim of set off not exceeding one hundred rupees in value which, in the Presidency towns, is not of a kind specified in section 19 of the , or outside the Presidency towns, is not of a kind specified in the Second Schedule to the Provincial Small Cause Courts Act, 1887, or to any proceeding in execution or other proceeding incidental to or arising from any such suit or claim 'Me section, speaking generally, bars certain suits and pro ceedings as a consequence of non registration of firms.
Sub 55 section (1) prohibits the institution of a suit between partners inter se or between partners and the firm for the purpose of .enforcing a right arising from a contract or conferred by the Partnership Act unless the firm is registered and the person suing is or has been shown in the Register of Firms as a partner in the firm.
Sub section
(2) similarly prohibits a suit by or on behalf of the firm against a third party for the purpose of enforcing rights arising from a contract unless the firm is registered and the person suing is or has been shown in the Register of Firms as a partner in the firm.
In the third sub section a claim of set off which is in the nature of a counter claim is also similarly barred.
Then that subsection bars "other proceedings".
The only doubt that has arisen in this case is regarding the meaning to be given to the expression "other proceeding".
One way to look at the matter is to give these words their full and natural meaning and the other way is to cut down that meaning in the light of the words that precede them.
The next question is whether the application under section 8 (2) of the can be regarded as a proceeding "to enforce a right arising from a contract", and therefore, within the bar of section 69 of the .
Mr. Justice Mudholkar in reaching his conclusion did not interpret the expression "other proceeding" ejusdem generis with the words "a claim of set off".
He held further that the application was to enforce a right arising from the contract of the parties.
Mr. Justice Naik pointed out that the words used were not "any proceeding" nor "any other proceedings" but "other proceeding" and that as these words were juxtaposed with 'a claim of set off ' they indicated a, proceeding of the nature of a claim in defence.
On the second point Mr. Justice Naik held that this was not a proceeding to enforce a right arising from a contract but was a claim for damages and such a claim, could be enter tained because it was based on something which was inde pendent of the contract to supply ore.
He held that the, right which was being enforced was a right arising from the and not from the contract of the parties.
Mr. Justice K. T. Desai agreed with most of these conclu sions and suggeted that the words preceding "other proceed 56 ing", namely, "a claim of set off" had 'demonstrative and limiting effect '.
He seems to have ascertained the meaning of the expression "other proceeding" by reference to the meaning of the words "a claim of set off", which he considered were associated with it.
Ile first question to decide is whether the present pro ceeding is one to enforce a right arising from the contract of the parties.
The proceeding under the eighth section of the has its genesis in the arbitration clause, because without an agreement to refer the matter to arbitration that section cannot possibly be invoked.
Since the arbitration clause is a part of the agreement constituting the partnership it is obvious that the proceeding which is before the court is to enforce a right which arises from a contract.
Whether we view the contract between the parties as ;a whole or view only the clause about arbitration, it is impossible to think that the right to proceed to arbitration is not one of the rights which are founded on the .
agreement of the parties.
The words of section 69(3) "a right arising from a contract" are in either sense sufficient to cover the present matter.
It remains, however, to consider whether by reason of the fact that the words "other proceeding" stand opposed to the words "a claim of set off" any limitation in their eaning was contemplated.
It is on this aspect of the case that the learned Judges have seriously differed.
When in a statute particular classes are mentioned by name and then are followed by general words, the general words are sometimes construed ejusdem generis, i.e. limited to the same category or genus comprehended by the particular wordsbut it is not necessary that this rule must alwavs apply.
The nature of the special words and the general words must e considered before the rule is applied.
In Allen vs Emerson (1), Asquith J. gave interesting examples of particular words followed by general words where the Principle of ejusdem generis might or might not apply.
We ink that the following illustration will clear any difflculty.
In the expression "books, pamphlets, newspapers and other (1) [i944] 1 K.B. 362.
57 documents" private letters may not be held included it 'other documents ' be intepreted ejusdem generis with what goes before.
But in a provision which reads "newspapers or other document likely to convey secrets to the enemy", the, words 'other document ' would include document of any kind and would not take their colour from 'newspapers '.
It follows, therefore, that interpretation ejusdem generis or noscitur a sociis need not always be made when words showiig particular classes are followed by general words.
Before the general words can be so interpreted there must be a genus constituted or a category disclosed with reference to which the general words can and are intended to be restricted.
Here the expression "claim of set off" does not disclose a category or a genus.
Set offs are of two kinds legal and equitable and both are already comprehended and it is difficult to think of any right "arising from a contract" which is of the same nature as a claim of set off and can be raised by a defendant in a suit.
Mr. B. C. Misra, whom we invited to give us examples, admitted frankly that it was impossible for him to think of any proceeding of the nature of a claim of set off other than a claim of set off which could be raised in a suit such as is described in the second sub section.
In respect of the first sub secton he could give only two examples.
They are (i) a claim by a pledger of goods with an unregistered firm whose goods are attached and who has to make an objection under 0.
21 r. 58 of the Code of Civil Procedure and (ii) proving a debt before a liquidator.
The latter is not raised as a defence and cannot belong to the same genus as a "claim of set off".
The former can be made to fit but by a stretch of some considerable imagination.
It is difficult for Lis to accept that the Legislature was thinking of such far fetched things when it spoke of "other proceeding" ejusdem generis with a claim of set off.
Mr. Justice Naik asked the question that if all proceedings were to be excluded why was it not considered suffi cient to speak of proceedings along with suits in sub sections
(1) and (2) instead of framing a separate subsection about proceedings and coupling 'other proceeding, ' with 'a 58 the search for the answer in the ' scheme of the section itself gives the clue.
The section thinks in terms of (a) suits and (b) claims of set off which are in a sense of the nature of suits and (c) of other proceedings.
The section first provides for exclusion of suits in sub sections
(1) and (2).
Then it says that the same ban applies to a claim of set off and other proceeding to enforce a right arising from a contract.
Next it excludes the ban in respect of the right to sue (a) for the dissolution of a firm, (b) for accounts of.
a dissolved firm and (c) for the realisation of the property of a dissolved firm.
The emphasis in each case is on dissolution of the firm.
Then follows a general exclusion of the section.
The fourth sub section says that the section as a whole, is not to apply to firms or to partners and firms which have no place of business in the territories of India or whose places of business are situated in the territories of India but in areas to which Chapter VII is not to apply and to suits or claims of set off not exceeding Rs. 100 in value.
Here there is no insistence on the dissolution of the firm.
It is significant that in the latter part of clause (b) of that section the words are "or to any proceeding in execution or other proceeding incidental to or arising from any such suit or claim" and this clearly shows that the word "proceeding" is not limited to a proceeding in the nature of a suit or a claim of set off.
Subsection (4) combines suits and a claim of set off and then speaks of "any proceeding in execution" and "other proceeding incidental to or arising from any such suit or clainm" as being outside the ban of the main section.
It would hardly have been necessary to be so explicit if the words other proceeding in the main section had a meaning as restricted as is suggested by the respondent.
It is possible that the draftsman wishing to make exceptions of different kinds in respect of suits, claims of set off and other proceedings grouped suits in sub sections
(1) and (2), set off and other proceedings in sub section
(3) made some special exceptions in respect of them in sub section
(3) in respect of dissolved firms and then viewed them all together in sub section
(4) providing for a complete exclusion ' of the section in respect of suits of particular classes.
For convenience of drafting this 59 scheme was probably followed and nothing can be spelled out from the manner in which the section is sub divided.
Some cases noticed by the High Court were cited to us but none of them appears to be really in point.
In Hafiz Qamar Din vs Nur Din( ') and Babutal Dhandhania vs Messrs. Gauttam and Co.( ') proceedings were started on an award, in one to make it a rule of the Court and in the other to get it set aside.
These cases are distinguishable because they deal with awards and it is not necessary to decide whether after an award the proceeding is one to enforce a right arising from a contract.
We do not refer to them.
In Kottamasu Sreemannarayanamuthy and another vs Chakka Arjanadu() a petition for adjudication of a partner as insolvent was held to be a right arising not from, a contract but from statute.
Here the right that is being enforced through the medium of the arises from the contract between the parties and is a part of it.
In Jamal vs Firm Umar Haji Karim (4 ) the bar of section 69(3) was claimed during the execution of a consent decree and was disallowed.
Grille C. J. observed that the expression 'other proceeding ' indicated something which was 'sui generis of a claim of set off '.
If the partners of an unregistered firm.
go to court without either asking for a dissolution of the firm or dissolving it themselves and enter into an agreement and compose their differences it is possible to say that the enforcement of the consent decree is no more than the enforcement of a right arising from a contract and is within the ban.
It is, however, not necessary to decide this point here.
in Ram Lal Harnam Das vs Pal Krishan and others() it was expressly pointed out that the expression 'other proceeding ' in the third sub section applied to proceedings of the nature of a claim of set off and nothing else.
This case cannot be said to interpret the sub section correctly.
Similarly, Mahendra vs Gurdeyal( '), which lays down that section 69 does not bar a partner of an unregistered partnership firm from applying to the court under section 8 of the for referring the dispute (1) A.T.R (3) A.I.R. 1939 Mad.
(5) A.I.R. 1917 Punjab 159.
(2) A.r.
R. (4) I.L.R. (6) I.L.R. 30 Pat.
109. 60 between partners to arbitrator as provided in the condition of their agreement, cannot be accepted as sound.
The ,reason given by the Divisional Bench that as section 69 allows dissolution and accounts of unregistered partnership it cannot bar such an application appears to us to be not quite in Point.
In our judgment, the words 'other proceeding ' in sub section (3) must receive their full meaning untramelled by the words 'a claim of set off '.
The latter words neither intend nor can be construed to cut down the generality of the words 'other proceeding '.
The sub section provides for the application of the provisions of sub sections
(1) and (2) to claims of set off and also to other proceedings of any Kind which can properly be said to be for enforcement of any right arising from contract except those expressly mentioned as exceptions in sub section
(3) and sub section
The appeal is, therefore, allowed.
The decision of the High Court will be set aside and the application under section 8(2) of the shall stand dismissed with costs throughout on the applicant in the High Court.
| The plaintiff respondent brought a suit against the appel lant for recovery of possession of certain property and for mesne profits.
The plaintiff claimed recovery of possession and mesne profits on the ground that he was the absolute owner of the property described in the plaint and the defendant was in, wrongful possession of the same.
In the plaint the plaintiff made reference to a previous suit that had been filed by him and his mother (C.S. 28 of 1950) wherein a claim had been made against the defendant for the recovery of the mesne profits in regard to the same property for the period ending February 1.0, 1950.
In the previous suit the mense profits had been decreed.
In his written statement in the present suit the defendant appellant raised a technical plea under Order 2 rule 2 of the Civil Procedure Code to the maintainability of the suit.
Before evidence was led by the parties the trial court de cided this preliminary issue raised by the defendant.
The trial court held that the suit was barred under 0.
2 r. 2 of the Code.
On appeal, the Appellate Court held that the plea of a bar under Order 2 rule 2, Civil Procedum Code should not have teen entertained at all because the pleadings in the earlier suit C.S. 28 of 1950 had not been filed in the present case.
Therefore, the Appellate Court set aside the order of the trial Court.
Against this order the defendant preferred an appeal which was dismissed by the High Court.
The appellant obtained special leave against the judgment of the High Court.
Hence the appeal Held:(i) A plea under Order 2 rule 2 of the Code based on the existence of a former pleading cannot be entertained when the pleading on which it rests has not been produced.
It is for this reason that a plea of a bar under 0.
2 r. 2 of the Code can be established only if the defendant files in evidence the pleadings in the previous suit and thereby proves to the court the identity of the cause of action in the two suits.
In other words a plea under 0.
2 r. 2 of the Code cannot be made out except on proof of the plaint in the previous suit the filing of which is said to create the bar.
Without placing before the court the plaint in which those facts were alleged, the defendant cannot invite the court to speculate or infer by a process of deduction what those facts might be with reference to the reliefs which were then claimed.
On the facts of this case it has to be held that the plea of a bar under 0, 2 r. 2 of the Code should not have been entertained at all by 832 the trial Court because the pleadings in civil suit No. 28 of 1950 were not filed by the appellant in support of this plea.
(ii)in order that a plea of a bar under 0. 2 r. 2 (3) of the Code should succeed the defendant who raises the plea must make out (i) that the second suit was in respect of the same cause of action as that on which the previous suit was based; (ii) that in respect of that cause of action the plaintiff was entitled to more that one relief (iii) that being thus entitled to more than one relief plaintiff, without leave obtained from the Court omitted to sue for the relief for which the second suit had been filed.
|
Civil Appeal No. 225 of 1960.
Appeal from the judgment and decree dated April 19, 1957, of the Madhya Pradesh High court (Indore Bench) at Indore in Civil Reference No. 1 of 1952.
B. Sen, B.K.B. Naidu and I.N. Shroff, for the appellant.
A. V. Viswanatha Sastri, K. A. Chitale, J. B. Dadachanji, section N. Andley, Rameshwar Nath and P. L. Vohra, for the respondents.
1961, December, 20 The Judgment of the Court was delivered by AYYANGAR, J.
This appeal comes before us by virtue of a certificate of fitness granted by the High Court of Madhya Pradesh under section 47(2) of the 245 Gwalior War Profits ordinance, Samvat 2001 (hereafter called the Ordinance) on the ground that the appeal involves a substantial question of law.
The question of law which arises in the appeal relates to the proper construction of r. 3(1) of the Schedule of the ordinance.
The respondent M/s.
Binodiram Balchand is the name under which a Hindu undivided family which wag resident in the State of Gwalior carried on various businesses in that State.
Profits derived from business carried in the State were charged to War Profits Tax under the ordinance.
Among the businesses carried on by the respondent was its employment as the Secretary Treasurer and Managing agent of a textile mill which was a limited company bearing the name of Binod Mills Company Limited, Ujjain.
The appeal is concerned with the computation of the profits of the respondent to War Profits Tax under the ordinance, which it might be stated at the outset, was on lines very similar to the Indian Excess Profits Tax Act, 1940.
The chargeable accounting period with which the appeal is concerned, is the period commencing from July 1, 1944, to.
October 16, 1944.
The respondent assessee submitted its return and thereafter the War Profits Tax officer by his assessment order dated July 9, 1951, determined the taxable income of the assessee for this chargeable accounting period at Rs. 12,16,145/ and assessed it to tax in the sum of Rs. 2,02,691/ .
Several points were raised in relation to this assessment order by the respondent, and one of them related to the inclusion in its assessable profits of a sum of Rs. 11,09,332/ which was received by the respondent on July 5, 1944, being the dividend declared and paid by the Binod Mills Ltd" for 1943 on the shares held by the respondent.
It was the contention of the respondent that this sum was its income from an investment pure and simple and was not 246 "profits" from business, and so could not be included in its taxable profits on a proper construction of the relevant provisions of the ordinance.
From the assessment order the respondent filed an appeal to the appellate authority which however was unsuccessful.
A revision to the Commissioner of War Profits Tax met with the same fate and thereafter the respondent prayed for a reference to the High Court under section 46(1) of the ordinance which ran thus: `46(1) If, in the course of any assessment under this ordinance or any proceeding in connection therewith, a question of law arises, The Commissioner, may; either on his own motion or on reference from any War Profits Tax authority subordinate to him, draw up statement of the case and refer it with his own opinion thereon to the High Court.
" The Commissioner acceded to this request and referred for the opinion of the High Court three questions:, "(1) Whether the dividend income of Rs. 11,09,332/ received from the Binod Mills was chargeable under the War Profits Tax ordinance ? (2) Whether certain bad debts written off by the assessees could be allowed as deductions in computing profits for war tax purpose? (3) Whether the expenses of assessees ' branch at Gwalior which was defunct, could be allowed as admissible expenses ?" The High Court answered questions 2 and 3 in favour of the department, but the first question was answered in the negative and in favour of the assessee.
There is now no dispute as regards questions 2 & 3 and the appeal is confined to the correctness of the answer to the first question.
247 Before setting out the grounds upon which the High court decided the reference in favour of the respondent it is necessary to read a few of the provisions of the relevant law which bear upon the point arising for consideration.
The preamble to the ordinance recites that it was enacted to impose a tax on "excess profits arising out of certain businesses" and this intention is carried out by section 4(1) which is the charging section which enacts: "4(1) Subject to the provisions of this ordinance, there shall, in respect of any business to which this ordinance applies, be charged, levied and paid on the amount by which the profits during any chargeable period exceed the standard profits, an excess profit tax (in this ordinance referred to as the War Profits Tax ') which shall be equal to 60 per cent.
of the aforesaid amount.
" The expression `business ', the profits derived from which are thus brought to charge is defined by section 2(5) in these terms: "2(5) `business ' includes any trade, commerce or manufacture or any adventure in the nature of trade, commerce or manufacturer or any profession or vocation, but does not include a profession carried on by an individual or by individuals in partnership, if the profits of the profession depend wholly or mainly on his or their personal qualifications, unless such profession consists wholly or mainly in the making of contracts on behalf of other persons or the giving to other persons of advice of a commercial nature in connection with the making of contracts: Provided that where the functions of a company or of a society incorporated by or under any enactment consist wholly or mainly in the holding of investments or other property or both, the holding thereof shall be 248 deemed for the purpose of this definition to be a business carried on by such company or society; Provided further that all businesses to which this ordinance applies carried on by the same person shall be treated as one business for the purposes of this ordinance;" There are two further definitions which are of some relevance to the arguments addressed to us and might therefore be set out at this stage.
Section 2(14) defines the expression `prescribed ' as meaning "prescribed by Rules made under the ordinance;" section 50 being the provision empowering the Government make rules and this section ran: "50(1) Subject to the provisions of this ordinance, Government may make rules for carrying out the purposes of this ordinance.
(2) Rules made under this section shall be published in the official Gazette and shall thereupon have effect as if enacted in this ordinance.
" The other relevant definition is of the expression profits ' which is defined in section 2 (16) as: "profits as determined in accordance with the provisions of this Ordinance and its first schedule;" There is a First Schedule which follows the ordinance and which is headed 'Rules for the computation of profits for the purposes of War Profits Tax ', and of these the one pertinent to the matter in controversy in the appeal is r. 3 of which sub rs.
(1) and (2) have been relied on in the course of arguments.
They run: "3(1)Income received from investments shall be included in the profits of a business liable to the War Profits Tax, unless it is proved to satisfaction of the War Profits 249 Tax Officer that the investments have no connection whatever with the business.
(2) In the case of a business which consists wholly or mainly in the dealing in or holding of investments, income received from investments shall be deemed to be profits of that business, and in the case of a business, a specific part only of which consists in dealing in investments, the income received from investments held for the purpose of that part of the business shall be deemed to be profits of that part of the business.
Explanation: 'The income from investments to be included in the profits of the business under the provisions of this rule shall be computed exclusive of all income received by way of dividends or distribution of profits from a company carrying on a business, to the whole of which the Section of the Ordinance imposing the War Profits Tax applies".
Pausing here, it is necessary to mention that in relation to the first question regarding the inclusion of the dividend income in the taxable profits of the assessee three contentions were raised on behalf of the respondent which are thus set out in the judgment under appeal: "(1) The assessees did not deal in shares and their holdings in the Binod Mills Limited, were purely in the nature of investments, having no connections with their business as defined in Section 2(5) read with Rule 1 of Sch.
I of the Gwalior War Profits Tax Ordinance.
The business of the Secretaries, Treasurers and Agents of the Binod Mills Limited, which was carried on by them did not require any holding of the shares of the company and 250 was not dependent on their investment in the said company.
(2) The dividend income accrued or arose from the profits of the Binod Mills Limited, and as the Ordinance applied to the business carried on by this company, the dividends were excluded under the explanation to Rule 3(1) of Schedule I. (3) The dividend income should be considered as income of the full accounting period, i.e. from Diwali of 1943 to Diwali of 1944 and should be apportioned on that basis.
" The learned Judges of the High Court dealt only with the first of the above contentions, and having accepted it, considered it unnecessary to express any opinion on the other two.
We may now proceed to state the grounds upon which the learned Judges of the High Court answered this contention in favour of the respondent.
It was urged before them by the respondent that though the provisions headed 'Rules for the computation of business ' purported to be part of the Ordinance itself as forming the Schedule to the Ordinance, they were in reality rules made by government under the rule making power conferred on it by section 50 of the Ordinance, This argument was accepted apparently being aided by the fact that immediately after the title "Schedule I" occur the words "See Section 2(14)".
Proceeding on this basis the reasoning of the learned Judges was on these lines.
The charge under section 4(1) was on the profits of a business and unless an activity which resulted in any income derived was one in the nature of trade, the mere fact that income was derived therefrom would not make it assessable to tax under the ordinance.
This they deduced from an interpretation of the words used in the charging section read in conjunction with the definition of "profits" in section 2(16).
The next question was whether 251 the dividend which the respondent obtained from the shares held by it in the Binod Mills Ltd., of which it was the Secretary, Treasurer and Managing agent were profits derived by any business activity.
Unless the acquisition of the shares was an adventure in the nature of trade or the respondent was a dealer in shares, such that the shares held by it were part of its stock in trade, the income derived therefrom by way of dividends could not be characterised as profits from business.
If this was the result on a proper construction of the Act the question the learned Judges addressed themselves to next was, whether r. 3(1), which according to them was a piece of subordinate legislation, could validly bring to charge an item of income which was not within the scope of the Ordinance itself, and this had necessarily to be answered in the negative.
They consequently held that r. 3(1) of the 1st Schedule was beyond the power of the rule making authority under section 50 of the Ordinance and answered the first question referred to them in favour of the assesssee.
Mr. Sen, learned Counsel for the appellant has however placed before us material to show that Sch.
I containing the rules for the computation of profits were not rules made by the Government under section 50 of the Ordinance but was really part of the Ordinance itself.
In the first place, it has to be noted that section 2(16) speaks of Sch.
I to the Ordinance, and admittedly besides the one now produced before us there was no other Schedule attached to the Ordinance.
It is impossible to hold that with section 2(16) in the form in which we now find it, the rules for the computation of the business did not form part of the Ordinance having been enacted simultaneously as part and parcel thereof.
In this connection it might be pointed out that the Excess Profits Tax Act, 1940, which formed the basis or model upon which the Ordinance was fashioned has 252 a similar Schedule headed "Rules" for the computation of profits" and the Schedule formed part of that Act.
The only ground for even a suspicion that Sch.
I was not a part of the Ordinance itself is the reference to section 2 (14) in the heading of these rules just below the words Schedule I, but very little assistance can be sought from this reference, because section 2(14) in not itself the source of power for making rules which is section 50 of the Ordinance and, in fact, rules have been made under the power conferred by section 50 of the Ordinance; vide War Profits Tax Rules Samvat 2001, No. 65 dated December 26, 1944, which carries the recital in the following terms: "In exercise of the powers conferred by section 50 of the War Profits Tax Ordinance the Government of Gwalior are pleased to make the following rules. " It is obvious therefore "section 2(14) in Sch.
I is a mistake or a misprint for "section 2(16)" and it might be noted that in the corresponding Schedule to the Indian Excess Profits Tax Act, 1940, immediately after the title "Schedule I" occur the words "See section 2(19)" which in that enactment corresponds to section 2(16) of the Ordinance.
There are other circumstances to which Mr. Sen has drawn our attention which also point to the Schedule being part of the Ordinance and not rules made under section 50.
The Schedule was the subject of amendments more than once and each time this was done it is significant that this was done not by virtue of the exercise of the rule making power under section 50 of the Ordinance but by further ordinances showing clearly that the Schedule was part of the Ordinance itself.
To give just a few example, the Explanation to r. 3(2) which we have extracted earlier was not in the Schedule as originally enacted but was introduced as 253 an amendment by Ordinance No. 42 dated February 28, 1946.
The short title of this Ordinance runs: "This Ordinance might be called the Gwalior War Profits Tax (Amendment) Act, Samvat 2002".
Further it would be noticed that in the Explanation there is a comma after the words "carrying on a business".
That comma was not there when the schedule was amended by the Amending ordinance of February 28.
1946, but was introduced by Ordinance 5 of Samvat 2004 and the short title of this second Ordinance reads: "This Ordinance might be called the Gwalior War Profits Tax (Amendment) Ordinance Samvat 2004".
We do not consider it necessary to dilate on the point as we are clearly of the opinion that the Schedule was part of the Ordinance and has therefore to be read not as subordinate legislation under r. 50 but as part and parcel of the Ordinance itself.
The whole basis therefore of the reasoning upon which the learned Judges of the High Court proceeded falls to the ground and the only question is whether accepting the respondent 's case that the shares held by it in the Binod Mills Ltd. were really part of its investments, these investments have "any connection" with its business.
It is common ground that the respondent was the Secretary, Treasurer and Managing agent of the Binod Mills and what we are now concerned with are the shares held by it in that company.
In the case of every assessee who carries on a business activity and is in receipt of profits from that business, on the terms of r. 3(1) income from every investment held by him is liable to be included in the profits assessable to tax unless such person was able to satisfy the 254 revenue authorities that the investments had "no connection whatever" with his business.
Mr. Viswanatha Sastri, learned Counsel for the respondent sought to overcome this position by submitting that the "connection" contemplated by the rule was a direct "connection" and not a remote or fanciful one and that in the present case there was really no connection between the respondents ownership of these shares and the office of managing agent which it held.
His contention was that except the fact that the recipient of the profits from the "business" of managing agency and of the dividend income was the same, there was no other connection between the one and the other.
In further elaboration of his point, he invited us to hold that the "connections would be direct only where the investment was related to a business activity as cause and effect or as a sine qua non.
Thus if it was a requirement either of the Articles of Association of the company or of the Managing Agency Agreement, that the managing agent should be a shareholder, or the holder of specified number of shares, then alone, learned Counsel contended, the managing agent being dependent on the shareholding, there would be that connection which would bring the dividend income with in the expanded definition of profits from business under r. 3(1).
In all other cases where shares were held, without the assessee being obliged to hold them for the purpose of his business activity, no distinction, Counsel submitted, could be drawn between the investment in the shares of a company with which he had nothing to do, and a company which he managed under an agreement.
Learned Counsel further stressed that the case of the respondent was stronger because the Managing Agency Agreement with the respondent was to last so long as the respondent firm existed and carried on business in that name and could not be terminated by the company "save and except when the agent being 255 found guilty of fraud in the Management or in the discharge of their duties." and having regard to this security of tenure which the respondent enjoyed, the holding of these shares had no connection whatever with the business of managing agency.
We find ourselves unable to accept this interpretation of r. 3(1).
The relevant words in the rule being "any connection whatever" it would not be giving proper effect to the meaning of the words "any" and "whatever" to restrict it to cases of "direct connection" in the sense suggested on behalf of the respondent.
But this apart, by the number of shares which the respondent owned in the mills it is admitted that it obtained a controlling interest it held the majority of the shares in the company.
The respondent was therefore enabled by reason of this investment to control the action of the company which was the other party under the Managing agency Agreement.
This control was capable of being used to further the interests of the Managing agent in its relations with the company and whether or not this was used for obtaining advantages, it would certainly be available for avoiding any disadvantages arising from misunderstandings with the company.
It could not be denied that the control would certainly be useful to keep the relations between the company and the Managing agent smooth so as to enable the Managing agent to earn his commission etc.
without differences or disputes.
Even if therefore the word "connection" in r. 3(1) meant a "direct" connection a construction which we do not adopt it appears to us that the present case satisfied even that test.
In any event the "connection" is not anything remote, fanciful or imaginary, but on the other hand real and capable of being turned to good account.
It certainly cannot be equated with the holding of shares by the respondent in a company with which he had no connection other than as a shareholder.
256 We are therefore of the opinion that the dividend received by the respondent from the Binod Mills Ltd., was properly included by the assessing authorities in the computation of the taxable profit of there respondent under the Ordinance and that the High Court erred in answering the reference in favour of the assessee.
We have already pointed out that the High Court did not deal with or express any opinion on the two subsidiary contentions urged by the respondent with reference to the first question.
Those points were also naturally not argued before us and we do not express any opinion on them.
It is obvious that the reference cannot be disposed of without deciding these contentions and the case would have to be remanded to the High Court for dealing with these subsidiary points.
The appeal will accordingly be allowed, the judgment of the High Court set aside and the first contention in relation to question No. 1 answered against the assessee and in favour of the appellant and the case remanded to the High Court for the consideration of the other contentions with reference to that question.
The appellant will be entitled to his costs here.
The costs in the High Court will be provided in its final order.
Appeal allowed.
| Rule 3 (1) of such.
I of the Gwalior War Profits Tax ordinance, Samvat 2001 provided: "Income received from investments shall be included in the profits of a business liable to the war Profits Tax, unless it is proved to satisfaction of the War Profits Tax officer that the investments have no connection whatever with the business." The respondent, a Hindu undivided family, was carrying on various businesses in the erstwhile State of Gwalior, and one of them was its employment as the Secretary, Treasurer and Managing Agent of, a limited company.
The respondent held a majority of the issued shares in the company.
For the accounting period July 1, 1944, to October 16, 1944, the War Profits Tax officer by his assessment order dated July 9, 1951, included in its assessable profits the sum received by the respondent on July s, 1944, as the dividend declare and paid by the company on its shares.
The respondent claimed that the said sum could not be included in its taxable profits on the ground that it did not deal in shares and that its holdings in the company were purely in the nature of investments having no connection with its business as defined section 2(5) of the ordinance Gwalior War Profits ordinance and that the business of the Secretaries, Treasurers and Managing Agent of the company which was carried on by it did not require any holding of the shares of the company and was not dependent on its investment in the said company.
The High Court of Madhya Pradesh took the view (1) that on a proper construction of the provisions of the ordinance, unless the acquisition of the shares was an adventure in the nature of trade or the respondent was a dealer in shares such that the shares held by it were part of its stock in trade, the income derived therefrom by way of dividends could not be characterised as profits from business, and (2) that Sch.
I of the Ordinance which 244 was headed "Rules for the computation of business", though it purported to be part of the Ordinance, in reality comprised rules made by Government under the rule making power conferred on it by section 50 of the ordinance and that r. 3 (I) of the Schedule, being subordinate legislation could not validly bring to charge an item of income which was not within the scope of the ordinance itself. ^ Held that : Schedule I of the Gwalior War Profits Tax Ordinance was part and parcel of the ordinance itself and, therefore, could not be considered to be subordinate legislation as rules framed under section 50 of the ordinance (2) the word "connection" in r. 3 (1) of Sch.
I of the Ordinance was not restricted to cases of "direct connection", in view of the expression "no connection whatever" in that rule; and (3) the respondent as the holder of the majority of the shares in the company, was enabled by reason of this investment to control the action of the company which was true other party under the Managing Agency Agreement, and therefore, the investment was connected with the business carried on by it within the meaning of r. 3(1) of Sch.
I of the ordinance.
Accordingly, the dividend received by the respondent from the company was properly included by the assessing authorities in the computation of its taxable profits under the ordinance.
|
Civil Appeal No. 720 of 1978.
Appeal under section 116 A of the Representation of People Act 1951 from the Judgment and Order dated 7 2 1978 of the Punjab and Haryana High Court in E.P. No. 15/77.
Hardev Singh for the Appellant.
P. P. Rao, O. P. Sharma, R. Venkataramiah and R. C. Bhatia for the Respondents.
The Judgment of the Court was delivered by SHINGHAL J.
This appeal by election petitioner Harjit Singh Mann is directed against the judgment of the Punjab and Haryana High Court dated February 7, 1978, dismissing the petition by which he had challenged the election of Umrao Singh, respondent No. 1, hereinafter referred to as the respondent, from the Nakodar constituency of the Punjab Legislative Assembly.
The result of the election was declared on June 14, 1977, according to which the respondent was declared elected as he secured the highest votes at the poll.
503 Appellant Harjit Singh Mann could not contest the election as his nomination papers were rejected by the Returning Officer on May 19, 1977, which was the date fixed for the scrutiny of the nominations.
That was taken as one of the grounds for filing the election petition, the other ground being the commission of some corrupt practices by the respondent.
The respondent traversed the allegations.
The trial court examined some of the preliminary objections and framed eight issues.
The first two issues were decided in favour of the appellant.
As regards issue No. 3, the trial court held that a part of the allegation of corrupt practice which was sought to be incorporated in the amended petition, could not be taken into consideration as the amendment was applied for after the expiry of the period of limitation; and it was therefore ordered to be deleted.
The correctness of the above findings has not been challenged before us.
In fact we are required to consider the trial court 's findings only on issues Nos. 4, 5 and 6, which have all gone against the appellant.
Issues Nos. 7 and 8 have not been pressed for our consideration.
We shall therefore concern ourselves with three issues (Nos. 4, 5 and 6) and deal with them one by one.
Issue No. 4 was to the following effect, "Whether Jit Ram proposer of the petitioner reached the office of the Returning Officer at 2.50 p.m. and filed the nomination papers of the petitioner before 3.00 p.m. on 18 5 1977 and whether the endorsement made on the nomination papers that the nomination papers were received at 3.10 p.m. was wrongly made and thereby illegally rejected the nomination papers of the petitioner on 19 5 1977 ? If so, to what effect.
" The appellant 's allegation in this respect was that although Jit Ram (P.W. 7), who had proposed his candidature, reached the office of the Returning Officer after depositing the necessary security in the bank at 2.50 p.m. on May 18, 1977, and the Returning Officer placed the nomination papers on his table, he wrongly asked Jit Ram to take back the nomination papers saying that the time for filing them had expired.
It was further alleged that the Returning Officer got annoyed when Jit Ram protested that he had filed the nomination papers in time, and that he wrongly noted down the time of presentation of the nomination papers as 15.10 hours.
As has been stated, the trial court has disbelieved the averment of the petitioner in this respect and found the issue against him.
We have gone through the statement of Jit Ram P.W. 7 who, according to the appellant 's case, presented the nomination papers to 504 the Returning Officer.
The witness has however admitted in cross examination that when he was trying to deliver the nomination papers, the Returning Officer "said that he objected to the delivery of the nomination papers as the time was over".
The witness no doubt claimed that he reached the office of the Returning Officer, after depositing the security at about 2.45 p.m. and that when the Returning Officer told him that the time for the filing of the nomination papers had expired, some four other "persons" standing in the office of the Returning Officer said that "still two minutes remained for it becoming 3 O 'clock and some said that one minute still remained".
The trial court disbelieved that version of Jit Ram.
He really could not even read the time in the clock of the trial court, for when he deposed that it was 3.19 p.m., the time accordingly to that clock was 3.6 p.m.
Jit Ram did not therefore have the capacity of reading or stating the time correctly, and it may in fact be said that what he deposed about the presentation of the nomination papers a couple of minutes or a minute before 3 p.m. was nothing but hearsay.
The trial court has examined the other evidence of the parties, including the statement of Returning Officer Manohar Singh R.W.1, and we have no doubt that its finding that the nomination papers were filed 10 minutes after 3 p.m. is fully borne out by the evidence on the record and is correct.
It has to be appreciated that it is the requirement of the law that the Returning Officer should mention the time of the presentation of the nomination papers, and that endorsement exhibit P.W.1/19 has been proved by the Returning Officer.
It shows that the nomination papers were presented on May 18, 1977 at 15.10 hours by the proposer, and the endorsement to that effect was duly signed by the Returning Officer.
There is no reason to disbelieve that evidence.
The fact of late presentation of the nomination papers was reiterated by the Returning Officer in his order of scrutiny exhibit P.W. 1/20 on May 19, 1977.
In that order he clearly stated that as the nomination papers was delivered to him on May 18, 1977 after 3 p.m. i.e. at 15.10 hours by the proposer Shri Jit Ram, he rejected it for that reason and also for the reason that the required oath or affirmation was not made by the candidate.
It may be mentioned that the form of the nomination paper prescribed by the Conduct of Election Rules, 1961, provides for the issue of a receipt for the nomination paper and the notice of scrutiny, which has to be handed over to the person presenting the nomination paper.
The serial number of the nomination paper, the name of the candidate, the name of the constituency, the date and time of presentation of the nomination paper and the date and time fixed for its scrutiny had therefore to be mentioned in that receipt, and we find from the judgment of the trial court that the 505 non production of that receipt by the appellant has rightly been taken as a circumstance against him.
On the evidence before it the trial court was justified in finding issue No. 4 against the appellant and in holding that the nomination papers were filed after the expiry of the time prescribed for them i.e. at 3.10 p.m.
An attempt was made to argue that the delay in the presentation of the nomination papers in question could not justify its rejection as it was not a defect of a substantial character within the meaning of sub section
(4) of section 36 of the Representation of the People Act, 1951, hereinafter referred to as the Act.
In order to appreciate the argument it is necessary to make a cross reference to sub s.(1) of section 33 of the Act which provides as follows, "33(1) On or before the date appointed under clause (a) of section 30 each candidate shall, either in person or by his proposer, between the hours of eleven O 'clock in the forenoon and three o 'clock in the afternoon deliver to the returning officer at the place specified in this behalf in the notice issued under section 31 a nomination paper completed in the prescribed form and signed by the candidate and by an elector of the constituency as proposer".
It is therefore the requirement of that sub section that, inter alia, the nomination paper shall be delivered to the Returning Officer between the hours of eleven O 'clock in the forenoon and three O 'clock in the afternoon, so that a nomination paper delivered after three O 'clock in the afternoon cannot be said to comply with that provision of section 33.
Sub section (2) of section 36 of the Act, which provides for the examination of the nomination papers for the purpose of deciding all objections made to any nomination, requires that the Returning Officer shall reject any nomination paper on the grounds mentioned in the sub section.
We are concerned with ground No. (b) which provides as follows: "(b) that there has been a failure to comply with any of the provisions of section 33 or section 34".
So as there was failure to comply with that provision of section 33 which required the delivery of the nomination paper between the hours of eleven O 'clock in the forenoon and three O 'clock in the afternoon, the Returning Officer had really no option but to reject the nomination paper.
We have considered the argument that such a defect was not of a substantial character within the meaning of sub section
(4) of section 36 of the 506 Act, but we are unable to uphold it in the face of the clear requirement of ground (b) of sub section
(2) of section 36, referred to above.
It has to be appreciated that any other view would make the requirement for the presentation of the nomination paper before the last date for making nominations, and within the specified period of time, unworkable for it will not then be possible to draw a line upto which the delay in the delivery of the nomination papers could be condoned.
In fact if the requirement of the law in that respect is not observed, and its breach is considered to be a defect which was not of a substantial character, it may be permissible to go to the extent of arguing that the nomination paper may be filed even upto the date and time fixed for the scrutiny of the nominations.
That would not only cause administrative inconvenience but put the other candidates to a serious disadvantage for they would not be able to prepare themselves for any objection they may like to raise to the validity of the nomination at the time of the scrutiny of the nominations.
We have no hesitation therefore in taking the view that the failure to comply with the requirement that the nomination papers shall be delivered between the hours of eleven O 'clock in the forenoon and three O 'clock in the afternoon is mandatory and the Returning Officer was justified in rejecting the nomination paper in question because of its breach.
A similar provision in an election rule has been stated to be mandatory in Rogers on Elections, Volume III, twentyfirst edition, at page 74, and it has been observed that the rule must be "literally complied with".
Reference in this connection may be made to Cutting vs Windsor.
There Avory J., referred to the requirement of r. 7 in Part II of the third Schedule to the Municipal Corporations Act, 1882.
according to which the nomination paper had to be delivered before five O 'clock in the afternoon of the last day for the delivery of nomination papers, and rejected the argument that what had occurred there was a pure technicality.
He held as follows, "So far as rule 7 provided for the time within which nomination papers must be delivered at the town clerk 's office it was mandatory.
It was not within the discretion of the town clerk to receive nomination papers after the hour specified in the rule, nor was it competent to that Court to say that the delivery of a nomination paper after the prescribed time constituted a good nomination.
Mr. Windsor had never been duly nominated and his election must be declared void.
Mr. Cutting was the only other candidate and he must be declared to have been duly elected".
507 Horridge J., agreed with him saying that if Windsor had never been nominated it was impossible for the Court to say that his election was in accordance with the principles laid down in the body of the Act.
The same view has been expressed in Parker 's Conduct of Parliamentary Elections, 1970, on page 137, "The returning officer has no power to extend the time for delivery (see Howes vs Turner, , Cutting vs Windsor, 40 Times L.R. 395)".
The matter has been dealt with in Parliamentary Elections by A. Norman Schofield, second edition, on pages 149 150 under the rubic "Delivery at wrong time" and it has been held that the requirement in that respect is mandatory.
So as the provision of section 36 regarding the delivery of the nomination papers between the hours of eleven O 'clock in the forenoon and three O 'clock in the afternoon was not complied with, the Returning Officer had no option but to reject the nomination paper in question as required by section 36(2) (b) of the Act and the finding of the trial court in that respect is quite correct.
Issue No. 5 raises the question whether the appellant reached the office of the Returning Officer at 3.45 p.m. on May 18, 1977, and took oath in the presence of the Returning Officer who, however, failed to make the necessary endorsement on the nomination paper.
It is not in controversy that it was obligatory under cl.
(a) of article 173 of the Constitution for the appellant to make and subscribe, before a person authorised in that behalf by the Election Commission, an oath or affirmation according to the form set out for the purpose in the Third Schedule, and that he could not be qualified to be chosen to fill a seat in the Legislature of a State without doing so.
The importance of that requirement of the Constitution has been reiterated in sub section
(2) of section 36 of the Act for ground No. (a) thereof provides that the Returning Officer shall reject a nomination paper on the ground that on the date fixed for the scrutiny of nomination the candidate was, inter alia, not qualified to be chosen to fill the seat in the Legislative Assembly under article 173 of the Constitution.
The requirement for the making and subscribing the oath or affirmation was therefore clearly mandatory.
The appellant tried to establish the plea that he reached the office of the Returning Officer at 3.45 p.m. on May 18, 1977, and took 508 oath in the presence of the Returning Officer who, however, failed to make the necessary endorsement to that effect.
That averment was denied on behalf of the respondent, and we find that the trial court has adequately dealt with the evidence on the record in that respect.
It will be sufficient for us to mention that the Election Commission took care to point out the importance of the requirement for the making and subscribing the oath or affirmation in their "Handbook for Returning Officers", and directed that the "authorised person" before whom that was done would "forthwith give a certificate to the candidate" that he had made and subscribed the oath before him on the date and hour mentioned in the certificate.
It has been emphasised that the certificate would be given to the candidate without his applying for it, for that would avoid all controversy later on as to whether he had taken the oath or not.
Annexure VI provides for the issue of that certificate in the portion which appears just below the perforated portion of the form of oath or affirmation prescribed by the Constitution.
It may be pointed out in this connection that the appellant admitted in his statement that he was given a slip by his proposer Jit Ram P.W. 7, in which it was mentioned that he should take oath or make the affirmation before the Returning Officer on May 19, 1977.
It is therefore quite clear that the oath or affirmation had not been made or subscribed at the time of the presentation of the nomination papers, and as the appellant was not able to produce the certificate of his making or subscribing the oath or affirmation before the Returning Officer thereafter, in the manner alleged by him, there is nothing wrong with the view taken by the trial court that he did not really do so, and we do not think it necessary to reappraise the evidence in that connection.
Issue No. 6 dealt with the question whether the respondent was guilty of the corrupt practice of bribery alleged in paragraph 11 of the petition.
The allegations were amended by the appellant, but a part of them were ordered to be deleted and there is no grievance in that respect.
The remaining allegation was to the following effect, "11.
That after the last Parliament Elections and installation of Janta Party Government at the Centre, it became evident that the State Government would be toppled and the Ministers of the Previous Congress Government and specially respondent No. 1 with a view to bribe the voters or the Constituency, he started giving large sum of dis 509 cretionary grants in the Constituency.
To name a few Bara Pind, Littran, Dalla etc.
He used his influence in the Department that the funds were released during the Elections.
This was done with the object of influencing the electors of those villages to vote in favour of respondent No. 1.
Respondent No. 1 went to village Bara Pind on 25 5 1977 at 5.00 p.m. and in the presence of Master Jasmel Singh handed over a cheque No. K 314781 dated 29 4 1977 for a sum of Rs. 20,000/ out of the accounts of Punjab State Sports Council to the lady Sarpanch Smt.
Banti and Biant Kaur and gave a lecture requesting the co villagers to vote for him, since he had given the money.
On 27 5 1977 respondent No. 1 went to village Littran at 4 p.m. and gave a cheque of Rs. 5,000/ in the presence of about 50 villagers including Chanan Singh Mistri to section Balwant Singh Bali a cheque No. K 314782 and called upon those present to vote for him.
The cheque was issued out the funds of Punjab State Sports Council".
It is hardly necessary to say that the allegations were traversed by the respondent and the trial court found that they had not been established.
The corrupt practice which was thus alleged against the respondent was one under section 123(1) (a) (b), according to which any gift, offer or promise by a candidate or his agent or by any other person with the consent of a candidate or his election agent of any gratification, to any person whomsoever, with the object, directly or indirectly of inducing an elector to vote or refrain from voting at an election is a corrupt practice.
In view of the allegations mentioned above, it appears that it was not the allegation of the appellant that the gift, offer or promise was made as a reward to an elector for having voted or refrained from voting within the meaning of sub cl.
(ii), and it could only be said to fall under sub clause (b) of section 1(A) as the allegation was that the bribery was meant to induce the electors to vote for the respondent.
It is nonetheless an essential ingredient of the definition of the corrupt practice of "bribery" that the gift, offer or promise should be by the candidate or his agent or by any other person with the consent of the candidate or his election agent.
Part VI of the Act deals with disputes regarding elections and Part VII deals with Corrupt Practices and Electoral Offences.
Section 79 of the Act provides that both in Parts VI and VII, unless the context otherwise requires, the definitions mentioned in it would govern the interpretation of those parts.
Clause 510 (b) of the section defines the expression ' candidate ' as follows, " 'Candidate ' means a person who has been or claims to have been duly nominated as a candidate at any election".
It has therefore to be seen whether the respondent had been duly nominated as a candidate at the election in question, or whether he claimed to be duly nominated at that election at the time when the corrupt practice was alleged to have been committed by him.
It is nobody 's case that the respondent laid any such claim at any point of time until his nomination paper was scrutinised; and he was held to be a validly nominated candidate only after the nomination was scrutinised by the Returning Officer on May 19, 1977.
He could not therefore be said to be a 'candidate ' within the meaning of section 123 read with section 79 of the Act until that date.
The allegation in paragraph 11 of the election petition was to the effect that the cheque of Rs. 20,000/ was delivered at village Bara Pind on May 25, 1977 and the votes were solicited on that date.
As regards village Littran, the allegation was that a cheque of Rs. 5,000/ was delivered on May 27, 1977 and votes were solicited.
It is not disputed however that the precise evidence against the respondent was that he made an order for the delivery of Rs. 20,000/ on April 17, 1977 in respect of village Bara Pind and on April 29, 1977 in respect of village Littran, in his capacity as the Minister for Revenue.
Both these orders were therefore made before the respondent was a candidate at the election in question and it is not disputed before us that he ceased to be a minister on April 30, 1977, when Punjab was brought under the President 's rule.
So even if it were assumed that the respondent sanctioned the two payments for the purpose of gaining popularity in Bara Pind and Littran villages, with an eye to his ultimate candidature from Nakodar Assembly constituency, it cannot be said that his action amounted to a gift, offer or promise by him as a "candidate" at the election in question so as to amount to the corrupt practice of bribery under cl.
(1) of section 123 of the Act.
As regards the alleged distribution of cheques on May 25 and May 27, 1977, it will be enough to say that even if it were presumed that the respondent was allowed to do so after he ceased to be a Minister, the mere delivery of cheques could not possibly amount to bribery when, as has been stated, there was no element of bargain in regard to it.
It may be mentioned that the trial court rightly took the view that it was necessary for the purpose of proving the corrupt practice 511 of bribery to establish that there was an element of "bargaining" in what the respondent was alleged to have done for Bara Pind and Littran.
Reference in this connection may be made to the decision of this Court in Ghasi Ram vs Dal Singh and others where it was held with reference to the decision in Amirchand vs Surendra Lal Jha and others that if a Minister redress the grievances of a class of the public or people of a locality or renders them any help, on the eve of an election, it is not a corrup practice unless he obtains promises from the voters in return, as a condition for his help.
It was also held that the "evidence must show clearly that the promise or gift directly or indirectly was made to an elector to vote or refrain from voting at an election", and that "if there was good evidence that the Minister bargained directly or indirectly for votes, the result might have been different".
The decision in Ghasi Ram 's case (supra) was followed in Om Prabha Jain vs Abnash Chand and another, Bhanu Kumar Shastri vs Mohan Lal Sukhandia and others and Chaitanya Kumar Adatiya vs Smt.
Sushila Dixit and others.
It was therefore necessary for the appellant to plead and prove that there was bargaining between the respondent and the voters and he did what he is alleged to have done in Bara Pind and Littran for that reason but, as the trial court has pointed out, there was no such allegation in the election petition.
So when the element of bargain was completely absent from the allegation against the respondent, the trial court was justified in holding that the alleged corrupt practice had not been established.
The trial court has considered the evidence on the record in this respect and its finding on issue No. 6 is quite correct and nothing worthwhile has been urged before us to require its reconsideration.
As there is no merit in this appeal, it is dismissed with costs.
N.K.A. Appeal dismissed.
| The appellant was a voter in the Constituency from which the Respondent was elected as a member of the State Legislative Assembly.
His nomination paper was rejected by the Returning Officer on the ground that it was filed beyond the time prescribed for filing nomination paper and that he had not made and subscribed an oath on it, as required by law.
In his petition before the High Court the appellant contended that (1) the filing of nomination paper late by 10 minutes could not be a ground for rejecting the nomination paper and it was not a defect of substantial character within the meaning of section 36(4) of the Act, (2) the allegation that he had filed to make and subscribe the oath before the Returning officer as required by article 173 of the Constitution was not true and (3) the respondent was guilty of corrupt practice of bribery.
The High Court rejecting all the contentions, dismissed the petition.
Dismissing the appeal, this court ^ HELD : 1(a) It is the requirement of law that the Returning officer should mention the time of presentation of the nomination papers.
The endorsement by the Returning officer shows that the nomination paper was presented on May 18, 1977 at 15.10 by the proposer, and that the endorsement to that effect was duly signed by the Returning officer.
[504 E F] (b) It is not correct to say that the delay in presentation of the nomination paper was not a ground for its rejection as it was not a defect of substantial character within the meaning of Section 36(4) of the Representation of the People Act.
In the face of the clear requirement of section 36(2)(b) of the Act, any other view would make the requirement for the presentation of the nomination paper before the last date and within the specified period of time, unworkable for it will not then be possible to draw a line upto which the delay in the delivery of the nomination papers could be condoned.
If the requirement of the law in that respect is not observed, and its breach is considered to be a defect which was not of a substantial character it may be permissible to go to the extent of arguing that the nomination paper may be filed even upto the date and time fixed for the scrutiny of the nominations.
That would not only cause administrative inconvenience but put the other candidate to a serious disadvantage for they would not be able to prepare themselves for any objection they may like to raise to the validity of the nomination, at the time of scrutiny of the nominations.
[505 H, 506 A C] 502 (c) The requirement that the nomination papers shall be delivered between the hours of eleven O 'clock in the forenoon and three O 'clock in the afternoon is mandatory and the Returning officer has no option but to reject the nomination paper as required by Section 36(2) of thee Act.
[505 G H] (2) The trial court held that the oath ar affirmation which was required to be made or subscribed by the candidate had not been made and subscribed at the time of the presentation of the nomination papers.
As the appellant was not able to produce the certificate of his making and subscribing the oath or affirmation before the Returning officer thereafter, in the manner alleged by him, there is nothing wrong with the view taken by the trial court that he did not really do so [508 A B, D E] (3) It is an essential ingredient of the definition of corrupt practice of "bribery" that the gift, offer or promise should be by the candidate or his agent or by any other person with the consent of the candidate or his Election Agent.
The trial court rightly took the view that it was necessary for the purpose of proving the corrupt practice of bribery to establish that there was an element of "bargaining" in what the respondent was alleged to have done for two villages.
When the element of bargain was completely absent from the allegation against the respondent, the trial court was justified in holding that the alleged corrup practice had not been established.
[809G, 510H, 511A, D E] Ghasi Ram vs Dal Singh and others ; , Amir Chand vs Surendra Lal Jha and others , Om Prabha Jain vs Abnash Chand and another ; ; Bhanu Kumar Shastri vs Mohan Lal Sukhadia and others ; ; Chaitanya Kumar Adatiya vs Smt.
Sushila Dixit and others , referred to.
|
Civil Appeal No. 716 of 1968 Appeal by Special Leave from the Judgment and order dated the 2nd March, 1967 of the Patna High Court in Letters Patent Appeal No. S of 1962.
section C. Mishra and U. P. Singh for the appellant.
S N. Prasad , A. K. Srivastava, M. section Narasimhan and B. P. Singh for the respondents.
The Judgment of the Court was delivered by KRISHNA IYER, J.
This appeal, by special leave, turns substantially on the application of section 6 of the Bihar Land Reforms Act, 1950 (hereinafter called, the Act), to the case situation the facts having been decided concurrently and finally in favour of the appellant.
Still he lost at the stage of the Letters Patent Appeal, because 3 Division Bench of the High Court held that he had been robbed of his right to sue by Section 6 of the Act.
We may set out the relevant facts briefly.
Although a number of items of immovable property were involved in the suit, which was for ejectment on title.
the lands now in dispute are bakasht lands in the 'B ' Schedule to the plaint.
for easy reference called suit lands.
Regarding the rest the plaintiff 's suit has been decreed.
several items of property were gifted by one Ram Badan Singh to his two wives whose names were duly mutated in the revenue register.
The further course of the proprietary history takes us to the creation of a wakf and the office of mutawalli which are not relevant to the controversy before us but are interesting when we remember that the donees were Hindus and yet they had executed a wakf and constituted themselves as mutawallis.
This shows how community life absorbs and blends jural concepts, overriding religion in the creation of an inter laced legal culture.
This is by the way.
742 We may now take up the thread at the point where by further Gift deeds and transfers the lands covered be the original gift deeds case to vest in the plaintiff and defendants, second party.
they divided them as per a partition deed Exhibit 4 'a dated (October 30, 1952 whereby the suit lands fell to the exclusive share of the plaintiff, along with some other items while other properties were similarly allotted to defendants 2nd party.
Undaunted by this fact defendants, second ;3 party, sold the suit lands to the defendants first party alleging an oral partition sometime before August 1952 and under cover of that case, committed trespass.
Thereupon, a scramble for possession these properties and a proceeding under section 145 Cr.
P.C. ensued in which the defendants, first party, got their possession upheld by the Magistrate`s order dated 5.4.1954.
Inevitably the plaintiff brought the present suit in April 1955 for a declaration of his title, for possession and mesne profits on the score that his exclusive possession was by force taken away in July August 1954 by defendants, first party.
The latter put forward the plea of prior oral partition and exclusive hostile possession, tracing their claim through defendants second party.
The courts of fact found against the defendants and decreed the suit as prayed for, but in Letters Patent Appeal, the present contestig respondents, i.e., the defendants 1st party, urged with success that the plaintiff had lost his title thanks to the operation of sections 3 and 4 of the Act and could not salvage any interest under section 6 thereof.
The defeated plaintiff has come up to this Court, as appellant, assailing the findings of the High Court mainly on three grounds: According to Shri section C. Misra, learned counsel for the appellant section 6 of the Act applied to his case and so there was no vesting of title in the State of the suit lands.
He further pressed that, any way, this case, resting on the Act, which had been on the statute block for several years had not been set up at the earlier stages of the litigation and should not have been permitted at the Letters Patent Appeal stage in the High Court for the first time.
His third contention was that the deed of partition Exhibit 4/a was not legally divestative of rights in view of the provisions of the Estates Partition Act, 1897 which, in his submission, empowered the Collector alone to partition the properties, which not having been done, the lands remained in co ownership wherefore the possession of the defendants, first party, was that of co sharers.
If that were so, the possession of one co sharer was constructive possession of the other co sharer and the plaintiff was thus in khas possession under section 2k of the Act and, on that basis, section 6 of the Act saved the disputed properties from vesting in the State.
All these three fold contentions were sought to be repelled by counsel for the respondent and we proceed to examine them.
We may as well mention here, but dilate on it later, that certain items out of the B Schedule bakasht lands are, on the showing of defendants second party, not in their possession, although the plaintiff has averred.
, in his pleading, dispossession of all the B Schedule lands The legal impact of this circumstance on section 4(a) and the schemes of the Act has to be gauged, in the context of the relief claimed by the plaintiff and the eligibility of possessory benefits of the contesting defendants.
743 The central issue obviously is the resolution of the competition between vesting of the suit lands in the State by virtue of sections 3 and 4 and their exemption from such deprivation by the saving provision in section 6 in favour of tile plaintiff.
A close up of the profile of the land reform law would help us appreciate the purpose and programme of the statute and the meaning of the provision under construction .
The project, as highlighted in the Preamble in grandiose and in keeping with Part IV of thus Constitution, but ill actual implementation drags its feet.
Indeed, counsel on both sides were readily agreed only on one point, viz., that neither his Act nor the law setting a ceiling on land ownership slumbering the statue book since 1962, has been seriously enforced.
The Ninth Schedule to the Constitution can immunise a legislation from forensic challenge but what schedule can invigorate a half inert Administration into quick implementation of welfare oriented, urgently needed, radical legislation now Lying mummified in the books ? If the assertion of non implementation of land reforms laws made at the bar were true, the Bihar State Government has much to answer for to 'We the People of India ' and to the stultified legislature whose 'reform ' exercise remains in suspended animation.
In this very case, before the High Court, the Advocate General has appeared for the plaintiff landowner and yet the State has not bestirred itself to appear and claim the suit lands.
We are left in obscurity on the vital point, neither counsel nor the records throwing any light on whether the State has been given notice in the case in the High Court.
The social transformation cherished by the Constitution involved re ordering of the land system and a vigilant administration would have intervened in this 20 year old litigation long ago and extinguished the private contest to the advantage of the State.
The feudal will may, not unoften, furtively hide, in strategic positions may, be.
We may begin consideration of the merits of the rival cases by a broad projection of the Act.
Its basic object is to extinguish the proprietary rights and transfer absolutely, and free from all private interests, such ownership to the Stat.
The tillers are not to be up rooted and so, they i.e., the raiyats and under raiyats are to be settled on terms of fair rent.
The Act, making; a simplistic dischotomy sufficient for our study, thus absolutely vests in the State all lands, freed from all private rights (sec. 3) as from a date notified under section 4, but carves out of this land mass and leaves untouched.
apart from raiyati holdings, the bakasht lands in the khas possession of the 'intermediary ' i.e., the prior full owner (sec. 6).
Lands not falling within the saved category will be directly managed by the State (sec. 13), if need be, by ejecting trespassers if they are found ill illegal occupation [sec. 4(g)]. 'rh valuable rights attached to or imbedded in lands, like trees, fisheries, minerals also go to the State.
A seemingly bold legislation stroke of substantial land nationalisation will be reduced to pathetic futility if the flood gates of evasion are kept ajar by plausible but diluted interpretation of section 6 as urged by the landlords.
The Court must suppress the mischief and advance the remedy .
Indeed.
if we may anticipate our conclusion, the pronouncements of this Court in Surajnath Ahir vs 744 Prithinath Singh(1) and Ram Ran Bijai Singh & Ors vs Behari Singh @ Bagandha Singh,( ') bar and bolt the, door of escape in a big way and counsel for the appellant has striven to impress on us the need to reconsider and distinguish that view because it is inconsistent with vintage jurisprudence and Anglo American concepts bearing on possession of an owner.
Let us get down to an openheart surgery in a limited way to check upon the soundness of this cardinal submission.
The consternation expressed by appellant 's counsel that the High Court 's interpretation of sec.
6 will create rights in rank trespassers and distort and defeat the right to possess enjoyed by Zamindars does not, by itself, disturb us.
We are in a juridical province of agrarian reform.
The creative legal ideas needed to effectuate this developmental plan are conceptually alien to the old land law and 'rural ' jurisprudence, wearing as they do radical contenance.
The Court, in the process of construction must help the chariot of land reform move forward and sections 3 and 6 are the vital wheels.
Having regard to the significance of the State 's presence even in private litigation bearing on eviction and the like, section 4(ee) provides for notice to the State in certain classes of cases but the present suit and later proceedings are not covered by the term of section 4(ee) and counsel on either side, when we enquired, did not show interest in taking steps to implead the State or otherwise to give notice to it in the present appeal.
We have to Leave it at that.
The consequence of non impleader or absence of notice to the State will naturally be visited on the parties, in the sense that the State will not be bound by this adjudication and its rights vis a vis the plaintiff and the defendants, first party will remain unaffected.
So also of other third parties on the suit lands.
We have already adverted to the skeletal scheme of the Act, of vesting the lands in the State and saving in the hands of proprietors such lands as are in their khas possession, including certain categories spelt out in s.6 by settling them on fair rents under the State.
So, the crucial concept of khas possession calls for judicial scrutiny rather closely so i has loopholes for escape through the meshes of s.6 may not frustrate the land reform law itself.
But what is legitimately due by way of legislative justice to erstwhile proprietors should not be denied.
With this and in view, the Legislature has defined khas possession in s.2k which reads thus: G "2.
Definitions In this Act, unless there is anything repugnant in the subject or context, (k) 'khas possession ' used with reference to the possession of a proprietor or tenure holder of any land used for agricultural or horticultural purposes means the possession of such proprietor or tenure holder by cultivating (1) (2) 745 such land or carrying on horticultural operations thereon himself with his own stock or by his own servants or by hired labour or with hired stock; Explanation : "Land used for horticultural purposes" ' means lands used for the purpose of growing fruits, flowers or vegetables." He who runs and read will readily make out that what is meant is actual possession with one 's feet on the land, plough in the field and hands in the soil, although hired labour is also contemplated.
The emphatic point is that possession is actual possession and admits of no dilution except to the extent s.6 itself, by an inclusive process permits.
This basic idea banishes the importation of the right to possess as tantamount to khas possession.
It would be a perversion of definition to equate the two.
Of course, Shri section C. Misra, appearing for the appellant, has preset before us that jurisprudentially even the right to possess should be regarded as possession.
Indeed, this Court has had occasion to consider and construe the relevant provision in Surajnath Ahir and Ram Ran Bijai Singh (supra) and our task is largely to explain and adopt.
Before we examine this quintessential aspect presented before us will complex scholarship by Shri section C. Misra we Had better make.
short shrift of certain other questions raised by him.
He has desired ` us, by way of preliminary objection, not to give quarter to the plea, founded on section 6 of the Act, to non suit his client, since it was a point raised be nova at Letters Patent state.
The High Court have thought to this objection but overruled it, if we may say so rightly.
The Court narrated the twists and turns of factual and legal circumstances which served lo extenuate the omission to urge the point earlier but hit the nail on the head when it held that it was well settled that a pure question of law going to the root of the case and based on undisputed or proven facts could be raised even before the Court of last resort, provided the opposite side was not taken by surprise or otherwise unfairly prejudiced.
Lord Watson, in Connecticut Fire Insurance Company vs Kavanach,(1) stated the law thus: When a question of law is raised for the first time in a Court of last resort upon the construction of a document or upon facts either admitted or proved beyond controversy, it is not only competent but expedient in the interest of justice to entertain the plea.
The expediency of adopting that course may be doubted when the plea cannot be disposed of without deciding nice questions of fact in considering which the Court of ultimate review is placed in a much less advantageous position than the courts below.
But their Lordships have no hesitation in holding that the course ought not any case to be followed unless the Court is satisfied that the evidence upon which they are asked to decide establishes beyond doubt that the facts if fully investigated would have supported the new plea." (1) , 480.
17 L925SupCI /75 746 We agree with the High Court that the new plea springs from the common case of the parties, and nothing which may work injustice by allowance of this contention at the late stage of the Letters Patent Appeal has been made out to our satisfaction.
Therefore, we proceed to consider the impact and applicability of s.6 of the Act to the circumstances of the present case.
Counsel for the appellant, in his turn, in this Court went a step further to raise two new points not urged in the prior state of the litigation.
We have heard him but arc not persuaded to, agree with him.
According to him, the defendants, first party, had stated in their written statement that their possession of the disputed items as based on the order of the Magistrate under s.145 Cr. P.C.`.
That order having been found erroneous, no benefit could accrue to the defendants.
So stated, it is a little obscure and indeed the point itself is obscure.
There was a proceeding under s.145 Cr.
P.C. before the criminal court in view of the dispute regarding the claims of actual possession.
In the order of the Magistrate, the oral partition relied on by the defendants was held proved and the subsequent deed of partition relied on by the plaintiff held not been acted upon.
Counsel says that this led to the occupation by trespass of the suit properties.
Since the Magistrate 's order had led to this prejudicial consequence it was not proper to permit the party to benefit by his own wrong founded on an 'actus curiae '.
We see no force at all in this contention.
The Magistrate did not direct possession of the B shedule properties to be handed over to the defendants, first parts, but declared their actual possession.
He has done no wrong nor conferred any unjust advantage.
There is no principle on which it could be held that these circumstance deprive a party of the benefit of his possession and d of the dispossession of the plaintiff flowing from s.6 of the Act; if any rights accrued from a statutory provision, it could not withheld for the reasons urged by counsel for the appellant The next new discovery in this Court turns on the absence of jurisdiction of the civil court to give relief when the substance the matter falls within the special jurisdiction of the revenue authorities .
Counsel submitted that this new point occurred to him on reflection and was being pressed by him because it had force .
The plaintiff 's prayer .
for declaration of title and for possession was negatived by the High Court in the light of s.6 of the Act wherein it was held that he had no khas possession and his interests could not in any manner be saved by that provision It was not a case of the defendant claiming or securing any relief regarding possession but the plaintiff"s title standing negatived.
The suit itself was for ejectment on little and sans title, ejectment could not be granted The title of the plaintiff was sought to be rested on s.6 at the letters patent Appeal level but on a construction of that Provision the Court held against him In short the High Court did nothing to investigate into the possession of parties but on the admitted fact that the Defendants" first party, were in possession by trespass the plaint alleges this the Court Dismissed the suit, since section 6 of the Act divested 747 the plaintiff of his quondam proprietorship.
Moreover, there is nothing in section 35 of the Act, relied on by counsel to substantiate his submission, depriving the civil court of its jurisdiction to decide questions of declaration of title and consequential relief of possession.
Section 35 deals with different types of suits Indeed, s.6(1) with which we are concerned, also contains no inhibition against the civil court 's power to decide the issue of title and right to possession of the plaintiff and, as a necessary corollary, the claim of actual possession set up by the defendants first party Nor, can section 6(2) inferentially interdict the plenary power of the civil court.
In short, the plea of bar of the restriction is specious and fails Another peripheral issue invoked before the High Court and here to undo the defendant 's claim of exclusive possession and consequential absence of khas possession in the plaintiff was based on the provisions of the Estates Partition Act, 1897.
Shri Misra propounded what, unfortunately, strikes us as a fallacious proposition.
He went to the extreme extent of maintaining that a partition of lands, to be valid, should be in terms of the Estates Partition Act, 1897 and.
until then, a deed or decree effecting division by metes and bounds does not legally operate.
If so, Ex.4/a remains an arrangement for separate enjoyment between co owners, title continuing, joint.
The follow up of this reasoning is that the suit properties are in the possession of co shares viz, defendants first party (derived from defendents., second party) and possession of one co sharer is possession of the other.
The plaintiff thus is in constrictive possession good enough to bring him into the rescue shelter provided by s.6 Of the Act.
He relied on the ruling in Mahanth Ram Bhushan Das vs Ramrati Kuer(1) and the various provisions of the Estates partition Act to Make out his thesis.
The support derived from the decision is more apparent than real because, as noticed by the High Court, the suit there was not, unlike here, brought on the foot of` a partition and the ruling(r laid down that any 'amicable division ' among, co sharer would not bind the Revenue until the partition was effected as visualised under the Estates Partition Act.
Shri Misra 's study of the provisions of the said Act is free from confusion, save in one fundamental respect That one point, missed by him, is that the whole statutory project is to protect the land revenue, not to affect title.
The partition is valid, it divests title, it binds all; but, so far as land revenue liability is concerned, it relieves parties from the burden falling, on the other sharer 's land only if the exercise prescribed in the Estates Partition Act is gone through.
The statute is a Protective fiscal armour not a mono for division among co owners to travel.
Section 7 makes it clear.
Not that Courts have lost power to decree partition nor that co owners have become impotent to separate their shares voluntarily but that land revenue shall not be prejudiced without the procedure under that Act being gone through.
More clinching is the fact that the plaintiff has here come to Court on the sole case of partition by metes and bounds and has founded his relief not as co sharer (1) 1965 Bihar L. J. 119.
748 but as exclusive owner.
Seeming legal ingenuity has small chance in A court and to miss the point and pertinence of a measure is to travel to a wrong destination.
Now we come to the master problem presented at learned length by Shri section C. Misra and deferentially listened to by us to discover its substance and the solution. 'A 'blind understanding ' has been the result, and as his argument concluded we 'came out by the same door, as in (we) went '.
It behaves us to set out counsel 's submission and the setting of the Act to explain why we do not agree with him and what we regard is the master key to the construction of section 6.
We must first appreciate that it is a land reform law we are interpreting and not just an ordinary statute.
The social economic thrust of the law in this area should not be retarded by judicial construction but filliped by the legal process, without departing from the plain meaning and objective of the Act.
We may delineate the content and contours of section 6 with which we arc directly concerned in the present case.
The preamble to the Act, which sheds skylight on the statute, reads: "An Act to provide for the transference to the State of the interests of proprietors and tenure holders in land and of the mortgages and lessees of such interests including in tersest in trees, forests, fishries, jalkars, ferries, hats bazaars.
mines and minerals and to provide for the constitution of a l and Commission for the State of Bihar with powers to advise the State Government on the agrarian policy to be pursued by the State Government consequent upon such transference and for other matters connected therewith" From this it is fairly clear that the legislative goal s to liquidate all intermediary interests and vest the ultimate ownership on land in the State.
In this sense, the import of the Act is a tepid measure of land nationalisation.
Section 3 in unmistakable language vests the absolute proprietorship in all the lands in Bihar in the State, the succeeding sections spell out details.
F We may here read sections 3, 4(g) and 6(1) of the Act: "3.
Notification vesting an estate or tenure in the State (1) The State Government may, from time to time, by notification declare that the estates or tenures of a proprietor or tenure holder, specified in the notification, have passed to and become vested in the State.
(2) The notification referred to in sub section (1) shall be published in the official Gazette A copy of such notification shall be sent by registered post, with acknowledgement due, to the proprietor of the estate recorded in the general registers of revenue paying or revenue free lands maintained under the Land Registration Act, 1876 (Ben.
Act 7 of 1876), or in case where the estate is not entered in 749 any such registers and in the case of tenure holders, to the proprietor of the estate or to the tenureholder of the tenure is the Collector is in possession of a list of such proprietors or tenure holders together with their addresses, and such posting shall be deemed to be sufficient service of the notification on such proprietor or., where such notification is sent book post to the tenure holder, on such tenure holder for the purposes of this Act.
(3) The publication of such notification, in the Official Gazette shall be conclusive evidence of the notice of the declaration to such proprietors or tenure holders whose interests are affected by the notification" "4.
Consequences of the vesting of an estate or tenure in the State Notwithstanding anything contained in any other law for the time being in force or in any contract, on the publication of the notification under sub section (1) of section 3 or sub section (1) or (2) of section 3A the following consequences shall ensue, namely: (g) Where by reason of the vesting of any estate or tenure or any part thereof in the State under provision of this Act, the Collector is of opinion that the State is entitled to the direct possession of any property he shall, by an order in writing served in the prescribed manner on the person in possession of such property, require him to deliver possession thereof to the State or show cause, if any, against the order within a time to be specified therein and if such person fails to deliver possession or show cause or if the Collector rejects any cause shown by such person after giving him a reasonable opportunity of being heard, the Collector shall for reasons to be recorded" take or cause to be taken such steps or use or cause to be used such force as, in his opinion, may be necessary for securing compliance with the order or preventing a breach of the peace: Provided that if the order under clause (g) is passed by an officer below the rank of the Collector of a district, an appeal shall, if preferred within sixty days of the order., lie to the Collector of the district and the Collector shall dispose of the appeal in accordance with the prescribed procedure" "6.
Certain other lands in khas possession of intermediaries to be retained by them on payment of rent as raiyats having occupancy rights (1) on and from the date of vesting all lands used for agricultural or horticultural purposes, which were in khas possession of an intermediary on the date of such vesting, including (a)(1) proprietor 's private lands let out under a lease for a term of years or under a lease from year 750 to year, referred to in section 116 of the Bihar A Tenancy Act, 1885 (8 of 1885), (ii) landlord 's privileged lands let out under a registered lease for a term exceeding one year or under a lease, written or oral" for a period of one year or less, referred to in section 43 of the Chota Nagpur Tenancy Act, 1908 (Ben.
Act 6 of 1908), (b) lands used for agricultural or horticultural purposes and held in the direct possession of a temporary lease of an estate or tenure and cultivated by himself with his own stock or by his own servants or by hired labour or with hired stock, and (c) lands used for agricultural or horticultural purposes forming the subject matter of a subsisting mortgage on the redemption of which the intermediary is entitled to recover khas possession thereof; shall, subject to the provisions of section 7A and 7B be deemed to be settled by the State with such intermediary and he shall be entitled to retain possession thereof and hold r them as a raiyat under the State having occupancy rights in respect of such lands subject to the payment of such fair and equitable rent as may be determined by the Collector in the prescribed manner: Provided that nothing contained in this sub section shall entitle an intermediary to retain possession of any naukarana land or any land recorded as chaukidari or goraiti jagir or mafi goraiti in the record of rights or any other land in respect of which occupancy right has already accrued to a raiyat before the date of vesting.
Explantion.
For the purposes of this sub section. 'naukarana land ' means land held as a grant burdened with service in lieu of rent or held simply in lieu of wages for services to he rendered.
" Although there is a blanket vesting of proprietorship in all the lands in the State, the legislation is careful, in this initial state of agrarian reform, not to be too deprivatory of the cultivating possession of those who have been tilling the land for long.
Therefore, while the consequence of the vesting is stated to be annihilation of all interests, encumbrances and the like in the land, certain special categories of rights are saved.
Thus, raiyats and under raiyats are not dispossessed and their rights are preserved.
The full proprietor 's khas possession is if so not disturbed.
Certainly.
the large landholders, whose lands have for long been under tenancy, lose their lands to the State by virtue of the vesting operation (of course, compensation is provided for).
751 Nevertheless, the reform law concedes the continuance of a limited species of interests in favour of those Zamindars.
The three fold class of lands is brought into the saving bucket by including them in the khas possession of the proprietors.
They are legislatively included in khas possession by an extended itemisation in section 6(1).
The purpose and the purport of the provision is to allow the large land holders to keep possession of small areas which may be designated as the private or privileged or mortgaged lands traditionally held directly and occasionally made over to others, often servants or others in the shape of leases or mortgages.
The crucial point to remember is that section 3 in its total sweep" transfers all the interests in all lands to the State, the exception being lesser interests under the State set out in detail in sections 5, 6 and 7.
So much so, any person who claims full title after the date of vesting notified under section 4 has no longer any such proprietorship.
All the same, he may have a lesser right if he falls within the saving provisions viz., sections 5, 6 and 7 Sections 5 and 7 do not apply here.
The claim of the plaintiff is that he can sustain his right to recover possession in this suit, as coming within the oasis of section 6(1).
There is no case that the sub clauses (a), (b) and (c) of section 1) 6(1) apply.
Counsel 's contention is that he comes within the ambit of the main paragraph, being allegedly in khas possession.
To appreciate the further discussion, it is useful to recapitulate that the appellant has averred in his plaint that he had been dispossessed as early as 1954 by a brazen act of trespass by the contesting respondents who were holding adversely to him.
Undaunted by this fatal fact counsel claimed to be in possession and argued still.
The focus was turned by him on the concept of khas possession defined in section 2(k).
He presented a historical perspective and suggested that the genesis of khas possession could be traced to the Bengal Tenancy Act, 1885.
May be, the draftsmen might have drawn upon those earlier land tenure laws for facility, but we must understand right at the outset that the Constitution of India has inaugurated a new jurisprudence as it were, guided by Part IV and reflected in Part II.
When there has been a determined break with traditional jurisprudence and a big endeavour has been made to over turn a feudal land system and substitute what may be called transformation of agrarian relations, we cannot hark back to the bygone jura or hold a new legislation captive within the confines of vanishing tenurial thought.
De hors the historical links a break away from the past in the socio legal system is not accomplished by worship of the manes of the law khas possession means what the definition, in plain English, says.
The definition clause is ordinarily a statutory dictionary, and viewed that way, we have in the early part of this judgment explained how it means actual, cultivatory possession nothing less nothing else.
Of course, section 6(1) makes a special addition by 'including ' other demised lands by express enumeration.
Section 6 does not stop with merely saving lands in khas possession of the intermediary (erstwhile proprietor) but proceeds to include certain lands outstanding on temporary leases or mortgages with others.
752 as earlier indicated.
These are private lands as known to the Bihar Tenancy Act, privileged lands as known to the Chota Nagpur Tenancy Act, land outstanding with mortgagees, pending redemption and lands which are actually being cultivated by the proprietor himself.
Ordinarily what is outstanding with lessees and mortgagees may not fall within khas possession.
The Legislature, however, thought that while: the permanent tiller 's rights should be protected and therefore, raiyats and under raiyats should have rights directly under the state, eliminating the private proprietors, the Zamindar or proprietor also should be allowed to hold under the State., on payment of fair rent, such lands as have been in his cultivatory possession and other lands which were really enjoyed as private or privileged lands or mortgaged with possession by him.
With this end in view, section 6(1) enlarged its scope by including the special categories.
The word 'include ' is generally used in interpretation clauses in order to enlarge the meaning of that words or phrases occurring in the body of the statute.
It is obvious that section 6(1) uses the word 'including ' to permit enlargement of the meaning of khas possession for the limited purpose of that section, emphasising thereby that, but for such enlargement, the expression khas possession excludes lands outstanding even with temporary lessees.
It is perfectly plain, therefore, that khas possession has been used in the restricted sense of actual possession and to the small extent it had to be enlarged for giving relief to proprietors in respect of 'private ' 'privileged ' and mortgaged lands inclusive expressions had to be employed.
Khas possession is actual possession, that is "a foothold on the land, an actual entry, a possession in fact, a standing upon it, an occupation of it, as a real, administrative act done"(l).
Constructive possession or possession in law is what is covered by the sub clauses of section 6(1).
Even so, it is impossible to conceive, although Shri Misra wanted us to accept, that possession is so wide as to include a mere right to possess, when the actual dominion over the property is held by one in hostility to the former.
Possession, correctly understood, means effective, physical control or occupation.
"The word possession is sometimes used inaccurately as synonymous with the right to possess".
(Words and Phrases, 2nd Edn., John B. Sounders., p.151).
"In the Dictionary of English Law (Earl Jowitt) 1959 at p. l 367 "possession" is defined as follows: 'possession, the visible possibility of exercising physical control over a thing, coupled with the intention of doing so, either against all the world, or against all the world except certain persons.
There are, therefore, three requisites of possession.
First, there must be actual or potential physical control.
Secondly, physical control is not possession, unless accompanied by intention; hence, if a thing is put into the hand of a sleeping person, he has not possession of it.
Thirdly, the possibility and intention must be visible or evidence by external signs for if the thing shows no signs of being under the control of anyone, it is not possessed; . ' In the end of all, however the meaning of 'possession ' must depend on the context." (ibid.
p. 153).
May be, in certain situations, possession may cover right to possess.
It is thus clear that in Anglo American jurisprudence also, possession is actual possession and in a limited set of cases, may include constructive possession, but when (1) American Jurisprudence, Words & Phrases Vol. 33, p. 103.
753 there is a bare right to possess bereft of any dominion or factum of control, it will be a strange legal travesty to assert that an owner is in possession merely because he has a right to possess when a rival, in the teeth of owner 's opposition, is actually holding dominion and control over the land adversely, openly and continuously.
Admittedly in the present case" the possession of the plaintiff had ceased totally at least two years before the vesting under section 4 took place.
This situation excludes khas possession.
We have the uniform authority of this Court to hold that the possession of a trespasser, by no stretch of imagination, can be deemed to be khas possession or even constructive possession of the owner.
In Surajnath Ahir (supra) this Court considered the definition of khas possession in the Act in the context of section and after adverting to Brij Nandan Singh vs Jamuna Prasad, on which Shri Misra placed massive reliance, observed: "Reliance was placed by the High Court on the case reported as Brijnandan Singh vs Jamuna Prasad for the construction put on the expression 'khas possession ' to include subsisting title to possession as well, and therefore for holding that any proprietor, whose right to get khas possession of the land is not barred by any provision of law, will have a right to recover possession and that the State of Bihar shall treat him as a raiyat with occupancy right and not as trespasser.
We do not agree with this view when the definition of khas possession ' means the possession of a proprietor or tenure holder either by cultivating such land himself with his own stock or by his own servants or by hired labour or with hired stock.
The mere fact that a proprietor has a subsisting title to possession over certain land on the date of vesting would not make that land under his 'khas possession ' ".
The attempt to distinguish this decision on the score that the observation is obiter does not appeal to us and the rule laid down there is in conformity with the principle as we have earlier expounded.
The law has been indubitably laid down in Ram Ran Bijai Singh (supra) where a Bench of five Judges of this Court discussed khas possession in section 2k and the scope of section 6 of the Act.
The same Full Bench(1) case earlier referred to was pressed before the learned Judges, and over ruling that case, Ayyangar,, J. speaking for the Court stated the law in these unmincing words: "Mr. Sarjoo Prasad however relied on certain observations in the judgment of the Full Bench of the Patna High Court in Sukdeo Das vs Kashi Prasad where the learned Judges appear to consider the possession even of a trespasser who has not perfected his title by adverse possession for the time requisite under the Indian Limitation Act as the khas possession of the true owner.
We consider that this equation of the right to possession with 'khas possession ' (1) A.I.R. 1958 Pat.
754 is not justified by principle or authority.
Besides this is also inconsistent with the reasoning of the Full Bench by which constructive possession is treated as within the concept of khas possession.
The possession of the contesting defendants in the present case was in their own right and adverse to the plaintiff, even on the case with which the appellants themselves came into Court." .
In this context the plea made by the plaintiffs relevant to the character of the possession of the contesting defendants assumes crucial importance, for if they were admittedly trespassers then they could not be said to hold the property on behalf of the mortgagors and the entire basis of the argument as to the property being ill the khas possession of the plaintiffs would disappear.
It was on the basis of their possession being wrongful that a claim was made against them for mesne profits and it was on the footing of their being trespassers that they were sued and possession sought to be recovered from them.
In these circumstances we consider that it is not possible for the appellants to contend that these tenants were in possession of the property on behalf of the mortgagor and in the character of their rights being derived from the mortgagor. ' The Court rejected the theory that the possession of a trespasser was that of the owner.
Other decisions of the Patna High Court and this Court were referred to at the bar but the position having been made unmistakable by the two cases just mentioned, we do not wish to burden this judgment with case law any further.
The conclusion we, therefore, draw is that on the facts found indeed, on the facts averred in the plaint the plaintiff had no khas possession of the suit lands and cannot use section 6 as a rescue raft.
His title was lost when section 4 was notified as applicable to the suit lands by section 3 in 1956.
Without title he could not maintain the action for recovery of possession.
But that is not the end of the matter.
He is certainly entitled to mesne profits from the defendants, first party, until the date of vesting, i.e." January 1, 1956.
We, grant him a decree in this behalf subject to the qualification mentioned below.
Again, the contesting defendants, in paragraph 27 of their written statement, have admitted that they had no possession of or connection with some of the plots mentioned in Schedule to the plaint and set out therein.
The High Court has dismissed the suit in entirety after noticing the admission of the contesting defendants that they have not been in possession of those items covered by paragraph 27 of the written statement.
The plea in that paragraph is that these lands have been made over to the defendants, second party.
It is undeniable that the plaintiff had title to the entire Schedule properties as against defendants.
first party, and second party.
If defendants, first party. were not in possession and defendants, second party,, were in possession, the plaintiff would still be entitled to a decree for possession of the same.
It neither is in possession the presumption that the owner is in possession holds good and he is entitled to that 755 possession being restored to him.
Therefore, a decree for possession of these items covered by paragraph 7 of the written statement filed on behalf of the contesting defendants, first party, is also granted.
Here we must utter a word of caution and condition our decree accordingly.
The State, by the vesting operation, has become the owner and very probably the plaintiff cannot sustain any claim to be in possession as against the State.
While we do not investigate this aspect, we wish to make it perfectly plain that the rights of the State, as against the plaintiff, in regard to the items for which we are giving him a decree, will not in any manner be affected.
Likewise, if some third party is in possession of those items unclaimed by the defendants, first party, their possession, if any, also will not be prejudiced.
After all, the decree of this Court can bind and regulate the rights of the parties to the litigation and not others.
Inevitably, the mesne profits which we have decreed will be confined to those items which are found to be in the possession of the defendants, first party.
There is a disturbing feature about this case.
We have already indicated how there is an apparent indifference on the part of the State in securing its rights granted by the Act.
Here is a case where the defendants, first party,, are rank trespassers and have no evident equity in their favour.
Section 4(f) declares that the Collector shall be deemed to have taken charge of the estates and interests vested in the State This means he has a public duty to take charge of lands vested in the State.
Surely, a responsible public officer like the Collector, charged with a duty of taking delivery of possession of lands which by virtue of the vesting the State is entitled to take direct possession of, will proceed to dispossess the trespasser.
In this case, defendants first party, are trespassers and the plaintiff being out of the pale of section 6, the State is entitled to the direct possession of the suit lands.
We expect the Collector to do his duty by section 4(g).
Counsel for the respondents drew our attention to rule 7H: "7 H. How to deal with cases in which proprietor, etc. not found in possession on the date of vesting If the Collector holds on the report of enquiry held under rule 7 E or 7 F that the outgoing proprietor or tenure holder, or his temporary lessee or mortgagee" was not in possession of the lands or buildings referred to in rule 7 G, he shall fix the fair rent or ground rent thereof in the manner prescribed in these rules and the person who may be found to be in possession of such lands or buildings shall thereupon be liable to pay the rent or ground rent so fixed to the State Government with effect from the date of vesting.
" Although we need not elaborately study the implications of this pro vision, it is fairly clear that this rule does not confer any right or equity to be in possession in favour of d trespasser.
All that it does is to make the man in possession, be he trespasser or not, "liable to pay the rent or ground rent so fixed to the State Government with effect from the date of vesting. ' It is the liability to pay rent that is created, not the equity to claim possession.
After all, the land reform 756 measure is intended to conserve as much land as is available in the hands of the State and any trespasser who distorts this claim and snatches possession, cannot benefit by his wrong.
May be.
there are special circumstances which may persuade the State to give possession of any land either to its erstwhile proprietor or to one who has been in long possession rightly of wrongly.
We do not make any observation in that behalf but point out that prima facie section 4(f) and (g) and rule 7 H attract the jurisdiction of the State and its revenue 13 authorities.
The policy of the Act includes the State taking over and managing lands not saved by sections 5, 6 and 7 and are not found to be in possession of the proprietor so that the eventual distribution to the landless and the like may be worked out smoothly.
The appeal is dismissed in substantial measure except to the extent of the relief by way of mesne profits and possession in regard to a few items mentioned in paragraph 27 of the contestants ' written statement The parties will bear their costs throughout in the peculiar circumstances of the case.
This judgment will not affect the rights, if any.
either party may seek or has secured from the State.
V.M.K. Appeal dismissed.
| Messers Das Bank Ltd. instituted a mortgage suit against the responded on January 19, 1950 in respect of the tea garden mortgaged with them in 1943.
On reorganisation of the Judicial Administration in 'Tripura, the suit was transferred from the Tripura High Court to the court of the District Judge, Agartala.
On the application by the Bank for appointment of a receiver, an employee of the Bank was appointed as the receiver subject to his furnishing security in the sum of Rs. 50,000.
The Receiver took possession of the estate on 22nd January, on February 26, 1 950 the tea garden was damaged by a tire which destroyed over 3,000 tea saplings.
The respondent moved an application asking for damages from the Receiver on the ground that the fire had occured due to his negligence.
He also renewed his request that the receiver be asked to furnish security.
On August 26, 1950, the appellant M/s. Howrah Insurance Co. executed a surety bond in the sum of Rs. 50,000 in favour of Shri R. M. Goswami, District Judge, Agartala, his successors, successors in office and assigns.
The bond was approved and accepted by the District judge on October 10, 1950.
The bond was executed both by the Receiver and the appellant in favour of "Sri Ramani Mohan Goswami the District Judge of Agartala, his successors, successors in office and assigns.
" By the bond, the executants bound themselves jointly and severalty in the whole of the amount of Rs. 50,000 up to the District Judge Agartala, his successors, successors in office and assigns.
The bond, though executed on August 26, 1950, related back to January 22, 1950 being the date when the Receiver took possession of the property.
By virtue of the powers conferred by the Tripura (Courts) order of 1950 which came into force on December 31, 1950 the District Judge transferred the mortgage slit to the court of the Subordinate Judge.
Agartala.
The transferee court was created under the order of 1950.
The Subordinate Judge decreed the suit and also allowed the respondent 's application for damages to the extent of Rs. 32,525.
The appeal filed by the Receiver was dismissed for default by the Judicial Commissioner, 'Tripura, but he allowed the respondent 's cross objections and enhanced the damages to Rs. 41,525.
On the Execution Petition filed by the respondent, the Subordinate Judge directed that the damages awarded to the respondent be recovered from the appellant The appeal filed by the appellant against that order a, dismissed by the Judicial Commissioner and this appeal has been preferred on the basis of the special leave "ranted by this Court.
It was contended for the appellant that (l) 'The Subordinate Judge who tried the suit was incompetent to enforce the surety bond executed by the appellant as he was neither the successor nor the successor in office nor the assign of The District Judge; and (2) Under the terms of the bond, the appellant was not answerable for the loss caused to the tea garden by fire.
Rejecting the contentions and dismissing the appeal, HELD: ( I ) (i) Th Subordinate Judge of Agartala may not be the successor in office of the District Judge because "successor in office" would mean successor of the District Judge in the post or office of the District Judge.
But the Subordinate Judge, Agartala is, for the purposes of the present proceedings, a 357 successor of the District Judge who was seized of the suit and who transferred it to the Subordinate Judge under the Tripura (Courts) order of 1950.
The surety bond was executed in and for the purposes of the particular proceedings which were Pending before the District Judge, in order that the bond should be enforceable at the instance of the presiding other of the court.
"Successor", therefore, must in the context mean the court which for the time being is seized of the proceedings.
[359B C] (ii) By virtue of section 1 SO C.P.C., the Subordinate Judge was entitled to exercise the same powers in the matter of the enforcement of the bond as the District Judge himself.
[359D E] (iii) As laid down by section 145(c) of tho C.P.C., by the surety bond, the appellant rendered itself liable as a surety for the fulfilment of the conditions imposed on the Receiver under the orders passed by the Court, Therefore, the order for the recovery of damages obtained by respondent against the Receiver can be executed against the appellant to the extent to which it rendered itself personally liable under the terms of the bond.
[359 FG]] (2) 'The Receiver Was put in possession of the tea garden in his capacity as a Receiver and parties had made contentions from time to time as to whether the tea garden was managed by the Receiver economically and efficiently The surety bond which was given retrospective operation with effect from the date on which the Receiver had taken Possession of the mortgaged property including the tea garden, would therefore cover the loss occasioned to the tea garden due to the Receiver 's default.
[360B C]
|
Appeal No. 37 of 1958.
Appeal by special leave from the judgment and order dated September 14, 1956, of the Madras High Court in Writ Appeal No. 64 of 1956, arising out of the judgment and order dated May 1, 1956, of the said High Court in Writ Petition No. 852 of 1955.
G. section Pathak, R. Ganapathy lyer and O. Gopalakrishnan, for the appellant.
A. V. Viswanatha Sastri, J. B. Dadachanji and section N. Andley, for respondent No. 4. 1959.
February 18.
The judgment of Imam and Subba Rao, JJ., was delivered by Subba Rao, J. Sarkar, J., delivered a separate judgment.
SUBBA RAO, J.
This appeal by Special Leave against the judgment of the High Court of Judicature at Madras raises the question of interpretation of section 43A of the (IV of 1939), as amended by the Motor Vehicles (Madras Amendment) Act, 1948 (Mad. XX of 1948), hereinafter referred to as the Act.
On February 19, 1955, the Regional Transport Authority, Tanjore, Madras State, the second respondent herein, called for applications under section 57(2) of the Act for grant of a stage carriage permit on the Saliamangalam Kodavasal route.
The appellant and the fourth respondent, K. M. Shanmugam, Proprietor, K. M. section Transport, Ammapet, Tanjore District, along with others, applied for the grant of the said permit.
The Regional Transport Authority 230 at its meeting held on April 19, 1955, after hearing the representations of the applicants, granted the permit to the appellant.
The fourth respondent and two others preferred appeals against the said order to the Central Road Traffic Board, Madras, the third respondent herein.
The Central Road Traffic, Board by its order dated June 25, 1955, set aside the order of the Regional Transport Authority and granted the permit to the fourth respondent.
The appellant preferred a Revision Petition against that order to the first respondent, the State of Madras, but the first respondent rejected the petition by its order dated October 14, 1955.
Thereafter, the appellant filed a Writ Petition (No. 852 of 1955) in the High Court of Madras under article 226 of the Constitution to quash the orders of the Central Road Traffic Board and the State of Madras.
Rajagopalan, J., of the said High Court by his order dated May 1, 1956, quashed the order of the Government and directed the State Transport Appellate Tribunal which had been constituted in place of the Central Road Traffic Board to dispose of the appeal in accordance with law.
Against the judgment of the learned Judge, the fourth respondent preferred an appeal under the Letters Patent and the Appellate Bench of that High Court, consisting of Rajamannar, C. J., and Ramaswami, J., set aside the order of RajagopaIan, J., and restored the order of the Central Road Traffic Board.
The appellant with special leave filed the present appeal against that judgment of the High Court.
Mr. Pathak, appearing for the appellant, raised before us the following two points: (i) The appeal filed by the fourth respondent against the order of the Regional Transport Authority to the Central Road Traffic Board was barred by limitation and the Board acted illegally in disposing of the appeal without deciding the question of limitation; and (ii) the appellant had the fundamental right to carry on the business of transport subject to reasonable restrictions imposed by law as on the date he applied for a permit or at any rate when the Regional Transport Authority issued the permit to him, and that the Central Road 231 Traffic Board committed an error, evident on the face of the record, in disposing of the appeal in accordance with the new restrictions imposed by law made pending the appeal before it.
Stated as a legal proposition, the contention is that the appellant had acquired a vested right to carry on the business of transport and that the same could not be defeated by a subsequent law made pending the appeal, which was only prospective in character.
The first argument need not detain us, for the learned Counsel, in view of the finding of the High Court that as a matter of fact the appeal to the Central Road Traffic Board was not barred, fairly did not press it before us.
This leaves us with the second and the only argument in the case.
To appreciate the contention it is necessary to set out some more relevant facts: On March 28, 1953, the Government made an order, G. O. Ms. No. 1037 Home, purporting to be under section 43A of the Act.
The material part of that order reads: " (1) That additional buses should not be permitted to ply on existing routes unless there is a clear need for increase in the number of buses plying on a particular route and wasteful competition should be discouraged but healthy competition where there is room should be encouraged and, (2)that the transport authorities while granting stage carriage permits should work up to the minimum of 5 permits with a spare bus for each operator and the issue of permits should be so regulated as not to encourage benamidars on one hand and inefficient operators on the other." On November 15, 1954, in supersession of paragraph 2 of the above order, the Government issued an order, G. O. Ms. No. 3353 Home, to the following effect: " The Governor of Madras hereby directs that each viable stage carriage unit in this State shall consist of not less than 10 buses and that in the matter of grant of stage carriage permits, other things being equal, and with a view to build up such viable units, the following shall be the order of preference 232 (1)Operators with less than 10 buses but nearer the mark of 10.
(2) Operators with 10 and more buses.
(3) Others including new entrants.
The Government also directs that in order to facilitate the amalgamation of existing small units into viable units transfer of permits shall be allowed liberally.
" On June 15, 1955, the Government issued another order, G. O. Ms. No. 1689 Home, whereby the Central Road Traffic Board was informed that pending further orders of Government after re examination of the question of formation of viable units of stage carriages, the orders in para.
(2) of G. O. Ms. No. 1037 Home dated 28th March, 1953, would be in force.
The effect of this order was that the first order was restored pending final orders.
When the Regional Transport Authority issued the permit in favour of the appellant, G. O. Ms. No. 3353 Home dated 15th November, 1954, was in force, and when the Central Road Traffic Board made the order giving the permit to the fourth respondent, G. O. Ms. No. 1689 Home dated 15th June, 1955, was in operation.
Apart from other considerations, the Regional Transport Authority relied upon the former G. O. in preferring the appellant to other applicants, while the Central Road Traffic Board referred to G. O. Ms. No. 1037 Home dated 28th March, 1953, which was restored by the later G. O. in preferring the fourth respondent to the appellant.
We shall give further details of the orders of the Regional Transport Authority and the Appellate Tribunal in the context of another argument, but, for the present, the aforesaid facts would suffice.
It would be convenient at this stage, before entering into the controversial question, to state briefly some of the well established principles relevant to the question raised: (i) A citizen has a fundamental right to ply motor vehicles on public pathways under article 19(1)(g) of the Constitution, and any infringement of that right by the State can be justified only if it falls within the scope of article 19(6) thereof See C. section section 233 Motor Service, Tenkasi vs The State, of Madras (1) and Saghir Ahmad vs The State of U. P. (2); (ii) proceedings before tribunals issuing permits are of quasi judicial in character See C. section section Motor Service, Tenkasi vs The State of Madras (1) and New Prakash Transport Co. Ltd. vs New Suwarna Transport Co. Ltd. (3) ; (iii) a new law which takes away or impairs vested rights acquired under existing laws must be deemed to be intended not to have retrospective operation, unless such law makes it retrospective expressly or by implication See Maxwell on the Interpretation of Statutes, p. 215; Garikapatti Veeraya vs N. Subbiah Chowdhury (4 ) and Seth Gulab Chand vs Kudilal (5); and (iv) the same principle applies to a law made pending an appeal before an appellate Court See P. M. Seshadri vs Province of Madras (6).
So much is not, and cannot, de disputed.
We shall assume that the said principles apply to a law made pending an appeal against an order of a quasi judicial tribunal.
The main controversy centres round the fact whether the orders made and the directions issued by the State Government under section 43A of the Act are " laws " as to attract the operation of the aforesaid principles.
While Mr. Pathak says that the said directions are as much laws as those of the provisions of a statute or rules made thereunder, Mr. A. Viswanatha Sastri contends that, having regard to the scheme of the and the different sections of the Act vesting powers in the State Government with regard to different matters dealt with by the Act, the power conferred on the State Government under section 43A is a power to make orders or issue directions in respect of administrative matters regulating the relationship between the State Government and the Transport Authorities and that such orders do not affect the legality or the validity of judicial acts of the said authorities.
To appreciate the rival contentions, it is necessary to consider the relevant provisions of the Act.
(1) I.L.R. , 330, 334.(2) [1955] 1 S.C.R. 707, 719.
(3) , 118.(4) ; , 515.
(5) ; , 322.(6) A.I.R 1954 Mad.
30 234 The Act, which is a Central Act, was passed in the year 1939 and subsequently it was amended from time to time both by Parliament and also by the local legislatures.
The main object of the Act is to regulate the motor traffic in every provisions relating to licensing of drivers of motor vehicles.
Chapter III prescribes for the registration of motor vehicles.
Chapter IV provides for the control of transport vehicles.
Chapter V lays down the general provisions regarding construction, equipment and maintenance of motor vehicles.
Chapter VI regulates the control of traffic.
Chapter VIII deals with the insurance of motor vehicles against third party risks.
Chapter IX defines the offences, lays down the penalties and prescribes the procedure for detecting offences and enforcing penalties.
Chapter X deals with miscellaneous matters.
Every Chapter contains a specific provision conferring a power on the State Government to make rules for the purpose of carrying into effect the provisions of that Chapter.
To carry out the objects of the Act, the State Government is authorized to create a hierarchy of officers such as the State Transport Authority, the Regional Transport Authority, the Registering Authority, etc.
Such Authorities are entrusted with administrative as well as quasi judicial functions.
Chapter IV with which we are now concerned follows the same pattern.
Its general heading is " Control of Transport Vehicles ".
Section 42 prohibits the owners of transport vehicles from using them in any public place without permits.
Section 43 empowers the State Government to control road transport.
Section 44 enables the State Government to constitute Transport Authorities to exercise and discharge the specified powers and functions.
Under section 44(4) the State Transport Authority is authorized to issue directions to any Regional Transport Authority and the latter shall be guided by such directions.
Sections 46, 47, 48, 57, 60 and 64 prescribe the procedure for issue of permits and also create a hierarchy of Tribunals for hearing of applications and disposal of appeals.
The said procedure is clearly quasi judicial in character and has 235 been held to be so by this Court.
Sections 67 and 68 confer a power on the State Government to make rules to regulate the operation of transport carriages and also to make rules for the purpose of carrying into effect the provisions of this Chapter.
Under the aforesaid provisions and the rules made thereunder, the State Transport Authority is made the administrative head of all the other Transport Authorities functioning in the State, and the Central Road Traffic Board the appellate authority in the hierarchy of Tribunals constituted under the Act.
As the administrative head the State Transport Authority is authorized under section 44(4) of the Act to issue directions to any Regional Transport Authority, who shall be guided by such directions.
As an appellate tribunal the Central Road Traffic Board is empowered to dispose of the appeals preferred against the orders made by the subordinate authorities under the Act in respect of specified matters.
But the Central Act did not make any provision enabling the State Governments to control either the quasi judicial or the administrative wings of the machinery provided under the Act.
While the State Transport Authority could issue directions to other Transport Authorities constituted under the Act, a State Government could not likewise issue any directions either to the State Transport Authority or to its subordinate authorities.
So too, while the Central Road Traffic Board could in its appellate jurisdiction set aside or modify the orders of the subordinate tribunals, the State Government was not in a position to set aside the improper orders of the tribunals under the Act.
Presumably, therefore, to bring the said authorities under its control, both on the judicial and the administrative wings, Motor Vehicles (Madras Amendment) Act, 1948 ((Mad. XX of 1948), was passed and it became law on December 21, 1948.
Among other amendments, sections 43A and 64A were inserted in the Act.
Section 43A reads: " The State Government may issue such orders and directions of a general character as it may consider necessary,, in respect of any matter relating to road transport, to the State Transport Authority or 236 a Regional Transport Authority; and such Transport Authority shall give effect to all such orders and directions." Section 64A is to the following effect: " The State Government may, on its own motion or on application made to it, call for the records of any order passed or proceeding taken under this Chapter by any authority or officer subordinate to it, for the purpose of satisfying itself as to the legality, regularity or propriety of such order or proceeding and after examining such records, may pass such orders in reference thereto as it thinks fit." So far as section 64A is concerned, in express terms it confers a judicial power on the State Government to keep a subordinate judicial tribunal within bounds.
Section 64A, along with sections 45 to 57, 60 and 64, forms a complete code in respect of the quasi judicial disposals of the issue of permits.
The permits should be issued in accordance with the provisions of the Act and the rules framed thereunder following the judicial procedure.
The words used in section 43A are very wide.
It says that the State Government may issue orders and directions of a general character in respect of any matters relating to road transport.
Divorced from the context and the setting in which the new section appears, it may comprehend any orders or directions of a general character in respect of road transport; and, if so construed, it would not only subvert the other provisions of the Act but also would be vulnerable to attack on the ground of constitutional invalidity.
It would entrust the Government with a naked arbitrary power capable of being used to compel quasi judicial tribunals to dispose of cases in a particular way; it would enable them to couch the order in a general way to induce a tribunal to come to a particular decision in a given case; and it would be destructive of the entire judicial procedure envisaged by the Act and the rules framed thereunder in the matter of disposal of specified questions.
It would be attributing to the legislature an incongruity, for the State Government could issue directions in respect of which it could make rules ignoring the safeguards provided in the 237 making of the rules.
Section 133 lays down that every power to make rules given by the Act is subject to the condition of the rules being made after previous publication.
It also enjoins on the Central and the State Governments to place the said rules for not less than fourteen days before the appropriate legislature and the rules so made shall be subject to such modification as the legislature may make in such session in which they are so laid.
All these salutary precautions can be ignored if the directions given under section 43A are given the status of law; on the other hand, if a restrictive meaning is given as it should be in the context, there would be a happy correlation of the functions of the various bodies under the Act, including the Government.
The Government 's legislative power is recognised under sections 67 and 68 of the Act; its judicial power is maintained under section 64A and its administrative power is affirmed under section 43A.
Chapter IV and the rules made thereunder confer adminis trative powers on the Regional Transport Authorities and the State Transport Authority.
Section 43A enables the State Government to make orders and issue directions of a general character in respect of those functions to implement the provisions of the Act and the rules made thereunder; and the said authorities shall give effect to all such orders and directions.
The context in which and the setting wherein the section is inserted also lend support to the said conclusion.
Section 42 describes the necessity for permits and section 43 confers specific powers on the Government to control road transport.
Section 43A coming thereafter and before the sections conferring quasi judicial powers on tribunals is indicative of the fact that the jurisdiction conferred under section 43A is confined to administrative functions of the Government and the tribunals rather than to their judicial functions; for, if the section was intended to confer legislative power, it should have found its place after section 64A or somewhere near the end of the Chapter.
Though it is not a conclusive test, the placing of the provisions of sections 43A and 64A, which were inserted by the same Amending Act is also a pointer to the intention of the 238 legislature, namely, that section 43A was intended to govern administrative functions of the tribunals.
The terms of the section and the manner of issuing orders and directions thereunder also support the same conclusion.
The legislature used two words in the section: (i) order and (ii) directions.
Whenever it intended to affect the rights of parties, it used the word " rules ", but in this section it designedly used the words appropriate to the control of administrative machinery.
The words " directions and order " are defined in one of the Law Lexicons thus: " Direction contains most of instruction in it; order most of authority.
Directions should be followed; orders obeyed.
It is necessary to direct those who are unable to act for themselves; it is necessary to order those whose business it is to execute the orders. " The said meaning of the words is more appropriate to administrative control rather than to rules of law affecting rights of parties.
Further, the declaration in the section that the orders and the directions under the section shall be binding on the authorities concerned is indicative of the fact that they are not laws, for if they are laws, no such declaration is necessary.
What is more, they need not even be published and may, if the Government so desires, take the form of secret communication to the authorities concerned.
Nor is there any basis for the argument that as the directions are issued under a statutory power, they are " laws ".
The source of the power does not affect the character of the things done in exercise of that power.
Whether it is a law or an administrative direction depends upon the character or nature of the orders or directions authorized to be issued in exercise of the power conferred.
That should be determined on other considerations adverted to by us already.
Our view is in accord with that expressed by a Division Bench of the Madras High Court in C. section section Motor Service, Tenkasi vs The State of Madras (1).
There the constitutional validity of sections 42, 43A, 47, 48 and 64A of the Act was questioned.
In dealing with section 43A, Venkatarama Ayyar, J., who delivered the judgment of the Court, observed at p. 335 thus (1) I.L.R. , 330, 334. 239 "Coming next to section 43A, it is argued that it confers on the Provincial Government wide and unlimited powers to issue all such orders and directions of a general character as they may consider necessary, that the transport authorities are bound under that section to give effect to such orders and directions, that there is nothing to prevent the Government from even issuing directions with reference to the judicial functions which those authorities have to dis charge under the Act, that it could not be expected that such directions would be disregarded by those authorities and that in practice the provisions of section 47 could be evaded.
Reference is also made to the fact that this section was introduced for nullifying the effect of the decision in Sri Rama Vilas Service Ltd. vs The Road Traffic Board, Madras (1) where it was held that the transport authorities had failed in the discharge of their judicial function in meekly giving effect to an order of the Government which was opposed to the provisions of the Act.
Section 43 A appears to be intended to clothe the Government with authority to issue directions of an administrative character and in that view it would be valid.
No specific order or direction of the Government is attacked in these proceedings as invalid and the discussion is largely academic.
The section must itself be held to be valid though particular orders passed thereunder might be open to challenge as unconstitutional.
" From the aforesaid observations, it is manifest that the learned Judge construed section 43A as conferring a power on the State Government to issue directions of an administrative character.
If the construction was otherwise, the learned Judge would have held that the section was constitutionally bad as he had held in regard to other sections.
The High Court of Andhra Pradesh in Gopalakrishna Motor Transport Co. Ltd. vs Secretary, Regional Transport Authority, Krishna District, Vijayawada (2) had also considered the scope of the provisions of section 43A.
There, the State Government issued an order under section 43A of the Act prescribing the manner of checking a bus for over (1) (2) loading.
The procedure prescribed was not followed by the Regional Transport Authority, which was empowered to suspend the permit on the ground of overloading under section 60 of the Act.
One of the contentions raised was that as the mandatory direction given by s the State Government under section 43A was not followed, the Regional Transport Authority in exercising its powers under section 60 should have held that there was no over loading.
In rejecting this plea, the High Court observed at p. 885 thus: " Government has power to frame rules and also to issue administrative directions of a general character under Section 43 A of the Act. . .
In so far as the order was couched in mandatory terms, it is incumbent upon the officers concerned to comply with it.
Any instruction given under Section 43 A cannot override the discretionary power conferred upon the Transport Authority under section 60. .
We, therefore, hold that the order of the Government contained only administrative instructions issued under Section 43 A.
It is true that some of the, administrative instructions impose a mandatory duty on the officers concerned and if they do not discharge their duty, Government may take disciplinary action against them.
But, in our view, non compliance with those directions cannot affect the finding the Authority arrived at on other material on the question of over loading.
" In the present case, the learned Chief Justice, who was a party to the decision in C. section section Motor Service vs The State of Madras (1), presumably on the basis of that judgment observed thus: " In our opinion, these Government orders, which are in the nature of general administrative directions to the transport authorities, do not vest any rights, indefeasible rights in any applicant for a stage carriage permit ".
The result of the discussion may be summarised thus: The appellant had a fundamental right to carry (1) I.L.R. , 334.
241 on his motor transport business subject to reasonable restrictions imposed upon that right by law.
Some of the provisions of Chapter IV of the Act contain reasonable restrictions on the said right.
He was given a permit on the basis of the law imposing the said restrictions on his right.
The orders made and the directions issued under section 43A could cover only the administrative field of the officers concerned and therefore any direction issued thereunder was not law regulating the rights of the parties.
The order made and the directions issued under section 43A of the Act cannot obviously add to the considerations prescribed under section 47 on the basis of which the tribunal is empowered to issue or refuse permit, as the case may be.
There was, therefore, no change in the law pending the appeal so as to affect the appellant 's vested right in this view, the appellant cannot question the validity of the order of the Central Road Traffic Board on the ground that it decided the appeal on a law that was made subsequent to the issue of the permit to him.
The same result could be arrived at by different process of reasoning.
The appellant had a fundamental right to carry on the business of motor transport subject to reasonable restrictions imposed by law under article 19(6) of the Constitution.
The Act imposed reasonable restrictions oil the said right.
One such restriction was that the State Government may issue such orders and directions of a general character as it ' may consider necessary in respect of any matter relating to road transport to the State Transport Authority.
When the appellant applied for a permit, be must be deemed to have bad the knowledge of the fact that his application would be disposed of by the State Transport Authority in accordance with orders and directions of a general character issued, by the State Government.
The directions were not now law that came into existence pending the appeal, but only issued under a law that was in existence even at the time he applied for a permit.
The law was that embodied in section 43A of the Act, namely, that the Government could issue directions binding on the authorities 31 242 concerned and that law was a pre existing one and the application had to be disposed of subject to that law till it was finally terminated by an order of the highest tribunal in the hierarchy.
In this view also there are no merits in the appellant 's contention.
Now coming to the merits of the case, the contentions of the parties may be stated thus: The learned Counsel for the respondents contends that there is no material difference between G. O. Ms. No. 1037 and G. O. Ms. No. 3353, except in regard to one circumstance, which is not material for the present purpose: while in the former G. O., the argument proceeds, the transport authority is directed to work up to a minimum of five units with a spare bus, under the latter G. O., the viable unit fixed is not less than ten buses and the authority concerned is directed to work up to that limit.
It is pointed out that the only difference, is in the measure of a viable unit and that the fourth respondent 's case falls squarely within the first category in the order of preference prescribed in G. O. Ms. No. 3353 of 1954.
The learned Counsel for the appellant contends that the order of preference is based upon the achievement of the object, namely, building up of viable units of ten permits and that the appellant admittedly had only four permits and, therefore, far below the viable unit and he could not be given preference in a competition between him and the appellant, who had more than thirty permits.
The problem presented can only be solved by a reasonable inter pretation of the plain words used in G. O. Ms. No. 3353 of 1954 read along with the expressed object sought to be achieved thereby.
It will be convenient at this stage to read the said order omitting the unnecessary words: G. O. Ms. No. 3353 Home dated 15th November, 1954.
" The Planning Commission has made the following recommendation in respect of Road Transport service : 'It is desirable for the existing private operators ' units to amalgamate, wherever possible, into big viable units to enable them to achieve better returns and maintain better standards of operation 243 The Government considered that it will be in the interests of the public if road transport services are conducted by operators having at least toil stage carriages and they have therefore decided that each viable unit should consist of at least ten stage carriages.
In exercise of the powers conferred by Section 43 A of the (Central Act IV of 1939), and in supersession of the orders issued in paragraph (ii) of G. O. Ms. 1037, Home dated 28th March 1953, the Governor of Madras hereby directs that each viable stage carriage unit in this State shall consist of not less than 10 buses and that in the matter of grant of stage carriage permits, other things being equal, and that with a view to build up such viable units, the following shall be the order of preference 1.
Operators with less than 10 buses, but nearer the mark of ten. 2.
Operators with 10 and more buses.
Others including new entrants.
The Governor also directs that in order to facilitate the amalgamation of existing small units into viable units transfer of permits shall be allowed liberally." The G. O., Was issued to achieve the object of inducing the operators to amalgamate wherever possible, into big viable units to enable them to achieved better returns and maintain better standards of operation.
The Government decided that a unit of at least ten buses would be necessary to achieve that object.
To implement that policy, it directed that each viable stage carriage unit should consist of not less than ten buses and with a view to build up such viable units, it directed that, other things being equal, the order of preference contained therein should be followed.
The order of preference contained three categories, one ex cluding the other.
They did not provide for any rules of preference inter se of operators coming within each one of the categories.
Presumably, that was left to be decided by the transport authorities, having regard to the considerations mentioned in section 47.
The argument 244 of the learned Counsel for the fourth respondent is based upon the first category, which reads: " Operators with less than 10 buses but nearer the mark of 10 ".
He contends that, having regard to the object of the G. O., namely, to build up a viable stage carriage unit of ten, in the absence of an operator with stage carriages nearer to the mark of ten than the fourth respondent, he is entitled to a permit in preference to the appellant provided other things are equal between them.
In respect of this argument, emphasis is laid upon the word "nearer " and it is said that the said word indicates a rule of preference between operators coming within that category, namely, that an operator like the fourth respondent is to be preferred, if there is no other operator nearer than him to the mark of ten.
This argument is attractive, but, in our view, it is inconsistent with the scheme of the order.
It is true that the phraseology of category (1) has not been happily worded and perhaps grammatically not correct.
But the intention is fairly obvious.
For one thing the rule of preference is based upon the achievement of the object, i.e., the building up of a viable unit of ten permits, for the other, the rule of preference is only to govern the three categories mentioned therein and not inter se between those falling in each category.
The word " others " in category (3) becomes meaningless, if operators far below the mark of ten permits fall within the first category.
The more reasonable interpretation and that is in accord with the intention of the State Government is that other things being equal, in a competition between the three categories of operators mentioned in the order, operators nearer the mark of ten shall be preferred.
In the absence of any such operator, operators with ten or more buses should be given the second preference.
In the absence of such operators, others, i. e., operators who are not nearer the mark of ten and new entrants, will have to be preferred.
This rule of preference was not expected to cause any injustice as the restriction on the transfer of permits was removed and the small operators were permitted to amalgamate the existing units into viable units.
245 This policy did not achieve the expected results, but encouraged monopolies; with the result that the Government had to cancel the order of June 15,1955, within about six months from the making of it; but that circumstance does not affect the construction of the clause.
We, therefore, hold that on a strict inter pretation of the G. O. Ms. No. 3353 of 1954, the fourth respondent would not have been entitled to the permit.
But as we have held that the said order was not law but was only an administrative direction, it could not affect the validity of the order of the Central Road Traffic Board, if it made the order, having regard to the consideration laid down in section 47 of the Act.
The main consideration under section 47 of the Act is that the Regional Transport Authority shall, in deciding whether to grant or refuse such carriage permit, have regard to the interest of the public generally.
The Central Road Traffic Board, after having found that the appellant had other advantages such as he operated a three route permit touching the route under appeal, that his record was satisfactory and that he was not inefficient, came to the conclusion that by giving the permit to the fourth respondent, it would be encouraging not only healthy competition but also would be enabling him to work out to the minimum of five permits.
It is true that if the 1954 order should govern the selection, the main reason given by the Board would be wrong.
Whether a small unit or a large unit would be viable or would be in the interest of the public is always a debatable point and it is possible to take conflicting views on the question.
One view is that ail operator who is described as fleet owner will have considerable experience in the business and will be in a position to keep a workshop and additional buses to meet any emergency and therefore he would be in a better position to operate the service without break and keep up the timings in the interest of the public than a stray bus operator.
The alternative view is that encouragement of large viable units will tend to monopoly and the freedom from competition will bring about deterioration in service.
Oil the other hand, new entrants and operators 246 Owning a few buses will incentive to bestow greater attention to tile public needs, particularly in view of the competition from others in the same field.
That both views are possible is evident from the fact that the State Government has been changing its views so often on the subject; and indeed the cancellation of G. O. Ms. No. 3353 of 1954, within six months from the date of its issue, presumably on the basis of the experience gained during that period, is a clear indication that in the opinion of the, Government, encouragement of large units was not in the interest of public.
If that be so, one cannot say that the Central Road Traffic Board acted without jurisdiction when it accepted the view that the smaller units would be more in the interest of the public rather than larger units ; nor the fact that it accepted the prevailing view of the Government on the subject would make it any the less an order within its jurisdiction, provided the said view was germane to one or other matters stated in section 47 of the Act.
As pointed out by us, both the views are possible and the Board was well within its rights in holding that the public interest would be served if the permit was given to the fourth respondent, in the circumstances of the case.
In this view, no other question arises for consideration.
The order of the Madras High Court is correct and the appeal is dismissed with costs.
SARKAR, J.
The appellant before us is a company operating public motor bus services in the State of Madras.
Its grievance is that it has been wrongly refused a permit to run a bus.
Motor bus services transporting passengers on the public highways for consideration, called stage carriage services, are controlled by sections 42 to 68 contained in Chapter IV of the .
The Act provides that no vehicle can be used as a stage carriage save in accordance with a permit granted by a regional Transport Authority set up by the State Government.
Section 47 of the Act lays down certain matters to which a Regional Transport Authority shall have regard in deciding whether to grant or refuse a 247 stage carriage permit, one of which is the interest of the public generally.
Section 68 of the Act authorises the State Government to make rules for the purpose of carrying into effect the provisions of Chapter IV.
The rules framed under this section do not contain anything to guide the Regional Transport Authority in the matter of granting the permits save that r. 150 provides that it " shall in all matters be subject to the orders of the Government and shall give effect to all orders passed by the Government whether on appeal or otherwise.
" Section 43 A of the Act however gives the State Government power to issue orders and directions to the Regional Transport Authority.
That sec tion is in these terms " The State Government may issue such orders and directions of a general character as it may consider necessary, in respect of any matter relating to road transport, to the State Transport Authority or a Regional Transport Authority; and such Transport Authority shall give effect to all such orders and directions.
" We are not concerned with the State Transport Authority in this case.
The Act is a Central Act and section 43 A was introduced into it by an amendment made by the legislature of the Province of Madras.
The Government of Madras from time to time issued orders under this section providing certain considerations for the guidance of the Regional Transport Authorities in deciding applications for the rant of permits for stage carriages.
The appellant 's contention is that the permit was refused to it by applying one of these orders which was not applicable to its case.
Section 64 of the Act permits an appeal to an appellate authority from an order of a Regional Transport Authority refusing to grant a permit.
This appellate authority in the State of Madras is called the Central Road Traffic Board.
Section 64 A which again was introduced into the Act by an amendment of the legislature of the Province of Madras, empowers the Government to look into the records of any case concerning the grant of a permit and pass such order as it thought fit.
Now as to the facts of this case, on March 28, 1953, 248 the Government issued an order tinder section 43 A marked G. O. Ms. No. 1037 laying down certain considerations to be observed in granting permits.
On November 15, 1954, the Government issued another order marked G. O. Ms. No. 3353 superseding the second of G. O. Ms. No. 1037 and substituting fresh provisions in its place.
As I do not consider it necessary to discuss the terms of these orders, it will tend to clarity to proceed on the basis as if G. O. Ms. No. 3353 superseded G. O. Ms. No. 1037 wholly.
The appellant, the respondent No. 4 and eight other persons had applied for the permit for a route for which applications had been invited.
It does not appear from the record when these applications had been made, but it appears that on April 9, 1955, the Regional Transport Authority after hearing all the competing applicants granted the permit to the appellant applying G. O. Ms. No. 3353, this being the order then in force.
Soon thereafter, namely, on May 20, 1955, the Government passed under the same section a fresh order being ( 'J. O. Ms. No. 1403 cancelling G. O. Ms. No. 3353 and on June 15, 1955, it passed another order being G. O. Ms. No. 1689 which, for the purpose of this case it may be said, had the effect of restoring G. O. Ms. No. 1037.
On or about June 23, 1955, the respondent No. 4, who will be referred to as the respondent as he is the only contesting respondent, preferred an appeal to the Central Road Traffic Board against the decision of the Regional Transport Authority.
It may be that some of the other disappointed applicants for the permit also preferred similar appeals but with them we are not concerned.
The Board considered the representations of all the parties before it and made an order on June 25, 1955, setting aside the decision of the Regional Transport Authority and granting the permit to the respondent.
According to the appellant, in making this order the Board followed G. O. Ms. No. 1037.
The complaint of the appellant is that the Board went wrong in doing so as G. O. Ms. No. 1037 was not in force when the appellant 's application was considered by the Regional Transport Authority but had been brought into force subsequently, and as the Board was only hearing an appeal from the Regional Transport Authority it was bound to decide the case according to the order in force when the Regional Transport Authority made its decision and was not entitled to decide it according to an order which came into existence subsequently.
The appellant took the matter up to the Government under section 64 A of the Act but the Government refused to interfere.
The appellant then moved the High Court at Madras for a writ of certiorari quashing the orders of the Board granting the permit to the respondent and of the Government refusing to interfere.
Rajagopalan, J., who heard the application, thought that the Government had failed to exercise its jurisdiction by not deciding a point raised before it, namely, whether the appeal to the Board had been made within the prescribed time.
He, therefore, set aside the order of the Government and sent the case back for reconsideration.
The respondent went up in appeal from the order of Rajagopalan, J.
The appeal was heard by a bench of the same High Court consisting of Rajamannar, C. J., and Ramaswami, J., and was allowed.
The learned Chief Justice who delivered the judgment of the court, held that Rajagopalan, J., was not right in thinking that the Government had failed to decide whether the appeal to the Board had been filed by the respondent within the prescribed time.
He rejected the contention of the appellant that the order of the Board was liable to be set aside inasmuch as it had been made pursuant to G. O. Ms. No. 1037 which was not the order in force when the Regional Transport Authority heard the matter.
He observed, " these Government orders, which are in the nature of general administrative directions to the transport authorities, do not vest any rights, indefeasible rights in any applicant for a stage carriage permit ".
He also held, " It cannot be said that because on the date of the disposal of the application by the Regional Transport Authority a particular G. O. was in force, any one had a vested 32 250 right conferred on him by that G. O.
We think that it was permissible to the Central Road Traffic Board to decide between the claimants on the basis of the G.O. which was in force at the time the appeal was being heard.
" The appellant has now come to this Court by special leave in appeal against this judgment.
Only one point has been argued by Mr. Pathak appearing in support of the appeal.
He said that the Board was a quasi judicial tribunal and an order made by it is therefore liable to be quashed by a writ of certiorari if that order discloses an error apparent on the face of it.
He then said that the order of the Board of June 25, 1955, was erroneous in law as it decided the case by the terms of G. O. Ms. No. 1037, which was brought into force after the date of the decision of the Regional Transport Authority and bad not been given a retrospective operation, and the Board which was hearing an appeal from the Regional Transport Authority, could only decide whether that Authority had gone wrong in the application of the provisions in force at the time of the hearing before it, namely, the provisions contained in G. O. Ms. No. 3353.
He also said that such error was apparent on the face of the record as the Board in its decision stated that it was deciding the case by G. O. Ms. No. 1037.
It has not been contended before us that the Board is not a quasi judicial Tribunal.
It clearly is so.
In view of the many decisions of this Court in similar matters it would be impossible to take a contrary view.
Then again it is a principle firmly established and accepted by this Court that a writ of certiorari can issue where the decision of a tribunal discloses an error of law apparent on its face.
I am also clear in my mind that if it was an error for the Board to have followed G. O. Ms. No. 1037, such error appeared on the face of its decisions for it expressly purported to be guided by G. O. Ms. No. 1037.
The only questions that remain are whether this was an error and an apparent error.
These I now proceed to discuss.
It is true that G. O. Ms. No. 1037 which had been 251 superseded by G. O. Ms. No. 3353 on November 15, 1954, was revived by G. O. Ms. No. 1689 issued on June 15, 1955, i.e., after the date of the decision of the Regional Transport Authority given on April 9, 1955, when G. O. Ms. No. 3353 prevailed.
I will assume now that G. O. Ms. No. 1689 did not bring back G. O. Ms. No. 1037 with retrospective force.
Was the Board then wrong in a plying G. O. Ms. No. 1037 when it decided the appeal from the Regional Transport Authority 's decision ? I do not think so.
It may be that when one regular and ordinary court bears an appeal from the decision of another such court, it cannot, generally speaking, take into consideration a law which has been passed since that decision.
But it is far from clear that the same rule applies when an appeal from the order of a quasi judicial tribunal is heard by another such tribunal, as is the case here.
No authority to warrant such a proposition was cited and as at present advised, I am not prepared to assent to it.
In any case, it can safely be said, and it is enough for the purpose of this case to do so, that it is far from clear that a quasi judicial tribunal like the one before us is not entitled in hearing appeal from another such tribunal to apply a rule which has come into existence since the decision under appeal.
If it is not so clear there of course is no error apparent on the face of the record.
It cannot be overlooked that such a tribunal is not enforcing a vested right which one party has against another or others.
The tribunal is to choose from amongst a number of persons the fittest to be granted a permit.
The overriding interest in the selection is of one who is not a party to the proceedings, namely, the travelling public.
The lower tribunal is entitled to be heard on an appeal under section 64, a procedure which is wholly inapplicable in appeals from the decisions of what are called courts of law.
As a general rule, a court gives effect at the trial to the substantive rights of the parties existing at the date of the writ and it is for this reason that a change in the law cannot ordinarily be taken into account in appeals.
Now such a consideration does not prevail in the 252 present case.
It is not said that a person when he makes an application for a permit acquires a right to have his application decided by the order under the section then in force.
All that is said is that the Transport Authority must consider the applications according to the order in force at the time it hears them.
If this is so, as I think it is, then the basis for saying that the appellate authority cannot consider a Government order issued since the order under appeal was made, completely disappears.
Another reason given for the view that a court of appeal cannot take into consideration a new law is that, " a matter of substantive right which has become res judicata cannot be upset by a subsequent general change of the law": see Re a Debtor, Exparte Debtor (1).
Now it does not seem to me possible to say that an applicant for a permit has a substantive right to the permit vested in him.
Nor is it possible to conceive of the decision of a Regional Transport Authority in granting or refusing to grant a permit as having any operation by way of res judicata.
It therefore seems to me that there is no warrant for applying the general rule applicable to a court of law hearing an appeal from a similar subordinate court which prevents it from taking notice of a new law, to tribunals such as those with which this case is concerned.
I wish to add one thing more on this subject.
Even in the case of appeals strictly so called, the court hearing the appeal may take cognisance of new laws which are made applicable to pending cases: see Quilter vs Mapleson (2).
I have so long been proceeding on the assumption that G. O. Ms. No. 1689 had no retrospective effect at all.
Now it seems to me that there is at least grave doubt if G. O. Ms. No. 1689 which revived G. O. Ms. No. 1037, was not intended to be applied to pending appeals.
It was directed only to the Central Road Traffic Board which heard appeals, and this would indicate that it was intended that the Board would follow it in deciding the appeals that were then pending before it.
It is not therefore clear that G. O. Ms. No. 1689 was not intended to (1) , 243.
(2) 253 have at least this retrospective effect.
If it did, which on the form of the order it may well be said to have done, then that would be another reason for saying that it is not clear that the Board was in error in applying it.
In my view therefore it has not been shown that the Board committed an error apparent on the face of its decision in applying G. O. Ms. No. 1037 to the appellant 's case.
This appeal must therefore fail.
Before leaving the case I wish to express my opinion on a matter which was pressed on behalf of the respondent.
It was said that only administrative orders could be made under section 43 A which orders were not laws, and therefore an error with regard to them would not be an error of law which would warrant the issue of a certiorari.
I am unable to assent to this contention.
To my mind the question is not solved by describing the orders as administrative orders, a term as to the meaning of which, I confess, I am not clear.
So it does not seem to me to be necessary to enquire what kind of orders could be issued under section 43 A.
In my view if an order under the section is one to the observance of which a person is entitled, that would be a law, a mistake of which would justify the issue of the writ at his instance.
The whole justification for a writ of certiorari is to prevent, where no other remedy is available, a patent injustice being allowed to stand.
It would be strange if a person was entitled to the observance of a rule and was held not to have a remedy for its breach.
It can make no difference by what name that rule is called.
I wish to read here as a salutary advice to follow, what Pollock C. B. and Martin B. said in The Mayor of Rochester vs The Queen (1) regarding the writ, " Instead of being astute to discover reasons for not applying this great constitutional remedy for error and mis government, we think it our duty to be vigilant to apply it in every case to which, by any reasonable construction, it can be made applicable." The real question thus is whether the applicants for permits were entitled to the observance of the orders (1) ; ,1033; ; 254 with which we are dealing.
I think they clearly were.
The orders were made under a statutory provision.
That itself would make them binding.
Further, the statute expressly says that the " Transport Authority shall give effect to all such orders and directions ".
The statute applies to all; every one is entitled to the benefit of it.
Any person interested has therefore a right to claim that an order passed under the section shall be observed by the Transport Authorities.
The respondent himself made such a claim and has got the benefit of one of these orders.
It was however said that it is true that the Transport Authorities owed a duty to observe the orders but that was a duty they owed to the Government alone and that a breach of this duty only exposed them to disciplinary action by the Government but did not vitiate their decisions.
I find no words in the section so to limit the scope of the duty imposed by it on the Transport Authorities.
The nature of the orders makes it impossible to think that it was intended to visit a breach by disciplinary action only.
These orders lay down principles to be applied in deciding whether a person should or should not be given a permit.
They affect persons materially ; they affect persons ' living .
I find it very difficult to think that the only sanction for such rules can be disciplinary action.
It seems to me abhorrent that judicial bodies should in the discharge of their functions be subjected to disciplinary action.
Then I think it would certainly be a very unusual statute which sets up quasi judicial tribunals with power to affect people materially and binds the tribunals on pain of disciplinary action only to proceed according to rules made under its authority but gives the persons deeply affected by the tribunal 's decision no right to claim that the rules should be observed.
I am unable to hold that the is a statute of this kind.
I ought to refer to the case of Nagendra Nath Bora vs The Commissioner of Hills Division and Appeals, Assam (1).
That was a case concerning a licensing authority for liquor hops.
It was there said that a (1) [1958] S C.R. 1240.
255 breach of certain executive instructions issued to the licensing authority did not amount to error of law.
I think that case is clearly distinguishable.
It dealt with executive instructions and therefore not such as were issued under a statutory power.
There is nothing to show that it was the bounden duty of the tribunal, the licensing authority, to obey these instructions.
Had it not been that a hierachy of appeals had been provided for, it would perhaps have been held in that case that the authority was not a quasi judicial authority at all.
Furthermore, it was held there that no one had an inherent right to a settlement of a liquor shop.
Therefore it seems to me that that case does not help in deciding the effect of the orders issued under section 43 A.
It is interesting to note that it was said in that case referring to the writ of certiorari at p. 412 that, " its purpose is only to determine, on an examination of the record, whether the inferior tribunal has exceeded its jurisdiction or has not proceeded in accordance with the essential requirements of law which it was meant to administer.
" The words " law which it was meant to administer " are very significant.
The Transport Authorities in the present case were certainly meant to administer the orders issued under section 43 A.
There is one thing more that I wish to observe in this connection.
It may be that an order which it is the bounden duty of the Transport Authority to obey may give it a certain amount of discretion, but that in my view would riot make the order any the less a law.
If the discretion has been duly exercised, there would be no error of law for the law itself gives the discretion.
It would be the bounden duty of the tribunal to observe that law and so if necessary to exercise the discretion given by it.
For the reasons earlier mentioned, however, I agree that the appeal should be dismissed.
Appeal dismissed.
| The three appeals arose out of disputes relating to the publication of telephone directories of MTNL a Government of India Undertaking.
The MTNL introduced a new concept of "yellow pages ' in telephone directories, and these yellow pages were to contain advertisement under different headings.
The contractor who was to be awarded the contract for printing such directories was to collect the revenue from the advertisements in the yellow pages as well as in the white pages of the telephone directory, supply the same free of cost to the for its subscribers, and pay royalty to the MTNL in connection with printing of such directories.
Tenders for publication of the directories for Delhi and Bombay were invited.
Tender of UIP respondent No. 2 in the Writ Petition and appellant in one of the appeals (CA.No. 91 of 1993) was accepted, and an agreement dated 14th March, 1987 was executed.
UDI, respondent No. 3 to the Writ Petition and appellant in one of the other appeals (CA No. 90, of 1993) was a subsidiary of UIP.
Under the original agreement UIP was to publish directories every year for a period of five years from 1987 to 1991 for Delhi and Bombay separately, pay an amount of Rs. 20.16 crores as royalty to the MTNL, supply the directories free of cost to subscribers.
UIP also furnished a 82 ` performance guarantee for a sum of Rs. one crore, and was also to supply the same number of supplementary directories which were to be published six months after the publication of the annual issue, to be published in November/December every year.
UIP was given the exclusive right for procurement of the advertisements in the yellow pages as well as strips, bold the extra entries in the white pages, the rates to be fixed by the UIP for each issue of the directory, and such rates to be printed for general information.
It was stipulated that if UIP committed default or breach of the agreement or failed in the due performance thereof, the MTNL shall be entitled to recover from the UIP by way of compensation or liquidated damages and amount calculated at the rate of Rs. One lakh for every day or part thereof for the delay beyond the stipulated date.
The MTNL without prejudice to other rights could by notice in writing determine the contract.
UIP defaulted and committed breach of the agreement inasmuch as directories for Delhi were published only for the years 1987 and 1988 and for Bombay only for the year 1987.
For the year 1987, Delhi issue was published after a delay of seven months and Bombay issue after six months, and the Delhi issue of 1988 was published only in August, 1990, a delay of two years.
There was no publication of the directories for Delhi for the years 1989, 1990 and 1991, and in respect of Bombay for the years 1988, 1989, 1990 and 1991.
A supplemental agreement was entered on 26th September, 1991 between UIP, UDI, MTNL and Sterling Computers Limited appellant in one of the appeals (CA.
No. 89 of 1993).
Sterling by this agreement was introduced to carry out the unexecuted portion of the agreement with UIP.
By this supplemental agreement Sterling was to print and publish 13 main issues of Delhi and Bombay directories within a period of seven years including the year 1991 on payment of additional royalty of only Rs. 10 crores to the MTNL over and above the royalty stipulated in the original agreement by the UIP.
Under the agreement dated 14th March, 1987 the royalty which was payable was Rs. 20.16 crores for the period 1987 to 1991, but under the supplemental agreement Sterling was given the contract to publish 13 main issues of the Delhi and Bombay directories upto 1997 and 1998, but for the extended period it had to pay royalty only for an amount of Rs. 10 83 crores.
A Writ Petition was flied questioning the validity and legality of the supplemental agreement on different grounds including the ground of mala fide.
It was contended by the petitioners that under the grab of a supplemental agreement a fresh contract was awarded to Sterling for a fresh period from 1991 to 1997 on fresh terms and conditions to publish the directories every year for Delhi and Bombay without inviting tenders or affording an opportunity to others, to submit tenders so that they may be also considered for award of the said contract.
It was asserted by the petitioners that in the process of entering into the supplemental agree ment the MTNL, which is a public undertaking and a "State ' within the meaning of Article 12 of the constitution, had suffered a loss of more than Rs. 60 crores without any corresponding benefit accruing to the MTNL or to the public in general.
MTNL contested the writ petition, contending that the supplemental agreement was a result of a bona fide commercial decision free from any bias or malice, that the original contract for the years 1987 to 1991 had been awarded to UIP after inviting tenders, but UIP having gone bankrupt, no money could have been realised from it.
The termination of the original contract was no remedy although repeated contraventions and breaches had been committed by the UIP inasmuch as there was no publication of directory for Bombay for the years 1988, 1989, 1990 and 1991 and for Delhi for the years 1989, 1990 and 1991.
In order to salvage Rs. 20.16 crores which was payable to the MTNL under the original agreement dated 14th March, 1987 by the UIP and which had not been paid, a decision was taken by the MTNL to enter into a supplemental agreement and to allow the UIP/UNI/Sterling to publish the thirteen issues of directories, six main issues for Delhi and seven main issues for Bombay upto years 1997 98 apart from the supplementary directories.
The High Court allowed the writ petitions, and came to the conclusion that the supplemental agreement dated 26th September, 1991 cannot be held to be an extension of the original agreement dated 14th March, 1987, and that the supplemental agreement was tainted with malice the object being to provide unjust enrichment to UIP/UDI/Sterling.
In the appeals to this Court, it was contended on behalf of the 84 appellants that the supplemental agreement was entered into by the MTNL taking into consideration the circumstances then existing which had been examined at the highest level and as such a Court should not examine the discretion exercised by the public authority as a court of appeal because the decision to enter into the supplemental agreement also involved a question of policy, and it was pointed out that the contract had been awarded in the year 1987 to UIP on an experimental basis on such terms and conditions on which in past directories had not ever been published, and that the real experiment was as to how the directories ' could be published without incurring any cost by MTNL.
On behalf of the Writ Petitioners it was stated that they were prepared to pay to the MTNL an amount of Rs. 60 crores for the period 1991 to 1997/1998 the period covered by the supplemental agreement for which the UIP/(JDI/Sterling have undertaken to pay only Rs. 10 crores as royalty.
Dismissing the appeals, this court HELD:1.
Ile publication of directories by the MTNL is not just a commercial venture, the primary object is to provide service to the people.
[92F] 2.The norms and procedures prescribed by Government and indicated by Courts have to be more strictly followed while awarding contracts which have along with a commercial element a public purpose.
[92F] 3.The action or the procedure adopted by the authorities which can be held to be a 'State ' within the meaning of Article 12 of the Constitution, while awarding contracts in respect of properties belonging to the state can be judged and tested in the light of Article 14 of the Constitution.
Raman Davaram Shelly vs 7he International Airport Authority of India, ' ; ; M/s. Kasturi Lal Lakshmi Reddy vs The State of Jammu and Kashmir, ; ; Fertilizer Corporation Kamgar Union (Regd) Sindri vs Union of India, ; ; Ram and Shyam Company vs State of Haryana, ; ; Haji T.M. Hasan Rawther vs Kerala Financial Corporation, AIR 1988 SC 157; Mahabir Auto Stores vs Indian Oil Corporation, ; and Kumari Shrilekha Vidyarthi vs State of U.P., , referred to.
[92 H 93 A] 4.
Public authorities, at times It Is said must have the same liberty 85 as they have in framing the policies, even while entering into contracts because many contracts amount to implementation or projection of policies of the Government.
But it cannot be overlooked that unlike policies, contracts are legally binding commitments and they commit the authority which may be held to be a State within the meaning of Article 12 of the Constitution In many cases for years.
That is why the courts have impressed that even in contractual matters the public authority should not have unfettered discretion.
[91G H, 92A] 5.In contracts having commercial elements, some more discretion has to be conceded to the authorities so that they may enter into contracts with persons, keeping an eye on the augmentation of the revenue But even in such matters they have to follow the norms recognised by courts while dealing with public property.
[92B] 6.Under some special circumstances a discretion has to be conceded to the authorities who have to enter into contract giving them liberty to assess the overall situation for purposes of taking a decision its to whom the contract is to be awarded and at what terms.
If the decisions have been taken in bone fide manner although not strictly following the norms laid down by the Courts, such decisions are upheld.
[92C] 7.Public authorities are essentially different from those of private persons.
Even while taking decision in respect of commercial transactions a publicauthority must be guided by relevant considerations and not by irrelevant ones.
If such decision is influenced by extraneous considerations which it ought not to have been taken into account the ultimate decision is bound to be vitiated, even if it is established that such decision had been taken without bias.
[102H, 103A] 8.While exercising the power of judicial review, in respect of contracts entered into on behalf of the State, the Court is concerned primarily as to whether there has been any infirmity in the 'decision making process '.
By way of judicial review the Court cannot examine the details of the terms of the contract which have been entered into by the public bodies or the state.
Courts have inherent limitations on the scope of any such enquiry.
But the Courts can certainly examine whether "decision making process ' was reasonable, rational, not arbitrary and violative of Article 14 of the Constitution.
[95C E F] 86 Chief Constable of the North Wales Police vs Evans, ; , referred to.
9.In the facts and the circumstances of the instant case, it has to be held that the MTNL has applied the "irrelevant considerations ' doctrine while granting a fresh contract for a period of five years through the supplemental agreement dated 26th September, 1991, because it had failed to take into account considerations which were necessarily relevant ie.
following the rule of inviting tenders while granting the contract for a further period of five years on fresh terms and conditions and had taken into account irrelevant considerations.
[101H, 102A] 10.Philanthropy is no part of the management of an undertaking, while dealing with a contractor entrusted with the execution of a contract. '[102F] 11.The supply of the directories to public in time, was a public service which was being affected by the liberal attitude of the MTNL and due to the condonation of delay on the part of the UIP/UDI.
There was no justification on the part of the MTNL to become benevolent by entering into the supplemental agreement with no apparent benefit to the without inviting fresh tenders from intending persons to perform the some job for the next five years.
[102G] 12.The supplemental agreement is really a fresh agreement with fresh terms and, conditions which has been entered by MTNL without inviting any tender for the same.
It has been entered to benefit the parties who are admittedly defaulters by not publishing directories for Bombay for the years 1988 1991, and for Delhi for the years 1989 1991 although they had collected several crores or Rupees for the advertisements for the directories to be published in the aforesaid years.
[103D E] 13.It is a matter of common experience that whenever applications relating to awarding of contracts are entertained for judicial review of the administrative action, such applications remain pending for months and in some cases for years.
Because of the interim orders passed in such applications, the very execution of the contracts, are kept in abeyance.
The cost of different projects keep on escalating with passage of time apart from the fact that the completion of the project itself Is deferred.
This process not only affects the public exchequer but even the public In general 87 who are deprived of availing the facilities under different projects.
As such, it need not be impressed that while exercising the power of judicial review in connection with contractual obligations, Courts should be conscious of the urgency of the disposal of such matters, otherwise the power which is to be exercised in the interest of the public and for public good in some cases become counter productive by causing injury to the public in general.
[106AB]
|
: Civil Appeal No. 3527 (NL) of 1984 From the Judgment and Order/decree dated July 27, 1984 of the High Court of Bombay in Appeal No. 660 of 1984.
Danial Latifi, V.S. Desai R.S. Sodhi, K.V. Sreekumar, M.N. Shroff and Ms. Radha de ' Souza for the Appellants.
497 M.K. Ramamurthi, Mrs. Urmila Sirur, F.D Damania, A.M. A Dittia and D.N. Misra or the Respondents.
Appellant Balmer Lawrie Workers Union ( 'non recognised Union ' for short) filed Writ Petition No. 1518 of 1984 in the High Court of Judicature at Bombay challenging the constitutional validity of Sec. 20 (2) read with Schedule I of the Maharashtra Recognition of Trade Union & Prevention of Unfair Labour Practices Act, 1971 ( '1971 Act ' for short).
To this petition, they impleaded the employer company and the Balmer Lawrie Employees Union ( 'Recognised Union ' for short).
Few facts giving rise to the writ petition may be stated.
A settlement was arrived at between the employer and the recognised Union resolving a number of industrial disputes pending between them.
Clause 17 of the Settlement reads as under: "17.
Arrears will he paid within two months from the date of signing of the.
Settlement.
Further, the Company shall collect from each workman an amount equivalent to 15% of the gross arrears payable to each employee under this settlement as contribution to the Union Fund and this Amount shall be paid to the Union within 3 days of the payment of arrears by Payee 's .A/c Cheque.
" The non recognised union the appellant apprehending that if and when settlement would be arrived at between the employer and the recognised union, there would be the usual clause for deduction from amounts payable to the workmen under the settlement for the benefit of the recognised union Therefore the non recognised union informed the employer not to make any deduction pursuant to the settlement from the arrears payable to the members of the non recognised union as and when the settlement is arrived at.
Correspondence ensued between the parties which led to the filing of the writ petition No. 473 of 1984.
This writ petition was moved to forestall the settlement if any about any deduction from the payments under the settlement as and when arrived at.
An undertaking was given before the 498 High Court that the employer would give notice of the settlement, if it is finally arrived at and will implement the same only a week thereafter.
On this undertaking, the writ petition was withdrawn.
Thereafter the settlement was arrived at which inter alia included Clause No. 17 extracted hereinbefore.
The non recognised union filed a fresh writ petition inter alia contending that Clause 7 permits a compulsory exaction not permitted by the Payment of Wages Act from the arrears payable to the workmen by the employer, without the consent of the workmen, who are not the members of the recognised union.
It was alleged in the petition that if upon its true construction Sec. 20 (2) (b) of 1971 Act permits such compulsory exaction without the consent of the workmen concerned, the same will be unconstitutional inasmuch as such union levy would force and compel the workmen against their will to join the union which has acquired the status of recognised union.
Specific allegation was that Sec. 20 (2) violates the fundamental freedom to form association guaranteed by Art 19 (1) (c).
There were other incidental grievances made in the petition but the main thrust of the petition was against the constitutional validity of aforementioned section.
The learned Single Judge dismissed the writ petition and after an unsuccessful appeal to the Division Bench of the High Court this appeal was filed by special leave Mr. Daniel Latifi learned counsel who appeared for the appellant assisted by Mrs. Radha D. De 'souja, the President of non recognised union and also as counsel appearing for non recognised union urged that if Sec. 20 (2) is so interpreted as to mean that the employer or the recognised union can discriminate between the members of the recognised union and non members though workmen of the same employer, the same is violative of article 14 and if it compels the workmen to join recognised union it is violative of article 19 (1) (a) and (c).
20 of the 1971 Act enumerates the rights of the recognised union.
Sec. 20 (2) reads as under: "20 (2): Where there is a recognised union for any undertaking, (a) that union alone shall have the right to appoint its nominees to represent workmen on the Works Committee constituted under Section 3 of the Central Act: (b) no employee shall be allowed to appear or act or be Hallowed to be represented in any proceedings under the 499 Central Act (not being a proceeding in which the legality or propriety of an order of dismissal, discharge, removal, retrenchment, termination of service or suspension of an employee is under consideration), except through the recognised union; and the decision arrived at or order made, in such proceeding shall be binding on all the employees in such undertaking; and accordingly the provisions of the Central Act, that is to say, the , shall stand amended in the manner and to the extent specified in Schedule I." Does Sec.
20 (2) which confers an exclusive right to represent workmen of any undertaking on a union which acquires the status of a recognised union under 1971 Act and simultaneously denies the right to a workman to appear or act or to be allowed to represent in any proceeding under the ( 'lD Act ' for short) violate the fundamental freedom to form association guaranteed by Art 19 (1) (c).
The 1971 Act was enacted as its long title shows to provide for the recognition of trade unions for facilitating collective bargaining for certain undertakings, to state their rights and obligations, to confer certain powers on unrecognised unions; to provide for declaring certain strikes and lock outs as illegal strikes and lock outs; to define and provide for the prevention of certain unfair labour practices; to constitute court (as independent machinery) for carrying out the purposes of according recognition to trade unions and for enforcing the provisions relating to unfair practices etc There is in force in the State of Maharashtra a comprehensive legislation, Bombay Industrial Relations Act, 1946 touching almost all aspects of industrial relations but it applies only to specified industries.
Industries other than specified industries are governed by industrial Disputes Act, 1947.
This latter act is not comprehensive in character There is no provisions for recognising union vis a vis the undertaking or the industry.
Unions of workmen employed by undertakings not governed by Bombay Industrial Relations Act voiced dissatisfaction over this discriminatory treatment and the lacuna in the 1947 Act.
To bring the provisions of both the acts on par in certain specific areas 1971 Act was enacted by the State Legislature.
A brief review of the scheme of the 1971 Act would be advantageous.
It specifically provides for recognition of unions.
A conspectus of provisions included in Chapter III headed recognition of unions 500 provide that every undertaking wherein 50 or more employes are employed or were employed on any day of the preceding 12 months will be governed by the provisions therein set out.
I l provides for making of an application for recognition of union.
The eligibility criterion for obtaining the recognition is that the union applying for the status of a recognised union must have for the whole of the period of six calendar months immediately preceding the calendar month in which it makes the application, a membership of not less than thirty percent of the total number of employees employed in any undertaking.
The application has to be made to the Industrial Court set up under the Bombay Industrial Relations Act.
On receipt of the application, the Industrial Court has to cause a notice to be displaced on the notice board of the undertaking, declaring its intention to consider the said application on a date to be specified in the notice and calling upon other union or unions, if any, having membership of employees in that undertaking and the employers and the employees affected by the proposal to show cause why the recognition should not be granted.
If after considering all the objections that may have been lodged pursuant to the notice given as hereinbefore indicated, the industrial Court comes to the conclusion that the conditions requisite for registration are satisfied and the union complies with the conditions specified in Sec 19, the Industrial Court shall grant recognition to the applicant union under the Act and issue a certificate in the prescribed form.
At any point of time, there shall not be more than one recognised union in respect of the same undertaking.
13 confers power on the Industrial Court to cancel the recognition if any of the circumstances therein set out is satisfactorily established.
14 provides for resolving the dispute inter se between the recognised union and another union seeking recognition.
The obligations and rights of the recognised union are set out in Secs.
19 and 20 in Chapter IV.
Mr. Daniel Latifi, learned counsel urged that the embargo placed by Sec. 20 (2) (b) on any workman to appear or to be represented in any proceeding under the ID Act 1947 barring those which are specifically excluded save by the recognised union contravenes the fundamental freedom guaranteed to the citizens under Art 19 (1) (a) and (c) of the Constitution article 19 (1) (a) guarantees to the citizens fundamental freedom of speech and expression and article 19 (1) (c) guarantees fundamental freedom to form association.
Tersely put the question is: if a law relating to regulating industrial relations between the employer and workmen provides for a sole bargaining agent such as the recognised union and simultaneously denies to the individual workman the right to appear or to be represented in any 501 proceeding under the ID Act, 1947, would it contravene the fundamental freedoms guaranteed by article 19 (1) (a) and 19 (1) (c) ? History bears a witness to the long drawn out unequal fight between the employer and the employed to be on terms of equality.
A brief resume would be helpful.
On the advent of industrial revolution which aimed at mass production of commodities, large scale industrial units came to be set up resulting in concentration of workmen at one place under one employer.
Individual employer has now been replaced by corporations wielding immense economic power.
To say that workmen were at the mercy of the employer is to state the obvious.
It was even sacrilegious to think of a right of a workman qua the employer Till the laissez faire ruled the roost the State would not interpose itself to protect the under privileged and weaker partner in the industry and left the workmen to fend for themselves, the State concerning itself only with the problem of law and order when a conflict arose between the employer and the workmen.
This was predicated upon an untenable if not wholly erroneous assumption that as the society has moved from status to contract, the employer and the workman would by negotiations churn out a contract mutually beneficial to both.
That the parties were unevenly placed in the matter of contracting was absolutely over looked.
The liberal albeit capitalist English society treated united refusal of work on the part of workmen as conspiracy and as Jeremy Benthan put it "the word conspiracy served judges for an excuse for inflicting punishment without stint on all persons by whom any act was committed which did not accord with the Judges ' notion concerning the act in question.
" Justice Erle in Reg.
vs Duffield(1) summed up to the Jury as under: "The unlawful combination and conspiracy is to be inferred from the conduct of the parties.
If several persons take several steps, all tending towards one obvious purpose, it is for the jury to say whether these persons have not combined together to bring about that and which their conduct appears adapted to effectuate.
" English Common Law frowned upon combination of workmen to achieve common object; Common Law looked upon combination as criminal in character.
On the enactment of the Trade Unions Act, 1913 in United Kingdom, registered trade union acquired corporate (1) 5, Cox 's Criminal case.
502 capacity, entitled to sue and be sued in its registered name and enter into contracts as separate entity, separate from its members.
This status acquired by the trade unions, would clothe a collective agreement arrived at between the employer and the union with the semblance of legality though Common Law for long refused to recognise it as enforceable contract.
Royal Commission on Trade Unions and Employer 's Association under the Chairmanship of Lord Donovan ( 'Donovan Commission ' for short) which submitted its report in 1968 proceeded on the basis that collective bargains are not subject to legal enforcement and number of arguments were put forth in support of the proposition.
Even though the Commission in concluding portion of paragraph 472 of its report observed that "Industrywide bargaining and workshops or plant bargaining are, however, closely intertwined.
To enforce one without the other would be to distort the effect of our collective system.
That system is today a patch work of formal agreements, informal agreements and custom and practice.
No Court, asked to enforce a collective agreement could disentangle the agreement from the inarticulate practices which are its background." Quest of justice by labour, victim for long of exploitation of human being by impersonal juristic persons such as corporations led to the formation of industrial norms by a legislative enactment generally styled as labour law.
The main object of labour law was to be a countervailing force to counter act the inequality of bargaining power which is inherent and must be inherent in the employment relations.
As stated by Otto Khan Freund in his Hamalin lecture "this was an attempt to infuse law into a relationship of command and obedience, in other words in the field where one enjoys the power to command and other suffers the duty to obey.
To the extent law limits the range of workers ' duty of obedience and enlarges the range of its freedom, Labour Law fulfills one of its objects. ' '(1) In the context of the political society which we resolved to set up in the post independent India, on the introduction of universal adult suffrage by article 326 of the Constitution trade union movement representing the organised labour developed as an adjunct of political part.
The organised labour as a vote bank was assiduously wood by political parties.
Every political party with a view to controlling vote banks set up its labour wings.
Combinations and fragmentations of political parties had the pernicious effect on trade unions.
Multipli (1) See Report the Labour Laws Review Committee, Govt.
of Gujarat Publication 503 city of political parties had its spill over in multiplicity of trade unions A seeking to represent workmen in an industrial undertaking or industry, as the case may be.
The fall out of the multiplicity of unions was inter union and intra union rivalry which threatened peaceful working of the industrial undertaking or the industry.
Each union, as the unfortunate experience shows, tried to over reach the rival by making occasionally exhorbitant and untenable demands.
The emerging situation led to conflict and confrontation disturbing industrial peace and harmony directly affecting production In the first Five Year Plan it was observed: "Answer to class antagonism and world conflict will arrive soon if we succeed in discovering a sound basis for human relations in industry.
Industrial relations are there fore, not a matter between the employers and employees alone but a vital concern of the community which may be expressed in measures for the protection of its larger interests.
" A need was felt that where there are multiple unions seeking to represent workmen in an undertaking or in an industry, a concept of recognised, union must be developed.
Standing Labour Committee of the Union of India at its 29th Session held in July 1970 addressed itself to the question of recognition of trade union by the employer.
In fact even amongst trade union leaders there was near unanimity that the concept of recognised unions the sole bargaining agent must be developed in the larger interest of industrial peace and harmony.
National Commission on Labour chaired by late Shri P.B. Gajendragadkar, former Chief Justice of India, after unanimously and wholeheartedly expressing itself in favour of the concept of recognised union and it being clothed with powers of sole bargaining agent with exclusive right to represent workmen, addressed itself only to the question of the method of ascertaining which amongst various rival unions must be accorded the status of a recognised union.
Planting itself firmly in favour of democratic principle, it was agreed that the Union Which represents the largest number of workmen working in the undertaking must acquire the status as that would be in tune with the concept of industrial democracy.
The fissures arose as to the method of finding out the membership.
The Commission had before it two alternative suggestions for ascertaining the membership (i) verification of membership by registers and (ii) by secret ballot.
As there was a sharp cleavage of opinion, the Commission left the question of adopting one or the other method in a given case to the proposed Indus 504 trial Relations Commission which was recommended to be set up if the recommendations of the Commission were to be accepted.
What is of importance to us is that every one was agreed that where there are multiple unions in an industrial undertaking or an industry, the union having the largest membership of the workmen must be clothed with the status of recognised union and consequently as the sole bargaining agent.
The underlining assumption was that the recognised union represent all the workmen in the industrial undertaking or in the industry.
It may be mentioned in passing that the Bombay Industrial Relations Act had incorporated provisions for conferring the status of a recognised union and despite strident criticism of the method of ascertaining membership, the system seems to be working well.
The Act went further and developed the concept of approved union on which powers were conferred for making reference of an industrial dispute to the relevant authority for adjudication a power which under the Central Act is the close preserve of the appropriate Government.
The oft repeated grievance voiced by those opposed to the concept of recognised union entitled to represent all workmen was that such a status will concentrate so much power in the hands of the recognised union that it can work to the disadvantage of those not becoming its members as also those opposed to the political or social philosophy of the recognised union and would therefore keep away from it.
The chink in the armous appeared when it was found that a workman who is questioning his termination of service, largely a personal punishment and therefore provides a personal cause of action but who was not a member of the recognised union was sought to be thrown out of the court by the representative union appearing to get the petition dismissed on the specious plea that it alone is entitled to represent workmen.
The Legislature immediately became aware of the pitfall and remedied the situation by introducing Sec. 2 (A) in the which provides that a workman, who is dismissed, discharged or removed from service or whose service is otherwise terminated can espouse his own cause without the help of a recognised union and yet such a dispute would be an industrial dispute.
This very protection is retained in the impugned provision Sec.
20 (2) (b).
Status to be the sole bargaining agent as a recognised union is a hard won battle and need not be permitted to be frittered away by a sentimental approach that where trade union movement has idelogical overtones, such a provision would compel workmen either to become members of a union, whose socio political philosophy is not in tune with his own or suffer isolation as such workman can 505 not forge a to 1 of A trade union or even if they form one, the employer can ignore it with impunity.
Is there any substance either in the contention or the apprehension voiced ? The matter cannot be viewed from the perspective of same ideloguis but has to be examined in the large perspective of public interest of peace and harmony in the industry, healthy industrial relations and large national interest which eschews strikes, lock outs, conflict and confrontation.
Having briefly referred the history of the development of trade unions, let us turn to the challenge in this case.
Mr. Daniel Latifi contended that Sec 20 unquestionably denies to the workmen who are not members of a recognised union the fundamental freedom guaranteed under article 19 (1) (a) and (c).
It was urged that the provisions of the Act inheres the pernicious tendency to compel the workmen to join the union which has acquired the status of a recognised union even if followed a socio economic or socio political philosophy contrary to the philosophy of non members and that such compulsion denies the free dom to form association.
It was also submitted that the right to form association would be an empty formality if the association is not in a position to effectively participate in any proceeding concerning the workmen of an industrial undertaking, some of whom have formed a separate trade union.
It was stated that either all the unions of the workmen should be treated on par or at any rate in order to safe guard the members of non recognised union against the imposition of the will of recognised union, they must be free not to be bound by the action of the recognised union.
It was stated that Sec.
:0 (2) of the 1971 Act denies all these safeguards and therefore it must be declared unconstitutional.
Before the introduction of Sec.
2 A in the the court leaned in favour of the view that individual dispute cannot be comprehended in the expression 'industrial dispute ' as defined in the .
Any dispute not espoused by the union for the general benefit of all workmen or a sizeable segment of them would not be comprehended in the expression 'industrial dispute ' was the courts ' view.
Often an invidious situation arose out of this legal conundrum.
An individual workman if punished by the employer and if he was not a member of the recognised union, the latter was very reluctant to espouse the cause of such stray workman and the individual workman was without a remedy.
Cases came to light where the recognised union by devious means compelled the workmen to be its member before it would espouse their causes.
The trade union tyranny was taken note of by the legis 506 lature and Sec.
2 A was introduced in the by which it was made distinctly clear that the discharge, dismissal retrenchment or termination of service of the individual workman would be an industrial dispute notwithstanding that no other workman or any union of workman is a party to the dispute.
Sec. 20, sub sec.
2 while conferring exclusive right on the recognised union to represent workmen in any proceeding under the simultaneously denying the right to be represented by any individual workman has taken care to retain the exception as enacted in Sec.
This legal position is reiterated in Sec. 20 (2) (b).
Therefore while interpreting Sec. 20 (2) (b) it must be kept in view that an individual workman, who has his individual dispute with the employer arising out of his dismissal, discharge, retrenchment or termination of service will not suffer any disadvantage if any recognised union would not espouse his case and he will be able to pursue his remedy under the .
Once this protection is assured, let us see whether the status to represent workmen conferred on a recognised union to the exclusion of any individual workman or one or two workmen and who are not members of the recognised union would deny to such workmen the fundamental freedom guaranteed under article 19 (1) (a) and 19 (1) (c) of the Constitution.
We fail to see how the restriction on the right to appear and participate in a proceeding under the to a workman who is not prepared to be represented by the recognised union ill respect of a dispute not personal to him alone such as termination of his service denies him the freedom of` speech and expression or to form an association.
Conferring the status of recognised union on the union satisfying certain pre requisites which the other union is not in a position to satisfy does not deny the right to form association.
in fact the appellant union has been registered under the Trade Unions Act and the members have formed their association without let or hindrance by anyone.
Not only that the appellant union can communicate with the employer, it is not correct to say that the disinclination of the workmen to join the recognised union violates the fundamental freedom to form association.
It is equally not correct to say that recognition by an employer is implicit in the fundamental freedom to form an association.
Forming an association is entirely independent and different from its recognition.
Recognition of a union confers rights, duties and obligations.
Nonconferring of such rights, duties and obligations on a union other than the recognised union does not put it on an inferior position nor the charge of discrimination can be entertained.
The members of a 507 non recognised association can fully enjoy their fundamental freedom A of speech and expression as also to form the association.
The Legislature has in fact taken note of the existing phenomenon in trade unions where there would be unions claiming to represent workman in an undertaking or industry other than recognised union.
22 of 1971 Act confers some specific rights on such non recognised unions, on such being the right to meet and discuss with the employer the grievances of individual workman The Legislature has made a clear distinction between individual grievance of a workman and an individual dispute affecting all or a large number of workmen.
In the case of even an unrecognised union, it enjoys the statutory right to appear and discuss the grievance of individual workmen with employer.
It also enjoys the statutory right to appear and participate in a domestic or departmental enquiry in which its member is involved.
This is statutory recognition of an unrecognised union.
The exclusion is partial and the embargo on such unrecognised union or individual workman to represent workman is in the large interest of industry, public interest and national interest.
Such a provision could not be said to be violative of fundamental freedom guaranteed under article 19 (1) (a) or 19 (1) (c) of the Constitution Having examined the contention on principle, we may now turn to precedents brought to our notice.
In Raja Kulkarni and Ors.
vs State of Bombay(1), one of the contentious canvassed before the Constitution Bench was that Sec. 13 of the Bombay Industrial Relations Act, 1946 as it then stood provided that a union can be registered as a representative union for an industry in a local area if it has for the whole of the period of three months next preceding the date of its application, a membership of not less than 15% of the total number of employees employed in any F industry in any local area.
If the union does not satisfy that condition and has a membership of not less than 5%, it could be registered as a qualified union Rashtriya Mill Mazdoor Sangh was registered as a representative union while the Mill Mazdoor Sabha was registered as a qualified union.
It was contended on behalf to Mill Mazdoor Sabha of which the appellants before this Court were the office bearers that the provisions that conferred an exclusive right only on the representative union to represent workmen was violative of fundamental freedoms guaranted to the members of Mill Mazdoor Sabha .
(1) [1954] SCR 384.
508 or any other workman who is not a member of the representative union under article 19 (1) (a) and (c) and was also violative of article 14 inasmuch as the two representatives of workmen were denied equality before law or the equal protection of laws.
The Constitution Bench repelled the contention observing that such a provision does no t deny either the fundamental freedom of speech and expression or the right to form association.
The Court said that it is always open to the workmen who are not members of the representative union to form their own association or union and to claim higher percentage of membership so as to dethrone the representative union and take its place.
This decision should have concluded the matter.
Mr. Latifi however, urged that this decision is of no assistance because it was rendered at a time when sub sec.
(2) Of Sec.
114 of the Bombay Industrial Relations Act, 1946 provided that where the representative union is a party to a registered agreement or settlement, submission or award the Provincial Government may after giving the parties affected an opportunity of being hard by notification in the Official Gazette direct that such agreement, settlement, submission or award shall be binding union such other employers and employees in such industry or occupation in that local areas as may be specified in the notification.
There was a proviso to sub sec.
(2) which provided that before giving a direction under sub sec.
(2) the Provincial Government may in such cases as it deems fit, make a reference to the Industrial Court for its opinion.
It was urged that workmen in an industry or in an undertaking, who are not members of the representative union would not be bound by a settlement, sub mission or award to which representative union alone is a party, unless the Provincial Government took action under sub sec.
(2) of Sec. 114 and there was a further safeguard inasmuch as before making such a settlement, submission or award binding on all workmen, a reference to the Industrial Court for its opinion could be made.
It was urged that these safeguards are missing inasmuch as Sec. 20 (2) would make a settlement or award to which a representative union is a party binding on all the workmen in to undertaking or the industry as the case may be and therefore the aforementioned decision can be distinguished.
We see no merit in this submission.
This Court did not uphold the vires of the relevant provisions on the ground that there were safeguards for non members.
The provision was held intra vires on the broad features of the pro visions that they neither deny the fundamental freedom guaranteed under article 19 (1) (a) nor 19 (1) (c).
In Ram Prasad Vishwakarma vs The Chairman, Industrial Tribu 509 nal(1), an industrial dispute arising out of the termination of service A of the appellant in that case was espoused by the union and which was referred for adjudication to the Tribunal.
When the matter was before the Tribunal, the appellant workman made an application that he may be permitted to represent his case by his two colleagues and at any rate not by the Secretary of the union The Tribunal rejected the application and after an unsuccessful writ petition the matter came to this Court.
It was contended that even though the case of the appellant was espoused by the union, he was entitled to a separate representation.
Repelling the contention, this Court held that any individual grievance is not comprehended in the expression 'industrial dispute ' as defined and the dispute would only acquire the character of an industrial dispute if espoused by the union and therefore, the workman would not be entitled to a separate representation.
The decision turns on the interpretation of expression 'industrial dispute and before the introduction of Sec.
2 A in the Industrial Disputes act, 1947.
It does not shed any light on the issue under discussion.
In Girja Shankar Kashi Ram vs Gujarat Spinning and Weaving Mills Ltd.,(2) the right of the representative union to appear in a proceeding under the Bombay Industrial Relations Act to the execusion of the workmen likely to be adversely affected by the decision of the court came up for consideration.
The representative union and the employer entered into a settlement for grant of bonus to the workmen and in consideration thereof the representative union agreed not to press for any compensation for the workmen discharged by the employer.
Subsequently 376 persons, who had been in the employment of the company prior to its closure gave notice under Sec.
42 (1) of the Bombay Industrial Relations Act and claimed compensation for the period of closure.
As the parties failed to arrive at a settlement, an application under Sec.
42 (4) was made to the Labour Court.
During the pendency of this application, the representative union made appearance before the Labour Court and contended that the application should be dismissed in view of the compromise which had been arrived at before the Labour Appellate Tribunal.
The Labour Court accepted the contention and dismissed the application.
In the appeal to the Industrial Court, it was contended that considering that no individual workman could be permitted to appear in any proceeding where representative union appears as representative of employees, yet if the action of the representative union was malafide, (1) ; (2) [1962] 2 Supp.
S.C.R. 890.
510 the Labour Court should not have permitted the representative union to appear and thereby deny the adversely affected workmen to be represented and then non suited at the instance of the representative union The Industrial Court dismissed the appeal.
A writ petition to the High Court failed and thereafter the matter was brought to this Court.
After an exhaustive review of the various provisions of the Bombay Industrial Relations Act, this Court held that bona fides or the mala fides of the representative union can have nothing to do with the ban imposed upon appearance of any one other than a representative union in any proceeding under the Bombay Industrial Relations Act The decision goes so far as to suggest that even where the action of The representative union may be such as would appear to be disadvantageous to some workmen yet its action has to be judged in the light of the fact that it does not tend to cater to the needs of a section of the workmen but the workmen represented by it as a whole.
Incidentally it must be pointed out that the question of vires was not raised in this case.
The view taken in Girja Shankar 's case was affirmed and approved in Santuram Khudai vs Kimatrai Printers & Processors (p) Ltd.& Ors (1) wherein this Court observed that the legislature has clothed the representative union with exclusive right to appear or act behalf of the employees in any proceeding under the Bombay Industrial Relations Act and has simultaneously deprived the individual employee or workman of the right to appear or act in any proceeding under the Act where representative union enters appearance or acts as representative union of employees.
The question of vires was not raised.
Prima facie on the arguments urged and decisions examined, we are satisfied that there is no substance in the challenge that Sec. 20 (2) (b) upon its true construction violates article 19 (1) (a) and (c) of the Constitution.
We must however make it clear that we may keep this question of constitutionality open for a more detailed argument and in depth examination because in this case at the fag end of arguments, the parties more or less buried the hatchet and there was the spirit of give and take to which we would presently advert.
The change in the law made by the introduction of Sec.
2 A in the has been taken note of by the State Legislature in introducing a safeguard in Sec. 20 (2) (b) in that (1) ; 511 an individual workman who has been either dismissed, discharged, A removed, retrenched or whose services has been terminated in any manner or who is suspended would be on his own entitled to raise an industrial dispute concerning the termination of his service in any manner and he would be able to pursue his remedy in a proceeding arising out of the legality or validity of the order of termination of service.
The representative union would not be able to supplant the workman by its appearance and act to the detriment of the workman Cases are not unknown where an individual workman whose services has been terminated and who wanted his cause to be espoused by the union was not only ignored by the union but occasionally the power of representative union to exclude the workman from the proceeding was exercised to the disadvantage of the workman by appearing in the proceeding and after excluding the workman to so get the proceedings disposed of as to be wholly disadvantageous to the workman and the workman was left without a remedy Care has been taken to deny such steam rolling power to the representative union and this position is further strengthened by the provisions contained in Sec.
22 of the 1971 Act which confers certain rights on unrecognised unions more especially right to meet and discuss with the employer the grievances of an individual member relating to his discharge, removal, retrenchment, termination of service or suspension as also to appear on behalf of its members employed in the undertaking in any domestic or departmental enquiry held by the employer.
This is certainly an advance on the similar provisions of the Bombay Industrial Relations Act.
Sec. 20 (2) (b) is more or less in pari materia with the provisions of the Bombay Industrial Relations Act, 1946, The provisions relating to the status, character, powers and obligations of a representative union as envisaged in the Bombay Industrial Relations Act, 1946 have been extended to cover industries not governed by that Act but by the .
Where a representative union acts in exercise of the powers conferred by Sec. 20 (2) it is obligatory upon it to act in a manner as not discriminate between its members and other workmen of the undertaking who are not its members.
However when a settlement is reached in a proceeding under the Industrial Disputes act in which a representation union has appeared, the same is to he binding on all the workman of the undertaking.
This would mean that neither the representative union nor the employer can discriminate between members of the representative union and other workmen who are not members.
Both the benefits, advantages, disadvantages or liabilities arising out of a settlement in any proceeding under the to 512 which a representative union is a party shall be equally applicable to each workman in the undertaking.
There shall not be the slightest trace of discrimination between members and non members both as regards the advantages and also as regards the obligations and liabilities.
Any other view of Sec. 20 (2) (b) would render it unconstitutional and invalid as being violative of Art 14.
Equal treatment of members and non members is implicit in the section and by its interpretation we only make it explicit.
A serious grievance was vioiced by Mr. Latifi that by the impugned Clause 17 of the Settlement, the non members are subjected to compulsory exaction for the benefit of the representative union with whose philosophy the non members are not in agreement and they are made to pay to advance a rival philosophy.
It was urged that this is some thing like a tax for the propogation of a philosophy which the members of the appellant union consider harmful or disadvantageous to the workmen in general.
Clause 17 of the settlement is already extracted.
After a strike, a settlement was arrived at between the first respondent employer and the second respondent representative union, Clause 17 of which mandated the employer to deduct 15% of the gross arrears payable under the settlement to each employee as contribution to the union fund.
It is well known that no deduction could be made from the wages and salary payable to a workman governed by the Payment of Wages Act unless authorised by that Act.
A settlement arrived at on consent of parties can however permit a deduction as it is the outcome of understanding between the parties even though such deduction may not be authorised or legally permissible under the Payment of Wages Act.
The contention is that where members who form a union pay the membership fee and receive the benefits or advantages of being members of the union yet, persons who are not members of the union without their consent were forced to part with their earnings as if paying a tax which is compulsory.
If the same is held permissible under Sec. 20 (2) (b), either the section will be constitutionally invalid or that part of the settlement being severable would be illegal and invalid qua non members On the face of it, the contention appears to be attractive but anyone who, has some understanding and appreciation of the working of a trade union would be able to fully appreciate the provision like the one under discussion.
Though unfortunate, it is notorious that in some cases resorting to strike has by itself become an industry and the unions invest in the strike by sustaining morale of the workmen 513 when during the strike the employer would deny wages.
In a case of genuine grievances and forced strike, the workmen unable to stand up for want of wherewithal or cushions, the trade union may help them sustain their vigour by some monetary assistance during the period of strike.
When the strike ends in a settlement or where even without a strike.
benefits under a settlement are made retro active and the arrears are required to be paid under the settlement, naturally the union in order to vigorously carry on its activities free from financial constraints would expect the workmen for whose benefit the dispute was raised which on settlement may bring in monetary benefits to reimburse itself.
As the members and non members are entitled to equal treatment under the settlement both can be asked as a condition of settlement to part with a portion of the benefits towards union activities.
Such deductions can neither be said to be compulsory exaction nor a tax.
Therefore such a provision of deduction at a certain rate as agreed between the parties for payment to the union, the same being with the consent and as part of overall settlement would neither be improper nor impermissible nor illegal.
Mr. Daniel Latifi, however, urged that in case of non members, the deduction would be without their consent, and therefore has the nefarious tendency of making non members pay for the benefit of a rival union.
Expanding the submission, he urged that the trade union movement has more or less developed as an appendage of the political parties and therefore each union is influenced by its own parent identity and therefore the rival union would certainly he expected to have a rival parent identity and yet the rival union not having acquired, the status of a representative union would be compelled by the settlement to contribute to the coffers of the representative union funds, which would expended to propogate its own philosophy to the detriment of the rival union.
It was urged that this amounts to compelling an individual to contribute against his will for the propogation of the cult of an opponent.
Maybe there may be some harsh truth in the submission.
It can not however be examined from a setarian point of view.
The submission has to be examined in the proper perspective of the trade union movement.
Shorn of embellishment such a provision would show that benefits and liabilities both must be shared equally.
If under a settlement with the representative union some benefits accrue to the workmen, and upon a true interpretation of sec.
20 (2) (b), it is held all encompassing and therefore binding on all workmen and the employer alike, all the benefits would be available to the workmen who are not members of the representative union and who may have formed a rival union.
If these workmen 514 could not be denied the benefits they would enjoy an unfair advantage if from the package deal covered by the settlement, they draw benefits and abjure liabilities.
Heads I win and tails you lose could hardly be a fair and just approach in settling inter union disputes.
Therefore a clause like Clause 17 of the Settlement has to be understood in the context of strengthening the trade union movement and to free it from financial constraints.
Workmen who are members of a union may pay fee for membership and enjoy the advantage of membership but if by the action of the representative union all workmen acquire benefit or monetary advantage, the members and non members alike can be made to make common sacrifice in the larger interest of trade union movement and to strengthen the trade union which by its activities acquired the benefits for all workmen.
Payment to trade union fund in these circumstances can be styled as quid pro quo for benefits acquired.
Therefore, we see nothing objectionable in Clause 17 of the Settlement which directs the employer to deduct 15% of the gross arrears payable to each employee under the settlement as contribution to the trade union funds.
Thereby the workman is not subscribing to the philosophy of rival union but he is merely paying the price of the advantage obtained.
Another view would make the union members suffer and the non members benefit, a situation which must at all costs be avoided.
Therefore clause 17 of the Settlement would not be invalid despite the lack of consent of the workmen who are members of the appellant union.
The settlement having been made by the representative union its right to represent all workman would imply the consent of the members of the rival union.
This is the legal consequence of the right of the representative union to represent all workmen and the binding effect of its action.
Mrs. Radha De 'souza who also appeared along with Mr. Daniel Latifi for the appellant union urged that the refusal of the representative union to admit all workmen of the first respondent industrial undertaking had forced those denied membership to form the appellant union.
President of the second respondent representative union was present in the Court and after consulting him Mr. M.K. Ramamurthy, learned counsel stated in the Court that all workmen of the first respondent industrial undertaking are entitled and are, eligible to be the members of the representative union and they will be admitted without let or hindrance on a proper application being made as members of the second respondent representative union.
Mrs. Radha De 'souza stated that all the members of the appellant union would as early as possible make the necessary application and the President of the second respondent representative 515 union stated that all of them will be admitted without any further scrutiny.
On such membership being granted the appellant union would stand dissolved.
This would certainly go a long way to strengthen the trade union movement.
Having considered all the aspects of the matter and keeping in view the interpretation we have placed on Sec. 20 (2) (b) and Clause 17 of the settlement dated June 18, 1984 this appeal must fail and is dismissed with no order as to costs.
Whatever benefits are yet to be paid to the members of the appellant union under the aforementioned settlement shall be paid within 2 months from today.
M.L.A. Appeal dismissed.
| Section 19 of the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act 1971 (1971 Act, for short) provides for recognition of a union if it complies with certain conditions specified in the section.
Section 20 enumerates the rights of a recognised union.
Clause (b) of sub sec.
(2) of s.20 confers an exclusive right on a recognised union to represent workmen of an undertaking in certain disputes and makes the decision or order made in such proceedings binding on all the employees while it denies such right to a workman to appear or act or to be allowed to represent in any proceedings under the except in a proceeding in which the legality or propriety of an order of dismissal, discharge, removal, retrenchment.
termination of service or suspension of an employee is under consideration.
After a strike, the respondent employer entered into a settlement in respect of a number of pending industrial disputes with its union, which was recognised under the 1971 Act.
Clause 17 of the Settlement provided that the 493 company shall deduct an amount equivalent to 15% of the gross arrears payable under the Settlement to each employee towards contribution to the fund of the recognised union The appellant, a non recognised union challenged in a writ petition before the High Court the constitutional validity of Clause 17 of the Settlement on the grounds, inter alia.
(i) that Clause 17 permits a compulsory exaction not parented by the Payment of Wages Act from the arrears payable to the workmen who are not the members of the recognised union; (ii) that section 20 of the 1971 Act is unconstitutional, since (a) it 1 unquestionably denies to the workman who are not members of a recognised union, the fundamental freedom guaranteed under Article 19 (1) (a) and(e) inasmuch as it inheres the pernicious tendency to compel the Workmen to join the union which has acquired the status of a recognised union even if it followed a socio economic or socio political philosophy contrary to the philosophy of non members; (b) it denies to the unrecognised union, the right to effectively participate in any proceeding concerning the workmen of an industrial undertaking, some of whom have formed a separate trade union and (c) it does not treat all the unions at par as the members of non recognised union are compelled to be bound by the action of the recognised union.
The Single Judge of the High Court dismissed the writ petition and the same was affirmed in appeal to the Division Bench of the High Court.
Hence this appeal.
Dismissing the appeal by the appellant, ^ HELD: 1.1.
In order to appreciate the controversy between the parties a brief review of the Scheme of the 1971 Act would be advantageous.
On the advent of industrial revolution which aimed at mass production of commodities, large scale industrial units came to be set up resulting in concentration of workmen at one place under one employer.
Trade union movement representing the organised labour developed as an adjunct of political party.
The organised Labour as a vote banks was assiduously wooed by political parties.
Every political party with a view to controlling vote banks set up its labour wings.
Combinations and fragmentations of politics] parties had the pernicious effect on trade union.
Multiplicity of political parties had its spill over in multiplicity of trade unions seeking to represent workmen in an industrial undertaking or industry, as the case may be.
The fall out of the multiplicity of unions was inter union and intra union rivalry which threatened peaceful working of the industrial undertaking or the industry.
Each union, as the unfortunate experience shows, tried to over reach the rival by making occasionally experience and untenable demands.
The emerging situation led to conflict and confrontation disturbing industrial peace and harmony directly affecting production.
Therefore, a need was felt that where there are multiple unions seeking to represent workmen in an undertaking or in an industry, a concept of recognised union must be developed In fact, even amongst trade union leaders there was near unanimity that the concept of recognised union as the sole bargaining agent must be developed in the larger interest of industrial peace and harmony.
National Commission on Labour also after unanimously and whole heatedly expressing itself in favour of the concept of recognised union and it being clothed with powers of sole bargaining agent with exclusive right to r present workmen, addressed itself only to the question of the method of ascertaining which amongst various rival unions must be accorded the status of a recognised union and it was agreed that the union which 494 represents the largest number of workmen working in the undertaking must acquire the status as that would be in tune with the concept of industrial democracy.
[499H; 501B; 502G H; 503A B; D G] 1.2.
It is therefore clear that every one was agreed that where there are multiple unions in an industrial undertaking or an industry, the union having the largest membership of the workmen must be clothed with the status of recognised union and consequently as the sole bargaining agent.
The under lining assumption was that the recognised union represents all the workmen in the industrial undertaking or in the industry.
Thus, the 1971 Act was enacted as its long title shows to provide for the recognition of trade unions for facilitating collective bargaining for certain undertakings, to state their rights and obligations, to confer certain powers on unrecognised unions; to provide for declaring certain strikes and lockouts as illegal strikes and lock outs; to define and provide for the prevention of certain unfair labour practices; to constitute courts (as independent machinery) for carrying out the purposes of according recognition to trade unions and for enforcing the provisions relating to unfair practices etc.
[504A B; 499E F] 1.3.
Status to be the sole bargaining agent as a recognised union is a hard won battle and need not be permitted to be frittered away by a sentimental approach that where trade union movement has ideological overtones, such a provision would compel workmen either to become members of a union, whose socio political philosophy is not in tune with his own or suffer isolation as such workman cannot forge a tool of a trade union or even if they forge one, the employer can ignore it with impunity.
The matter cannot be viewed from the perspective of same ideloguis but has to be examined in the large perspective of public interest of peace and harmony in the industry, healthy industrial relations and large national interest which eschews strikes, lock outs, conflict and confrontation.
[504H, 505A B] 2.1.
Sec. 20, sub sec.
2 while conferring exclusive right on the recognised union to represent workmen in any proceeding under the simultaneously denying the right to be represented by any individual workman has taken care to retain the exception as enacted in Sec.
2A of the .
This legal position is reiterated in Sec.
20(2) (b).
Therefore, while interpreting Sec.
20(2) (b), it must be kept in view that an individual workman, who has his individual dispute with the employer arising out of his dismissal, discharge, retrenchment or termination of service will not suffer any disadvantage if any recognised union would not espouse his case and he will be able to pursue his remedy under the .
Once this protection is assured, the question is whether the status to represent workmen conferred on a recognised union to the exclusion of any individual workman or one or two workmen and who are not members of the recognised onion would deny to such workmen the fundamental freedom guaranteed under article 19(1) (a) and 19(1) (c) of the Constitution.
[506B D] 2.2.
The restriction on the right to appear and participate in a proceeding under the to a workman who is not prepared to be represented by the recognised union in respect of a dispute not personal to him alone such as termination of his service does not deny him the freedom 495 of speech and expression or to form an association.
Conferring the status of A recognised union on the union satisfying certain pre requisites which the other union is not in a position to satisfy does not deny the right to form association [506E.F] 2.3.
Forming an association is entirely independent and different from its recognition.
Recognition of a union confers rights, duties and obligations Non conferring of such rights, duties and obligations on a union other than the recognised union does not put it on an inferior position nor the charge of discrimination can be entertained.
The members of a non recognised association can fully enjoy their fundamental freedom of speech and expression as also to form the association.
The Legislature has, in fact, taken note of the existing phenomenon in trade unions where there would be unions claiming to represent workmen in an undertaking or industry other than recognised union.
Sec.22 of 1971 Act confers some specific rights on such non recognised unions, one such being the right to meet and discuss with the employer the grievances of individual workman The Legislature has made a clear distinction between individual grievance of a workman and an industrial dispute affecting all or a large number of workmen In the case of even an unrecognised union, it enjoys the statutory right to meet and discuss the grievance of individual workman with employer.
It also enjoys the statutory right to appear and participate in a domestic or departmental enquiry in which itsh member is involved.
this is statutory recognition of an unrecognised union.
The exclusion is partial and the embargo on such unrecognised union or individual workman to represent workmen is in the large interest of industry, public interest and national interest.
Such a provision could not be said to be violative of fundamental freedom guaranteed under article 19(1)(a) or 19(1)(c) of the Constitution.
[506H; 507A D] 3.
Where a representative union acts in exercise of the powers conferred by Sec 20(2) it is obligatory upon it to act in a manner as not to discriminate between its members and other workmen of the undertaking who are not its members.
However when a settlement is reached in a proceeding under the in which a representative union has appeared, the same is to be binding on all the workmen of the undertaking This would mean that neither the representative union nor the employer can discriminate between members of the representative union and other workmen who are not members.
Both the benefits, advantages, disadvantages or liabilities arising out of a settlement in any proceeding under the to which a representative union is a party shall be equally applicable to each workman in the undertaking There shall not be the slightest trace of discrimination between members and non members both as regards the advantages and also as regards the obligations and liabilities.
Any other view of Sec.
20(2)(b) would render it unconstitutional and invalid as being violative of article 14.
Equal treatment of members and non members is implicit in the section and by its interpretation this Court only makes it explicit.
[511F H; 512A B] (4) It is well known that no deduction could be made from the wages and salary payable to a workmen governed by the Payment of Wages Act unless authorised by that Act.
A settlement arrived at on consent of parties can however permit a deduction as it is the outcome of understanding between the parties even though such deduction may not be authorised or legally permissible under the Payment of Wages Act.
[512D E] H 496 (5) If under a settlement with the representative union some benefits accrue to the workmen, and upon a true interpretation of Sec.
20(2)(b), it is held all encompassing and therefore binding on all workmen employer alike, all the benefits would be available to the workmen who are not members of the representative union and who may have formed a rival union.
If these work i men could not be denied the benefits, they would enjoy an unfair advantage if from the package deal covered by the settlement, they draw benefits and abjure liabilities.
therefore, a clause like Clause 17 of the Settlement has to be understood in the context of strengthening the trade union movement and to free it from financial constraints.
Workmen who are members of a union may pay fee for membership and enjoy the advantage or membership put if by the action of the representative union all workmen acquire benefit or monetary advantage, the members and non members alike can be made to make common sacrifice in the large interest of trade union movement and to strengthen the trade union which by its activities acquired the benefits for all workmen.
Payment to trade union fund in these circumstances can be styled as quid pro quo for benefits acquired.
It can neither be said to be compulsory exaction nor a tax.
Therefore, there is nothing objectionable in Clause 17 of the Settlement which directs the employer to deduct 15% of the gross arrears payable to each employee under the settlement as contribution to the trade union funds.
Thereby the workman is not subscribing to the philosophy of rival union but he is merely paying the price of the advantage obtained.
Another view would make the union members suffer and the non members benefit, a situation which must at all costs be avoided.
Therefore clause 17 of the Settlement would not be invalid despite the lack of consent of the workmen who are members of the appellant union.
The settlement having been made by the representative union, its right to represent all workmen would imply the consent of the members of the rival union.
This is the legal consequenee of the right of the representative union to represent all workmen and the binding effect of its action.
[513G H; 514A E] Reg.
vs Duffield, 5, Cox 's Criminal Case, 404 referred to.
Raja Kulkarni and Ors.
vs State of Bombay [1954] SCR 384, relied upon.
Rum Prasad Vishwakarma vs The Chairman Industrial Tribunal, , held in applicable.
Girja Shankar Kashi Ram vs Gujarat Spinning and Weaving Mills Ltd. [1962] 2 Supp.
SCR 890 and Santuram Khudai vs Kimatrai Printers & Processors (P) Ltd. & Ors., ; , distinguished.
|
Appeals Nos. 158 to 164 of 1960.
Appeals from the judgment and order dated October 8, 1958, of the Bombay High Court in I.T.A. Nos.
7505, 7506, 5046 to 5048, 5149 and 5150 of 1956 57.
A. V. Viswanatha Sastri, section N. Andley, J. B. Dadachanji, Rameshwar Nath and P. L. Vohra, for the. appellants.
R. Ganapathy Iyer and D. Gupta, for the respondent.
January 12.
The Judgment of the Court was delivered by HIDAYATULLAH, J.
These seven appeals have been filed on a certificate granted by the High Court of Bombay against the judgment and order of the High Court dated October 8, 1958, in a case referred by the Income tax Appellate Tribunal, Bombay.
The first appellant is the Bhor Industries, Ltd., a Company incorporated in 1944 in the former Bhor State with its registered office also situated in the town of Bhor.
It did the business of dyeing, printing and bleaching cloth, cloth proofing, etc., in Bhor State.
The remaining five appellants are the shareholders of this Company, which, admittedly, was a private Company limited by shares, at all material times.
We are concerned in these appeals with the account years of the Company, 1946 and 1947.
During these years, the income of the Company was as follows: Assessment Total Income accruing Total World year Income or arising in the Income (Sum Indian State of of 2 & 3) Bhor.
1 2 3 4 1947 48 Rs. 4,32,542 Rs. 2,24,542 Rs. 6,57,084 1948 49 Rs. 4,32$709 Rs. 3,47,416 Rs. 7,80,125 412 The Company held its general meetings to declare dividends at Bhor on August 17,1947, and August 19, 1948, respectively.
For the account years 1946 and 1947 respectively it declared a dividend of Rs. 2,580/and Rs. 1,140/ .
Bhor State merged with the Province of Bombay by virtue of the States Merger (Governors ' Provinces) Order, 1949, which came into force on August 1, 1949.
By the Taxation Laws (Extension to Merged States and Amendment) Act, 1949, which received the assent of the Governor General on December 31, 1949, the Indian Income tax Act was extended to the merged States with effect from April 1, 1949.
That Act also introduced section 60A in the Income tax Act, by which power was given to the Central Government, if it considered necessary or expedient so to do, to avoid any hardship or anomaly or to remove any difficulty in the application of the Income tax Act to merged States, to make a general or special order granting exemption, reduction in rate or other modification.
Under the power thus conferred, the Central Government notified the Merged States (Taxation Concessions) Order, 1949.
For the assessment years 1947 48 and 1948 49 corresponding to the account years of the Company, 1946 and 1947, the Income tax Officers assessed the Company as non resident, and held that the Company was not a public Company within the meaning of section 23A of the Indian Income tax Act.
The Income tax Officer who passed the order for the assessment year 1947 48 under section 23A, held that the assessable income in British India of the Company in 1946 minus the taxes, must be deemed to be distributed among the shareholders in the proportion of their shareholdings.
The Incometax Officer calculated the amount deemed to be distributed as follows: 413 1946 (assessment year 1947 48).
Total Income .
Rs. 4,32,542 Taxes .
Rs. 1,89,237 Amount available for distribution .
Rs. 2,43,305 as dividend Dividend declared .
Rs. 2,580 Balance of the amount available and deemed to be distributed .
Rs. 2,40,725 For the account year 1947, the Income tax Officer took the total world income less the taxes as the amount available for distribution as dividend.
According to him, that amount was as follows: 1947 (assessment year 1948 49).
Total income .
Rs. 4,32,709 Income in Bhor State .
Rs. 3,47,416 Total world income .
Rs. 7,80,125 Taxes .
Rs. 2,43,399 Amount available for distribution as dividend .
Rs. 5,36,726 Dividend declared .
Rs.1,140 Balance of the amount available for distribution .
Rs.5,35,586 The Income tax Officer then apportioned it among the shareholders as on August 19, 1948.
This worked out at Rs. 539.9 per share.
The Income tax Officer then divided this amount of Rs. 539.9 in the proportion the total income bore to the income in Bhor State and taxed the former in the hands of the shareholders, but the balance was included and considered for purposes of rate only.
The Tribunal in the statement of the case illustrated this by citing the case of one of the shareholders (Pushpakumar M. D. Thackersey) as follows: 414 "The portion of Rs. 5,35,586 apportionable to his 90 shares at the rate of Rs. 539.9 per share worked out at Rs. 50,211/ .
This amount of Rs. 50,21/was divided into two smaller amounts in the ratio already mentioned and the amount of Rs. 27,851/was actually brought to tax whereas the amount of Rs. 22,360/ attributable to Bhor State income of Rs. 3,47,416/ was merely included in the total income for rate purposes." In computing these " deemed dividends ", the two Income tax Officers did not deduct the interest charged to the Company under section 18A(8), from the assessable income along with income tax and super tax under section 23A(1).
The Company as well as the shareholders appealed to the Appellate Assistant Commissioner, but their appeals were unsuccessful.
Their further appeals to the Tribunal were also dismissed.
They raised the contentions that section 23A was not applicable to the Company, that the deemed income arising from a fictional distribution of the dividends could not be taxed in the hands of the shareholders because section 23A did not apply to them, and that they were protected by the Concessions Order in the same way in which the Company was.
They also raised the contention that in.
determining the balance of the amount available for distribution, interest charged under section 18A(8) ought to have been deducted.
All these contentions were not accepted by the Department and the Tribunal.
At the instance of the Company and the shareholders, the Tribunal drew up a statement of the case, and referred three questions to the High Court for its decision.
These questions were as follows: " 1.
Whether paragraph 12 of the Merged States (Taxation Concessions) Order, 1949, precluded the Income tax Officer from making an order under Section 23A in the case of the assessee company in respect of its profits and gains of the previous year ended 31st December, 1946 ?/ 31st December, 1947 ? 415 2.
Whether in making an order under Section 23A in respect of the profits and gains of the year 1946/1947 the assessable income of that previous year is to be reduced not only by the amount of incometax and super tax payable by the company in respect thereof but also by the amount of interest charged to it in accordance with the provisions of Section 18A ? 3.
Having regard to the order passed by the Income tax Officer under Section 23A in respect of the Company 's profits of the year 1947 and having apportioned the sum of Rs. 17,641/ to the shareholder, Pushpakumar, as his proportionate share in the distribution made by the Income tax Officer under Section 23A and having regard to the provisions of Section 14(2) (c), whether the said sum of Rs. 17,641/has been properly included in his total income for the purpose of charging it to tax ? " The third question was a typical question, as similar questions also arose in the case of other shareholders with variation in the amount.
The amount of Rs. 17,641/ , the Tribunal stated, replaced Rs. 50,211/in view of certain directions given by the Tribunal.
The High Court framed one more question as the second part of question No. 1 in disposing of the reference, which read as follows.
: " Whether paragraph 12 of the Merged States (Taxation Concessions) Order, 1949, precluded the Income tax Officer from making any order under Section 23A so as to affect the assessee shareholders in respect of their profits and gains for the assessment year 1949 50 ? The High Court answered the first and second questions and the question framed by it in the negative, and the third question, in the affirmative.
The High Court, however, granted a certificate under section 66A of the Income tax Act, and the present appeals have been filed.
The contentions raised before the High Court have been raised before us.
The Company questions the application of section 23A to the two assessment years, 1947 48 and 1948 49, while the shareholders 416 question the application of section 23A to the Company and also to them in the assessment year, 1949 50.
Both the Company and the shareholders contend that interest under section 18A(8) ought to have been deducted along with the income tax to find out the available surplus.
The shareholders claim the benefit of section 14(2) (c) in respect of the entire amount of the balance deemed to be distributed.
To begin with, one must remember that the Indian Income tax Act was applied to Bhor State from April 1, 1949, and that there was no income tax law in force in Bhor State prior to its merger.
This position also obtained in many other Indian States, which merged with the Provinces in British India.
The fact that income tax is charged in an assessment year on the income, profits or gains of the previous year would have made persons resident in merged States to pay tax on income which, but for the extension of the Indian Income tax Act, was either not liable to income tax at all or was liable at a lesser rate.
In view of the apprehended difficulties and anomalies, the Extension Act itself gave power to remove such anomalies and hardships.
Section 60A was added to the Income tax Act, and it read as follows: " If the Central Government considers it necessary or expedient so to do for avoiding any hardship or anomaly, or removing any difficulty, that may arise as a result of the extension of this Act to the merged States, the Central Government may, by general or special order, make an exemption, reduction in rate or other modification in respect of income tax in favour of any class of income, or in regard to the whole or any part of the income of any person or class o f persons. . " The Concessions Order, 1949, was passed in furtherance of this power.
We are concerned only with paragraph 12 of the Concessions Order, 1949, which has been relied upon by the Company and the share.
holders, who are appellants before US.
It is not necessary to refer to paragraphs 4, 5 and 6 to which passing reference Was made in the arguments, because 417 they deal with income in an Indian State, which has not been taxed in these cases at all.
Paragraph 12 provided for the application of section 23A to a previous year ending on or after August 1, 1949, but not to a previous year ending before August 1, 1949.
It may be quoted here: "The provisions of section 23A of the Indian Income tax Act shall not be applied in respect of the profits and gains of any previous year ending before 1st day of August, 1949, unless the State law contains a provision corresponding thereto." Reading the Extension Act, section 60A and the Concessions Order, 1949, together, the following position emerges.
The Indian Income tax Act applied to and from the assessment year 1949 50 (April 1, 1949 to March 31, 1950) in the merged States.
Corresponding previous years were comprehended.
The difficulty which was likely to be felt was with respect to the fact that the merger with the Province of Bombay operated from August 1, 1949, and not from April 1, 1949.
In respect of the exemption under section 14 (2) (c), the position was preserved by applying paragraphs 5 and 6 to the exempted income.
These two paragraphs made the State rate applicable to that exempted income.
Similarly, previous years ending after March 31, 1948, were to be assessed to Indian income tax, but the excess of the tax computed at Indian rates over the tax computed at State rates was to be given away as rebate, and profits and gains of companies of any previous year ending before August 1, 1948, earned in an Indian State were saved from section 23A, unless there was, in the State, a provision corresponding to section 23A.
It must be remembered that the Income tax Officer in the present case did not seek by his order under section 23A to distribute the Bhor State income of the shareholders of the Company as dividend; he restricted his order to the British Indian income.
There was, in fact, in the State of Bhor no law of Income tax, and no order taxing income which arose in Bhor could be passed by the Income tax Officer.
418 By the definition in section 2(5A) of the Indian Incometax Act.
a company formed in pursuance of an Act of an Indian State was a company for the purposes of the Act, and it was open to the Income tax Officer exercising powers under section 23A to declare the income of such a company accruing or arising within the taxable territory as distributed among the shareholders.
The right of the Department to pass an order under section 23A(1) of the Indian Income tax Act was not chal lenged before the Tribunal, and it was not the subject of a decision in the High Court.
The argument still has been, on behalf of the Company as well as the shareholders, that paragraph 12 of the Concessions Order saved the profits and gains, whether made in Bhor State or in British India, from the application of section 23A, and that indirectly the shareholders were entitled to the same benefit.
Paragraph 12 of the Concessions Order depends on whether a company was being assessed under the Indian Income tax Act in respect of its profits and gains in an Indian State for any previous year ending before the first day of August, 1949.
By the application of the Indian Act to an Indian State, the income of a company in an Indian State was likely to be taxed to Indian income tax from the assessment year, 1949 50.
For the earlier assessment years a company 's income in the Indian State was exempt without the assistance of the Concessions Order.
The exemption granted by the Concessions Order was to operate in respect of those profits and gains which, but for the exemption, would have been included in the assessment year, 1949 50 and subsequent years.
In so far as paragraph 12 of the Concessions Order was concerned, it gave exemption in respect of action under section 23A to income of " any previous year " ending before the first day of August, 1949.
The date, August 1, 1949, was chosen because the merger with the Provinces took place on that date.
The word " any " does not refer to all the previous years prior to and ending before August 1, 1949, but to a previous year in relation to the assessment year, 1949 50 and ending before the first day of August, 1949.
The words 419 any previous year mean, therefore, only one previous year, which would be a previous year for the purposes of the assessment year, 1949 50 but which, to get the exemption, must end before the first day of August, 1949.
The exemption, therefore, did not apply to previous years other than the one described, and in respect of the earlier previous years, paragraph 12 of the Concessions Order was hardly needed.
Otherwise, there would be no need to mention in the paragraph the date on which the previous year must end.
It is thus quite clear that paragraph 12 provided for income, profits and gains of those previous years which were specially mentioned and in respect of which anomalies were likely to arise by reason of the fact that the merger took place on August 1, 1949, while the Income tax Act was applied from April 1, 1949.
In view of the fact that specific terminii of previous years are expressly mentioned in the Concessions Order, it is not possible to accept the argument on behalf of the appellants that " all " previous years before the date mentioned were comprehended in paragraph 12.
The application of that paragraph must be limited to one previous year only which ended prior to August 1, 1949.
The previous years, with which we are concerned, ended on December 31, 1946, and December 31, 1947, respectively.
In the case of this Company, the previous year which would answer the description in paragraph 12 would be the previous year ending December 31, 1947.
To that previous year, the provisions of section 23A were not applicable, and the profits and gains made in Bhor State would be protected.
The position which obtained in the assessment year 194748 would thus obtain also in the assessment year 1948 49 in so far as the Company was concerned, and its profits and gains in Bhor State could not be considered for purposes of application of section 23A.
The position was, however, different in regard to the income in British India which formed the total income of the Company in the taxable territory.
It was not contended that the assessable income of the Company in the taxable territories would not attract 420 s.23A, if the distribution of dividends from that income was below the mark set in section 23A. There is thus no difference between the assessment years 194748 and 1948 49, and the method of calculation adopted in the first year is also applicable to the second.
To this extent, the answer to the first question (first part) must be deemed to be modified in respect of the previous year ending December 31, 1947.
It is next contended that interest that was charged to the Company under section 18A(8) ought to have been deducted along with the income tax before the fictional dividends were computed.
Section 18A(8) reads as follows: " Where, on making a regular assessment, the Income tax Officer finds that no payment of tax has been made in accordance with the foregoing provisions of the section, interest calculated in the manner laid down in sub section (6) shall be added to the tax as determined on the basis of regular assessment.
" The words of the sub section are clear to show that interest as interest is added to the tax as determined.
There is nothing to show that it is to be treated as tax, and it thus retains its character of interest but is recoverable along with the tax.
Indeed, section 29 of the Income tax Act makes a distinction between tax, penalty and interest.
Since section 23A speaks of deduction only of income tax and super tax, no deduction could be made in respect of this interest.
Question No. 2 was thus correctly answered by the High Court.
In so far as the shareholders who were all resident in the taxable territories were concerned, paragraph 12 of the Concessions Order did not, in terms, protect them.
Section 23A enjoins that dividends to the extent of 60 per cent.
of the assessable income of the Company after deduction of income tax and super tax must be paid.
When the assessable income of the Company has been determined and after the necessary deductions have been made, if dividends are not distributed in accordance with section 23A, the fiction applies to that portion of the profits and gains which were taxable as assessable income of the Company in the 421 taxable territories and which ought to have been so dis tributed.
Section 23A, as it was before the amendment in 1955, mentioned 60 per cent.
of the assessable income of a company as reduced by the amount of income tax and super tax payable by a company, and provided further that the undistributed portion of the assessable income of a company as computed and reduced shall, subject to certain conditions, be deemed to have been distributed as dividends amongst the shareholders.
We have already shown that the benefit of paragraph 12 is not available in respect of these fictional dividends, in so far as the assessable income of the Company was concerned.
It is, however, contended that these dividends would be deemed to be declared in Bhor State and to have been received there, and that unless another fiction is engrafted upon the fiction created by section 23A, these deemed dividends cannot be taxed in the hands of the shareholders.
No doubt, the section implies a fiction; but if the fiction is given effect to, such income must be deemed to be distributed to the shareholders, and the fiction thus transcends all questions of accrual or receipt in the taxable territories.
What is deemed to be distributed must be deemed to have accrued and also received by the person to whom it is deemed to be distributed [See sections 4(1)(a) and 4(1)(b)(i) and (ii)].
Paragraph 12 of the Concessions Order saved the Company in respect of income in Bhor State for the assessment year 194849 for the corresponding previous year ending before August 1, 1949, but it did not save the operation of a. 23A in respect of the assessable income of the Company in the taxable territories and the distribution of dividends to the shareholders from that income.
In our opinion, the High Court was right in holding that the dividends deemed to have been distributed out of the Assessable income of the Company in the taxable territories were ' rightly assessable in the total income of the shareholders resident in the taxable territories.
No question has been referred on the method of calculation of the dividends deemed to 422 have been distributed, and we need, therefore, express no opinion on that part of the case.
The shareholders (appellants 2 to 6) claim the benefit of a 14(2)(o) of the Act, which provides: " 14(2).
The tax shall not be payable by an assessee (c) in respect of any income, profits or gains accruing or arising to him within an Indian State, unless such income, profits or gains are received or deemed to be received in or are brought into British India in the previous year by or on behalf of the assessee, or are assessable under Section 12 B or Section 42.
" We have already shown that the force of the fiction makes the dividends which ought to have been distributed, to be so distributed.
We have also said that this fiction transcends all questions of accrual and receipt.
The effect of section 23A is to make dividends payable out of the British Indian income to the shareholders.
Paragraph 4 of the Concessions Order and section 14(2)(c) saved for the shareholders the income of the Company outside the taxable territories only, that is to say, the income earned in Bhor State.
They do not affect the operation of section 23A on the assessable income of the Company which, by reason of the application of the Indian Income tax Act even prior to the Extension Act, was assessable under the Indian Income tax Act.
Dividends payable out of that portion of the income will attract section 23A, and section 14(2)(c) does not apply.
Section 14(2)(c) saves only that portion of the income which was not assessable in the taxable territories by reason of its accrual in the State.
The Income tax Officer in assessing the income of the shareholders for the assessment year, 1949 50, ought to have deducted the income which accrued in Bhor State, while applying section 23A to them.
This he, in effect, did, but he adopted a method on which no question has been raised, and the correctness of the method cannot be examined.
The answer to question No. 1 is thus in the negative, with the modification that section 23A applied only to that 423 portion of the income which was earned in British India and not in Bhor State.
The answer to the second question is in the negative.
The answer to the third question is in the affirmative.
The question posed and answered by the High Court hardly arises, in view of the answer to the first questions That question and the answer to it are set aside as being not necessary.
The appeals thus fail except for a slight modification in the answer to the first question, and subject to that modification, are dismissed.
The appellants must bear the costs of these appeals.
There shall be one hearing fee.
Appeals dismissed.
| Where, in an arbitration under section 21 of the Indian Arbitration Act, the arbitrator took statements from each of the parties in the absence of the other and made an award: Held, that it is one of the elementary principles of the administration of justice, whether by courts or by arbitration by lawyers or merchants, that a party should not be allowed to use any means whatsoever to influence 120 the mind of the judge or arbitrator, which means, are not known to and capable of being met and resisted by the other party; the arbitrator was accordingly guilty of legal misconduct; and this was sufficent to vitiate the award, irrespective of the fact whether this misconduct bad caused prejudice to any one.
Harvey vs Shelton ; , Ganesh Narayan Singh vs Malida Koer , and Haigh vs Haigh ; , referred to.
|
ON: Civil Appeal No. 4297 of 1983.
From the Judgment and Order dated 26.10.1979 of the Allahabad High Court in C.M.W. No. 7168 of 1972.
Raja Ram Agarwal and A.K. Srivastava for the Appellants.
K.K. Venugopal, Rajinder Sachher, Satish Chandra, K.C. Dua, and J.P. Misra for the Respondents.
The Judgment of the Court was delivered by K.N. SAIKIA, J.
The State of U.P. by special leave appeals from the Judgment of the High Court of Allahabad dated 26.10.1979, allowing the respondents ' writ petition and holding that the State of U.P. and the Excise authori ties were not entitled to levy excise duty on the wastage of liquor in transit.
The respondents are manufacturers of high strength spirit classified as other sorts of spirit not otherwise specified ' under Section 28 of the United Prov inces Excise Act, 19 10, hereinafter referred to as 'the Act '.
After manufacture they transport those spirit in big containers from the distilleries to their warehouses, trans porting them on passes issued under section 16 of the Act.
In the bonded warehouses the same are sometimes diluted, separately bottled and sold.
They also used to manufacture and bottle military rum under a licence and supply the same to the defence personnel inside and outside the State of U.P.
The Officer Commanding Rail Head Depot A.S.C., Pathan kot having obtained permits from the State of Punjab for the import of military rum, against those permits the respond ents exported military rum from their distillery, under different passes.
The excise duty on military rum for export was Rs.7 per L.P. Litre while the rate for consumption within the State was 171 Rs.21 per L.P. Litre.
If the exported military rum was under bond thereupon duty was realised by the importing State from the importer thereof.
The respondents bottled the rum ac cording to rules and supplied the same to the consignees at the distillery premises and the consignments were taken by the consignees under the seal of the railway authorities to their respective destinations.
It appears by Notification dated March 26, 1979 in exercise of the powers under Sections 28 and 29 of the Act, read with section 21 of the U.P. General Clauses Act, 1904, and in supersession of the earlier Government Notification the Governor was pleased to direct that with effect from April 1, 1979 duty shall be imposed on country spirit at the rates specified in the schedule thereto and the duty was payable "before the issue from the distillery or bonded warehouse concerned save in the case of issued under bond".
By order dated 13.10.1970 notice was issued to the respond ents demanding Rs.4,295.55p.
on the wastage which was termed as "excess transit wastage" of rum calculated at the maximum rate of Rs.21 per L.P. Litre.
A representation of the re spondents dated November 9, 1970 was rejected by order dated 15.1.1972.
Another representation through the All India Distillers Association was also rejected by order dated August 28, 1972.
Several writ petitions challenging similar orders were filed by others before the Allahabad High Court for quashing the orders.
The respondents also filed Civil Miscellaneous Writ No. 7168 of 1972 under Article 226 of the constitution of India praying for appropriate writ, order or direction quashing the impugned orders dated 13.10.1970, 9.11.1970, 15.1.1972 and 28.8.1972 and for a mandamus commanding the State of U.P. not to realise or adjust any amount of duty towards wastage from the respondents ' advance duty account otherwise than in accordance with law and restraining them from giving effect to the impugned orders.
The High Court by the impugned judgment dated 26.10.1979 relying on an earlier Division Bench decision of the same High Court in M/s. Mohan Meakin Breweries Ltd. and Anr.
vs State of Uttar Pradesh and Ors.
, (Writ Petition No. 2604 of 1973, decided on 11.9.1979) allowed the writ petition and quashed the impugned orders thereby holding that no excise duty could legally be levied on the excess wastage the occurred during the transport of liquor in course of export, that is, taking out of U.P. otherwise than across a customs frontier as defined by the Central Government.
Mr. Raja Ram Agarwal, the learned counsel for the appel lants, submits that the duty has been levied keeping in mind the fact that in 172 U.P. excise duty is levied at two different rates at a higher rate when the liquor is sold inside the State, and at a lower rate when it is exported outside the State.
Counter vailing duty is paid by the importer on the quantity actual ly received in the importing State.
If there is excess wastage on transit the result is that the quantity actually received by the destination State is less than the quantity on which the State of U .P. charged the lower rate and, therefore, on the quantity shown as wastage the State of U.P. ought to recoup its differential duty by charging excise duty at the higher rate; and that this is clearly envisaged by the Act and the United Provinces Excise Manual Rules, hereinafter referred to as 'the Rules '.
Counsel further submits that it has a wholesome purpose, namely, to discourage evasion of duty and that there is no question of levying excise duty twice on the same article inasmuch as the amount of export duty actually paid is always deducted from the demand; and that it is a duty of regulatory charac ter meant to guard against perpetration of fraud or decep tion on excise revenue which the State is entitled to re ceive.
It is said to be a realisation of escaped duty justi fied by the implied presumption.
Mr. K.K. Venugopal, the learned counsel for the respond ents, submits that in this case while the exporting State, that is, U.P., levied export duty at a concessional rate the importing State levied countervailing duty on the quantity of rum imported; and the quantity exported and subjected to excise duty by the exporting State being the same as the quantity whereupon countervailing duty was imposed by the importing State, there could be no question of collecting differential duty on the excess wastage by the exporting State and if that was done it would amount to double taxa tion.
Explaining the procedure for export from U.P. counsel states that after export duty is paid, the exporter gets the alcohol released and transport it to the importing States in bottles or casks.
In the importing State countervailing duty is paid on full consignment at its destination and the seals of the bottles transported are intact.
So the entire con signment is taxed less the wastage.
The impugned demand notices have, submits counsel, rightly been quashed by the High Court and the appellants have rightly been restrained from levying such differential duty on excess wastage on transit in course of export.
The only question to be decided, therefore, is whether the differential duty is leviable under the Act and the Rules.
For answering the question we may refer to the Act and the Rules.
Included in Chapter V of the Act, which deals with duties and fees, Section 28 of the Act provides that an excise duty or a countervailing duty, as the 173 case may be, at such rate or rates as the State Government shall direct may be imposed either generally or for any specified local area on any excisable article stated in that section.
"Excise duty" and "countervailing duty" as defined in Section 3(3a) of the Act means any such excise duty or countervailing duty, as the case may be, as is mentioned in entry 51 of List II in the Seventh Schedule to the Constitu tion.
That entry reads as follows: "51.
Duties of excise on the following goods manufactured or produced in the State and countervailing duties at the same or lower rates on similar goods manufactured or produced elsewhere in India: (a) alcoholic liquors for human consumption; (b) opium, Indian hemp and other narcotic drugs and narcot ics; but not including medicinal and toilet preparations containing alcohol or any substance included in subparagraph (b) of this entry.
" The original Section 28 of the Act now re numbered as subsection (1) thereof, and sub sections 2 and 3 inserted by section 2 of the U.P. Act 7 of 1970 clearly covers Indian made foreign liquors.
There could be no dispute as to mili tary rum being one of the Indian made foreign liquors ex cisable under the Act.
A duty of excise under Section 28 is primarily levied upon a manufacturer or producer in respect of the excisable commodity manufactured or produced irre spective of its sale.
Firstly, it is a duty upon excisable goods, not upon sale or proceeds of sale of the goods.
It is related to production or manufacture of excisable goods.
The taxable event is the production or manufacture of the liq uor.
Secondly, as was held in A.B. Abdulkadir vs The State of Kerala.
reported in ; , an excise duty imposed on the manufacture and produc tion of excisable goods does not cease to be so merely because the duty is levied at a stage subsequent to manufac ture or production.
That was a case on Central Excise, but the principle is equally applicable here.
It does not cease to be excise duty because it is collected at the stage of issue of the liquor out of the distillery or at the subse quent stage of declaration of excess wastage.
Legislative competence under entry 51 of list II on levy of excise duty relates only to goods manufactured or produced in the State as was held in Bimal Chandra Banerjee vs State of Madhya Pradesh, ; In the instant case there is no 174 dispute that the military rum exported was produced in the State of U.P.
In State of Mysore & Ors.
vs M/s. D. Cawasji & Co., 10, which was on Mysore Excise Act, it was held that the excise duty must be closely related to production or manufacture of excisable goods and it did not matter if the levy was made not at the moment of production or manufacture but at a later stage and even if it was collected from retailer.
The differential duty in the in stant case, therefore, did not cease to be an excise duty even it was levied on the exporter after declaration of excess wastage.
The taxable event was still the production or manufacture.
It is settled law as was held in Bimal Chandra Banerjee vs State of Madhya Pradesh (supra), a case under the Madhya Pradesh Excise Act, that no tax can be levied by the State Government in the absence of specific authorisation by statute.
In that case the levy of duty on liquor which the contractor failed to lift was held to have been an attempt to exercise a power which the State Government did not possess.
Mr. Agarwal refers us to Rule 636 of the Rules which at the relevant time said: "636.
A distiller holding licences for bottling Indianmade foreign liquor of his own manufacture and for selling it by wholesale may export such foreign liquor bottled on his wholesale premises, to any other State or Union Territory in India subject to the following condi tions: (1) The exporter shall obtain from the importer a permit authorizing the import signed by the Chief Revenue Authority of the importing State or Union Territory or by an officer duly authorized in this behalf.
(2) The permit shall specify: (a) the name and address of the person of firm authorized to import; (b) the description and quantity of the foreign liquor to be imported; (c) the rate of duty chargeable in the importing State or Union Territory in case the Indian made foreign 175 liquor is imported in State or Union territory with which the state of Uttar Pradesh has entered into reciprocal arrangements for the adjustment of the excise duty by book transfer.
(d) the rate of duty charged in the importing State or Union Territory and the fact that it has been realized in advance in cases of import other than those covered by clause (c).
(3) On receipt of the permit the exporter shall deposit into the treasury; (a) Export duty on the total quantity of liquor to be ex ported; and (b) Where the export is made to a State or Union Territory with which the State of Uttar Pradesh has entered into a reciprocal arrangement for the adjustment of the excise duty by book transfer, and the rate higher than that enforced in the State of Uttar Pradesh, and that payable in the importing State or Union Territory on the total quantity of liquor to be exported.
(4) On receipt of the permit and the treasury receipt the wholesale vendor shall prepare a pass in form F.L. 23 in quadruplicate and submit it to the Excise Inspector, in charge of the distillery.
The Excise Inspector shall after satisfying himself that duty has been correctly realized, affix his signature to the pass.
The exporter shall then send one copy of the pass to the Collector of the district of export, one copy to the Chief Revenue Authority of the place of import or such other officer as may be authorised in this behalf.
One copy to the consignee and shall retain the fourth copy.
The treasury receipt shall always accompany the copy of the pass sent to the Collector of the exporting districts.
(5) The pass in form F.L. 23 shall state clearly: (a) the name and address of the consignor; 176 (b) the name and address of the consignee; (c) the exact description and quantity of each kind of foreign liquor despatched under the pass; (d) the route by which it is despatched; (e) the date of despatch; and (f) in case of export against duty paid permit, the fact that the duty has been prepaid in the State of import.
(6) A separate pass in form F.L. 23 shall be issued in respect of each consignment.
The Chief Revenue Authority or other officer of the place of import should send the copy of the pass received by him, duly countersigned, to the Excise Commissioner, Uttar Pradesh, in support of the claim for ' refund of duty annually after the close of the excise year.
(7) Should the rate of duty in the importing State be lower than that in force in Uttar Pradesh, exporter shall be entitled to a refund of the difference in duty.
If the duty has been prepaid in the State of import at the rate in force at the time of issuing import permit, the exporter shall be entitled to a refund of duty deposited by him in the State of export on verification of the claim by the Excise Inspector incharge of the distillery on the basis of export passes in form F.L. 23 duly countersigned by the Chief Revenue Authority of the State or Union Territory of import or the officer appointed in this behalf in token of receipt of the consignment of Indian made foreign liquor" Rule 637 provided than the duty, other that export duty, on foreign liquor manufactured at any distillery in Uttar Pradesh and exported therefrom on prepayment of duty to any State or Union Territory of India shall be credited by book transfer to the Government of the importing State or Union Territory after the close of the excise year.
Rule 637 A provided for registration of claims for refund or export of Indian made foreign liquor and provided that every distiller making exports of Indian made foreign liquor to other States, shall submit a statement showing all such exports made during the proceeding quarter, in form P.D. 31 to the Excise Commissioner, duly 177 verified by the officer incharge, distillery, despatching simultaneously a copy thereof to the Assistant Excise Com missioner of the charge.
Rule 37 B provided for maintenance of register of refunds against exports of Indian made for eign liquor and said that the Excise Inspector incharge of the distillery shall enter all the details given by the distillers in the statement in form P.D. 31, in a register to be maintained by him in form P.D. 31 A. As and when refunds are allowed by the Excise Commissioner, he shall make entries about refund in this register in relevant columns under his signature.
Similar entries shall also be made by the office of the Assistant Excise Commissioner concerned, on the copies of P.D. 31 statement received from the exporters, and be initialled by the Assistant Excise Commissioner after verification.
Thus it is seen that though not specifically mentioning charging up of differential export duty on excess wastage, the above rules definitely envisaged refund of excise duty of countervailing or equalising nature.
Mr. Agarwal also brings to our notice R.ale 8 14 which substituted the old Rule by the Excise Commissioner 's Noti fication No. 10909/IX.
241 A, dated February 8, 1978.
It provided as under: "Allowance for loss in transit.
An allowance upto 0.5 per cent will be made for the actual loss in transit by leakage, evaporation or other unavoidable cause, or spirit transport ed or exported under bond in wooden casks or metal vessels.
The allowance to be made under this rule will be determined by deducting from the quantity of spirit despatched from the distillery, the quantity received at the place of destina tion, both quantities being stated in terms of alcohol.
The allowance will be calculated on the quantity contained in each wooden cask metal vessels comprised in a consignment.
If the report of the officer by whom the consign ment of spirit has been gauged and proved at its destination shows that the wastage has occurred above the limit allowa ble the person executing the bond shall be liable to pay duty on so much of the deficiency as in excess of the allow ance.
The rate of duty leviable shall be the highest rate of duty leviable on such spirit in this State.
178 When the wastage does not exceed the prescribed limit, no action need be taken by the Officer in charge of the Distillery or bonded warehouse, as the case may be, but when the wastage exceeds the allowable limit, the Officer in charge of the Distillery shall obtain the expla nation of the Distillers or the person executing the bond and forward the same together with a full report of the circumstances to the Assistant Excise Commissioner or the Deputy Excise Commissioner of the charge in which the Dis tillery is situated.
The Assistant Excise Commissioner or the Deputy Excise Commissioner shall charge duty on excess wastage provided that when the total wastage in a consign ment is within the allowable limit.
Deputy/Assistant Excise Commissioner of the charge may write off the excess wastage in any particular wooden cask or metal vessel: Provided further that the Deputy Excise Commis sioner may write off the duty upto Rs.500, if he is satis fied that the excess wastage in a consignment was on account of an accident or other unavoidable cause but in other cases, the matter shall be referred to the Excise Commis sioner for orders.
Cases in which the Deputy Excise Commis sioner writes off duty shall be reported by him to the Excise Commissioner.
" It is emphasised by Mr. Agarwal that this provision is meant to discourage evasion of duty.
If any part of the lower export duty charged liquor is not in fact exported it should be made to pay the higher excise duty as payable on home consumed liquor.
It does not impose any new duty.
We are inclined to agree.
This rule does not authorise imposition of any new tax but only authorises charging up excise duty on the excess wastage of liquor in course of export which was charged at concessional rate.
The old Rule 814 of the Rules was made by B.O. No. 423/V 284 B, dated September 6, 1910 and No. 20/8 V E 980B, dated May 28, 1918 providing for allowance for Joss in transit.
It said: "An allowance will be made for the actual loss in transit, by leakage, evaporation or other unavoidable cause, of spirit transported or exported under bond.
The allowance is subject to the following maximum limits.
" Limits were prescribed differently for wooden casks and metal vessels, keeping in mind the duration of transport.
179 Thus, we find that the minimum limits of wastage in transit was prescribed even under the old rule.
This by implication enjoined that the excess wastage would be taxed as if not wasted.
The question may arise as to the date of the new Rule 814, to decide whether the impugned notices would be covered by it or by the old Rule.
Section 77 of the Act provides the answer.
It says: "77.
Publication of rules and notifications.
All rules made and notifications issued under the Act shall be published in the Official Gazette, and shall, have effect as if enacted in this Act from the date of such publication or from such other date as may be specified in that behalf." (The two provisos are not relevant for the purpose of this case) Both the old and the new Rule 8 14 must, therefore, have effect from the date of publication in the Official gazette or from such other date as may be specified in that behalf as if enacted in the Act.
The object of this ancient formu la, namely, "as if enacted in this Act" was to emphasise the fact that the notifications were to be as effective as the Act itself.
Its validity could be questioned in the same way as the validity of the Act could be questioned.
It is an ancient form of rule making still to be found in the Act.
Thus the Act having provided for fixed wastage allowance also in effect provided that the excess above the allowable wastage will be taxed.
It can not, therefore, be said that no such charging up of excise duty on the excess wastage in transit could be validly made.
The validity of Rule 814 had not been questioned before the High Court.
Absolute equality and justice is not attainable in taxing laws.
Legislature must be left to decide the State policy within Constitution al limitations.
In M/s. Mohan Meakin Breweries Ltd. vs Excise & Taxation Commissioner, Chandigarh, reported in 10: ; 1, the appellant company carried on the busi ness of manufacture, storage and sale of liquors.
Between June, 1967 and April 1969,.
it transported various quanti ties of liquor from its distilleries in U.P. to its bonded warehouse at Chandigarh.
On arrival, the consignments were examined by the Officer in Charge of the warehouse, and a shortage was found, exceeding the wastage allowance permis sible under rule 8 of the Punjab Bonded Warehouse Rules, 1957.
The Excise and Taxation Commissioner, exercising the powers of the .
Financial Commissioner. issued a show cause notice and then ordered 180 the appellant to pay duty on the wastage in excess.
The show cause notice required the appellant to pay duty on excess wastage in course of import of liquor from U.P. and the rules governing the appellant 's licence provided for a wastage allowance not exceeding 1% of the actual loss in transit by leakage or breakage of vessels or bottles con taining liquor, and if the wastage exceeded the prescribed limit the licensee should be liable to pay duty at the prescribed rate as if the wastage in excess of the pre scribed limit had actually been removed from the Warehouse, and it was also provided that the Financial Commissioner could in his discretion on goods cause being shown remit the whole or a part of the duty leviable on such wastage, and these provisions were challenged.
This Court held that the impugned rules did not impose any new duty or create any liability and that they were in essence and substance of a regulatory character meant to guard against perpetration of fraud or deception on the revenue.
"They provide for and regulate the storage and subsequently the removal of liquor from the bonded warehouse, on payment or otherwise of the duty which is chargeable under the Fiscal Rules of 1937.
" We agree with Mr. Agarwal that the instant Rules 636 and 814 are also a regulatory character and they are precautionary against perpetration of fraud on the excise revenue of the exporting State.
If out of the quantity of military rum in a consignment, a part or portion is claimed to have been wastage in transit and to that extent did not result in export, the State would, in the absence of reasonable expla nation, have reason to presume that the same have been disposed of otherwise than by export and impose on it the differential excise duty.
A statute has to be construed in light of the mischief it was designed to remedy.
There is no dispute that excise duty is a single point duty and may be levied at one of the points mentioned in Section 28.
The submission of the respondents that they paid duty on the entire quantity of rum to be exported under excise passes issued to the importer and that after payment of the export duty the rum bottled under the conditions enumerated in the Rules was supplied to the consignee at the distillery premises and the consignments were taken by the consignees under their seals and under the seal of the Railway authori ties and the consignments reached their destination with seals intact would not go to support the contention that the State Government was not competent to levy any duty on the excess wastage that is shown to have occurred during transit inasmuch as only a concessional rate of duty was levied on the liquor which was supposed to be exported out side the State of U.P. and if the entire quantity on which such concessional duty was paid did not reach its destination, and the 181 shortage is shown as wastage in transit, it surely meant that the short delivery was not exported.
The reason of the wastage would not be material so far as this conclusion is concerned.
Had this quantity been not exported but consumed locally the State would have derived higher duty of which it has been deprived.
The argument that countervailing duty is paid by the importers in the importing State on the quantity actually received, would also be immaterial for this conclusion though that may be of some importance for the purpose of revenue of the importing State as well as the consignee.
In case countervailing duty has been paid on the entire quanti ty of the consignment in the importing State there may be room for adjustment in accordance with the provisions of Rules 636, 637, 637 A and 637 B of the Rules.
The only material question may be whether the wastages was caused while the bottles were on transit but still within the territory of the exporting State or in transit inside the importing State.
If as a matter of fact it is found that the exported liquor actually crossed the territory of the ex porting State intact there may not be any justification for demanding differential duty.
That will of course be a ques tion of fact in no way affecting the right to demand the differential duty.
The decision in M/s. Ajudhia Distillery Rajaka, Sahaspur vs State of Uttar Pradesh and Anr., report ed in 1980 Taxation Law Reports 2262, quashing such a demand and holding that the exporting State had no jurisdiction to charge duty on the liquor wastage in transit cannot be said to have been correctly decided and the impugned judgment in the instant case suffers from the same infirmity, and has to be set aside.
Rule 814 envisages the levy of such differen tial duty.
There is no question of double charging or multi ple point charging in this case.
It is only a question of recovery of the difference on proof of the purposes for which lower duty was earlier levied having failed to be achieved entailing liability to make good the difference.
The Rules 636, 637 A and 637 are also relevant to this extent.
It was reiterated in M/s. Mc Dowell and Co. Ltd. vs Commercial Tax Officer, VH Circle, Hyderabad; , 14: ; , following Abdul Kadir (supra) that excise duty is a duty on the production or manufacture of goods produced or manufactured within the country though laws are to be found which impose a duty of excise at stages subsequent to the manufacture or production.
Similarly what was stated in Kalyani Stores vs The State of Orissa and Ors., ; , was reiterated in M/s Mohan Meakin Breweries Ltd. (supra) that a countervailing duty is meant "to counter balance; to avail 182 against with equal force or virtue; to compensate for some thing or serve as equivalent or substitute for".
A counter vailing duty is "meant to equalise the burden on alcoholic liquors manufactured or produced in the State.
" They may be imposed at the same rate as excise duty or at a lower rate so as to equalise the burden after taking into account the cost of transport from the place of manufacturing to the taxing State.
Countervailing duties are meant to equalise burden on alcoholic liquors imported from outside the State and the burden placed by excise duties on alcoholic liquors manufactured or produced in the State.
Countervailing duties can only be levied if similar goods are actually produced or manufactured in the State on which excise duties are being levied.
Thus, countervailing duty paid in the importing State does not ipso facto affect the excise revenue of the exporting State.
The fact that the importer is required to pay counter vailing duty on the imported military rum could, therefore, ipso facto be no ground for opposing the levy of differen tial duty on the excess wastage of exported rum that duty being levied with a view to safeguard the excise revenue of the exporting State.
If the excess wastage was actually lost to consumers while in the importing State no justification of such a duty may arise, that, however, would be an entire ly different question without in any way affecting the competence of the legislature of the exporting State to impose such a duty.
The fact that the exported rum was on payment of export duty or on bond would not again be materi al inasmuch as when the rum meant for export failed to be exported, there may be a presumption, may be rebuttable one, that what is shown as the excess has merged in mass of rum consumed within the State and was not separated from such a mass.
The imposition of differential duty was only deferred to this moment and it still continued to be a duty on pro duction or manufacture of rum.
It could not be regarded as a duty not connected with the taxable event of manufacture or production.
There is also no similarity with the excise duty sought to be levied only on the unlifted quantity of liquor by contractors which was held to be impermissible under Sec tions 28 and 29 of the Act in Excise Commissioner, U.P. vs Ram Kumar, and State of Madhya Pradesh vs Firm Gappulal; , In the instant case the military rum was obtained for the purpose of export and the lower export duty was paid and only when the rum did not result in export the question of imposing the differential duty arose.
The notion of the excise duty being changed or cancelled on account of what transpires later is not foreign to excise law.
Generally speaking 183 the imposing of the differential duty i.e. charging up the duty on the report of the excess wastage is the opposite of the system of drawback prevalent in some systems.
Drawback means the repayment of duties or taxes previously charged on commodities, from which they are relieved on exportation.
For example, in the customs laws of some countries an allow ance is made by the Government upon the duties due on im ported merchandise when the importer, instead of selling it within the country re exports it, and then the difference of duty is refunded, if already paid.
Similarly, in England there is a provision of refund of duties on British wine when the wine incidentally is spoilt or otherwise unfit for use or when delivered to another person has been returned to the maker as so spoilt or unfit.
The system of charging up the duty on the subsequent event of non export can not, therefore, be said to be irrespective of production or manufacture.
In the instant case if it is proved to the satisfaction of the appropriate authorities that countervailing duty had been paid on the entire consignment irrespective of the wastage then the question would arise as to whether the wastage could be ignored altogether by the exporting State as was done by the importing State.
Counsel for the parties had no objection to the idea that if the explanation for wastage was satisfactory and the countervailing duty was paid in the importing State on the entire consignment irre spective of the wastage, there would be room for adjustment by reducing the duty to similar extent.
For the foregoing reasons, the impugned Judgment is set aside and the appeal is allowed, but under the facts and circumstances of the case, without any order as to costs.
Y. Lal Appeal allowed.
| The first appellant and the first respondent were married at Tirupati on 27.2.1975 according to Hindu Law.
They separated in July 1978.
The appellant husband filed a petition for dissolution of the marriage in the Sub Court of Tirupati stating that he was a resident of South Claiborn Avenue, New Orleans, Louisiana, and that he was a citizen of India and that he and his wife last resided together at New Orleans, Louisiana.
Subsequently he filed another petition for dissolution of marriage in the Circuit Court St. Louis Country, Missouri, USA alleging that he has been a resident of the State of Missouri for 90 days or more immediately preceding th filing of the petition by refusing to continue to live with the appellant in the US and particularly in the State of Missouri.
But from the averments made by him in the petition before the Sub Judge, Tirupati it was obvious that he and his wife had last resided together at New Orleans, Louisiana and never within the jurisdiction of th Circuit Court of St. Louis Country in the State of Missouri.
The respondent wife filed her reply raising her objections to the maintainability of the petition.
She also clearly stated that her reply was without prejudice to her contention that she was not submitting to the jurisdiction of the foreign court.
The Circuit Court Missouri assumed jurisdiction on the ground that the 1st Appellant had been a resident of the State of Missouri for 90 days next preceding the commencement of the action in the Court.
In the absence of the respondent wife the Circuit Court, Missouri passed a decree for dissolution of marriage on the only ground that the marriage has irretrievably down.
Subsequent to the passing of the decree by the Circuit Court, Missouri, the appellant filed an application for dismissal of his earlier petition before the Sub Court of Tirupati and the same was dismissed.
823 On 2nd November 1981 the last appellant married appellant No. 2.
Thereafter, the 1st respondent filed a criminal complaint against the appellants for the offence of bigamy.
The appellants filed an application for their discharge in view of the decree for dissolution of marriage passed by the Circuit Court, Missouri.
The Magistrate discharged the appellants by holding that the complainant wife had failed to make out a prima facie case against the appellants.
The respondent preferred a Criminal Revision Petition before the High Court which set aside the order of the Magistrate by holding (i) that a photostat copy of the judgment of Missouri Court was not admissible in evidence; (ii) since the Learned Magistrate acted on the photostat copy of the judgment, he was in error in discharging the accused.
Accordingly the High Court directed the Magistrate to dispose of the petition filed by the appellants for their discharge afresh in accordance with law.
Aggrieved by the decision of the High Court the appellants filed appeal in this Court.
Dismissing the appeal, this Court, HELD: 1.
The decree dissolving the marriage passed by the foreign court is without jurisdiction according to the as neither the marriage was celebrated nor the parties last resided together nor the respondent resided within the jurisdiction of that Court.
Further, irretrievable breakdown of marriage is not one of the grounds recognised by the Act of dissolution of marriage.
Hence, the decree of the divorce passed by the foreign court was on a ground unavailable under the Act which is applicable to the marriage.
Since with regard to the jurisdiction of the forum as well as the ground on which it is passed the foreign decree in the present case is not in accordance with the Act under which the parties were married, and the respondent had not submitted to the jurisdiction of the court or consented to its passing, it cannot be recognised by the courts in this country and is therefore, unenforceable.
[828H, 829A, 828E, 834H, 835A] 2.
Residence does not mean a temporary residence for the purpose of obtaining a divorce but habitual residence or residence which is intended to be permanent for future as well.
[829E] Smt.
Satya vs Teja Singh, , referred to.
The rules of Private International Law in this country are not codified and are scattered in different enactments such as the Civil Procedure Code, the Contract ACt, the Indian Succession Act, the Indian Divorce Act, the Special Marriage Act etc.
In addition, some 824 rules have also been evolved by judicial decisions.
In matters of status or legal capacity of natural persons, matrimonial disputes, custody of children, adoption, testamentary and intestate succession etc.
the problem in this country is complicated by the fact that there exist different personal laws and no uniform rule can be laid down for all citizens.
Today more than ever in the past, the need for definitive rules for recognition of foreign judgments in personal and family matters, and particularly in matrimonial disputes has surged to the surface.
A large number of foreign decrees in matrimonial matters is becoming the order of the day.
A time has, therefore, come to ensure certainty in the recognition of the foreign judgments in these matters.
The minimum rules of guidance for securing the certainty need not await legislative initiative.
This Court can accomplish the modest job within the frame work of the present statutory provisions if they are rationally interpreted and extended to achieve the purpose.
Though the proposed rules of guidance in this area may prove inadequate or miss some aspects which may not be present to us at this juncture, yet a begining has to be made as best as one can, the lacunae and the errors being left to be filled in and corrected by future judgments.
[829H, 830A, 831C, F H] 4.
The relevant provisions of Section 13 of the CPC are capable of being interpreted to secure the required certainty in the sphere of this branch of law in conformity with public policy, justice, equity and good conscience, and the rules so evolved will protect the sanctity of the institution of marriage and the unity of family which are the corner stones of our social life.
[832A] 4.1 On an analysis and interpretation of Section 13 of CPC the following rule can be deduced for recognising a foreign matrimonial judgment in this country.
The jurisdiction assumed by the foreign court as well as the grounds on which the relief is granted must be in accordance with the matrimonial law under which the parties are married.
The exceptions to this rule may be as follows; (i) where the matrimonial action is filed in the forum where the respondent is domiciled or habitually and permanently resides and the relief is granted on a ground available in the matrimonial law under which the parties are married; (ii) where the respondent voluntarily and effectively submits to the jurisdiction of the forum and contests the claim which is based on a ground available under the matrimonial law under which the parties are married; (iii) where the respondent consents to the grant of the relief although the jurisdiction of the forum is not in accordance with the provisions of the matrimonial law of the parties.
[834B D] 825 5.
The High Court erred in setting aside the order of the learned Magistrate only on the ground that the photostat copy of the decree was not admissible in evidence.
In the instant case photostat copies of the judicial record of the Court of St. Louis is certified for th Circuit Clerk by the Deputy clerk who is a public officer having the custody of the document within the meaning of Section 76 of the also in the manner required by the provisions of the said section.
Hence the photostat copy per se is not inadmissible in evidence.
It is inadmissible because it has not further been certified by the representative of our Central Government in the United States as required by Section 86 of the Act.
Therefore the document is not admissible in evidence for want of the certificate under Section 86 of the Act and not because it is a photostat copy of the original as held by the High Court.
[835B, E, F G] 6.
The Magistrate is directed to proceed with th matter pending before him according to law as expeditiously as possible, preferably within four months.
[835G]
|
Appeal No. 98 of 1965.
Appeal by Special Leave from the Judgment and Order dated the December 7, 1961 of the Madhya Pradesh High Court (Gwalior Bench) in Civil Misc.
Petition No. 77 of 1959.
A. K. Sen, B. D. Gupta, Rameshwar Nath and Mahinder Narain, for the appellant.
I. N. Shroff, for the respondent.
762 The Judgment of the Court was delivered by Shelat, J.
The appellant is the ex jagirdar of certain villages called Jagir Nevri Bhorasa.
It appears that while the jagir was in his possession he had constructed roads one of which is the road connecting Bhorasa with Dewas Astha Road.
The road about 1 1/2 miles in length was lined on both sides with mango trees.
In 1951 the Madhya Bharat Abolition of Jagirs Act, 28 of 1951 (hereinafter referred to as the Act) was passed for resumption of jagir lands in the State.
Under that Act, the right, title and interest of the appellant in his said jagir were extinguished and the jagir lands vested in the State.
In 1955, the Tehsildar put up the mangoes grown on the said trees for public auction.
By his application dated February 8, 1955 the appellant objected to the said auction claiming that the said trees were planted and reared by him, that they constituted a "grove" within the meaning of section 5(b)(iv) of the Act and therefore continued to belong to him.
The Tehsildar rejected the application.
The appellant 's appeal and thereafter a revision before the Board of Revenue were also likewise rejected.
The appellant then filed a writ petition in the High Court of Madhya Pradesh but that also was dismissed on the ground that the said trees could not be said to constitute a "grove".
The appellant has filed this appeal after obtaining special leave.
The only question arising in this appeal is whether the said trees standing on the two sides of the said road can be said to be a "grove" within the meaning of sec.
5(b)(iv).
The Act was passed for resumption of jagir lands in the State and to carry out certain land reforms in the jagir areas.
Section 3 provides for the date of resumption and sec.
4(1) lays down the consequences of resumption.
Under sub section (1) of that section, the right, title and interest of a jagirdar in his jagir lands including forests, trees, fisheries, tanks, wells, ponds, etc., stand resumed to the State as from the date of resumption.
The section also provides for resumption of the right, title and interest of the jagirdar in all buildings on jagir lands used for schools, hospitals and other public purposes.
Section 5, however, provides that notwithstanding anything contained in sec.
4 the jagirdar shall continue to remain in possession of land cultivated personally by him; of open enclosures used for agricultural or domestic purposes and in continuous possession for twelve years immediately before the date of resumption, all open house sites purchased for valuable consideration, all private buildings, places of worship, and wells situated in, and trees standing on lands included in the aforesaid enclosures and house sites and /or land appertaining of such buildings or places of worship within the limits of village sites.
Sub cl.
(iv) of sec.
5 (b) reads as under: "all groves wherever situate belonging to or held by the Jagirdar or any other person, shall continue to belong to or be held by such Jagirdar or other person, as the case 763 may be, and the land thereof with the areas appurtenant thereto shall be settled on him by the Government according to the provisions of the Madhya Bharat Revenue Administration and Ryotwari Land Revenue and Tenancy Act, Samvat 2007.
" Under cl.
(c) also the jagirdar is allowed to continue to remain in possession of all tanks, trees, wells and buildings in or on occupied land belonging to or held by the jagirdar or any other person.
These provisions show clearly that the legislature has used the word "trees" at three places in three different contexts, in secs.
4(a), 5(b) and 5(c) apart from the expression "all groves wherever situate" in sub cl.
(iv) of sec.
Whereas under sec.
4(a) the trees are to vest in the State Government along with the forests, fisheries etc.
, the trees mentioned in sec.
5(b)(iii) and (c) are allowed to continue to belong to and be held by the jagirdar.
Obviously, the word "trees" in these provisions has not been used in any uniform sense and therefore has to be construed in the context in which it is used.
For instance, the word 'trees ' in sec. 5(b)(iii) and (c) is placed in juxtaposition with other properties such as private buildings, places of worship, wells situated in lands included in the said enclosures and house sites referred to in sub cls.
(i) and (ii).
It appears that the policy of the legislature was that jagir lands including forests, trees in such forests, fisheries, wells, tanks, ponds, ferries, pathways, village sites etc., which were used by, the public and in which the members of the public were interested were resumed while the land in personal cultivation of the jagirdar, enclosures used for agricultural and domestic purposes, house sites purchased for valuable consideration, private buildings, places of worship, wells, trees standing on lands in such enclosures and house sites and tanks, trees, private wells and buildings in or on occupied land belonging to or held by the jagirdar were allowed to continue to belong to and be held by him.
It will be seen that groves in sub cl.
(iv) of sec.
(b) are included amongst properties allowed to continue to belong to and be held by the jagirdar.
Subclause (iv) also shows that such groves need not be of fruit trees nor need the trees thereof have been planted by the jagirdar.
The words "wherever situate" indicate that it is not necessary that they should be on lands or properties allowed to be retained by the jagirdar under section 5.
If a grove belonged to or was held by him, whether planted by him or of natural growth and wherever situate it is allowed to continue to belong to him and be held by him.
The intention of the legislature appears therefore to be that properties which the jagirdar was in personal use and possession of or in respect of which he had paid valuable consideration are to be retained by him.
It is in this context that we should construe subcl.
(iv) of sec.
A grove irrespective of where it is situate, but belonging to or held by the jagirdar is to continue to belong to or to be held by him.
To secure the full and proper use and, enjoyment of such a grove, if it is on land other than that which is 764 allowed to be retained by him, sub clause (iv) further provides that the land on which such a grove stands with the areas appurtenant thereto also shall be settled upon him in accordance with the M.B. Revenue Administration and Ryotwari Land Revenue and Tenancy Act, Samvat 2007.
What then is the meaning of the word "grove" within the meaning of sec. 5(b)(iv)9 Though the Act contains a definition section the legislature has not chosen to include therein any definition of a "grove".
It intended therefore that it should be understood in its ordinary dictionary sense.
In Webster 's New World Dictionary, p. 641, a grove has been defined as a small wood; groups of trees standing together without undergrowth.
The Shorter Oxford English Dictionary, Vol. 1, 838 also defines it as a small wood, a group of trees affording shade or forming avenues or walks.
In Corpus Juris Secundum, Vol.
98, p. 688 a grove is defined to mean a cluster of trees not sufficiently extensive to be called a wood; a group of trees of indefinite extent but not large enough to constitute a forest; especially such a group considered as furnishing shade for avenues and walks.
Though a grove in this sense may consist of a group of trees of indefinite extent it cannot be divorced from the idea of a homogeneous or at any rate.
a substantially homogeneous unit consisting of a cluster of trees close to each, other so as to serve as a shade to walks or avenues.
Apart from the meaning that the dictionaries offer the word "grove" has also been the subject matter of a number of decisions.
The case of Daropadi vs Mannu Lal(1) was, of course an extreme case of only 4 fruit trees in an area of 3 bighas and that too on the boundaries.
Ashworth J. could therefore easily discard the contention that the said trees formed a grove or that the land on which they stood was a grove land within the meaning of sec.
3 of the Agra Tenancy Act, 1926 which provided that so long as any considerable portion of a plot had a sufficient number of trees to prevent that plot from being cultivated, assuming the trees to have reached their full size, the entire plot would retain the character of grove but not otherwise.
It is true that when the learned Judge made, this observation he had in mind the definition of grove in section 3 of that Act, but he also observed that that was the sense in which a "grove" and "grove land" 'were ordinarily understood and that the definition did no more than to bring out the sense in which these terms were generally understood.
In Kashi vs Jagoo Bai(2) also, Bennet J. held that isolated trees cannot be said to constitute a grove.
But unlike these two cases, the land in Shiv Sahai vs Hari Nandan(3) had 13 mango trees fully grown, big in size and covering a major part of it.
It was held that the land was a grove land within the meaning of sec.
3(5) of the U. P. Tenancy Act, 1939, in spite of the fact that there was some cultivation on the land.
The Court there observed that the definition merely (1) A.I.R. 1929 All 557 (2) A.I.R. 1934 All 290.
(3) A.I.R. 1963 All 413.
765 required that the trees must be in sufficiently large number to preclude the land from being used primarily for a purpose other than as grove land.
In Hasan vs State of Bombay(1) the High Court was concerned with section 5(h) of the Madhya Pradesh Abolition of Proprietory Rights (Estates, Mahals, Alienated Lands) Act, 1 of 1951 which is in almost identical terms as section 5(b)(iv) of the present Act.
The Court interpreted the word "grove" to mean an area covered by a cluster of trees specially planted by human agency but not large enough to constitute a forest.
It would seem therefore that the word "grove" conveys com pactness or at any rate substantial compactness to be recognized as a unit by itself which must consist of a group of trees in sufficient number to preclude the land on which they stand from being primarily used for a purpose, such as cultivation, other than as a grove land.
The language of sec.
5(b)(iv) does not require however that the trees needs be fruit bearing trees nor does it require that they should have been planted by human labour or agency.
But they must be sufficient in number and so standing in a group as to give them the character of a grove and to retain that character the trees would or when fully grown preclude the land on which they stand from being primarily used for a purpose other than that of a grove land.
Cultivation of a patch here and a patch there would have no significance to deprive it of its character as a grove.
Therefore, trees standing in a file on the road sidle intended to furnish shade to the road would not fulfil the requirements of a grove even as understood in ordinary parlance.
Counsel, however, contended that although the trees in ques tion are situate on the road sides along the said road there may at some places be a group or groups of trees sufficiently large in number and closely standing together to preclude that particular area from being used for cultivation or for any other purpose.
In that case, be argued, there was nothing in subcl.
(iv) to prevent such a cluster of trees from being regarded as a grove.
We think there is some force in this argument which requires consideration.
Neither the revenue authorities nor the High Court approached the question from this point of view and no inquiry at any stage seems to have been made whether there are at any place or places such group or groups of trees to constitute a grove or groves.
All of them appear to have dismissed the appellant 's claim only because of the fact that the trees stand along the two sides of the road.
It is possible that the road might have been constructed in this particular area because of a number of trees standing on both sides of it which would provide shade over it and form an avenue.
In fairness to the appellant, we think it necessary that he should have an opportunity to establish that at some place or places along the said road there are trees sufficient in number and proximity to constitute a grove or groves.
(1) 766 The appeal is allowed, the judgment and order of the High Court are set aside and the case is remanded to the High Court to decide the writ petition in the light of the observations hereinabove made after calling a finding from the Board of Revenue on the question whether there are trees at any place or places along the said road sufficient in number and proximity to constitute a grove or groves.
The Board will give an opportunity to the parties to adduce on the aforesaid question such further evidence, as they may think necessary.
In the circumstances, there will be no order as to costs.
Y.P. Appeal allowed.
| After the resumption of the appellant 's Jagir lands in the State by the enactment of the Madhya Bharat Abolition of Jagirs Act, he claimed the mango trees, planted by him on both sides of a long road, as constituting a "grove" within the meaning of section 5(b)(iv) of the Act, and therefore continued to belong to him.
HELD: A grove irrespective of where it was situate, but belonging to or held by the jagirdar was to continue to belong to or to be held by him.
To secure the full and proper use and enjoyment of such a grove, if it was on land other than that which was allowed to be retained by him, sub clause (iv) of section 5(b) further provides that the land on which such a grove stood with the areas appurtenant thereto also shall be settled upon him in accordance with the M. B. Revenue Administration and Ryotwari Land Revenue and Tenancy Act Samvat 2007.
The intention of the legislature appeared to be that properties which the jagirdar was in personal use and possession of or in respect of which he had paid valuable consideration were to be retained by him.
[764 H; 765 A].
The language of sec.
5(b) (iv) does not require that the trees need be fruit bearing trees nor does it require that they should have been planted by human labour or agency.
But they must be sufficient in number and so standing in a group as to give them the character of a grove and to retain that character the trees would or when fully grown preclude the land on which they stand from being primarily used for a purpose other than that of a grove land.
Cultivation of a patch here and a patch there would have no significance to deprive it of its character as a grove.
Therefore, trees standing in a file on the road side intended to furnish shade to the road would not fulfil the requirements of a grove even as understood in ordinary parlance.
[766 C E].
Daropadi vs Mannu Lal, A.I.R. 1929 All. 557.
Kashi vs Jagoo Bai.
A.I.R, 1934 All.
290, Shiv Sahai vs Hari Nandan, A.I.R 1963 All. 413, Hasan vs State of Bombay, , referred to.
|
ition (Crl.) No. 648 of 1987 etc.
(Under Article 32 of the Constitution of India) D.S. Tewatia, Mukul Mudgal, Rakesh Khanna, P.K. Jain, R.P. Singh, C.V.S. Rao, Prem Malhotra, S.K. Sabharwal, Mahabir Singh, Mrs. Urmila Kapoor and N. Sudhakaran for the appearing parties.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
These are a batch of writ petitions under Article 32 of the Constitution raising the common claim of entitlement to the benefit of Section 5 of the Punjab Borstal Act, 1926.
In each of these writ petitions, the petitioner has been convicted for the offence punishable under Section 302 of the Indian Penal Code and has been sentenced to life imprisonment.
The State of Haryana has challenged the claim of the petitioner in each of these writ petitions.
Learned counsel for the petitioners has relied upon the decision of this Court in Hava Singh vs State of Haryana & Anr., [1987] 4 SCC 207 in support of the claim advanced in the writ petitions.
A two Judge Bench of this Court in that case referred to Section 5 of the Act and E held: "On a conspectus of the aforesaid decision as well as on a consideration of the facts and circumstances the only conclusion follows that the petitioner who has already undergone actual imprisonment for seven years is entitled to be released from detention and from imprisonment.
Paragraph 516 B of the Punjab Jail Manual is not applicable in this case as the petitioner who was an adolescent convict below twenty one years of age was sent to the Borstal Institute at Hissar for detention in accordance with the provisions of Section 5 of the Punjab Borstal Act, 1926.
He being convicted by the Sessions Judge the maximum period of detention as prescribed by the Act is seven years.
We have already said hereinbefore that such an inmate of the Borstal Institute cannot be transferred to jail on the ground that he has attained the age of twenty one years as the said Act does not provide for the same.
The only provision for transfer to jail is in the case of incorrigible inmate or inmates convicted of major Borstal Institution offence.
" PG NO 143 Reliance was also placed by learned counsel for the petitioners on another two Judge Bench decision of this Court in the case of State of Andhra Pradesh vs Vallabhapuram Ravi; , That was a case under the Andhra Pradesh Borstal Schools Act, 1925 (5 of 1926) and the question for consideration was the same as here with reference to the provision of Section 8 of that Act.
The two Judge Bench held that the provisions of the Borstal Schools Act applied to the offence punishable under Section 302 of the Indian Penal Code.
Both these cases were referred to in Subhash Chand vs State of Haryana & Ors., ; by a three Judge Bench.
It referred to Hava Singh 's case (supra) at length.
The three Judge Bench in its judgment referred to the definition of 'offence ' under Section 2(4) of the Punjab Borstal Act which defined 'offence ' to mean "an offence punishable with transportation or rigorous imprisonment under the Indian Penal Code other than (a) an offence punishable with death;" The Court found that Section 302 of the Indian Penal Code provides: "whoever commits murder shall be punished with death, or imprisonment for life, and shall also be liable to fine" and proceeded to say again "one of the punishments for the offence of murder to death and, therefore, the offence of murder would be covered within Section 2(4)(i)(a) of the Punjab Act and to such a conviction the Punjab Borstal Act would have no application.
Support for such a view is available from several decisions of different High Courts".
The Court ultimately held: "In Hava Singh 's case the definition was not placed for consideration before the Court and, therefore, the conclusion which has been reached is not correct.
The Punjab Borstal Act does not have application to an offence punishable under Section 302 of IPC".
This being a decision of a larger Bench we are bound by it.
PG NO 144 In the Webster '6 Third New International Dictionary the follow ing meaning has been given to the word 'punishable ' "Deserving of, or liable to, punishment: capable of being punished by law or right".
Aiyar 's the Law Lexicon (Reprint Edition 1987) gives the meaning of 'punishable ' thus: "The word 'punishable ' as used in statutes which declare that certain offences are punishable in a certain way, means liable to be punished in the way designated.
" In Bouvier 's Law Dictionary, the meaning of the word 'punishable ' has been given as 'liable to punishment '.
In 'Words and Phrases Permanent Edition ', the following meaning has been given: "The word 'punishable ' in a statute stating that a crime is punishable by a designated penalty or term of years in the state prison limits the penalty or term of years to the amount or term of years stated in the statute.
" The word 'punishable ' is ordinarily defined as deserving of or capable or liable to Punishment, punishable within statute providing that defendant may have ten peremptory challenges if offence charged is 'punishable ' with death or by life imprisonment; means deserving of or liable to punishment; capable of being punished by law or right, may be punished, or liable to be punished, and not must be punished. 'Corpus Juris Secundum gives the meaning as: 'Deserving of, or liable to, punishment; capable of being punished by law or right; said of persons of offences.
The meaning of the term is not 'must be punished ', but 'may be punished ', or 'liable to be punished '.
In the absence of a definition of 'punishable ' we have referred to these for gathering the exact meaning of the word.
In the sense given to the word, as above, there can be no doubt that the offence of murder is punishable with death even though the punishment awarded is not death but imprisonment for life.
PG NO 145 An earlier decision of this Court in Kunwar Bahadur & Ors.
vs State of Uttar Pradesh, [1980] Supp.
SCC 339, where a two Judge Bench dealt with the provisions of the United Provinces Borstal Act 7 of 1938 was also relied upon.
The judgment is a short one.
Detailed reference to the provisions of the United Provinces Act has not been made but Section 7 of the Act was referred to and it was observed: "Under this Section where a prisoner is sentenced for transportation i.e. life imprisonment and is below the age of 21 years he should be sent to Borstal School where he cannot be detained for more than five years, The law thus contemplates that for such an offender the sentence of five years will be equivalent even to a higher sentence of life prisonment".
Obviously in the United Provinces Act, there is no definition of 'offence ' as available in the Punjab Act.
Therefore, the decision in Kunwar Bahadur 's case (supra) is not really material for our purpose. 'Punishable ' carries a meaning 'liable to be punished ' as indicated by the three Judge Bench.
Since the offence under Section 302 is punishable with death, the provisions of the Punjab Borstal Act would not cover an offence under Section 302 of IPC and the benefit would not therefore, be available to an accused convicted for the offence under Section 302 IPC.
During the hearing of the matters learned counsel for the petitioners had maintained that the provisions of the Punjab Act should be suitably amended to bring about uniformity in the law on the subject.
This is a matter for the State and the Legislature and it is for them to consider whether the provision should be suitably amended keeping the modern concept of punishment and treatment of adolescents in view.
Each of the writ petitions is dismissed.
There would be no order for costs P.S.S. Petitions dismissed .
| The husband of respondent No. l sought eviction of the appellants tenants.
The suit was decreed in his favour along with money decree for arrears of rent and damages.
During the pendency of the appeal the plaintiff died and his legal representatives were substituted as respondents.
Some of his children who were minor were placed under the guardianship of respondent No. 1.
Consequent to a petition by the parties a compromise decree was passed setting aside the entire decree.
The respondents thereafter challenged the compromise decree.
The trial court dismissed the suit.
On appeal the first appellate court reversed the decision.
The High Court dismissed the appeal, preferred by the appellants.
In this appeal by special leave it was contended for the appellants that as a consideration for the compromise they were giving up their right to claim costs which might have been decreed by the appellate court in case of their success on merits.
The respondents ' case was that the guardian of the minors was guilty of gross negligence in entering into the compromise by failing to take into consideration the interest of the minors.
Dismissing the appeal, HELD: The decision of the courts below does not call for any interference.
The compromise decree is fit to be set aside on the ground of gross negligence.
[199F; 199Cl The compromise was one sided whereby the minors were giving up their right under the trial court 's decree both in respect of eviction as well as arrears of rent and damages.
In view of the provisions of Order XXXII, Rule 7 of the Code of Civil Procedure it was essential for the Court to have PG NO 196 PG NO 197 granted permission to the guardian to enter into the compromise only after considering all the relevant circumstances.
[198F; 198C D] The earlier civil appeal is restored to its file before the Additional District Judge for disposal in accordance with law.
[l99G]
|
No. 58 of 1983.
(Under Article 32 of the Constitution of India) R.K. Garg and D.K. Garg for the Petitioner.
V.C. Mahajan and L.K. Gupta for the Respondents.
RANGANATH MISRA, J.
In this application under article 32 of the Constitution, petitioner assails the order dated 5th September, 1975, of his compulsory retirement from service with effect from 5th of December, 1975, made under rule 56(j)(i) of the Fundamental Rules.
The impugned order ran thus: "WHEREAS the Director of Audit, Defence Services, New Delhi (appropriate authority) is of the opinion that it is in the public interest to do so, NOW, THEREFORE, in exercise of the powers con ferred by clause (j)(i) of rule 56 of the Fundamental Rules, the Director of Defence Services (appropriate authority) hereby gives notice to Shri C.D. Ailawadi, Audit Officer, Defence Services that he, having already attained the age of 50 years on the 22nd November, 1969, shall retire from service with effect from the forenoon of the 4th of Decem ber, 1975, or from the date of expiry of three months com puted from the date of the service of this notice on him, whichever is later." The petitioner has pleaded that he was efficient and had risen 785 from the rank of a Clerk to the post of Audit Officer in which he was confirmed with effect from 3.12.
Accord ing to him, he had clear and unblemished record of service.
He had held independent charge of the senior post of Deputy Director of Audit and had been paid an additional amount of Rs. 100 per month for the period.
He also alleged that his character roll entries were excellent.
According to him, it was the obligation of the appropriate authority to review the petitioner 's case six months before he attained the age of 50 or completed thirty years of service.
Since no such review had been made or on the basis of review petitioner had not been retired, he was entitled to continue upto the age of 58, which is the normal age of retirement.
According to him, all cases of premature compulsory retirement made during the emergency were reviewed in terms of the Govern ment circular of lOth of August, 1978, but the representa tions made by the petitioner for the benefit of review in terms of the said circular were not heeded to and the peti tioner was, therefore, obliged to file the present petition.
In the return to the rule nisi by the Director of Audit, Defence Services, it has been contended that the order of retirement was made in public interest after review of the petitioner 's case.
It has been stated in the said affidavit: "In the case of Shri Ailawadi the Committee after review of his complete record of service observed that his earlier services were of a very marginal nature and he earned some adverse reports later.
The Committee, therefore, considering the quality of his work on the whole, concluded that Shri Ailawadi was not fit to be retained in the public interest.
The Appropriate Authority felt that his reports for the last few years were poor, colourless and indicative of steady deterioration attributed to family problems and to his state of health.
The Appropriate Authority also took into account his latest report for the year 1974 75 which assessed him as 'barely competent to hold an officer 's post '.
" The character roll entries have also been placed before the Court at the time of heating of this writ petition.
We have checked the same and in particular those for five years prior to the date of the impugned order.
In 1969 70, his ability was considered to be average.
His thought and ex pression were said to be vague and rambling.
Deterioration of his physical health was taken note of and the general assessment was that he was an average officer.
In the fol lowing year the reviewing 786 authority after treating him to be an average officer en dorsed the following direction: "I am inclined to think that the entire report may be commu nicated to him and he must be told so to exert himself that he earns a more commendable report next year. ' ' This appears to have been shown to him and his signature had been taken on 3.8.1971.
During the years 1972 73, 1973 74 and 1974 75, he was branded as an average officer.
In the last year it was indicated that his intelligence was of low order and though he was physically fit, he was not mentally alert.
It was also indicated that he was barely competent to hold an officer 's post.
In the report for a part of 1974 75 he was branded as poor and against the column of 'general assess ment ', it was shown that 'he was not sure of himself.
We have extracted entries from the character roll to meet the petitioner 's contention that he had an excellent record of service.
Mr. D.K. Garg, appearing for the petitioner has supple mented the arguments by a written note which has also been looked into.
Petitioner does not challenge the validity of the rule; nor does he allege that the order of compulsory retirement is the outcome of mala fides.
An aggrieved civil servant can challenge an order of compulsory retirement on any of the following grounds as settled by several decisions of this Court: (i) that the requisite opinion has not been formed; or (ii) that the decision is based on collateral grounds; or (iii) that it is an arbitrary decision.
In Union of India vs Col. J.N. Sinha & Anr., [1971] 1 SCR 791 this Court held that if the civil servant is able to establish that the order of compulsory retirement suffered from any of the above infirmities, the Court has jurisdiction to quash the same.
It is not disputed that compulsory retirement under rule 56(j) is not a punish ment as it does not take away any of the past benefits.
Chopping off the dead wood is one of the important consider ations for invoking rule 56(j) of the Fundamental Rules.
1n the instant case, on the basis of the service record, the Committee formed the requisite opinion that the petitioner had ceased to be useful and, therefore, should be retired prematurely.
We do not think petitioner has been able to place 787 any satisfactory material for the contention that the deci sion was on collateral grounds.
Once the opinion is reached on the basis of materials on record, the order cannot be treated to be arbitrary.
The service record of more than five years which we have perused shows that the higher officers under whom the petitioner had worked were different and different sets of reviewing officers had also made the entries.
Therefore, the reports must be taken to have re flected a appropriate and objective assessment of the per formance of the petitioner.
The writ petition must accordingly fail and is, there fore, dismissed.
There shall be no order as to costs.
N.P.V. Petition dismissed.
| The respondent, a constable, convicted under section 10(n) of the but released on probation under section 4 of the , was dismissed from service.
He chal lenged his dismissal before the High Court which ordered his reinstatement holding that there was no disqualification for him to continue in service, for section 12 of the has the effect of removing the dis qualification attaching to his conviction.
Hence this appeal by the Union of India.
Allowing the appeal and setting aside the order of the High Court, this Court.
HELD: 1.
Section 12 of the only directs that the offender 'shall not suffer dis qualification, if any, attaching to a conviction of an offence under such law '.
Such law in the context is the other law providing for disqualification on account of conviction e.g. if a law provides for disqualification of a person for being appointed in any office or for seeking election to any authority or body in view of his conviction, that disqualification by virtue of section 12 stands re moved.
But that is not the same thing to state that the person who has been dismissed from service in view of his conviction is entitled to reinstatement upon getting the benefit of probation of good conduct.
Section 12 does not preclude the department from taking action for misconduct leading to the offence or to his conviction theron 761 as per law.
It was not intended to exonerate the person from departmental punishment.
[766B C; 765E] R. Kumaraswami Aiyer vs The Commissioner, Municipal Council Tiruvannarnalai and Anr., ; Embaru (P) vs Chairman Madras Port Trust, Mad; A. Satyanarayana Murthy vs Zonal Manager L.I.C., AIR 1969 A.P. 371; Prern Kumar vs Union of India & Ors., [1971] Lab.
& Ind. Cases 823; Om Prakash vs The Director Postal Services & Ors., and Director of Postal Services & Anr.
vs Daya Nand, , approved.
The Divl.
Personnel Officer Southern Railway & Anr.
T.R. Challappan, , followed.
In criminal trial the conviction is one thing and sentence is another.
The departmental punishment for miscon duct is yet a third one.
The Court while invoking the provi sions of section 3 or 4 of the Act does not deal with the conviction; it only deals with the sentence which the of fender has to undergo.
Instead of sentencing the offender, the Court releases him on probation of good conduct.
The conviction, however, remains untouched and the stigma of conviction is not obliterated.
In the departmental proceed ings the delinquent could be dismissed or removed or reduced in rank on the ground of conduct which has led to his con viction on a criminal charge.
Therefore the question of respondent 's restatement into service does not arise.
Howev er, the penalty of dismissal from service is altered into removal from service.
[765C D, F; 766E] Tulsi Ram Patel vs Union of India, [1985] Suppl.
2 SCR 131 and Trikha Ram vs
V.K. Seth & Anr., , followed.
|
Appeal No. 507 of 1960.
Appeal from the judgment and decree dated March 19, 1958, of the ' Punjab High Court (Circuit Bench) at Delhi in R. F. A. No. 299 of 1951.
K. L. Gosain, R. Ganapathy Iyer and G. GopalaKrishnan, for the appellant.
B. Sen and P. D. Menon, for the. respondent.
March 27.
The Judgment of the Court was delivered by WANCHOO, J.
This appeal on a certificate granted by the Punjab High Court raises a question as to the interpretation of article 31 of the Limitation Act.
The appellant had brought a suit in forma pauperis for recovery of a sum of over Rs. 24,000/from the Union of India in connection with non delivery of certain goods booker with the railway.
The appellant was trading in Crujranwala, which is now in Pakistan, under the name and style of G. M. Bootamal and Company and also under the name and style of Gopal Metal Rollin(, Mills and Company he being the sole proprietor of both.
On August 5, 1947, just before the partition the appellant handed over two consignments to the North Western 72 Railway at Gujranwala for carriage to Jagadhari and these consignments were booked on the same day by two railway receipts.
The consignments however did not reach Jagadhari.
The appellant made inquiries and when no delivery was made he made a claim on the railway on November 30, 1947, for the price of the goods not delivered.
Later, on January 22, 1948, the appellant gave notice to the railway under section 80 of the Code of Civil Procedure in which it was said that the goods booked under the two railway receipts had not been delivered in spite of repeated reminders and demands from the officials concerned.
It was further said that the value of the goods booked was Rs. 24,189/4/ and that the railway was liable for this loss which was due to the negligence of the railway.
It was further stated that the cause of action arose on August 21 and 30, 1947 and on subsequent dates when the appellant met with refusal.
It was finally said that if the amount was not paid a suit would be brought against the railway.
It seems however that in spite this notice correspondence went on between the appellant and the railway and on December 1, 1948, the railway informed the appellant that the two consignments were still lying at Gujranwala and that their despatch had been withheld by the North Western Railway due to restrictions imposed by the Pakistan Government on export.
The railway therefore requested the appellant to secure a permit from the Chief Controller , Exports and Imports, Karachi and also from the Custodian of Evacues Property West Punjab and to send the same to the Station Master Gujranwala to enable the goods being sent to Jagadhari.
The appellant was also told that in case he failed to produce the requisite permits the consignments would be disposed of in accordance with the law in force in Pakistan, and the railway administration would not be responsible for any loss, damage or destruction to the goods.
This seems to have been the end of the correspon 73 dence between the railway and the appellant, and the appellant brought the present suit on December 13, 1949.
The suit was resisted by the Union of India and a number of defenses were raised with which we are however not concerned in the present appeal.
As many as.
seven issues 'Were framed by the trial court, the most important being of limitation.
The trial court found in favour of the appellant on all the issues including limitation and gave him a decree for Rs. 24,189/4/ .
It however ordered the parties to bear their own costs.
Thereupon there was an appeal by the respondent to the High Court, and the main point pressed there was that the suit as filed on December 13, 1949, was barred by limitation.
Under article 31 of the Limitation Act time begins to run against a carrier for compensation for non delivery of or delay in delivering goods from the time "when the goods ought to be delivered".
The question canvassed in the High Court was the interpretation of these words in article 31.
It appears that there had been difference of opinion in the High Court as to the meaning.to be attached to these words in Art 31 and a reference had been made to a Full Bench in another case, namely, Dominion of India vs Firm Aminchand Bholanath (C.A. 97 of 1949, decided on May 2, 1956).
In that reference the Full Bench held that "the limitation tinder article 31 starts on the expiry of the time fixed between the parties and in the ' absence of such agreement, the limitation starts on the expiry of reasonable time which is to be decided according to the circumstances of each case.
" The High Court therefore followed the view taken in that case and held after taking into account the circumstances prevailing in August 1947 that the goods ought to have been delivered at the most within five or six months of the booking and therefore the suit was 'barred by limitation as it was brought in December 1949, the period of limitation being only one year.
The High Court therefore allowed the appeal, set aside the decree of the trial court and dismissed the suit.
It however ordered the parties to bear their costs.
As the case involved a substantial question of law the High Court granted a certificate to the appellant; and that is how the matter has come up before us.
Article 31 reads as follows ____________________________________________________________ Description of suit Period of Time from limitation which period beings to run.
____________________________________________________________ x x x x x x x x x 31 Against a carrier One year When the goods for compensation for ought to be delivered.
non delivery of, or delay in delivering goods.
Its interpretation has been the subject of a number of decisions by various High Courts in India and the question that has been considered in these decisions is as to the time from which the period begins to run.
Under the Article, the time begins .to run ,when the goods ought to be delivered" and one should have thought that there would be no difficulty in finding out the meaning of these words.
Ordinarily, the words of a statute have to be given their strict grammatical meaning and equitable considerations are out of place, particularly in provisions of law limiting the period of limitation for filing suits or legal proceedings. ' This was laid down by the Privy Council in two decisions in 75 Nagendranath vs Suresh(1)and General Accident Fire and Life Assurance Corporation Limited vs Janmahomed Abdul Rahim (2).
In the first case the Privy Council observed that "the fixation of periods of limitation must always be to some extent arbitrary and may frequently result in hardship. ' But in construing such provisions equitable considerations are out of place, and the strict grammatical meaning of the words is the only safe guide".
In the latter case it was observed that "a limitation Act ought to receive such a construction as the language in its plain meaning imports. .
Great hardship may occasionally be caused by statutes of limitation in cases of poverty, distress and ignorance of rights, yet the statutory rules must be enforced according to their ordinary meaning in these and in other like cases.
" Two lines of reasoning seem to have governed the decisions of various High Courts on the interpretation of these words in the third column of article 31.
The first is based on the consideration that it was for the railway to prove what time ought to 'be taken for the delivery of the goods and therefore limitation can only start when the railway says finally that it cannot deliver the goods.
The second line of reasoning seems to be based on the principle of estoppel and is to the effect that where the railway enters into correspondence and says that efforts are being made to trace the goods the railway would be estopped from pleading that the time began to run from sometime anterior to the period before the correspondence on the question came to an end.
It may however be noted that though the majority of the decisions follow these two lines of reasoning and hold that time begins to run only when the railway finally refuses to deliver the goods, here and there a dissentient note has also been struck.
We shall consider some of these cases later.
(1) A.I.R. (1932) P.C. 165.
(2) 76 Let us first see what these words in article 31 mean on a plain grammatical construction.
It would be noticed that article 31 as it now stands after the Limitation Act of 1877 and 1909, governs two class of cases, namely, (i) where there has been no delivery of goods and (ii) where there has been delay in delivering goods.
In both class of cases the time begins to run from the date when the goods ought to be delivered.
These words therefore in column three of the Article must have a meaning which will apply equally to the two situations envisaged in column one.
Whether there has been nondelivery or there has been delay in delivery, in either case limitation would run from the date when the goods ought to be delivered.
Now it is not in dispute that if there is a term in a contract of carriage fixing when the goods have to be delivered that would be the time "when the goods ought to be delivered" within the meaning of the words used in the third column of article 31.
The difficulty however ' arises in that class of cases where there is no term in the contract of carriage, whether express or im.
plied, from which the date on which the goods have to be delivered, can be inferred.
It is in these cases that the question of interpretation of the words in the third column of article 31 seriously arises.
But these words can only mean one thing whether it is a case of late delivery or of nondelivery.
Reading the words in their plain grammatical meaning they are in our opinion capable of only one interpretation, namely, that they contemplate that the time would begin to run after a reasonable period has elapsed on the expiry of which the delivery ought to have been made.
The words "when the goods ought to be delivered" can only mean the reasona ble time taken (in the absence of any term in the contract from which the time can be inferred expressly or impliedly) in the carriage of the goods from the place of despatch to the place of destination.
Take the case, where the cause of action is 77 based on delay in delivering the goods.
In such a case the goods have been delivered and the claim is based on the delay caused in the delivery.
Obviously the question of delay can only be decided on the basis of what would be the reasonable time for the carriage of goods from the place of despatch to the place of destination.
Any time taken over and above that would be a case of delay.
Therefore, when we consider the interpretation of these words in the third column with respect to the case of non.
delivery, they must mean the same thing, namely, the reasonable time taken for the carriage of goods from the place of despatch to the place of destination.
The view therefore taken by some of the High Courts that the time begins from the date when the railway finally refuses to deliver cannot ,be correct, for the words in the third column of article 31 are incapable of being interpreted as meaning the final refusal of the carrier to deliver.
We may in this connection compare the language used in the third column of article 31 with certain other articles of the Limitation Act which will show that.
where the legislature intended that time should run from the date of refusal it has used appropriate words in that connection.
For example, in article 18, which provides for a suit for compensation against Government when the acquisition is not completed, the time begins to run from "the date of the refusal to complete".
Similarly, in article 78 which provides for a suit by the payee against the drawer of a bill of exchange which has been dishonoured by non acceptance, time begins to run from "the date of the refusal to accept".
Again in article 131 which provides for a suit to establish a periodically recurring right, ' the limitation begins to run "when the plaintiff is first refused the enjoyment of the righe '.
Therefore, if the legislature intended that in case of non delivery, the limitation would start on the final refusal of the carrier to deliver, such a case would have been provided for by a separate article and we 78 would have found appropriate words in the third column thereof.
The very fact that article 31 deals with both cases of non delivery of goods and delay in delivering the goods shows that in either case the starting point of limitation is after reasonable time has elapsed for the carriage of goods from the place of despatch to the place of destination.
The fact that what is reasonable time must depend upon the circumstances of each case and the further fact that the carrier may have to show eventually what is the reasonable time for carriage of goods would .in our opinion make no difference to the interpretation of the words used in the third column of article 31.
Nor do we think that their could be generally speaking any question of estoppel in the matter of the starting point of limitation because of any correspondence carried on between the carrier and the person whose goods are carried.
But, undoubtedly, if the correspondence discloses anything which may amount to an acknowledgement of liability of the carrier that will give a fresh starting.
point of limitation.
A we have said already, the words in 'the third column refer to reasonable time taken for the carriage of goods from the place of despatch to the place of destination and this reasonable time generally speaking cannot be Affected by the subsequent conduct of the parties.
We are therefore of opinion that the answer given by the Full Bench in the case of Aminchand Bholanath (supra) that "the limitation in such cases starts on the expiry of the time fixed between the parties and in the absence of any such agreement the limitation starts of the expiry of reasonable time which is to be decide according to the circumstances of each case," is correct.
We shall now consider some of the representative cases decided by High Courts in this connection.
In Jugal Kishore vs The Great Indian Peninsala Railway(1) it was observed that "when the X.I. Railway Company, by its own conduct made the (1) All 43.
79 plaintiff await the result of the inquiry, it is rather ,startling to find the plea of limitation raised in defence on its behalf".
It was further observed that "the correspondence between the parties shows that the matter was being inquired into and that there was no refusal to deliver, up to well within a year of the suit ; in the circumstances of the case we are unable to hold that the suit was instituted more than a year from the expiry of a reasonable, time within which the goods should have been delivered.
" This decision seems to suggest that the meaning of the relevant words in the third column is that limitation starts from the expiry of the reason.
able time within which the goods should have been delivered.
But it has taken into account the subsequent conduct of the railway and the fact that there was no refusal to deliver the goods till much later.
It was therefore held that as the suit was brought within one year of the final refusal to deliver, it was within time.
With respect, it is rather difficult to understand how the subsequent correspondence between the railway and the consignor or the consignee can make any difference to the starting point of limitation, when that correspondence only showed that the railway was trying to trace the goods.
The period that might be taken in tracing the goods can have no relevance in determining the reasonable time that is required for the carriage of the goods from the place of despatch to the place of destination.
In Bengal and North Western Railway Company vs Maharajadhiraj Ramhwar Singh Bahadur(1) it was held that "the defendants (i.e. Railway) by a deliberate process of ignoring the plantiff"s repeated requests for attention to his claim misled him into delaying his suit and it is not open to them (1) Pat. 67, 77. 80 now to contend that the suit has been brought too late.
" This case seems to be based on estoppel.
But here again we find it difficult to understand how the starting point of limitation under.
article
31 could be changed because the railway ignored the plaintiff 's requests for attention to his claim.
In Jai Narain vs The Governor General of India (1) it was held that ""the time 'when the goods ought to be delivered ' within the meaning of article 31 is not the time when they should have been delivered in the normal course, it least in a case where there is no time fixed for delivery, but the time when they ought to be delivered according to the sub sequent promises by the railway which informs the parties that it is carrying on enquiries.
" With respect we, find it difficult to find bow in the face of the clear words in the third column of article 31 the starting point of limitation can be changed because of the subsequent conduct of the railway, which informed.
the consignor or consignee that ' it was making enquiries to trace the goods.
Finally in, Governor General in Council vs section Ahmed(2).
it was held that "cannot be overlooked that for some time the railway authorities themselves were hoping to deliver the remaining packages and were making inquiries all along the route.
In such cases it is not fair to expect the plaintiff to rush to Court with a suit without waiting for the result, of the inquiries.
Limitation can therefore begin only when there was a definite statement by the railway authorities that they were not in a position to deliver the goods".
With respect, this case seems to read in the third column as if the starting point of limitation is from the final refusal of the railway to deliver the goods, when the actual words may that limitation starts from the time when the goods ought to be delivered i.e. in the absence of any term fixing the time in the contract from (1) A.I.R. (1951) Cal.
(2) A.I.R (1952) Nag.
81 the expiry of the reasonable time taken for carriage from the place of despatch to the place of destination.
It was however urged for the appellant that even though the words in the third column plainly mean that the time starts when the reasonable period which may be taken for the carriage of the goods from the place of despatch to the place of destination expires, the subsequent conduct of the railway a,% disclosed in the correspondence that might pass between the railway and the consignor or the consignee, might have a bearing on this reasonable time.
Now if the correspondence is only about tracing the goods that would not be material in considering the question as to when the goods ought to have been delivered.
On the other hand if the correspondence discloses material which might throw light on the question of determining the reasonable time for the carriage of the goods from the place of despatch to the place of destination, then it may be open to the court to take into account the correspondence.
Further, if there is anything in the correspondence which has a bearing on the question of reasonable time and the railway wants to go back on that, to that extent the railway may be estopped from denying that.
But the correspondence can only be taken into account to determine what would be the reasonable time and not to show that because of the subsequent conduct of the railway the reasonable time got extended by the time taken by the railway in tracing the goods.
Where however the correspondence provides material from which reasonable time in a particular case may ' be found out the .correspondence would be relevant to that extent.
For example, take a case where the correspondence ,shows that a certain bridge between the place of despatch and the place of destination ' has been ' destroyed on account of floods and that is the reason why the goods have not reached 82 the place of destination.
In such a case the correspondence may well be taken into account to find out the reasonable time for the carriage of the goods in the circumstances.
This will show that reasonable time will depend upon the facts of each case and that in the absence of any special circumstances the reasonable time would practically be.
the same between two stations as would normally or usually or ordinarily be taken for the carriage of goods from the one station to the other.
Further there may be no difficulty in finding out the reasonable time where bulk of the goods have been delivered and only a part has not been delivered, for in such a case in the absence of special circumstances it should be easy to see that the reasonable time is that within which the bulk of the goods have been delivered.
We may in this connection refer to Union of India vs Meghraj Agarwalla (1) and Gajanand Rajgoria vs Union of India (2) where it has been held that where a part of the consignment has been delivered, that should, in spite of the correspondence regarding inquiries and in the absence of circumstances leading to the contrary view, be taken to be the date when the goods ought to have been delivered as a whole within the meaning of those words in article 31.
The view taken therefore by the High Court in Aminchand Bholanath 's case as to the interpretation of the words in the third column of article 31 is in our opinion correct.
Let us therefore see what was the reasonable time within which the goods ought to.
have reached Jagadhari from Gujranwala in the present case.
The appellant himself in his replication stated that the goods in ordinary course should have reached Jagadhari before August 15, 1947.
Further in their notice that he gave on January 22, 1948, he stated that the cause of action arose on August 21 and 30, 1947, and on subsequent dates when he met with (1) A.I.R. (1958) Cal.
(2) A.I.R. (1955) Pat 182.
83 refusal to deliver the goods.
The fact that the appellant gave notice under section 80 of the Code of Civil Procedure in January 1948 in our opinion shows that even taking into account the extra ordinary conditions prevailing on account of the partition of India in August 1947, the appellant was satisfy that the goods ought to have been delivered before January 22, 1948 when he gave the notice.
If that was not so and if the cause of action had not arisen, there was no reason why the appellant should have given the notice under a. 80 in January 1948.
We can see no difficulty therefore on the facts of this case 'in agreeing with the High Court that the goods 'ought to have been delivered even taking into account the extraordinary circumstances prevailing on account of partition within five or six months of the date on which they were sent, namely, August 5, 1947.
This is also home out by the fact that the appellant gave notice on January 22, 1948 i.e. about 5 1/2 months after the goods had been consigned.
In the circumstances the suit which was brought in December 1949 would be clearly barred by time, for we cannot take the reasonable time within which the goods ought to have been delivered in the circumstances of this case beyond January 22, 1948, when the notice under section 80 was given.
As to the correspondence between the parties it in enough to say that there is nothing in the correspondence which has any bearing on the reasonable time taken for the carriage of goods from Gujranwala to Jagadhari.
It is true that on December 1, 1948, the appellant was informed by the Railway that the goods were still lying in Gujranwala because of the restrictions imposed by the Pakistan Government and he was asked to get the necessary permits from that Government ; but that in our opinion has nothing to do with the question of reasonable time to be taken for the carriage of goods from Gujran wala to Jagadhari.
In the circumstances, the High Court was right in holding that the suit was barred by limitation under article 31.
84 Learned.
counsel for the appellant however drew our attention to the Displaced Persons (Institution of Suits) Act(No.
XLVII of 1948) as amended by the Displaced Persons (Institution of suits and legal proceedings) amendment Act, (No. LXVIII of 1950) and contended that the appellant being a displaced person would be entitled to file this suit under section 8 of this Act as amended upto March 31, 1952.
It appears that in part 9 of the plaint, the appellant relied on his being a displaced person in order to give jurisdiction to the court in Delhi where he filed the suit.
But he does not seem to have relied on his being a displaced person on the question of limitation.
The respondent in the written statement denied that the appellant was a displaced person and nothing further happened with respect to this aspect of the matter.
Learned counsel for the appellant urges that in fact the appellant is a displaced person and would be entitled to the benefit of the Act of 1948 as amended by the Act of 1950 and on that basis his suit would be within time and that the suit might be remanded to allow the appellant to bring his case under the Act of 1948 as amended.
Ordinarily we would not have allowed such a prayer when the point was not raised in the plaint ; but considering that the appellant claims to be a displaced person who is registered in Delhi and also considering that he had to file this suit in forma pauperis probably on account of the circumstances arising from the partition of India, we think that the appellant should be given a chance to prove his case under the Act of 1948 as amended by the Act of 1950.
We express no opinion on the question whether the appellant is a displaced person or whether he is entitled to the benefit of the Act of 1948 as amended by the Act of 1950.
But we think in the interest of justice he should be given a chance to bring his case under the Act of 1948 as amended, by the Act of 1950 in the matter of limitation subject to his 85 paying all the costs incurred by the respondent upto date irrespective of the result of the suit.
We therefore allow the appeal and remand the case to the trial court for considering only the question of limitation on the basis of the Displaced Persons (Institution of Suits) Act, (No. XLVII of 1948) as amended by the Displaced Persons (Institution of suits and legal proceedings) Amendment Act ( No. LXVIII of 1950) after giving parties a chance to lead evidence in this connection, if necessary.
If the court comes to the conclusion that the suit is within time on the basis, of these two Acts, a decree for the amount claimed minus the costs incurred upto this date by the respondent will be passed in favour of the appellant.
If on the other hand the court comes to the conclusion that the suit is not within limitation ,p a under these two acts the suit will be finally, dismissed Costs incurred hereinafter will be in the discretion of the court Appeal allowed.
| The State Government of Orissa rejected the application of the appellant who had applied for grant of a mining lease in December 1957 on the ground that the State Government proposed to arrange for the exploitation of the area in the public sector.
The appellant made an application for review to the Central Government under r. 57 of the rules of Mineral Concession Rules, 1949.
This application was rejected by the Central Government in June 1959.
Thereupon the appellant filed a petition under article 226 of the Constitution in the High Court of Orissa.
This petition was dismissed by the High Court on the ground that it had no jurisdiction to deal with the matter under article 226 as the final order in the case was passed by the Central Govern ment, which was located beyond the territorial jurisdiction of the High Court.
The appellant came up by special leave to appeal to the Supreme Court.
The main question is as to the limit of the jurisdiction of the High Court under article 226.
The appellant contended that as the Central Government had merely dismissed the review petition, the effective 907 order rejecting the, appellant 's application for the mining lease was that of the State Government and therefore the High Court would have jurisdiction to grant a writ under article 226.
that the High Court was right in holding that it had no Jurisdiction to issue a writ under article 226 in the present case as the final order in this case was that of the Central Government which was not situate within the terri tories over which the High Court had jurisdiction.
This order of the Central Government in effect rejecting the application of the appellant.
for the grant of the mining lease to him and confirming the rejection of the application of the appellant by the Orissa Government is clearly not amenable to the jurisdiction of the High Court of Orissa under article 226 in view of the fact that the Central Government is not located within the territories subject to the jurisdiction of the Orissa High Court.
It would therefore have been useless for the Orissa High Court to issue a writ against the Orissa Government for the Central Government 's Order rejecting the application of the appellant for the grant of the mining lease would still stand.
Held, further that quite apart from the theoretical question of the merger of the State Government 's Order with the Central Government 's Order, the terms of r. 60 of the Mineral Concession Rule 1949 make it perfectly clear that whenever the matter is brought to the Central Government under r. 59, it is the order of the Central Government which is effective and final.
So where there is a review petition and the Central Government passes an order on such petition one way or the other it is the Central Government 's Order that prevails and the State Government 's Order must in those circumstances merge in the order of the Central Government.
Election Commission India vs Saka Venkata Subba Rao, ; , Lt. Col. Khajoor Singh vs Union of India, ; , A. Thangal Kunju Musaliar vs M. Venkitachalam Potti ; relied on.
Shivji Nathubhai vs The Union of India, ; , referred to.
The State of Uttar Pradesh vs Mohammad Nooh (1958) S.C.R. 595, not applicable.
|
riminal Appeal No. 447 of 1974.
(Appeal by Special Leave from the Judgment and Order dated the 14th March 1974 of the Delhi High Court in Crimi nal Revision Petition No. 61 of 1974.
Mrs. Urmila Kapoor and Miss Kamlesh Bansal, for the appel lant.
V.C. Mahajan and S.L.Aneja, for respondent.
The Judgment of the Court was delivered by SHINGHAL, J.
This appeal by special leave is directed against the judgment of the Delhi High Court dated March 14, 1974, allowing the revision application of.
respondent Dev Raj Vijh and 'dismissing the appellant 's application dated March 18, 1969, under section 488 of the Code of Criminal Procedure, 1898, hereinafter referred to as the Code.
Appellant Raj Kumari Vijh was married 'to respondent Dev Raj Vijh in Delhi, in June 195 '0.
It is the admitted case of the parties that they were living separately from 1953.
The appellant filed her 999 first application for maintenance under section 488 of the Code, in 1955, but it was dismissed.
The respondent filed an application for divorce, or judicial separation, in 1956 in Aligarh (Uttar Pradesh).
It was ultimately dismissed on appeal on March 29, 1968.
In the meantime the appellant filed a suit against the respondent for recovery of her "stridhen" in Delhi in 1956.
It was decreed on appeal by the Delhi High Court in 1967, for Rs. 6,458/ .
The appel lant gave a notice to the respondent on June 24, 1968, claiming maintenance as a 'deserted wife.
Nothing came out of it and she filed the present application under section 488 of the Code in the .Court of the Delhi Magistrate on March 18, 1969.
It was stated in the application that the appellant had lived with the respondent in Delhi and Aligarh as his legally wedded wife, and thereafter at village Lampur, P.S. Narela, Delhi, towards the end of December 1968, because the respondent visited her there for a settle ment and for non execution of the decree which she had obtained for Rs. 6,458/ on account of her "stridhan".
It was stated in the application that the parties lived at Lampur, as husband and wife and there was cohabitation.
The appellant prayed for an order allowing her Rs. 450/ per month for maintenance ' as the respondent had sufficient means but had neglected or refused to maintain her.
The respondent filed a reply on April 29, 1969 in which, according to the Magistrate, there was no specific denial of the averment that the parties last resided together at Lampur.
An objection was however taken that as the earlier application was dismissed on February 2, 1956, the second application was barred on the principle of res judicata.
An objection was taken to the jurisdiction of the Delhi Court on the ground that the respondent never resided, permanently or temporarily in Delhi.
We have not found it possible to go through the reply because it has been stated by counsel for the parties that the original record has been destroyed.
The Magistrate passed an order for production of evidence.
The respondent thereupon prayed that the question of juris diction may be decided before recording the evidence.
That was not agreed to by the magistrate.
He made an order on November 19, 1969 that the question of jurisdiction must await the recording of the evidence on the whole case.
The respondent did not challenge that order or apply for permis sion to file additional reply.
On the other hand, he asked for the holding of an identification parade for the purpose of showing that some of the appellant 's witnesses did not even know him.
Both the parties led their evidence, al though it appears that the respondent did not like to avail of the opportunity which was given to him to lead evidence on the merits.
He did not even apply for permission to file any ,additional reply when the Magistrate recorded the appellant 's evidence on her application for maintenance as a whole.
Ultimately the Magistrate made his final order on May 21, 1973.
He took the view that there was no specific denial of the appellant 's allegation that the parties last resided together, as husband and wife, in village Lampur, in Delhi, towards the end of December in 1968.
1000 He took notice of the fact that the plea of bar against the maintainability of the second application because of the dismissal of the first application, was not pressed by the respondent and after referring to the entire evidence in details, he reached the conclusion that he had the jurisdic tion to entertain the application, and granted maintenance allowance at the rate of Rs. 125/ per month, with effect from March 18, 1969, along with an order regarding the mode of payment of the arrears.
The respondent applied for a revision of that order, and the Additional Sessions Judge referred the case, to the High Court on November 30, 1973, for dismissal of the application (under section 488 of the Code) on the ground that the Delhi Magistrate had no juris diction to entertain it.
As the High Court has allowed the reference, and dismissed the revision application which was filed by the appellant for an increase in the mainte nance allowance, the appellant has come up to this Court by special leave.
In its impugned judgment dated March 14, 1974, the High Court has recorded the finding that the parties did not reside together at village Lampur, and for that reason it took the view that the Delhi Court had no jurisdiction to entertain the appellant 's application under section 488 of the .Code.
Counsel for the appellant has vehemently urged that the finding of the High Court is incorrect, but as it is a finding of fact, we shall proceed on the assumption that does not call for interference in this appeal.
The question however remains whether section 531 of the Code would be applicable to the case? The High Court has held that the section would not be applicable, and that is why it has passed the impugned order for the dismissal of the application of the appellant under section 488 of the Code.
The High Court has taken that view for the following reasons , (i) The objection as to jurisdiction was raised "right at the first instance by the husband".
(ii) The respondent "specifically reserved his right to file a written reply on merits after the question of jurisdiction was decid ed".
(iii) As the respondent had "reserved his right to lead evidence on merits, it is not a case where the husband deliberately gave up his right to lead evidence on merits . . " (iv) There was "obvious prejudice and failure of justice" the respondent as he never led evidence on the merits.
(v) It was necessary for the appellant to.
prove that the respondent had refused and neglected to maintain her, and that "obviously requires an opportunity to be given to the husband to prove his case,, if it be one, that he has not refused or refuses or neglected to maintain his wife or what his income and means is".
1001 (vi) "Before a decision on merits can be given the husband has the undoubted request (sic) to lead evidence on merits".
(vii) A proceeding cannot be entertained in a court which has jurisdiction by simply taking recourse to section 531 of the Code, when an objection has been taken against main tainability, for otherwise the provision relating to jurisdiction would become nuga tory.
Section 531 "can cure the infirmity after the case has been fought on merits.
" We have examined these grounds, but we are constrained to say that they are not tenable in the facts and circumstances of this case.
Section 531 of the Code reads an follows, "531.
No finding, sentence or order of any Criminal Court shah be set aside merely on the ground that the inquiry, trial or other proceeding in the course of which it was arrived at or passed, took place in a wrong sessions division, district, sub division or other local area, unless it appears that such error has in fact occasioned a failure of justice.
" The section therefore relates to a defect of jurisdiction.
As has been stated by this Court in Purushottamdas Dalmia vs The State of West Bengal(1) those are two types of jurisdic tion of a criminal court, namely, (1) the jurisdiction with respect to the power of the court to try particular kinds of offences, and (2) its territorial jurisdiction.
While the former goes to the root of the matter and any transgression of it makes the entire trial voild, the latter is not of a peremptory character and is curable under section 531 of the Code.
Territorial jurisdiction is provided "just as a matter of convenience, keeping in mind the administrative point of view with respect to the work of a particular court, the convenience of the accused who will have to meet the charge levelled against him and the convenience of the witnesses who have to appear before the Court '.
Sub section (8) of section 488 in fact provides that proceedings under the section "may be taken against any person in any district where he resides or is, or where he last resided with his wife or, as the case may be, the mother of the illegitimate child.
" This therefore is ordinarily the requirement as to the fling of an application under section 488 within the limits of the jurisdiction of the magistrate concerned.
So where a magistrate has the "power ' to try a particu lar.
application under section 488, and the controversy relates solely to his territorial jurisdiction, there should, ordinarily, be no reason why section 5 31 of the Code should not be applicable to the order made by him.
It has therefore to be examined whether there were any such circumstances in this case for which the High Court could justifiably refuse to apply the provisions of section 531.
(1) ; 1002 The first reason why the High Court .has not given the benefit of section 531 to the appellant is that an objection as to the jurisdiction of the Delhi Court was raised by the respondent "right at the first instance.
" Counsel for the respondent has strenuously argued that such.
a benefit will not be available in a case where the magistrate knew that he had no jurisdiction, and persisted in proceeding with the trial under the, impression that section 531 of the Code, would, at any rate, validate his order.
That, according to the counsel, amounted to an order by the magistrate giving the jurisdiction to himself by virtue of section 531.
Reliance in this connection has been placed on Radharani vs Rahim Sardar(1), Sakuntala vs Thirumalayya(2), State vs Tavara Naika(3), Sultan Chand vs Yogindra Nath Bar (4), and Satwant Singh vs Smt.
jaswant Kaur (5).
As is apparent, section 531 does not entitle a magis trate, who is not a magistrate of the class referred to in sub section (1) of section 488, to proceed with an applica tion for maintenance.
In fact even a District Magistrate, a Sub Divisional Magistrate or a Magistrate of the first class will not be entitled to proceed with such an application if he knows that the proceedings do not fall within his juris diction under sub section (8) of section 488.
The true meaning of section 531 is that while it will not uphold an order passed in proceedings wilfully taken in a wrong place, or enable a magistrate to confer jurisdiction on himself when he knows that he has no such jurisdiction, there is no reason why a magistrate, who is otherwise duly empowered to make an order under sub section (1 ) of section 488 of the Code, cannot proceed with an application under that subsec tion for the purpose of deciding whether he has the territo rial jurisdiction to entertain the application and to decide the application on the merits if he finds that he has the territorial jurisdiction.
Section 531 cannot thus be said to be inapplicable to a case where there is a controversy as to the district where the proceeding should be held, the parties lead evidence in support of their respective contention about the correct place of the pro ceeding, and the magistrate finds it necessary (after taking note of the entire evidence on the controversy) to arrive at a decision on the basis of the balance of probabilities.
In other words, there is no reason why, in such a case, section 531 should not be applicable merely because the magistrate, while considering the evidence relating to jurisdiction, unwittingly makes a reference to section 531 in passing and not for the purpose of assuming jurisdiction under it.
If the magistrate,in this case, had thought of assuming juris diction under section 531, he would not have proceeded to record the evidence of the parties, on the question of the territorial jurisdiction, or referred to it at length in his order and arrived at the decision that he had the jurisdic tion.
We have gone through the cases which have been cited by the counsel for the respondent.
Radharani and another vs Rahim Sardar (supra) was a case where the magistrate pro ceeded with the trial (1) A.I.R. 1946 Calcutta 459.
(2) (3) A.I.R. (4) A.I.R. 1944 Peshawar 25.
(5) 1003 in the wrong local area with his eyes open to the fact that he had no territorial jurisdiction, and the Calcutta High Court had to observe that the section does not confer any jurisdiction.
This is however not so in the present case, because the Magistrate recorded the evidence on the question of territorial jurisdiction, and he went to the extent of making 'a reference to the entire evidence which was led on the point.
Moreover he took note of the fact that the re spondent had not specifically dened that he lived at village Lampur with the appellant.
This is therefore not a case where the Magistrate proceeded with the application even though he had the knowledge that it did not fail within his jurisdiction.
The same is the position in regard to Sakunlala vs Thirumalayya (supra) and it also cannot avail the respondent.
We have gone through State vs Tavara Naika (supra).
It was not a case under section 488 of the Code.
What has been said there is that the curative provisions of section 531 should not be an excuse for overlooking a mate rial irregularity pertaining to jurisdiction when it is brought to the notice of the Court before the commencement of the trial.
It does not therefore lay down anything different from what has been stated in Radharani vs Rahim Sardar (supra).
It was a case where the accused was commit ted to a wrong sessions division, and the mistake was cor rected because the trial had not commenced.
Sultan Chand & another vs Yogindra Nath Baz (supra) was also not a case under section 488 of the Code.
It has been held in that case that when the question of jurisdiction has been raised before the trial magistrate, it is his duty to determine the point, otherwise the provisions 'as regards jurisdiction would never be enforced and that section 531 cannot be applied to such a case.
As has been stated, the Magistrate in the present case addressed himself to the question of jurisdiction, recorded detailed evidence on it, considered the evidence in his order and reached the conclusion that the application was maintainable in his court.
This is therefore a different case.
Satwant Singh vs Smt.
Jaswant Kaur (supra) was a case under section 488 of the Code.
It has been held there that where the question of jurisdiction had been raised before the trial magistrate, it wa.s his duty to determine the point, and that he cannot proceed with the trial in a wrong local area with his eyes open to the fact that he has no territorial jurisdiction.
As has been shown, this was not so in the present case.
It would thus appear that the High Court erred in taking the view that section 531 would not be applicable to this case merely because an objection as to jurisdiction was raised by the respondent "right at the first instance.
" The second ground mentioned by the High Court is that section 531 would not be applicable because the respondent had specifically reserved his right to file a written reply on merits after the question of jurisdiction had been decid ed,.
We find that this is clearly a misstatement of the facts, for counsel for the respondent was not able to refer to anything on the record to show that the respondent re served any such right to file a written reply on the merits at a later stage, after the question of jurisdiction was decided against him.
On the other hand, we find that the Magistrate specifically overruled the objection of the respondent, and made an order directing the parties adduce their evidence on the whole case and specifically rejected 16 206SCI/77 1004 the respondent 's application for deciding the question of jurisdiction in the first instance.
The Magistrate has clearly stated that an order was made.
by him for the pro duction of evidence "in the case", and that he decided to defer a decision of the question of jurisdiction until after the evidence had been recorded as a whole.
The Magis trate has further stated that the respondent did not file his further or additional reply even then.
The High Court therefore undoubtedly erred in thinking that the respondent specifically reserved his right to file a written reply on the merits later on.
As has been shown, no such reservation was permitted by the magistrate, and counsel for the re spondent was not able to show how the respondent could unilaterally make such a reservation for himself.
It may be that, in a given case, it may be advisable for a magistrate to confine the evidence of the parties, in the first in stance, to any preliminary objection relating to jurisdic tion, and to decide the controversy on the merits thereaf ter, but as this was not so in the present case, we arc unable to find any justification for the second ground mentioned.
by the High Court.
The third ground of the High Court is also untenable, for it has refused to apply section 531 on the ground of prejudice for the reason that the respondent had reserved his right to lead evidence on the merits and did not delib erately give up that right. 'Here again, counsel for the respondent was unable to show how it could be said that the respondent made any such reservation, or was entitled to it when, as has been stated, the Magistrate had rejected his application for deciding the question of jurisdiction as a preliminary question and had passed an ,order for the pro duction of all the evidence in the case.
If therefore the respondent persisted in refusing to produce his evidence in spite of that order of the Magistrate, he alone was to blame for it, and the High Court erred in taking the view that he had reserved the right to lead evidence at a later stage.
The High Court has taken the view that this is a case where there was obvious prejudice to the respondent and a failure of justice as he never led evidence on the merits.
But the High Court failed to appreciate that the respondent had to thank himself for that predicament.
He knew that the Magistrate had passed an order refusing to try the question of jurisdiction in the first instance and had rejected his application to that effect.
He also knew that the Magis trate had called upon the parties to lead all their evi dence.
The appellant obeyed that order and examined her witnesses.
The respondent persisted in thinking that the Magistrate had no jurisdiction, and he refused to examine the witnesses on the merits and thought it sufficient to confine his evidence to the question of jurisdiction.
if he deliberately refrained from producing his evidence on the merits, there can be no justification for him to raise the question of prejudice or failure of justice.
As it is, Counsel for the respondent has not been able to refer to any application of the respondent.
whether oral or documentary, expressing a desire to lead his evidence on the merits.
The fact of the matter therefore is that the respondent had decided that he would not lead any evidence on the merits, and confined his evidence to the question of jurisdiction.
It may be that, as 1005 has been argued by the Counsel for the appellant, he did so because he realised that he had no defence to make on the merits of the claim for maintenance.
The fifth ground mentioned by the High Court is that before an order could be passed under section 488(1) it was necessary to prove that the husband had refused or neglected to maintain his wife, and that required an oppor tunity to be given to the husband to prove, his case.
But the argument is futile because the respondent did not set up any defence on the merits.
On the other hand, the Magis trate.
found that there was no controversy about the facts that the appellant was the lawfully wedded wife of the respondent and that she had been living separately for the last many years and was entitled to maintenance as the respondent had neglected her or had refused to maintain her.
In its sixth ground the High Court has stated that before a decision could be given on the merits, the husband could make a request for permission to lead evidence on merits.
It would be sufficient to say that Counsel for the respondent was unable to point out when and how any such request was made but was refused by the Magistrate.
Lastly, the High Court has taken the view that a pro ceeding cannot be maintained by a court which has no juris diction by simply taking recourse to section 531 of the Code when an objection has been taken against its maintenance, for otherwise the provision relating to jurisdiction would become nugatory.
This point has already been considered earlier and need not be re examined.
It is thus quite clear that the High Court committed a serious error of law in refusing to.
invoke section 531 in the facts and circumstances of this case.
It is not in controversy that the Magistrate who took the proceedings, on the appellant 's application under subsection (1) of section 488, was one of the magistrates mentioned in that sub sec tion.
The respondent raised a controversy as to his local jurisdiction, and the Magistrate ordered the parties to lead all their evidence.
He specifically rejected the applica tion for confining the evidence to the question of jurisdic tion, or to try that as a preliminary issue.
It is there fore futile to contend that the Magistrate gave himself jurisdiction by recourse to section 531 of the Code.
On the other hand in his final order, he set out the points which arose for consideration on the question of jurisdic tion, made a mention, at length, of the entire evidence on that question and took into consideration the conduct of the respondent and the ease law as well as the respondent 's reply.
All that led him to the conclusion that he had jurisdiction to try the application.
There is therefore no reason why section 531 should not be held to be applicable to this case.
As has been shown, it is futile for Counsel for the respondent to raise the question of prejudice, or to say that there was a failure of justice, because the respondent did not lend his evidence on the merits.
As we have pointed out, he did So deliberately and in 1006 defiance of the order of the Magistrate calling upon him to lead his evidence on the whole case.
The respondent cannot in fact be heard to raise the question of prejudice when on the uncontroverted and well established facts the Magistrate found that the respondent was a person who had sufficient means and had neglected to maintain his wife, and made an order that he shall make a monthly allowance of Rs. 125/ per mensem for her maintenance.
The appeal is allowed and the impugned order of the High Court dated March 14, 1974, is set aside, with costs.
P.B.R. Appeal allowed.
| The appellant (Plaintiff) had two shops, one in his village and the other in a city.
The respondent (defendant) had dealings of various kinds with the appellant at both the places.
The plaintiff filed a suit claiming a certain sum representing the net balance due to him from the respondent (defendant) on the village account.
The defendant on the other hand claimed that, had the city account been taken into account, it was he who would be entitled to a larger sum from the plaintiff.
The plaintiff claimed that the accounts of the village and city should not be mixed up.
The trial Court held that, though the shops were located at different places, they were owned by the same person and in equity and law, set off was Permissible and it accordingly granted a decree.
On the plaintiff 's appeal, the High Court held that rendition of city accounts was illegal and remanded the case to the trial Court.
On remand, the trial Court held that while the plaintiff was right in his demand vis a vis the village shop the defendant was entitled to a certain sum from the city account and awarded a decree to the plaintiff m respect of the net balance.
In appeal, the High Court held that after remand the trial Court had no jurisdiction to look into the city accounts as a whole and on account of a misapprehension of the observations of the remand order, an illegal decree had been passed in favour of the plaintiff.
Restoring the trial Court 's order, HELD: The true nature of the action in this case was a suit on account to: the sum due on striking a balance.
That itself was the cause of action.
[981E] 1.
The trial Court 's view that the entirety of account in the two shops could be viewed as a composite one, was sound.
The parties are the same.
There was only one person who owned the two shops and it is wrong to construe the situation as if there were two juristic entities.
The defendant who dealt with the plaintiff in the two shops was the same person.
The dealings were either in one or the other shop.
The artificial dissection of the transactions could not square up with the reality of the situation.
[981C D] In the instant case there was no misapprehension on the part of the trial Court of the observations made by the High Court in its remand order.
While directing remand, the High Court ordered that issue No. 6, namely, whether on making an account of the two shops of the plaintiff the defendants were entitled a set off and thereafter to certain sums, should be decided by the trial Court.
The trial Court natu rally took the view that the High Court having ordered an adjudication of the issue, vested it with jurisdiction to enquire into the city accounts in toto and pass a decree.
If the village and city accounts had to be gone into, the decree passed was correct.
[980G H] 2.
Order 8, rule 6 CPC deals with a specific situation and does not prevent the Court.
where the facts call for wider relief, from looking into the accounts in both places to do ultimate justice between the parties.
[981 H] 974 3.
(a) After remand by the High Court, the subordinate Court is bound by the direction of the High Court, the same High Court hearing the matter on a second occasion or any other Court of co ordinate authority hearing the matter, cannot discard the earlier holding.
Both a finding in a remand order cannot bind a higher Court when it comes in appeal before it. [982A B] (b) The remand order by the High Court is a finding at an interreed are stage of the same litigation.
When it came to the trial Court and escalated to the High Court, it remained the same litigation.
The appeal before the Supreme Court is from the suit as a whole and, therefore, the entire subject matter is available for adjudication before the Supreme Court.
[982C D] (c) The circumstance that the remanding judgment of the High Court was not appealed against, assuming that an appeal lay therefrom, cannot preclude the appellant from challeng ing the correctness of the view taken by the High Court in that judgment.
[982E] Lonankutty vs Thomman ; , followed.
|
Appeal No. 64 of 1953.
Appeal by special leave from the Judgment and Decree, dated the 29th November, 1951, of the Court of the Judicial Commissioner for Himachal Pradesh at Simla in Civil Revision No. 52 of 1951.
Gopal Singh for the appellants.
section C. Isaacs (Amar Nath Chona, with him) for the respondents.
January 19.
The Judgment of the Court was delivered by DAS J.
This is an appeal by special leave against the order made on the 20th November, 1951, by the Judicial Commissioner of Himachal Pradesh in proceedings instituted by the respondents under articles 226 and 227 of the Constitution of India.
There is no substantial dispute as to the facts leading up to the present appeal.
The 'appellants 567 were tenants of a certain shop premises situate in Solan Bazar in the district of Mahasu in Himachal Pradesh.
On the llth October, 1947, they had executed a rent deed by which they agreed to pay an annual rent of Rs. 175 payable as to Rs. 50 on the last of Baisakh and as to the balance of Rs. 125 in the month of October, in default of which payment,% the respondents, as landlords, would be entitled to recover the whole of the said rent in one lump sum.
The tenancy created by the rent deed was only for one year in the first instance but it provided that if the tenants desired to continue in occupation they must execute a further rent deed before the expiration of the said term.
The appellants never executed any further rent deed but held over and continued in occupation of the demised premises.
The appellants fell into arrears with the payments of rents due for the years 1948 and 1949 and the respondents made applications to the Rent Controller for eviction of the appellants under section 13 (2) (i) of the East Punjab Urban Rent Restriction Act, 1949, as extended to Himachal Pradesh.
The appellants, however, paid up the arrears of rent into court and claimed the benefit of the proviso to section 13 (2) (i).
The claim was allowed and the said applications were dismissed accordingly on the 18th December, 1950.
The appellants again fell into arrears with the pay ment of rent due for the year 1950.
On the 26th December, 1950, the respondents served on the appellants a notice c alling upon the latter to pay whole of the said rent forthwith but the appellants failed to do so.
The respondents thereupon, on the 2nd January, 1951, filed an application under section 13 (2) (i) for the eviction of the appellants on the ground of nonpayment of rent.
Thereafter, on the 10th January, 1951, the appellants made an application to the Rent Controller for the fixation of a fair rent under section 4 of the said Act.
On the 25th January, 1951, the appellants filed their written statements in the proceedings under section 13 568 (2) (i) admitting the nonpayment of rent and the receipt of the notice but pleaded (i) that the respondents ' application was barred by reason of the rejection of the previous applications for eviction made by the respondents and (ii) that the present application could not be entertained in view of the pendency of their application for fixation of a fair rent under section 4 of the said Act.
On the 20th February, 1951, the Rent Controller framed the following issues: (1) Whether the application in question was not entertainable in view of the judgment of the District Judge, dated the 18th December, 1950 Onus on defendants.
(2) If issue No. I is not proved, had the opposite party (tenants) not paid the rent and as such were they liable to be ejected? Onus on plaintiffs.
(3) Have the opposite party already filed an application in the said court for the fixation of rent and are they, therefore, not liable for ejectment pending the decision on the application and what is its effect on the said application? Onus on defendants.
By his judgment, dated the 29th May, 1951, the Rent Controller held that as the previous applications related to non payment of rents for the years 1948 and 1949 the present application which was founded on non payment of rent for 1950 was not barred under section 14 of the said Act but, although the fact of rent being in arrears was admitted, the Rent Controller did not think fit to make an order directing the appellants to put the respondents in possession of the demised premises.
The reasons given by him were as follows: " Regarding the non payment of the rent when the plea of the tenant is only that he is waiting for the fixation of fair rent by the Rent Controller there is not enough ground for ejectment.
A civil suit for the recovery of the rent would have been a more appropriate method of obtaining that rent.
I therefore dismiss the suit. ' The parties should bear their own 569 The respondents preferred an appeal to the District Judge of Mahasu under section 15 of the said Act.
The learned District Judge dismissed the appeal observing "On behalf of the landlord it was urged that under section 13 (2) of the Punjab Urban Rent Restriction Act, as applied to Himachal Pradesh, the Controller, if it came to the finding that rent had not been paid, had no option but to direct the tenant to put the landlord in possession.
Undoubtedly, that is the correct legal position, but in the present case the non payment of rent was due to a misapprehension of the legal position created by the tenant filing an application for fixing fair rent.
1, therefore, think that this case can be distinguished and does not fall within section 13 (2), Punjab Urban Rent Restriction Act.
" The respondents moved the Judicial Commissioner, Himachal Pradesh, under articles 226 and 227 of the Constitution of India for setting aside the order of the District Judge.
The learned Judicial Commissioner held that in view of the admitted failure to pay the rent as provided by the rent deed or at the first hearing of the court under the proviso to section 13 (2) (i) the courts below had acted arbitrarily in refusing to make an order for ejectment against the tenants who had not done what was incumbent on them to do under the law and that such a situation called for inter ference by the court of the Judicial Commissioner in order to keep the subordinate courts within the bounds of their authority.
He accordingly set aside the orders of the courts below and allowed the application for ejectment but gave the appelants three months ' time for vacating the premises.
The appellants have now come up before this court on appeal by special leave obtained from this court.
Learned advocate appearing in support of this appeal urges that the learned Judicial Commissioner acted wholly without jurisdiction inasmuch as (1) the Rent Controller or the District Judge exercising powers 570 under the Act was not amenable to the jurisdiction of the High Court and, therefore, article 227 confers no power on the court of the Judicial Commissioner over the Rent Controller or the District Judge, and (2) that article 227 read with article 241 confers no power of judicial superintendence on the court of the Judicial Commissioner.
Re. l.
The court of the Judicial Commissioner of Himachal Pradesh exercises jurisdiction in relation to the whole of the territories of Himachal Pradesh.
The Rent Controller and the District Judge exercising jurisdiction under the Act are certainly tribunals, if not courts, and they function within the territories of Himachal Pradesh.
Therefore, article 297 (1) read with article 241 confers on the court of the Judicial Commissioner power of superintendence over such tribunals.
The words " in relation to which " obviously qualify the word " territories " and not the words "courts and tribunals".
2.The material part of article 227 substantially reproduces the provisions of section 107 of the Government of India Act, 1915, except that the power of superintendence has been extended by the article also to tribunals.
That the Rent Controller and the District Judge exercising jurisdiction under the Act are tribunals cannot and has not been controverted.
The only question raised is as to the nature of the power of superintendence conferred by the article.
Reference is made to clause (2) of the article in support of the contention that this article only confers on the High Court administrative superintendence over the subordinate courts and tribunals.
We are unable to accept this contention because clause ( 2) is, expressed to be without prejudice to the.generality of the provisions in clause (1).
Further, the preponderance of judicial opinion in India was that section 107 which was similar in terms to section 15 of the High Courts Act, 1861, gave a power of judicial superintendence to the High Court apart from and independently of the provisions of other laws conferring revisional jurisdiction on the High Court.
In this connection it has to 571 be remembered that section 107 of the Government of India Act, 1915, was reproduced in the Government of India Act, 1935, as section 224.
Section 224 of the 1935 Act, however, introduced sub section (2), which was new, providing that nothing in the section should be construed as giving the High Court any jurisdiction to,question any judgment of any inferior court which was not otherwise subject to appeal or revision.
The idea presumably was to nullify the effect of the decisions of the different High Courts referred to above.
Section 224 of the 1935 Act has been reproduced with certain modifications in article 227 of the Constitution.
It is significant to note that sub section (2) to section 224, of the 1935 Act has been omitted from article 227.
This significant omission has been regarded by all High Courts in India before whom this question has arisen As having restored to the High Court the power of judicial superintendence it had under section 15 of the High Courts Act, 186 1, and section 107 of the Government of India Act, 1915.
See the cases referred to in Moti Lal vs The State through Shrimati Sagrawati(1).
Our attention has not been drawn to any case which has taken a different view and, as at present advised, we see no reason to take a different view.
This power of superintendence conferred by article 227 is, as pointed out by Harries C. J., in Dalmia Jain Airways Ltd. vs Sukumar Mukherjee(2), to be exercised most sparingly and only in appropriate cases in order to keep the Subordinate Courts within the bounds of their authority and not for correcting mere errors.
As rightly pointed out by the Judicial Commissioner in the case before us the lower courts in refusing to make an order for ejectment acted arbitrarily.
The lower courts realised the legal position but in effect declined to do what was by section 13 (2) (i) incumbent on them to do and thereby refused to exercise jurisdiction vested in them by law.
was, therefore, a case which called for an interference by the court of the Judicial Commissioner and it acted (1) I.L.R. [1952] 1 All.
558 at p. 567, (2) A.I.R. 1951 Cal.
75 572 quite properly in doing so.
In our opinion there is no ground on which in an appeal by special leave under article 136 we should interfere.
The appeal, therefore, must stand dismissed with costs.
Appeal dismissed.
| The respondent concern had a rule in its packing and labelling department that if a woman employee got married her service would stand automatically terminated.
The appellant union raised an industrial dispute on this question and it was referred to the Industrial Tribunal, Maharashtra.
The Tribunal held that the rule was justified whereupon, the appellant came to this Court by special leave.
The justification given on behalf of the respondent for the said rule was that in the particular department where the rule operated team work was required for which regular attendance was necessary, and married women, for obvious reasons, could not be expected to be regular in attendance.
It was also contended for the respondent that industrial adjudication should not interfere with the employer 's right to impose any condition in the matter of employment when he employs new workmen.
Rule 5(3) of the Indian Administrative Service (Recruitment) Rules, 1964, was referred to as carrying a similar condition.
HELD: (i) There was nothing to show that married women would by the more likely to be absent than unmarried women or widows.
The only difference was that married women would ask for maternity leave.
This could be provided for by having a few extra women as leave reserve.
So far as efficiency was concerned it could hardly be said that married women would be less efficient than unmarried ones or widows.
The economic interest of the concern was also not affected in any material way.
There was thus no good and convincing reason why such a rule should continue in one department of the pharmaceutical industry.
The fact that such a rule existed in other concerns also was no justification, if the rule could not be justified on its own merits.
The rule, therefore, had to be abrogated.
[495E, G H; 496A B, D] (ii) It is too late in the day to stress the absolute freedom of an employer to impose any condition which he likes on labour.
It is always open to industrial adjudication to consider the conditions of employment of labour and to vary them if it is found necessary.
[496 E F] (iii) Rule 5(3) of the Indian Administrative Service (Recruitment) an unmarried woman marries subself the maintenance of the efficiency her to resign.
This rule does on marriage as a matter of course as the case of the respondent concern.
[497 B C]
|
ivil Appeal No. 9979 of 1983.
From the Judgment and Order dated 8.12.1982 of the Patna High Court in C.R. No. 377 of 1980 (R).
M.P. Jha for the Appellants.
D.P. Mukharjee for the Respondents.
The Judgment of the Court was delivered by 973 SHARMA, J.
The dispute in the present appeal by special leave is in regard to certain premises in the town of Ranchi in Bihar which belongs to the appellants and in which a cinema is running.
The contesting respondents have been occupying the property under a registered lease for a period of 20 years which expired on 31.7.1971.
They served a notice on the appellants on 16.7.1971 claiming the right to contin ue in possession after 31.7.1971 as tenants from month to month.
The appellants did not accept the claim and filed before Munsif, Ranchi a case purporting to be an application under section 12 of the Bihar Buildings (Lease, Rent and Evic tion) Control Act, 1947 (hereinafter referred to as the Act).
The respondents contested the application and raised several points in defence which were rejected by the learned Munsif.
The appellants ' application was allowed and an appeal therefrom filed by the respondents was dismissed by the Judicial Commissioner, Ranchi.
The respondents, then, moved the Patna High Court in its revisional jurisdiction, inter alia, contending that the appellants ' application under section 12 of the Act before the Munsif was not maintain able.
The plea was accepted by the High Court and the deci sion of the court below was set aside.
According to the appellants ' case the property earli er belonged to M/s Ganapathi Properties (Pvt.) Limited, the predecessor in title of the appellants.
The company had granted the lease in favour of one S.M. Ganguli who on his death was succeeded by his legal representatives.
There was due attornment of the tenancy and the lessees were liable to vacate the premises on 31.7.
197 1.
Their further case of induction of some of the respondents as sub tenants has been disbelieved and in view of the findings of fact in the case, it is not necessary to deal with this aspect now.
Apart from pleading that the application under section 12 was not maintainable and the allegations contained therein were incorrect, the respondents also stated that the heirs of late S.N. Ganguli had formed a partnership, as a result of which a new month to month tenancy was created, and the respondents, therefore, were not liable to eviction.
The parties differed on several questions of fact which, in view of the findings of the trial court and the appellate court, are not necessary to be detailed.
The parties led full evidence, both oral and documentary.
on the disputed issues and after an elaborate trial the learned Munsif accepted the appellants ' case that they are the successors in interest of the lessor company, and the legal representatives of late S.N. Ganguli the original lessee continued as tenants under the lease after due attornment and were liable to eviction after the expiry of the lease 974 period on 31.7.
The court accordingly directed the respondents to vacate the premises.
On appeal by the respondents, the learned Judicial Commissioner, Ranchi agreed with the findings of the learned Munsif on merits and concluded in paragraph 48 of the.judg ment thus: "Therefore, from the facts stated above it appears that the present landlords and tenants are the heirs and successors of the original lessor and the lessee respectively.
That being so, according to the terms of the deed of lease (Ext. 4) 1 have no hesitation in saying that the deed of lease (Ext. 4) is subsisting and the parties are having the relationship of lessors and lessees and also landlords and tenants respectively.
No month to month tenan cy had been created.
" He, however, modified the decision of the trial court in so far the learned Munsif had directed that his order would be executed and the respondents would be evicted from the premises on their failure to vacate within the time allowed.
The learned Judicial Commissioner confined his decision to deciding the issues between the parties and granting one month 's time to the respondents (appellants before him) for vacating the premises and further held that the appellants would have to make another application under section 12(3) of the Act for evicting the respondents if they did not vacate within the time allowed by court.
The respondents challenged the decision in C.R. No. 377 of 1980 (R) before the Patna High Court.
The learned Judge who heard the case held that in absence of a month 's notice under section 12(1) from the tenant, the application of the appellants was not maintainable before the Munsif, and the entire proceeding was mis conceived.
It was pointed out that in the circumstances the appropriate remedy of the appellants was to file a suit under section 11 of the Act.
Before proceeding further it will be helpful to examine the provisions of the section 12 which is quoted below: "12.
Extension of period limited by lease.
(1) If a tenant in possession of any building, held on a lease for a specified period, in tends to extend the period limited by such lease, he may give the landlord at least one month before the expiry of the period limited by the lease, a written notice of 975 his intention to do so; and upon the delivery of such notice the said time shall, subject to the provision of section 11, be deemed to have been extended by double the period covered by the original lease subject to a maximum of one year.
(2) Where the landlord to whom notice has been given under sub section (1) wishes to object to the extension demanded by the tenant on one or more of the grounds mentioned in sub section (1) of section 11 or on the ground that the landlord has any other good and sufficient cause for terminating the lease on the expiry of period limited thereby, he may, within fifty days of the delivery of such notice, appeal to the court in that behalf and the Court after hearing the parties may termi nate the lease or extend the same for such period as it deems proper in the circum stances.
Provided that the tenant shall not in any case be allowed to remain in possession of the building beyond the period permissible under sub section (1).
(3) If the tenant fails to vacate the building on the termination of the lease or as the case may be, on the expiry of the period fixed by the Court under sub section (2), the Court shall, on an application by the land lord, pass an order for ejectment, which shall be executed as a decree and may further order that the tenant shall pay to the landlord such amount as may be determined by it as daily compensation.
It has been contended on behalf of the appellants that an application under section 12 of the Act before the civil court was maintainable and the High Court was in error in holding otherwise.
The argument is that both the remedies, i.e., by an application under section 12 of the Act as also by way of a suit are open to a landlord after the expiry of the period of a fixed term tenancy, and it is for him to choose which course to follow.
Mr. Kameshwar Prasad, the learned counsel appearing on behalf of the respondents urged that on the expiry of such a tenancy the only remedy is to file a suit and in any event section 12 is wholly inapplicable in the facts of the case as the respondents, by their notice, did not seek an extension of the term of tenancy.
He asserted that according to their case in the notice a fresh tenancy had come into 976 existence.
The notice, therefore, was not one under section 12 of the Act at all.
We do not consider it necessary to decide the question as to whether a landlord after the expiry of the period of a fixed term lease is entitled to move the Court by an application under section 12 of the Act because even on assuming the argument of the respondents to be correct the appellants should succeed.
In view of the circumstances of the present case as discussed below, the proceeding arising out of the appellant 's application before the learned Munsiff should be treated as a suit and his decision as a decree.
It has to be kept in mind that it is the same court before which both a suit under section 11 and an application under section 12 are to be filed.
The Bihar Buildings (Lease, Rent and Eviction) Control Act refers to several authorities for decision of different issues, one of them being Control ler as defined in section 2(b) of the Act, and another 'Court as the court of general jurisdiction under the Code of Civil Procedure, 1908 as defined in section 2(bb).
So far the determi nation and redetermination of fair rent, or issuing appro priate directions relating to amenities in the premises and several other matters are concerned, the power is vested in the Controller.
But as regards the question of dealing with the eviction of tenants under section 11 and extension of period of lease under section 12, the civil court is the proper forum.
In the present case it is the Civil Court, Ranchi which is the appropriate court either for filing a suit for eviction under section 11 or making an application under section 12.
There is, thus, no difficulty so far the jurisdiction of the court is concerned.
The question is whether the petition which was filed by the appellants as an application under section 12 should be treated as a plaint and the impugned proceeding as the one in a suit followed by an appeal and a second appeal.
With the assistance of learned counsel for the par ties we have gone through the relevant papers in the case and are satisfied that both the parties dealt with every aspect of the case from their respective angles elaborately, and led their full evidence both oral and documentary and the case was tried by the learned Munsif in the same manner as the trial of an eviction suit.
The decision of the learned Munsif is also a detailed one considering every relevant question in the case.
The respondents filed a regular appeal from the decision before the District Judge, Ranchi, designated as Judicial Commissioner, and he also went into the entire controversy thoroughly.
The respondents lost the case once more and moved the High Court but in civil revision application instead of second appeal, presum ably because the Judicial Commissioner after deciding the disputed issues in favour of the present appellants instead of confirming the decree of 977 the Munsif directed them to file a fresh application under section 12(3) for a formal decree of eviction.
The judgment of the High Court indicates that the scope in which the argu ments by the parties were addressed was the same as in a second appeal, and the decision also was accordingly given.
The findings on the disputed issues of fact between the parties were concurrently recorded against the tenants by the first two courts and it was not open to the High Court to reverse them under section 100, C.P.C. We have also gone through the judgments of the first two courts on this aspect and considered the criticism of Mr. Kameshwar Prasad, learned counsel for the respondents appearing before us, and we do not find any error therein.
In these circumstances, it is wholly immaterial as to whether the application original ly filed by the appellants before the Munsif was not in the form of a plaint specially when the necessary verification was also there at the foot of the petition.
The only differ ence may be as to the amounts of court fees payable by the appellants in the first court and by the respondents before the Judicial Commissioner and the High Court, but that should not come in the way in construing the correct nature of the proceeding.
A similar approach was adopted in several cases decided by some High Courts and we would like to refer to three decisions in this regard.
In Madho Bibi vs Hazari Mal Marwari, AIR 1929 Patna 141, a suit was dismissed as against one of the defendants who in the proceeding of execution of the decree filed an objection to an attachment order under Order XXI, Rule 58, C.P.C. which was recorded under that Rule only.
The court proceeded under that Rule and after making inquiries reject ed the claim.
When a revision application was filed before the High Court, it was held that the objection petition, though wrongly preferred under Order XXI, Rule 58, must be treated as one under section 47, and the order passed by the court would have the effect of a final order under section 47 which would be appealable as a decree and against which no revision would lie.
In another decision by the same Court in Hazari Lal vs Ramjiwan Ramchandra and others, AIR 1929 Patna 472, the Division Bench held that a defendant against whom a suit is dismissed is nevertheless party to the suit, and an objection petition though described by him as one Under Order XXI, Rule 58, C.P.C, is such as would fall under section 47 and so the decision on it is appealable and a regular suit is barred.
In Lachhoo vs Munnilal Babu Lal, AIR 1935 Allaha bad 183, it was observed that in considering whether an application is under section 47 or not, the court must examine the substance of the application to find out its true nature and should not be guided solely by the heading given to it by a party.
The principle is well established that the exercise of a power will be referable to a 978 jurisdiction which confers validity upon it and not to a jurisdiction under which it will be nugatory, and there is no reason to exclude the application of this rule to judi cial proceedings.
In a case dealing with compulsory retire ment this Court in M.R. Singh vs The Chief ' Commissioner (Admn.) Manipur and others; , , observed that "if power can be traced to a valid power, the fact that the power is purported to have been exercised under a non exist ing power does not invalidate the exercise of the power".
If it is assumed that an application under section 12 of the Act is not maintainable in the facts and circumstances of the present case, in our opinion, the proceeding has to be treated as a suit and the judgment of the learned Munsif as a decree therein.
A further question may arise as to the effect of the Judicial Commissioner, Ranchi declining to pass a formal decree of eviction and directing the appel lants to make an application under section 12(3) of the Act for that purpose.
Can this Court restore the decree of the trial court in absence of an appeal by the appellants before the High Court? We think that we can and we should.
The question does not affect the substantive right of the parties as the controversy was concluded by the first appellate court in favour of the appellants.
What was left was only procedural in nature and inconsistent with our decision to treat the proceedings as a suit.
The occasion for filing an applica tion under section 12(3) can arise only where the matter is covered by section 12, and as we have made an assumption in favour of the respondents that section 12 has no application to the present case, there is no point in asking the appellants to file such an application.
As mentioned in article 142 of the Constitution of India, this Court may pass such decree or make such order as is necessary for doing complete justice in any cause or matter pending before it, and the present case is a most appropriate one for exercise of such power.
Accordingly, we set aside the judgment of the High Court and restore the decree passed by the Munsif, Ranchi.
The re spondents are directed to restore peaceful possession of the premises in question to the appellants within one month from today, failing which the appellants shall be entitled to execute the decree in accordance with law.
The appeal is allowed, but the parties are directed to bear their own costs throughout.
R.S.S. Appeal allowed.
| The words " specific moveable property " occurring in article 49 Of the Indian Limitation Act can mean only such specific items of moveable property in respect of which the plaintiff is entitled to claim immediate possession in specie from the defendant who has either wrongfully taken or is wrongfully withholding them from him.
A suit by one heir against the others for recovery of his share of the moveable property of a deceased person is not one for a specific moveable property wrongfully taken such as is contemplated by article 49 and must, in the absence of any other specific provision in the Act, be governed by article 12o and not article 49 of the Indian Limitation Act.
Mohomed Raisat Ali vs Musummat Hasin Banu, (1893) L,R. 2o I,A. 155, relied on.
Consequently, in a case where the decree passed upon an award, without specifying any particular G. P. Notes or dividing them, directed the elder brother to transfer G. P. Notes of the value of Rs. 13,200 to the younger brother from out of the G. P. Notes of the total value of Rs. 26,500 left by the father in the custody of the former, and the younger brother, failing to obtain relief by way of execution of the decree, brought the suit, out of which the present appeal arises, against the elder brother for a division of the G. P. Notes and a direction on him that G. P. Notes of the value of Rs. 13,200 might be transferred to him and claimed that the entire period covered by the execution proceeding from its inception till the final disposal by the High Court should be excluded in computing the period of limitation : Held, that the suit in substance was one for the division of moveable property held in joint ownership and not for possession of any specific.
item of moveable property and as such was governed, not by article 49, but by article 120 of the Indian Limitation Act.
Gopal Chandra Bose vs Surendra Nath Dutt, (1908) 12 C.W.N. 1010, distinguished and held inapplicable.
812 As the facts and circumstances of the case satisfied the requirements of section 14(1) Of the Indian Limitation Act in computing the prescribed period of limitation the time covered by the execution proceeding from its inception till its final disposal by the High Court must be excluded.
|
Appeal No. 2065 of 1968.
Appeal from the judgment and order dated September 18, 1968 of the Calcutta High Court in F.M.A. No. 381 of 1967.
B. Sen, B. P. Maheshwari, A. N. Parikh and section M. Jain, for the appellant.
D. Narsaraju, R. H. Dhebar and section P. Nayar, for respondents Nos.
and 2.
The Judgment of the Court was delivered by Hidayatullah, C.J.
This is an appeal against the judgment of the High Court of Calcutta dismissing a writ petition filed by the appellant Debesh Chandra Das.
This appeal is by certificate against the judgment dated September 18, 1968.
The appellant is a member of the Indian Civil Service.
He qualified in 1933 and arrived in India in 1934 and was allotted to Assam.
In 1940 he came to the Government of India and became in turn Under Secretary and Deputy Secretary, Home Ministry.
In 1947 he went back to Assam where he held the post of Development Commissioner and Chief Secretary.
In 1951 he again came to the Government of India as Secretary, Public Service Commission.
In 1955 he became Joint Secretary to the Government of India and continued to hold that post till 1961.
From 1961 to 1964 he was Managing Director of Central Warehousing Corporation.
On July 29, 1964, he was appointed Secretary, Department of Social Security with effect from July 30, 1964 and until further, orders, On March 6, 1965 the, 222 Appointments Committee of the Cabinet approved the proposal to continue him as Secretary, Department of Social Security.
He continued in that Department, which is now renamed as the Department of Social Welfare.
On June 20, 1966 he received a letter from the Cabinet Secretary which was to the following effect: "My dear Debesh: For sometime, the Government has been examin ing the question of building up a higher level of administrative efficiency.
This is much more important in the context of the recent developments in the country.
The future is also likely to be full of problems.
In this connection, the Government examined the names of those who are at present occupying top level administrative posts with a view to ascertaining whether they were fully capable of meeting the new challenges or whether they should make room for younger people.
As a result of this examination, it has been decided that you should be asked either to revert to your parent State or to proceed on leave preparatory to retirement or to accept some post lower than that of Secretary of Govt.
I would be glad if you would please let me know immediately as to what you propose to do so that further action in the matter may be taken.
Yours sincerely, Sd/ (DHARMA VIRA)".
He asked for interview with the Cabinet Secretary and the Prime Minister and represented his case but nothing seems to have come of it.
On September 7, 1966 he received a second letter from the Cabinet Secretary which said inter alia as follows : ". .
I am now directed to inform you that after considering your oral and written representations in the matter Government has decided that your services may be placed at the disposal of your parent state, namely, Assam.
In case, however, you like to proceed on leave preparatory to retirement, will you please let me know ?.
" The appellant treated these orders as reduction in his rank ,and filed a writ petition in the High Court of Calcutta on September 19, 1966.
According to him the order amounted to a reduction in rank since the pay of a Secretary to the Government of India (I.C.S.) is Rs. 4,000 and the highest pay in Assam (I.C.S.) 22 3 is Rs. 3,500.
There being no equal post in the Government of Assam his reversion to the Assam Service meant a reduction not only in his emoluments but also in his rank.
He also contended that he held a 5 years ' tenure post and the tenure was to end on July 29, 1969 but was wrongly terminated before the expiry of five years.
He also alleged that there was a stigma attached to his reversion as was clear from the three alternatives which the letter of the Cabinet Secretary gave him.
The highest post in the Government of Assam being equivalent to the Joint Secretary of Government of India, his reversion to the highest post, i.e. Chief Secretary to the Government of Assam, amounted to a reduction in rank.
He contended, if this was the case, the procedure under article 311(2) of the Constitution ought to have been followed and without following that procedure the order was not sustainable.
When the appellant filed the writ petition he was appointed as a Special Secretary on October 15, 1966 but under one of his juniors.
It may be mentioned here that the appellant is next only to the Cabinet Secretary in the matter of seniority.
He also received a letter from the Government of India dated October 20, 1966 in which it was said that Government was considering giving him a post equal to that of a Secretary.
The writ petition was dismissed by Justice A. N. Ray on May 19, 1967.
The following day the appellant was again riposted to Assam but he filed an appeal and obtained a stay.
On March 21, 1968 he was appointed Secretary in the Department of Statistics in the Central Government.
The appeal was heard by Justice P. B. Mukharji and Justice A. N. Sen who differed, the former was in favour of dismissing the appeal while the latter was in favour of allowing it.
The appeal was then laid before Sankar Prosad Mitra, J. who agreed with Justice Mukherji and the appeal was dismissed on September 18, 1968.
On September 20, 1968 the appellant was reposted to Assam.
He, however, filed the present appeal and has proceeded on leave although no orders on leave application seemed to have been passed when we heard the appeal.
In this appeal also, it is contended that the reversion of the appellant to the Assam Service amounts to a reduction in rank.
This is on the ground that he held a higher post in the Government of India and there is no post equal to it under the Assam Government.
The post of the Chief Secretary in the Assam Government is equal to the post of a Joint Secretary in the Government of India and his reversion would therefore indirectly mean a reduction in his rank and also in his emoluments because the highest post in Assam does not carry a salary equal to that of a Secretary in the Government of India.
He also contends that under article 311(2) an enquiry had to be made and he had to be 224 given a chance of explaining his case in the reduction in rank amounted to a penalty.
He contends that the letters of the Cabinet Secretary speak for themselves and clearly show that he was being offered a lower post even in the Government of India if he was to continue here denoting thereby a desire to reduce him in rank.
The letters also speak of his unsatisfactory work and, therefore, cast a stigma on him and therefore his reversion must be treated as a penalty and if the procedure laid down under article 311(2) is not followed, the order of the Government of India could not be sustained.
This, in short, is the case which he had put up before the High Court and has now put up before us.
The Government of India contends that he was on deputation and the deputation could be terminated at any time; that his orders of appointment clearly show that the appointments were "until further orders" and that he had no right to continue in the Government of India if his services were not required and that his reversion to his parent State did not amount either to any reduction in rank or a penalty, and, therefore, the order was quite legal.
Prior to 1946 the members of the Indian Civil Service were in a Civil Service of the Secretary of State.
As a result of a conference between Chief Ministers and the Government of India an All India Administrative Service was constituted in October 1946.
This agreement was entered into under section 263 of the Government of India Act, 1935.
The Indian Administrative Service was common to the Centre and the Provinces.
On January 25, 1950 rules were framed under sections 241(2) and 247 of the Government of India Act, 1935.
These rules were known as the Indian Civil Administrative (Cadre) Rules, 1950.
Under these rules cadres were constituted.
A 'cadre ' is defined in Fundamental Rule 9(4) as the strength of a service or a part of a service sanctioned as a separate unit.
In these rules 'cadre officer ' meant an officer belonging to any of these categories specified in rule 4 and 'cadre post ' meant any duty post included in the Schedule to the Rules.
In rule 4, it was provided that every cadre post shall be filled inter alia by an officer who is a member of the Indian Civil Service. ' In the Schedule Assam was to have 20 senior posts under the Provincial Government, 6 senior posts under the Central Government and 37 posts for direct recruitment, and junior posts and certain services.
After 1954 a number of Rules were framed and we are concerned in this case with the Indian Administrative Service (Cadre) Rules 1954, Indian Administrative Service (Fixation of Cadre Strength) Regulations 1955 and Indian Administrative Service (Pay) Rules 1954.
Under the Pay Rules were shown the posts carrying pay above the time scale pay in the Administrative Service under the State Governments.
In Assam there were 225 four such posts.
Chief secretary (Rs. 3,000), Member, Board of Revenue, Commissioners and Development Commissioners (Rs. 2500 125/2 2750).
These four were the Only posts above the time scale and the highest pay possible was that of a Chief Secretary carrying Rs. 3,000/ p.m. [vide All India Service Manual (1967) p. 2481.
The lower posts in Assam were; Secretaries, Additional Secretaries, Joint Secretaries etc.
who were on a time scale with ceiling of Rs. 2,250 p.m. (ibid p. 263) As against this the posts carrying pay above the time scale or special pay in addition to pay in the time scale under the Central Government when held by Indian Administrative Service men were Secretaries to the Government of India with a pay of Rs. 3,500/ (Rs. 4,000 for Indian Civil Service men) and so on in a downward position There was no separate cadre in the Government of India as defined in the Fundamental Rule mentioned above.
There were only cadres in the States.
Posts beyond the State cadre limit were only to be found in the Government of India.
The Indian Administrative Service (Cadre) Rules 1954 provided as elaborate machinery for getting persons to fill the posts in the Government of India. ' Similarly, the Indian Administrative Service (Fixation of Cadre Strength) Regulations 1955 provided for these matters.
Rule 3 of the Indian Administrative Service (Cadre) Rules provided as follows; "3.
"Constitution of Cadres. (1) There shall be constituted for each State or group of States an Indian Administrative Service Cadre.
(2) The cadre so constituted for a State or a group of States is hereinafter referred to as a 'State Cadre ' or, as the case may be, a 'Joint Cadre.
Rule 4 next provided : "Strength of Cadres. (1) The strength and composition of each of the cadres constituted under rule 3 shall be as determined by regulations made by the Central Government in consultation with the State Governments in this behalf and until such regulations are made, shall be as in force immediately before the commencement of these rules.
(2) The Central Government shall, at the interval of every three years, re examine the strength and composition of each such cadre in consultation with the State Government or the State Governments concerned and may make such alterations therein as it deems fit : Provided that nothing in this sub rule shall be deemed to affect the power of the Central Government to alter the strength and composition of any cadre at any other time; 226 Provided further that the State Government concerned may add for a period not exceeding one year and with the approval of the Central Government for a further period not exceeding two years, to a State or Joint Cadre one or more posts carrying duties or responsibilities of a like nature to cadre posts.
" Rule 6 then provided for deputation of cadre officers.
It reads as follows: "6.
Deputation of cadre officers. (1) A cadre.
officer may, with the concurrence of the State Government or the State Governments concerned and the Central Government, be deputed for service under the Central Government, or another State Government or under a company, association or body of individuals, whether incorporated or not, which is wholly or substantially owned or controlled by the Government.
(2) A cadre officer may also be deputed for service under (i) a Municipal Corporation or a Local Body, by the State Government on whose cadre he is borne, or by the Central Government with the concurrence of the State Government on whose cadre he is borne, as the case may be and (ii) an international Organisation, an autonomous body not controlled by the Government, or a private body, by the Central Government in consultation with the State Government on whose cadre he is borne: Provided that no cadre officer shall be deputed to any Organisation or body of the type referred to in item (ii) of this sub rule except with his consent.
" It may be pointed out here that 'permanent post ' is defined by the Fundamental Rules as a post carrying a definite rate of pay and sanctioned without limit of time and a 'temporary pose is defined as a post carrying definite rate of pay sanctioned for a limited time and a 'tenure post ' means a permanent post which an individual Government servant may not hold for more than a limited period.
All cadre posts were to be filled by cadre officers (rule 8), but temporary appointments of non cadre officers to cadre posts were possible under certain circumstances (rule 9).
Under the Indian Administrative Service (Fixation of Cadre Strength) Regulations 1955 Assam was to have a total of 117 cadre posts.
Of these, 55 were under the Government of Assam 227 and 22 senior posts were to be under the Central Government.
19 were promotion posts and 58 were to be filled by direct recruitment.
There were certain reserved posts for leave reserves, deputation reserves, training reserves and finally there were 'junior posts.
By the agreement which formed an annexure to the Indian Civil Administrative (Cadre) Rules 1950, Assam was to have 20 senior posts under the Provincial Government and 6 senior posts under the Central Government with some provision for direct recruitment posts, junior posts and reserves.
These posts denoted combined Service between the Central Government and the Assam Government.
The arrangement allowed an officer to go from one post to another whether under the Centre or the State but not a lower post unless the exigency of the case so demanded.
The posts in the Government of India were held in the ordinary course and were not deputation posts.
They were not as a part of the deputation reserves.
Under article 312, these services must be considered common to the Union and the State : tinder section 4 of the All India Services Act 1951 all rules in force immediately before the commencement of the Act and applicable to an All India Service were continued, thus the Indian Civil Administrative (Cadre) Rules 1950 continued to remain in force.
The position that emerges is that the cadres for the Indian Administratively are to be found in the States only.
There is no cadre in the Government of India.
A few of these persons are, however,intended to serve at the Centre.
When they do so they enjoy better emoluments and status.
They rank higher in the service and even in the Warrant of Precedence of the President.
In the States they cannot get the same salary in any post as Secretaries are entitled to in the Centre.
The appointments to the Centre are not in any sense a deputation.
They mean promotion to a higher post.
The only safeguard is that many of the posts at the Centre are tenure posts.
Those of Secretaries and equivalent posts are for five years and for lower posts the duration of tenure is four years.
Now Das held one of the tenure posts.
His tenure ordinarily was five years in the post.
He got his secretaryship on July 30, 1964, and was expected to continue in that post for five years, that is, till 29th July, 1969.
The short question in this case is whether his reversion to the Assam State before the expiry of the period of his tenure to a post carrying a smaller salary amounts to reduction in rank and involves a stigma upon him.
Reversion to a lower post does not per se amount to a stigma.
But we have here evidence that the reversion is accompanied by a stigma.
In the first letter issued to him on June 20, 1969 by Mr. Dharma Vira (Cabinet Secretary) it was said 228 Government was considering whether the persons at top level administrative posts were capable of meeting the new challenges or must make room for younger men.
The letter goes on to say that he may choose one of three alternatives : accept a lower post at the Centre, go back to a post carrying lower salary in Assam or take leave preparatory to retirement.
The offer of a lower post in Delhi is a clear pointer to the fact of his demotion.
It clearly tells him that his reversion is not due to any exigency of service but because he is found wanting.
The three alternatives speak volumes.
This was not a case of reverting him to Assam at the end of a deputation or tenure.
He can be retained in the Central Services provided he accepts a lower post, and the final alternative that he may retire clearly shows that the Government is bent upon removing him from his present post.
In the next letter this fact is recognised because on September 7, 1966 he is offered only two alternatives.
The alternative of a lower post is advisedly dropped because it discloses too clearly a stigma.
If any doubt remained it is cleared by the affidavit which is now filed.
Paragraphs 7 and 10 of the affidavit read as follows: "7.
With reference to the allegations made in paragraphs 13 to 23 of the said application, I make no admission in respect thereof except what appears from relevant records.
I further say that the performance of the petitioner did not come to the standard expected of a Secretary to the Government.
of India." "10.
The allegations made in paragraph 26 of the said application are correct.
I further say that the said representation was rejected by the Prime Minister in view of the standard of performance of the petitioner.
" Now it has been ruled again and again in this Court that re duction in rank accompanied by a stigma must follow the procedure of article 311(2) of the Constitution.
It is manifest that if this was a reduction in rank, it was accompanied by a stigma.
We are satisfied that there was a stigma attaching to the reversion and that it was not a pure accident of service.
It remains to see whether there was a reduction in rank.
There is no definition of reduction in rank in the Constitution.
But we get some assistance from rule 3 of the All India Services (Discipline and Appeal) Rules, which provides: "3 Penalties.
The following penalties , may, for good and sufficient reasons, and as hereinafter provided, be imposed on a member of the Service, namely 229 (iii) reduction in rank including reduction to a lower post or time scale, or to a lower stage in a time scale.
We have shown above that he was holding a tenure post.
Nothing turns upon the words of the notification 'Until further orders ' because all appointments to tenure posts have the game kind of order.
By an amendment of F.R. 9(30) in 1967, a form was prescribed and that form was used in his case.
These notifications also do not indicate that this was a deputation which could be terminated at any time.
The notifications involving deputation always clearly so state the fact.
Many notifications were brought to our notice during the argument which bear out this fact and none to the contrary was shown.
Das thus held a tenure post which was to, last till July 29, 1969.
A few months alone remained and he was not so desperately required in Assam that he could not continue here for the full duration.
The fact that it was found necessary to break into his tenure period close to its end must be read in conjunction with the three alternatives and they clearly demonstrate that the intention was to reduce him in rank by sheer pressure of denying him a secretaryship.
No Secretary, we were told, has so far been sent back in this manner and this emphasises the element of penalty.
His retention in Government of India on a lower post thus was a reduction in rank.
Finally we have to consider whether his reversion to Assam means a reduction in rank.
It has been noticed above that no State Service (the highest being Chief Secretary 's) carries the emoluments which Das was drawing as a Secretary for years.
His reversion would have meant a big drop in his emoluments.
Das was prepared to go to Assam provided he got a salary of Rs. 4,000 per month but it was stated before us that that was not possible.
Das was prepared to serve the Centre in any capacity which brought him the same salary.
This too was said to be not possible.
This case was adjourned several times to enable Government to consider the proposal but ultimately it was turned down.
All that was said was that he could only be kept in a lower post.
If this is not reduction in rank we do not see what else it is.
To give him a Hobson 's choice of choosing between reversion to a post carrying a lower salary or staying here on a lower salaried post, is to indirectly reduce him in rank.
Therefore, we are satisfied that Das was being reduced in rank with a stigma upon his work without following the procedure laid down in article 311(2).
We say nothing about a genuine case of accident of service in which a person drafted from a State has to go back for any reason not connected with his work or conduct.
Cases must obviously arise when a person taken from 230 the State may have to go back for reason unconnected with his work or conduct.
Those, cases are different and we are not expressing any opinion about them.
But this case is clearly one of reduction in rank with a distinct stigma upon the man.
This requires action in accordance with article 311(2) of the Constitution and since none was taken, the order of reversion cannot be sustained.
We quash it and order the retention of Das in a post comparable to the post of a Secretary in emoluments till such time as his present tenure lasts or there is an inquiry against him as contemplated by the Constitution.
Before we leave this case we are constrained to say that the attitude in respect of this case was not very happy.
Das offered to take leave preparatory to retirement on the 29th July, 1969 if he was retained in Delhi on this or other post.
This coincided with his present tenure.
But vast as the Delhi Secretariat is, no job was found for him.
This confirms us in our view ' of the matter that he was being sent away not because of exigency of service but definitely because he was not required for reasons connected with his work and conduct.
The appeal is thus allowed with costs here and in the High Court.
R.K.P.S. Appeal allowed.
| The appellant, an unsuccessful candidate filed an election petition for setting aside the election of the respondent who got elected as a Congress candidate to a Parliamentary constituency.
The respondent was chraged with several corrupt practices, viz., (i) by an ordinance the Government of the State in which the Congress Party was in power, granted exemption to certain agriculturists ' holdings from payment of land revenue and the Chief Minister announced the benefit though the exemption was claimed for sometime past by the opposition parties the ordinance was passed prior to the election; the opposition parties started a campaign stating that the object of the exemption was to forfeit the land; the Chief Minister refuted the charge and told the voters that the exemption should be granted and that the opposition parties should be routed in the election; a member of the Congress Party D, published a pamphlet refuting the false propaganda that exemption was temporary and urging the electors to vote for the Congress; (ii) the Chief Minister on the eve of the election announced increased dearness allowance to certain Government employees; (iii) the respondent or his agent distributed dummy ballot papers with the respondent 's name and his election symbol, and also that of appellant 's name but without his election symbol printed thereon, thereby conveying an impression that the appellant had withdrawn his candidature, and further, that the respondent and his agents on the eve of the election told the voters that the appellant bad withdrawn, so the respondent had committed corrupt practice under section 123(4); and (iv) a member of the police force in the service of the Government with the consent of the respondent actively canvassed for the respondent, thereby committing corrupt practice under 'section 123(7).
High Court dismissed the petition, HELD: The appeal must be dismissed.
(i)On the materials, on the record, it was impossible to hold that the respondent committed the corrupt practice under section 123(1)A.
The ordinance was passed by the Government of Madhya Pradesh.
As a result of the ordinance a large number of agriculturists got exemption from land revenue.
Such an exemption did not amount to a gift, offer or promise of any gratification within the meaning of section 123(1)(A) nor was it possible to say that the Government was the agent of the respondent.
The Congress Party was then in power.
But the exemption was not given by the Congress Party.
It was given by the Ordinance which was passed by the Government.
Nor does the announcement of the declaration by the Chief Minister or by the pamphlet carry the matter any further.
It was not possible to say that either the Chief Minister or D acted as the agent of the respondent.
[815 G] 814 (ii)The grant of the increased dearness allowance could not be regarded as a gift, offer or promise of any gratification within the meaning of section 123 (1 ) (A) nor it was possible to say that the Government or the Chief Minister was the agent of tie respondent.
The employees of the Government had given notice to go on strike a week before the election and without their cooperation. the entire election would have been at a standstill.
The Government thought that the demand of the employees was legitimate and therefore announced it on the eve of the election to meet it.
[816 D F] (iii)The dummy ballot papers were in contravention of the instructions issued by the Election Commission of India.
The appellant 's name should not have been printed in them.
But it was impossible to say that the dummy papers conveyed to the voters the impression that the appellant had withdrawn his candidature.
The statement of the appellant 's witnesses could not be accepted that on the eve of the election the respondent and his agents informed the voters that the appellant had withdrawn his candidature.
The voters knew that there were two candidates in the field.
Even a few days prior to the election the Chief Minister stated that the appellant was contesting the election.
The respondent carried on rigorous election propaganda till the last day.
[816 H] (iv)On the evidence the charge that the member of the police force canvassed for the respondent was not established.
|
ivil Appeal Nos.
437448 Of 1978 Etc.
From the Judgment and Order dated 18.1.
1977 of the Andhra Pradesh High Court in Writ Petition No. 4485, 3399, 4979, 5819 of 1974.
Y.S. Chitale, Soli J. Sorabjee, P.P. Rao, A.S. Nambiar, A. Chitale, T.V.S.N. Chari, N. Mathur, W. Quadri, Ms. V. Grover, Ms. Sunita Mudigouda, T.D. Ramayya, A. Mariarputham, T.C. Gupta, K.V.G. Rama Rao and G. Narayana Rao for the appearing parties.
The Judgment of the Court was delivered by CHINNAPPA REDDY, J.
The primary question involved in these appeals and petitions is whether under the 'Excise Law ' prevailing in the State of Andhra Pradesh, the Govern ment is entitled to claim from the Excise Contractors who have failed to lift the 'Minimum Guaranteed Quantity ' of liquor the amount said to represent the 'excise duty compo nent ' in the issue price of liquor relating to such unlifted quantity of liquor.
A full bench of three judges of the High Court of Andhra Pradesh, in V. Narasimha Rao vs Superintend ent of Excise, AIR 1974 AP 157 held that the Government could but this view was overruled by a Full Bench of Five Judges of the same High Court in Atluri Brahmanandam vs Tahsildar of Gannavaram AIR 1977 AP 196 where it was held that the Government could not.
It is the judgment of the Full Bench of Five Judges which is in question in the ap peals and petitions filed by the Government.
With a view to cure the defects pointed out by the Full Bench of Five Judges and to validate the demands raised by the Government, the Andhra Pradesh Legislature enacted the Andhra Pradesh Excise Amendment Act X of 1984.
Demands raised pursuant to the Amending Act were upheld by the High Court by a later judgment.
The aggrieved Excise Contractors have filed ap peals and they are also before us.
In some cases the con tractors who had originally succeeded because of the deci sion of the Five Judge Full Bench were again called upon to make good the deficit after the Amending Act was passed.
They questioned the fresh demands but failed in the High Court.
Their petitions for Special Leave to Appeal are also before us.
517 Entry 51 of List II of the seventh schedule to the Constitution empowers the State to levy duties of Excise on alcoholic liquors for human consumption (not including medicinal and toilet preparations containing alcohol) manu factured or produced in the State ' and counter availing duties on such alcoholic liquors manufactured or produced elsewhere in India.
An Excise duty levied by the State on alcoholic liquors is therefore.
primarily a duty on the manufacture or production of such alcoholic liquors.
Section 2(10) of the Andhra Pradesh Excise Act.
1%8 defines "Excise Duty" or "Countervailing duty" to mean "the duty of Excise or countervailing duty, as the case may be mentioned in Entry 51 is List II of the Seventh Schedule to the Constitu tion." 'Excise Revenue ' is defined by s.2(12) to mean 'Rev enue derived or derivable from any duty, fee, tax, rent, fine, penalty or confiscation levied, imposed or ordered under the provisions of this Act or other law for time being in force elating to intoxicating drugs '.
Section 17 of the Act, before and after the amendment was and is as follows: "Section 17 before amendment Section 17 as amended by Act No.10 of 1984.
Power to grant lease: Sec. 17: Grant of exclusive (i) The Government may, sub privilege of manufacture etc: ject to such conditions as (1) subject to the provisions they may deem fit to impose, of s.28 and any rules made grant for a fixed period to in this, the Govt.
may, subject any person, at any place a to such conditions as they lease jointly or severally may deem fit to impose, grant for the supply, manufacture for a fixed period to any or sale of any intoxicant.
person at any place a lease or licence or both either Explanation: A lease shall jointly or severally for the not take effect until the exclusive privilege collector or any other comp etent officer has issued (i) of manufacturing or of a licence under this Act.
supplying by wholesale or of both, or (2) The Government may (ii) or selling by wholesale confer on any officer the or by retail, or power mentioned in sub 519 section(1).
(iii) of manufacturing Or Of supplying by wholesale, or of both, and of selling by retail, any liquor or other intoxicant within any such area in the State as may be specified in the said order.
Explanation: A lease shall not take effect until the Collector or any other competent officer has issued a licence under this Act.
(2) The Government may confer on any officer the power mentioned in sub section( 1).
" Sections 21 and 22 which remained unchanged are as follows: "Section 21: Excise duty or Countervailing duty on excisable articles: (1) The Govt.
may, by notification levy an excise duty on any excisable article manufactured or produced in the State at such rate, not exceeding the rates mentioned in the Schedule, as may be specified in the notification.
(2) The Govt.
may by notification, levy a countervailing duty on any excisable article manufactured or produced elsewhere in India and imported into the State at such rate as may be specified in the notification which may not exceed the rates on excise duty on similar excisable articles levied under sub section(1).
(3) Different rates may be specified in sub section(1) and (2) for different kinds of excisable articles and different modes of levying duties under s.22.
Section 22: Modes of levying duties: The excise duty and the countervailing duty under s.21 shall be levied in one or more of the following modes: (a) rateably, on the quantity of any excisable article produced or manufactured in or issued from a distillery, brewery or manufactory or warehouse or imported into the State; 520 (b) in the case of spirits or other liquors produced in any distillery, brewery or manu factory in according with its quality or strength or in accordance with such scale of equivalents calculated on the quantity of materials used, or by the degree or attenua tion of the wash or wort as the case may be, prescribed; (c) In the case of today, in the form of a tax on each variety of excise tree from which teddy is drawn having due regard to the period during which such tree is capable of yielding today; (d) by fees on licences for the manufacture supply or sale of any excisable article.
" Section 23 before and after amendment was as follows: "Section 23 before amend Section 23 as substituted by ment Act 10 of 1984 Excise duty in respect of Sec. 23: Payment for exclu lease: Notwithstanding any sive privilege: Instead of or thing in Sections 21 and in addition to any excise 22, the sum accepted in con duty or fees leviable under sideration of the grant sections 21 and 22, the of any release relating to Commissioner or any any other any excisable article under competent officer may accept section 17, shall be the excise payment of a sum in consi duty or countervailing deration of the grant of duty payable in respect of lease or licence or both the excisable article, in for the exclusive privilege addition to any duty or in respect of the liquor or fees paid under s.21 & 22.
any other intoxicant under sec.
Validation: Where before the commencement of this Act.
, any issue price (which includes excise duty also) has been collected or recovered from the licensee in respect of short drawn 521 or undrawn minimum guaranteed quantity of arrack in pursu ance of rule 15 of the A.P. Excise (Arrack Retail, Vend and Special conditions of Licences) Rules, 1969, by deducting such price from the advance money paid by the licensee, then, notwith standing anything contained in any judgment, decree or order of any court, tribunal or other authority to the contrary, the price so col lected or recovered shall be deemed to be and shall be deemed always to have been validly collected or recov ered as consideration for the grant of lease or licensee or both to the lessee or licen see for the exclusive privi lege in respect of sale of liquor in accordance with the provisions of the principal Act as amended by this Act as if the amendments made to the principal Act by a sections 2 and 3 of this Act had been in force at all material times and accordingly (a) all acts, proceedings or things done or taken by the State Govt.or by any officer of the State Govt.
or by any other authority in connection with the collection of such price shall for all purposes, be deemed to be and to have always been done or taken in accordance with law; (b) no suit or other proceeding shall be maintained or contained in any Court or before any authority 522 for the refund of and no enforcement Shall be made by any Court of other authority of any decree or order directing the refund of any such price which has been collected as if the provisions of the principal Act as amended by this Act had been in force at all material times.
" The first entry in the Schedule to the Act is as follows: "No. Description of Mode of levying Maximum rate excisable article duty of duty 1.
Arrack on the quantity Rupees eight per issued from the litre of the distillery of ware strength of house.
proof spirit.
" We mentioned earlier that the Andhra Pradesh Legislature amended the Andhra Pradesh Excise Act to nullify the effect of the Full Bench judgment in Atluri Brahmanandam vs Tahsil dar of Gannavaram (supra).
We may refer to the provisions of the amending Act.
Section 2 of the Amending Act provides for the substitution of a new section 17 for the old.
section 17.
We have already extracted both the old and the new sections.
Sec tions 3 of the amending Act provides for the substitution of old s.23 by a new s.23.
We have already extracted both the old and the new sections.
Section 4 of the amending Act provides for the Validation of earlier demands made in respect of issue price of short drawn minimum guaranteed quantity of liquor.
It is necessary to set out the whole of this provision.
It is as follows: "4.
Validation Where, before the commence ment of this Act, any issue price (which includes excise duty also) has been collected or recovered from the licensee in respect of short drawn or undrawn minimum guaranteed quantity of arrack in pursuance of rule 15 of the Andhra Pradesh Excise (Arrack Retail, Vend and Special Conditions of Licences) Rules, 1969, by deducting such price from the advance money paid by the licensee, then, notwith standing 523 anything contained in any judgment decree or order of any court, tribunal or other authori ty to the contrary, the price so collected or recovered shall be deemed to be and shall be deemed always to have been validly collected or recovered as consideration for the grant of lease or licence or both of the lessee or licensee for the exclusive privilege in re spect of sale of liquor in accordance with the provisions of the principal Act as amended by this Act as if the amendments made to the Principal Act by sections 2 and 3 of this Act had been in force at all material times and accordingly, : (a) all acts, proceedings or thing done or taken by the State Government or by any offi cer of the State Government or by any other authority in connection with the collection of such price shall for all purposes be deemed to be and to have always been done or taken in accordance with law.
(b) no suit or other proceeding shall be maintained or continued in any court or before any authority for the refund, of, and no enforcement shall be made by any Court or other authority of any decree or order direct ing the refund of, any, such price which has been collected and which would have been validly collected as if the provisions of the Principal Act as amended by the Act had been in force at all material times.
" The Andhra Pradesh(Arrack, Retail Vend Special Condi tions of Licences) Rules, 1969 were made by the Government of Andhra Pradesh in exercise of the powers conferred by various provisions of the Andhra Pradesh Excise Act.
Rule 7 obliges the licensee to buy arrack from a recognised dis tillery, warehouse or depot as may be allotted by the de partment at the issue price as notified by the Commissioner from time to time.
Rule 11 provides for remittences of duty etc.
into the Government treasury.
Rule 15 deals with mini mum guaranteed quantity of liquor.
It is necessary to ex tract the first two clauses of rule 15 and they are as follows: "15.
Minimum guaranteed quantity of arrack (1) No licensee shall purchase arrack less than the speci fied minimum guaranteed quantity in any month.
If in any month, quantity less than the minimum guaranteed 524 quantity fixed for that month is drawn, at the end of that month issue price to the extent of deficit purchase shall be deducted from the advance money paid by the licensee under the minimum quantity of arrack guaranteed by him and the licensee shall be called upon to indemnity the amount so adjusted by the end of the succeeding month in which short drawn quantity had occured.
Provided that the Excise Superintendents may permit the licensee to lift the short drawn minimum guaran teed quantity of the previous month in the succeeded month for special reasons expert for the month of September, unless the licensee has committed default in lifting the minimum guaranteed quantity for two successive months; Provided further that where the Commissioner deems it necessary to permit a shop keeper to draw the deficit quantity short drawn in any month in the subsequent, he shall obtain the prior approval of the Government for grant ing such permission.
(2) Where a licensee fails to lift the arrack as permitted by the Excise Superintendent or to indemnity the advance amount so adjusted by the end of the succeeding month in which the short drawal of quantity had occurred, the right acquired by the defaulting licensee shall be reauctioned forthwith.
" Rule 17 prescribes "every licensee shall be bound by the provisions of Andhra Pradesh Excise Act, 1968, and the rules and orders made under from time to time.
" The Andhra Pradesh Excise(Lease of fight to sell liquor in retail) rules 1969 are another set of rules made under the various provisions of Andhra Pradesh Excise Act.
Rule 2(ix) defines "rental" to mean 'the rent payable in respect of a shop or group of shops in consideration of the grant of lease for sale of liquor '.
Rule 3 provides for the lease of the fight to sell liquor in retail.
Clause 1 of Rule 3 may be usefully extracted here and it is as follows: "3.
Lease to right to sell liquor in retail: (1) Subject to the provisions of these rules, every lease of right to sell 525 liquor in retail shall be granted by auction.
The lease shall ordinarily be for a period of one excise year; Provided that where the Commissioner considers it necessary to grant the lease of right to sell liquor in retail in any other manner, he shall do so with the prior approval of the Government.
" The rest of the rules relate to the procedure to be followed at the auction and thereafter.
Rule 16 requires the auction purchaser to pay 2 per cent of the annual rental as earnest money together with one month 's rental on the day of auction immediately after the acceptance of tender or bid as the case may be.
The earnest money and one month 's rental are to be in addition to the deposit of rental prescribed by Rule 18.
Rule 18(1) provides for the deposit by auction purchaser within fifteen days from the date of auction, two months ' rental in cash or in fixed deposit certificates.
Rule 21 provides for execution of counterpart agreement by the licensee in form 42.
This is required to be done before taking out a licence in respect of lease granted to him for the sale of liquor.
Rule 22 provides that the lease shall not take effect until the auction purchaser obtains a li cence.
Rule 24 prescribes that every auction purchaser shall be bound by all the provisions of the Excise Laws which are in force or which may come into force and of the rules or orders made from time to time by the Government or Commis sioner or by the competent authority.
The prescribed form for the counterpart agreement provides among other thing for an undertaking that the licensee shah abide by all the provisions of the Andhra Pradesh Excise Act and the Rules and Orders thereunder existing and also those that would be issued from time to time in that respect.
The Andhra Pradesh Excise (Lease of right to sell liquor in retail) Rules, 1969 and the Andhra Pradesh Excise(Arrack, Retail Vend Special Conditions for Licences) Rules were duly amended in 1984.
It is to be mentioned here that the issue price of arrack is notified well in advance of the Excise year and the minimum guaranteed quantity of liquor is also fixed in regard to each shop well in advance of the auction.
The issue price is always a definite sum per bulk litre of liquor.
The notification specifying the issue price does not attempt to split up the issue price into various components such as cost price, Excise duty, transport charges etc.
Cost price, Excise duty and transport charges are not separately and individually charged.
Issue price is the sum total of whatever has gone into the price of liquor at the time it is issued and it is a single pre determined definite sum and not the total 526 of separate sums representing so many specified components.
For example, the issue price of arrack for the year 1979~80 was notified in the following manner: "In exercise of the powers conferred by Rule 7(1) of the Andhra Pradesh Excise (Arrack, Retail sale Special Conditions for Licences) Rules, 1969, the Commissioner of Excise, Andhra Pradesh, hereby notifies the issue price of arrack for the Excise Year 1979 80 at Rs.5.10 per bulk liter of 30x U.P. strength and Rs.3 per bulk liter of 60x U.P. strength.
" It is however not disputed that excise duty does enter the determination of the issue price but that has nothing to do with the excise contractor whose obligation is to pay the whole of the issue price.
As we said the issue price as well as minimum guaranteed quantity are both fixed well in ad vance and it is with full knowledge of the issue price and the minimum guaranteed quantity that every bidder partici pates in the auction.
We wish to emphasise here that the 'issue price ' is that which is not notified as issue price and not its components, if any.
These components which have come together to become 'issue price ' are not to be separat ed again.
To borrow the analogy of Chemistry it is a chemi cal compound and not a mechanical mixture.
Excise duty loses its identity, as it were, and becomes an inseparable part of 'issue price '.
The learned counsel for the contractors however, argued that excise duty was admittedly a part of issue price and that the legislature, while amending the Excise Act in 1984, had also recognised the distinctive duty element in issue price.
He also invited our attention to Narasimha Rao vs Superintendent of Excise (supra).
It is true that it is not disputed that the element of excise duty has entered the issue price but that does not mean that it continues to retain its character as Excise duty.
In V. Narasimha Rao vs Superintendent of Excise (supra), the High Court of Andhra Pradesh, after refering to Rule 11 of the retail vend Rules, observed that it could be safely taken that the three items, namely, duty, cost and sales tax constituted the issue price.
It is one thing to say that several elements enter into the determination of issue price but it is altogether a different thing to say that these erstwhile constituent elements retain their character and individually as such even after determination of issue price.
In the statement of objects and reasons of the amend ing Act there is reference to 'issue price ' together with excise duty ' and 'issue price including excise duty '.
In s.4 of the amending Act there is a reference to 'issue price(which includes excise duty also) '.
These references to issue 527 price and excise duty are made in the context of the judg ment of the Five Judge Full Bench of the Andhra Pradesh High Court which has treated excise duty as a severable element of issue price, the effect of which was sought to be got rid by the amending Act.
It was in that context that there was a reference to the excise duty element of issue price.
We do not think that it is permissible for us to hold that the element of excise duty which has gone into the determination of issue price continues to retain its individual character so as to be capable of being severed and dealt with sepa rately.
Basing himself on an observation made in Panna Lal vs State of Rajasthan; , it was argued by the learned counsel on behalf of the Excise Contractors, that issue price can only relate to liquor drawn by the contrac tors and cannot pertain to undrawn liquor.
There can be no question that issue price must generally relate to liquor which is drawn by the Contractors but it does not follow therefrom that issue price cannot be adopted by agreement between the parties as the measure of compensation to be paid in the case of undrawn liquor.
In fact, it may not be quiet correct even to view it as compensation as we shall presently see.
It is no more and no less than the price which the contractor agrees to pay for the grant of the privilege to sell liquor, drawn or undrawn.
We may now examine the situation as it obtained before the amending Act, 1984.
It is well settled that all right in regard to manufacture and sale of intoxicants vest in the State.
It is open to the State to part with those rights for a consideration.
The consideration for parting with the privilege of the State is neither Excise duty nor Licence fee but it is the price of the privilege.
Section 17 of the Andhra Pradesh Excise Act as it stood before the amendment provided for the grant of a lease for the manufacture or sale of an intoxicant subject to such conditions as the Government deemed fit to impose.
It also provided that a lease shall not take effect until a licence under the Act was also issued.
Section 21 provided for the levy of Excise duty on excisable articles and s.22 prescribed the mode of levy of excise duty.
Section 23 provided that, notwithstand ing anything in sec.
21 and 22, the sum accepted in consid eration for the grant of any lease under section 17 was to be the excise duty payable in respect of that excisable article.
The marginal note of s.23 is "Excise duty in respect of lease".
Rental we have seen has been defined in the Andhra Pradesh (Lease of fight to sell liquor in retail) Rules, 1969, as meaning "the rent payable in respect of a shop or group of shops in consideration of the grant of lease for the sale of liquor".
Rule 3 prescribes that every lease of right 528 to sell liquor in retail shall be granted by auction.
Rule 7 of the Andhra Pradesh (Arrack Retail Vend Special Conditions of Licences) Rules prescribes that the licensee shall pur chase arrack from the distillery, warehouse or depot allot ted by the Government and shall pay issue price as notified by the Commissioner from time to time.
Rule 15 provides for the purchase of a specified minimum guaranteed quantity of arrack every month and for the adjustment of the issue price in case of any short fall in the purchase of the minimum guaranteed quantity of liquor.
Thus reading sections 17 and 23 of Andhra Pradesh Excise Act together with the Andhra Pradesh Excise (Lease of Right to sell liquor in retail) Rules, 1969 and Andhra Pradesh (Retail Vend Special Condi tions of Licences) Rules, the picture which emerges is that the privilege of selling liquor which includes the lease of the shop for an area and the licence to sell liquor therein may be granted by the State by public auction subject to (1) payment of rental being the highest bid at the auction (It is to be noted here that rental is the rent payable in consideration of grant of lease for the sale of liquor but it is not the sale or exclusive consideration for the lease), (2) the requirement that the licensee shall purchase arrack at the issue price, and (3) the further requirement that the licensee shall purchase a minimum guaranteed quan tity of arrack, which he has to make good in case of short fall.
The consideration for the grant of the privilege to sell liquor is not merely the rental to be paid by the lessee but also the issue price of the arrack supplied or treated as supplied in case of short fall, which is also to be paid by the lessee licensee.
There is no question of the lessee licensee having to pay the excise duty though it may be that the issue price is arrived at after taking into account the excise duty payable.
If this is the true posi tion, the question arises whether the contractor can claim to deduct from the issue price payable by him in respect of short drawn arrack, the amount said to be attributable to excise duty.
Once we have understood the true nature of 'issue price ' and the true consideration for the grant of the exclusive privilege to sell liquor, the question posed in the previous paragraph is not difficult to answer.
We have guidance from several decisions of this Court.
The first of the cases on which the learned counsel for the liquor contractors relied was that of Bimal Chandra Banerjee vs State of Madhya Pradesh, ; The successful bidders at an excise auction who had failed to take delivery of the prescribed minimum quantity of liquor which they were required to sell under the condition of auction were called upon to pay excise duty on the quantity of liquor which they had failed to take.
Clause 2(c) of the 529 notification prescribing the conditions of auction provided that the contractor had to make good every month "the defi cit of monthly average of the total minimum duty".
The court found that none of the provisions of the Act empowered the rule making authority viz. the State Government to levy tax on excisable articles which had not been either imported, exported, transported, manufactured, cultivated or collected under any licence or manufactured in any distillery estab lished or distillery or brewery licenced under the Act.
The Court said, "Quite clearly the State Government purported to levy duty on liquor which the contractors failed to lift.
In so doing it was attempting to exercise a power which it did not possess.
No tax can be imposed by any by law or rule or regulation unless the statute itself under which the subordinate legislation is made specially authorises the imposition even if it is assumed that the power to tax can be dele gated to the executive.
" This was clearly a case where the State purported to levy excise duty on the unlifted quantity of liquor ' and this could not be done under the authority of law.
The second case on which the learned counsel relied was that of State of Madhya Pradesh vs Firm Gappulal etc.
; , In that case there was no dispute that the demand made on the contractors was in respect of duty on liquor which had not been lifted.
It was held that the demand could not be made.
The decision of the court in Panna Lal 's case was distinguished on the ground that in that case there was not levy of excise duty in enforcing the payment of the guaranteed sum or the stipulated lump sum mentioned in the licences.
It was also pointed out that in Panna Lal 's case the excise duty component of the issue price was found to be a measure of the quantum of or extent of the conces sion or the remission to be given to the liquor contractors.
The lump sum amount payable for the exclusive privilege was not to be confused with the issue price.
In essence, it was said, what was sought to be recovered from the liquor con tractors in Panna Lal 's case was the shortfall occasioned on account of failure on the part of liquor contractors to fulfil the terms of licence.
Gappulal 's case is not of any assitance to the contractors in the present case as what was sought to be recovered there, was undoubtedly excise duty which was not leviable on unlifted liquor.
The third case relied on by the learned counsel for the con 530 tractors was that of Excise Commissioner, Uttar Pradesh vs Ram Kumar, The licence granted to each of the contractors in this case provided that on his failure to lift the monthly proportonate quota in any month, he shall be liable to pay compensation to the State Government at the rate equal to the rate of still head duty . on the quantity falling short of such monthly proportionate quota.
The contractors having failed to lift or sell the minimum quantity of quota of liquor were required to compensate the State as provided by the licence.
The Court held that the demand though disguised as compensation was in reality a demand for excise duty on the unlifted quantity of liquor and that was not authorised by the provisions of the Act.
Thus we see that in Bimal Chandra Banerjee 's case and Gappulal 's case, what was sought to be recovered, was excise duty and in Ram Kumar 's case also what was sought to be recovered was excise duty, though disguised as compensation.
Such excise duty on unlifted liquor was not leviable.
Refer ring to these cases, Chandrachud, CJ.
observed in State of Haryana vs Jage Ram, ; "In Bimal Chandra Banerjee 's case, it was held by this court that the levy of excise duty on undrawn liquor was beyond the power of the State Government and that therefore, the rule imposing the condition to that effect was invalid.
That decision was followed in State of Madhya Pradesh vs Firm Gappulal where also the licensees were required to pay what was described as 'Pratikar ' which was nothing but excise duty on undrawn liquor.
The same situa tion obtained in Excise Commissioner vs Ram Kumar because the real nature of the payment which the licensee were required to pay there, was excise duty on undrawn liquor.
"These decisions cannot held the respondents because the true position, as we stated earlier, is that the amount which the respondents are called upon to pay is not excise duty on undrawn liquor but is the price of a privilege for which they bid at the auction of the vend which they wanted to conduct.
" The learned counsel for the State of Andhra Pradesh relied on Har Shankar & Ors., vs The Dy.
Excise & Taxation Commr.
& Ors.
, ; ; Panna Lal vs State of Rajasthan (supra) and State of 531 Haryana vs Jage Ram (supra).
In Har Shankar 's case, it was held by a Constitution Bench of the Court (Chandrachud, J. speaking for the Court) that since rights in regard to intoxicants belonged to the State, it was open to the Gov ernment to part with those rights for a consideration.
In a scheme providing for the parting of the right for a consid eration, it was not of the essence whether the amount charged to the licences was pre determined or whether it was left to be determined by bids offered in auctions.
The power of the Government to charge a price for parting with its rights and not the mode of fixing that price was constituted the essence of the matter.
Nor indeed did the label affixed to the price determine either the true nature of the charge left by the Government or its rights to levy the same.
The amount charged was neither a fee properly so called nor indeed a tax but was in the nature of a price of the privi lege which the purchaser had to pay in any trade or business transaction.
Once it was appreciated that the auctions were only a mode or medium for ascertaining the best price ob tainable for the grant of a privilege to sell liquor, there would be no further contradiction in them.
In Panna Lal 's case, the court held: "The agreements gave the liquor contractors an exclusive privilege to sell country liquor in a specified area for the period fixed for a stipulated sum of money for enjoying the privilege.
If the contractors do not sell any liquor, they are yet bound to pay the stipu lated sum.
If they sell liquor, they are given the benefit of remission in the price of the exclusive privilege.
The measure for this remission is the excise duty leviable to the extent that the liquor contractor can neutra lise the entire amount of exclusive privilege in the excise duty payable by them.
If the contractors fail to lift adequate quantity of liquor and thereby fail in neutralising the entire price of exclusive privilege, the contractors are not called upon to pay excise duty.
" It was held that there was no leviable excise duty in en forcing the payment of the guaranteed sum or the stipulated lump sum mentioned in the licence.
We have already referred to the references made to 'rental ' and 'issue price '.
We finally come to the State of Haryana vs Jage Ram (supra) which we may now take to be the last word on the subject.
Chandrachud, CJ spoke for the Court and said,: "The amount which the respondents agreed to pay to the 532 State Government under the terms of the auc tion is neither a fee properly so called which would require the existence of a quid pro quo, nor indeed is the amount in the nature of excise duty, which by reason of the constitu tional constraints had to be primarily a duty on the production or manufacture of goods produced or manufactured within the country.
The respondents cannot therefore complain that they are being asked to pay 'excise duty ' or "stillhead duty" on quota of liquor not taken, lifted or purchased by them.
The respondents agreed to pay a certain sum order the terms of the auction and the Rules only prescribe a convenient mode whereby their liability was spread over the entire year by splitting it up into fortnightly instalments.
The Rules might as well have provided for payment of a lump sum and the very issuance of the licence could have been made to depend on the payment of such sum.
If it could not be argued in that event that the lumpsum payment represented excise duty, it cannot be so argued in the present event merely because the quota for which the respondents gave their bid is re quired to be multiplied by a certain figure per proof litre and further because the re spondents were given the facility of paying the amount by instalments while lifting the quota from time to time.
What the respondents agreed to pay was the price of a privilege which the State parted with in their favour.
They cannot therefore avoid their liability by contending that the payment which they were called upon to make is truly in the nature of excise duty and that no such duty can be imposed on liquor not lifted or purchased by them".
The result of our discussion is that even prior to the 1984 amendment, the amount which each of the contractors was required to pay or have adjusted was not excise duty on undrawn liquor, but was part of the price which he had agreed to pay for the grant of the privilege to sell liquor.
The judgment of the High Court of Andhra Pradesh in Atluri Brahmanandam vs Tahsildar of Gannnvaram (supra) is reversed.
The appeals filed by the State of Andhra Pradesh are al lowed.
We mentioned that in order to remedy the situation resulting from the Full Bench judgment of the Andhra Pradesh High Court, the Andhra Pradesh Legislature enacted the Andhra Pradesh Excise (Amendment) Act 10 of 1984.
In the view that we have now taken the amendment of the Act has become a needless exercise.
However, we 533 may briefly consider the attack on the amending Act.
It was argued that the amending Act did not effectually remove the vices or defects pointed out by the Full Bench in Brahmanan dam 's case (supra) as secs.
21 and 22 were left in tact.
It was said that without amending secs.
21 and 22, the amend ment of sec.
23 effected by the Andhra Pradesh Legislature led no where towards achieving the result aimed at by the Legislature.
Nor could the Legislature validate the demands earlier made and struck down by the courts merely by enact ing that the demands were to be deemed to be valid without removing the vices or defects from which those demands suffered.
We are not inclined to agreed with these submis sions. Sec.
17 of the Andhra Pradesh Excise Act which deals with the grant of the fight to sell liquor has been substan tially amended.
Even the marginal note has been changed from "power to grant lease" to "grant of exclusive privilege of manufacture, etc.
" The new sec.
17 makes it clear that what is proposed to be granted is the exclusive privilege to manufacture or sell liquor in the shape of a lease or li cence or both.
The explanation makes it clear that the lease shall not take effect unless a licence is issued.
Having regard to the vital amendment of sec.
17, no further amend ment of secs.
21 and 22 was necessary.
The consequential amendment to sec.
23 has however been made.
Again the mar ginal note has been changed from "excise duty in respect of lease" to "payment for exclusive privilege.
" It is now specified in the new section that the payment of the same in consideration of the grant of lease or licence or both for the exclusive privilege is to be instead of or in addition to any excise duty or fees leviable in secs.
21 and 22.
We are, therefore, satisfied that the amendments effected to secs.
17 and 23 have fulfilled the object of removing the vices or defects pointed out by the Full Bench in Atluri Brahmanandam 's case, if indeed there were defects or vices.
In the result, the petitions for special leave to appeal filed against the judgments of the Andhra Pradesh High Court upholding the amending Act and the demands made by the excise authorities are dismissed.
P.S.S. Appeals & Petitions dismissed.
| Respondent and Ramlal Narang are brothers.
An order of detention passed on 19.12.1974 under section 3(1) of the COFEPOSA against Ramlal Narang was successfully challenged by W.P. 10/75 before the Delhi High Court.
An appeal was filed against that order before the Supreme Court by the Union of India.
Refusing a stay application, the Supreme Court passed an order imposing certain conditions on the movement of Ramlal Narang.
On 25.6.1975 Emergency was de clared.
On 1.7.1975 a fresh order of detention was passed against Ramlal on the same facts and grounds.
The earlier appeal filed by Union of India against W.P. 10/75 was dis missed in 1977.
Ramlal was detained under the second order of detention.
A writ petition No. 115/75 flied by his rela tive before the Delhi High Court challenging the second detention was dismissed on 25.11.1975.
An appeal was filed by certificate against that order before the Supreme Court as Crl.
Appeal No. 399/75.
In the meanwhile, notices under sections 6 and 7 of the Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976 were issued against Ramlal.
These notices were challenged by him by filing W.P. No. 720/75 in the Delhi High Court.
Subsequently Crl.
Appeal No. 399/75 was disposed of observing that it would be open to raise all contentions available to him in W.P. 720/75 notwithstanding what is contained in W.P. 115/75.
The Delhi High Court having dismissed W.P. NO.
720/75, Crl.
Appeal No. 2790/85 was preferred to the Supreme 455 Court and is now pending before the Constitution Bench on the question of competency of the authorities to issue second detention order on the name grounds and facts.
While Respondents Manoharlal was in England an order of detention under COFEPOSA was issued against him on 31.1.1975.
He was brought to India on some express under standing given to the Government of the United Kingdom.
His order of detention was quashed by the Bombay High Court, wile allowing his writ petition No. 2752/75 on 8.7.1980.
The Union appeal against the same was dismissed on 4.11.1980 by the Supreme Court.
A further notice under section 6 of the SAFEMA read with section 2 was issued to the Respondent on 29.10.83 on the basis of the detention order dated 1.7.1975 issued against Ramlal.
A full Bench of the Bombay High Court quashed the said notice resulting in the present Crl.
Appeal No. 662/86 by Union of India.
The appellants plea to have the case tagged on to Crl.
Appeal No. 2790/85 pending before the Constitution Bench was opposed by respondent since he could succeed on merits.
Dismissing the appeal, the Court, HELD: 1.
In this case, the provisions of Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act, 1976 were being pressed into service because he is a rela tive answering the description given in Explanation 2 to sub section (2) of section 2 was available.
Therefore, in such cases, the person against whom action is taken by invoking the Explanation to Sub section 2 referred to above, is at liberty to raise all grounds available to him though such grounds were raised and found against in a proceedings initiated by the relative.
[459C D] 2.
An order of the Supreme Court is not an inconsequen tial order.
If the detaining authority has considered the order of Supreme Court, one cannot state with definiteness which way is subjective satisfaction would have reacted.
This order could have persuaded the detaining authority to desist from passing the order of detention since Supreme Court had allowed freedom of movement.
Detention is only a preventive Act.
The Supreme Court did not find it necessary to restrict the liberty of Ramlal when the order on the stay application was passed.
It may also be that the detaining authority after considering the order of the Supreme Court carefully could still feel, that an order of detention is necessary with reference to other materials which outweigh the effect of Supreme Court 's order.
In all these cases, non application of mind 456 on a vital and relevant material need not necessarily lead to the conclusion that application of mind on such materials would, always be in favour of the detenu.
Application of mind in such cases is insisted upon to enable the detaining authority to consider one way or the other, as to what effect a relevant material could have, on the authority that decides the detention.
The absence of consideration of this important document amounts to non application of mind on the part of the detaining authority rendering the detention order invalid.
[462A D] Ibrahim Bachu Bafen vs State of Gujarat & Ors., ; Ashadevi vs K. Shivraj, ; ; Mohd. Shakeel Wahid Ahmed vs State of Maharashtra & Ors.
,[1983] 2 SCC 392 and Sita Ram Somani vs State of Rajasthan & Ors., , referred to.
|
Appeals Nos. 901 to 903 of 1971.
Appeals by special leave from the judgment and order dated May 13, 1971 of the Andhra Pradesh High Court in Writ Petitions Nos.
6090 of 1970, 221 of 1971 and 543 of 1971 respectively.
section V. Gupte, P. section Shankar and P. P. Rao, for the appellants (in C.A. No. 901 of 1971).
P. section Shankar and P. P. Rao, for the appellants (in C.A. Nos.
902 and 903 of 1971).
V. M. Tarkunde and K. Rajendra Chowdhary, for the respon dents (in C.A. No. 901 of 1971).
G. Narasimhulu and P. A. Chowdhry, for the respondent (in C.A. No. 902 of 1971).
A. Subba Rao, for the respondent (in C.A. No. 903 of 1971).
The Judgment of the Court was delivered by Vaidialingam, J.
These three appeals, in which the State of Andhra Pradesh is the first appellant, by special leave, are directed against the judgment and order dated May 13, 1971 of the Andhra Pradesh High Court in a batch of writ petitions, striking down Rule 9, in the Rules relating to the selection of candidates for admission to the Integrated M.B.B.S. Course in the Government Medical College in the Andhra Pradesh area, issued G.O. No. 1.648/Health dated July 23, 1970 as also under G.O. No. 1793,/Education dated September 23, 1970, regarding reservation of seats, in professional colleges for Backward Classes together with the annexure to the said notification containing the 250 list of Socially and Educationally Backward Classes.
The Addl.
Director of Medical and Health Services, Hyderabad and Principal, Government Medical College, Guntur, are also appellants Nos. 2 and 3 respectively in the appeals.
The Government of Andhra Pradesh by G.O. No. 1648/ Health dated July 23, 1970 announced Rules for the selection and admission of students to the Integrated M.B.B.S. Course in the Government Medical Colleges, in the Andhra area.
The rules provided a pattern of allotment of seats by reference to certain.
qualifying examinations.
The candidates eligible for admission to the Integrated M.B.B.S. Course, being largely taken from the students who had passed the qualifying examination for the Pre University Course and those who had passed the Higher Secondary Course (Multipurpose), the rules provided for a pattern of earmarking seats for the students according to the qualifying examinations taken by them.
It may be mentioned at this stage that the H.S.C. Course (Multipurpose) students are called Multipurpose candidates since they pass their examinations from Multipurpose Schools.
Rule 8 dealt with the pattern of allotment of seats in respect of qualifying examination.
Rule 9 outlined the procedure for selection.
Rule 10 provided that all the reservations would be subject to the order of merit of marks obtained in the entrance test by the students in the relevant category of reservations, namely, P.U.C. and H.S.C. Rule 24 provided that the selections made under the Rules will be subject to any rules or orders that may be made in regard to the reservation of seats for Socially and Educationally Backward Classes of students, having regard to the recommendations made by the Andhra Pradesh Backward Classes Commission.
But there was a condition that such Rules or Orders should have been made by the Government before the finalisation and communication of the selection of candidates.
On June 20, 1970, the Backward Classes Commission appointed by the State, 'a couple of years back, made its report re garding the various categories of persons who are to be treated as belonging to Backward Classes and recommended reservation of 30% of seats to persons belonging to the Backward Classes.
The State by G.O. No. 1793/Education, dated September 23, 1970 announced reservation of 25% of the seats in the M.B.B.S. Course for candidates belonging to the various Backward Classes enumerated therein on the basis of the report of the Backward Classes Commission.
In or about August, 1970, the validity of the entrance test provided under the Rules issued by the G.O. ' No.
1648 of 1970 was challenged before the High Court of Andhra Pradesh in a batch of writ petitions Nos. 3859, 3881, 3955 and 4052 of 1970.
The challenge was on the ground that 251 the State had no power or authority to determine admission by reference only to the result of the entrance test there by ignoring the results of the qualifying examinations taken by a candidates These writ petitions were dismissed by a learned Single Judge of the High Court on September 5, 1970.
But on Letters Patent Appeals by the candidates, a Division Bench of the High Court on September 18, 1970 reversed the order of the Single Judge and struck down the provisions regarding holding of entrance test for admission to Government Colleges as illegal.
The State came to this Court in Civil Appeal Nos.
2161A and 2162B of 1970.
This Court by its judgment dated February 11, 1971 allowed the appeals holding that the Government could hold an entrance test for selection eligible candidates for admission to the medical course in the colleges run by the Government.
The said decision is State of Andhra Pradesh and another vs Narendranath and others (1).
On the basis of the decision of this Court in the above appeals the Government on February 12, 1971, published an additional list of candidates selected on the basis of the entrance test for admission to the Integrated M.B.B.S. Course.
On December 27, 1970, the respondent in Civil Appeal No. 901 of 1971, who was a P.U.C. candidate filed in the High Court Writ Petition No. 6090 of 1970 challenging the validity of the classification of candidates into two categories as P.U.C. and H.S.C. (M.P.) and reserving 40% of seats to the latter as also the G.O. No. 1793/Education dated September 23, 1970 specifying certain classes as being Socially and Educationally backward and providing for them a reservation of 25% of seats in the colleges.
Certain other candidates belonging to the H.S.C. (M.P.) category had filed writ petitions challenging G.O. No. 1793 of 1970 regarding the reservation made for the Backward Classes.
The P.U.C. candidate contended that the classification and reservation of 40% of seats for the H.S.C. (M.P.) candidates was vio lative of article 14 of the Constitution and that it was arbitrary and illegal.
In particular he contended that he has obtained more marks than some of the H.S.C(M.P.) candidates at the entrance test and that he was entitled to admission in preference to such candidates.
Both the P.U.C. as well as the H.S.C.(M.P.) writ petitioners attacked G.O. No. 1793 of 1970 regarding reservation of 25% of seats for the Socially and Educationally Backward Classes as violative of article 15(1) read with article 29 and that it has not been saved by article 15 (4).
According to them the classification of Backward Classes was not made on any reliable material and in the enumeration of such classes, the, various principles laid down by this Court have not been given due regard.
(1) 252 The State contested the writ petitions on various grounds.
Regarding rule 9 of G.O. No. 1648 of 1970, the stand taken by the State was that the P.U.C. and H.S.C. (M.P.) candidates formed two distinct categories and they did not form part of the same class.
It was further contended that the State was entitled to lay down the principles regarding the source from which the candidates are to be selected to the medical colleges which are run by the Government and that in providing for equal distribution of seats to the P.U.C. and H.S.C. (M.P.) candidates, no discrimination has been made and there has been no violation of article 14.
Regarding G.O. No. 1793 of 1970, the State referred to the appointment of a high powered commission to exhaustively in vestigate and report as to the persons who are to be considered as Backward Classes for the purpose of reservation being made in their favour.
The Commission had gone into the matter and after considering the educational and social backwardness of the various classes of citizens in the State in the light of the various principles and tests laid down by this Court, had submitted its report on June 26, 1970 enumerating the various classes of persons who are to be treated as Backward Classes.
The report accepted by the Government had also given the reasons for such classes being treated as backward.
The High Court by its judgment, under attack, allowed the writ petitions and also directed the State to give admissions to the writ petitioners to the 1st Year Integrated M.B.B.S, Course.
The High Court has held that the only basis for selection for the 1st Year Integrated M.B.B.S. Course in relation to the H.S.C. and P.U.C. candidates is the marks obtained by them at the entrance test provided by the, rules framed under G.O. No. 1648 of 1970.
According to the High Court when once rules have been framed in that manner, the selection of candidates from these categories must only be of those who have obtained the highest number of marks in the said test irrespective of the fact as to which category they belonged.
In view of the fact that the selection is sought to be made by earmarking 40% of seats to the H.S.C. (M.P.), the latter are having an unfair advantage over the P.U.C. candidates, who will be denied admission, though they have obtained higher number of marks.
In this view the High Court held that rule 9 providing for reservation of 40% to the H.S.C. (M.P.) framed under G.O. No. 1648 of 1970 was illegal as being discriminatory and as such offends article 14 of the Constitution.
The said rule was struck down in consequence.
Regarding the enumeration of Backward Classes by the Backward Class Commission, and the order of the Government, G.O. No. 1795 of 1970, reserving 25% of seats in the Colleges, 253 the High Court held that the Government order violate& article 15 (1) read with article 29 and that the reservation was not saved by article 15 (4).
It is the view of the High Court that, proper investigation and collection of data have not been done by the Commission in accordance with the principles laid down by this Court in its various decisions.
On the other hand, the High Court has held that the Commission has merely enumerated the various persons belonging to a particular caste as Backward Classes, which is contrary to the decisions of this Court.
We will deal further with this aspect when we advert to the validity of G.O. No. 1739 of 1970.
Suffice it to say that the High Court struck down the said Government Order as violative of article 15(1) and that it was not saved by article of the Constitution.
The High Court declared that the writ petitioners were entitled to be admitted to the Integrated M.B.B.S. Course in the Medical Colleges in the Andhra area.
Before us, on behalf of the appellants Mr. S.V. Gupte, learned counsel has attacked the findings of the High Court striking down Rule 9, issued under G.O. No. 1648 of 1970, as well as the reservation of seats made in the Professional Colleges for the Backward Classes by G.O. No. 1793 of 1970.
We will first deal with the validity of Rule 9 issued under G.O. No. 1648 of 1970 reserving 40% of seats for the H.S.C. (M.P.) candidates.
Before we consider the contentions urged in that regard by Mr. Gupte, on behalf of the State and Mr. Tarkunde, on behalf of the respondents, it is necessary to broadly refer to some of the material rules issued under G.O. No. 1648 of 1970.
The rules were issued as annexure to this Government Order.
It was specifically stated in the said Government Order that the rules specified in the annexure have to be followed in respect of admissions of students to the Integrated M.B.B.S. Course in the Government Medical Colleges in the Andhra area including Bhadrachalam Division of Khammam District and Mungala Division of Nalgonda District from the academic year 1970 71.
Rule I referred to the availability of 550 seats in the 1st Year Integrated M.B.B.S. Course in the four Government Medical Colleges, referred to therein the Andhra area.
Rule 2 dealt with reservation of seats (viz.) for candidates outside the State, candidates distinguished in N.C.C., Presidents ' Scouts and Guides and children of exhibit Servicemen and Armed personnel; and candidates belonging to Scheduled Caste and Scheduled Tribes, women candidates etc.
Rule 3 deals with the age and educational qualifications.
Regarding educational qualifications it is provided that candidates possessing the minimum qualifications of H.S.C. 254 (M.P.), I.S.C., P.U.C. and A.I.H.S.C. or equivalent qualifications are eligible to appear in the Entrance Test.
But there was a .proviso to the effect that in the qualifying examination the candidates should have taken up physical sciences and biological sciences and must have obtained not less than 50% of marks in ,.those subjects put together.
But in respect of candidates belonging to Scheduled Castes and Scheduled Tribes, the provision is that they should obtain not, less than 40% of marks in those Subjects put together in their qualifying examination.
Rule 4 dealt with basis and method of admission.
Clause (i) of this rule provides that all candidates who, have applied for admission and are found eligible will be required to take Entrance Test to be conducted by the Director of Medical and Health Services.
The said rule also dealt with the holding of the Entrance Test at the centres specified therein.
Clause (v) specifically provided that the Entrance Test will consist of four papers of 50 marks each in (a) subject of Physical Science (Chemistry and Physics), (b) subject of Biological Science, (Zoology and Botany).
,Clause (vi) provided for the examinations in Chemistry and Physics being held in 'the morning and the remaining two i.e. Zoology and Botany, in the evening session and that answers will be written in separate answer books and that the Entrance Test will be conducted in a single day.
The said rule also provided for the standard of test, type of the test and the medium of the test.
Rule 6 deals with the method of admission.
It provides that based on the result of the Entrance Test, a separate Master List of eligible candidates will be prepared in order of merit and that the selection will be made keeping in view the various reservations mentioned therein.
It may be mentioned at this stage that the reservations refered to therein are for Scheduled Castes and Schedule Tribes, Women candidates, children of exhibit Servicemen etc.
There is no reservation referred to therein either of H.S.C. or P.U.C. candidates.
Rule 7 deals with the distribution of seats.
The total number of seats available is stated to be 550.
But the actual number of seats available to be filled up on the basis of merit at the Entrance Test is given as 532.
The said rule also provides for the distribution of seats to certain reserved groups such as Scheduled Castes and Scheduled Tribes, women candidates etc.
Here again there is no reservation for H.S.C. or P.U.C. candidates.
Rule 8 deals with the pattern of allotment of seats in respect of qualifying examination.
The seats are distributed as follows : 40% each to Multipurpose and P.U.C. candidates; 5% to M.Sc.
255 and B.Sc.
candidates; 4% for N.C.C., President 's Scouts and Guides and exhibit Servicemen and 11% strictly in the order of merit in the Entrance Test from the general pool.
Rule 9 deals with the procedure for selection.
Clause (D) dealing with the Multipurpose and P.U.C. candidates, refers to the fact that the total seats available are 545 and that according to the pattern of distribution, 40% of the seats are reserved for Multipurpose and 40% for P.U.C. (including I.S.C.)".
The said clause further provides that the rate of seats to be filled up by the candidates from the P.U.C./Multipurpose and allied qualification holders should be done so as to keep the number of seats according to the ceiling, i.e., 40% as per the pattern of allotment for each group.
It is this provision that was really struck down by the High Court.
Rule 10 specifies that all reservations would be subject to the order of merit of marks obtained in the Entrance List.
The other rules are not material.
From a perusal of the rules, referred to above, two aspects underlying the scheme of selection broadly emerge : (1) that there is to be an Entrance Test for all the applicants for the admission to the 1st Year Integrated M.B., B.S. Course; and (2) that the result of the Entrance Test is to form the basis for admission to the medical course.
Under rule 3 (2) candidates possessing the minimum qualification of H.S.C. (M.P.), I.S.C., P.U.C. ,and A.I.H.S.C. or equivalent qualification are eligible to appear in the Entrance Test.
Therefore, it is clear that all the candidates possessing these qualifications are to be put on a par and are qualified to take the Entrance Test.
We have already referred to the fact that there is a proviso that the candidates excepting those belonging to the Scheduled Castes and Scheduled Tribes should have obtained in their qualifying examination not less than 50% of marks in Physical and Biological Sciences put together in their qualifying examination.
There is no distinction made between a P.U.C. or Multipurpose candidate.
Both of them, in order to become eligible to appear in the Entrance Test, must have secured not less than 50% marks in their qualifying examinations in the two Physical and Biological Sciences put together.
The only relaxation, or exception, if it may be so called, is regarding the candidates, belonging to the Scheduled Castes and Scheduled Tribes.
These candidates should have secured not less than 40% of the marks in those subjects in their qualifying examination.
Rule 4 emphasises that all eligible candidates who have applied for admission are bound to take the Entrance Test conducted by 87 Sup.
Cl/72 256 the Director of Medical and Health Services.
All the candidates, who take the Entrance Test, must take all the, four papers, referred to therein.
Here again, it will be seen that there is no distinction made between a P.U.C. and a Multipurpose candidate.
Both of them must have obtained not less than 50% marks under rule 3 in Physical and Biological Sciences in their qualifying examinations, and both of them will have to appear for those subjects in the Entrance Test, which is common to all the candidates.
Rule 6 specifically provides for the admission being made on the bases of the results of the Entrance Test.
Rule 7 regarding distribution of seats specifically refers to 532 seats being available to be filled up on the basis of merit in the Entrance Test.
But when we come to rules 8 and 9, it is stated in the former that 40% each is to be allotted on the basis of qualifying examination to Multipurpose and P.U.C. students and the latter refers to distribution in the same proportion to the two sets of candidates on the basis of the result of the Entrance Test.
This is so, notwithstanding the fact that rule 10 provides even in respect of candidates for whom reservations have been made, their selection will be in the order of merit of marks obtained in the Entrance Test.
When the scheme of the rules clearly shows that the basis of selection for the 1st Year Integrated M.B., B.S. Course is according to the result of the Entrance Test, the question is whether the reservation of 40% of seats for the H.S.C. candidates under rule 9 is valid ? Under this rule though a P.U.C. candidate may have got higher marks than a H.S.C. candidate, he may not be able to get admission because 40% of the seats allotted to the P.U.C. candidates would have been filled up; whereas a H.S.C. candidate who may have got lesser number of marks than a P.U.C. candidate may be eligible to got a seat because of 40% quota allotted to the H.S.C. candidates has not yet been completed.
Does this amount to an arbitrary discrimination violative of article 14 ? Prima facie having due regard to the scheme of the rules and the object sought to be achieved, namely, of getting the best students for the Medical Colleges, the provision is discriminatory and it has no reasonable relation to the object, sought to be achieved.
Mr. Gupte, learned counsel for the State urged that the P.U.C. and H.S.C. candidates form two separate categories and that unless such reservation of seats is made, the H.S.C. candidates may not be able to get adequate number of seats in the Medical Colleges.
He further contended that the Medical Colleges being run by the Government, it is open to the State to specify the sources from which the candidates will have to be selected for admission to those Colleges.
He also pointed out that such a categorisation of students into two separate groups as P.U.C. and H.S.C. has been held to be valid by the High Court.
257 Mr. Tarkunde, learned counsel for the respondents, on the other hand, urged that whatever may have been the circumstances that originally existed when the High Court then upheld the division into separate groups of P.U.C. and H.S.C. students, when once the rules clearly specify that there is to be a common Entrance Test and that selections are to be made only on the basis of the results of such a test, the reservation of 40% in favour of the H.S.C. candidates is arbitrary, unjust and discriminatory and as such it violates article 14 of the Constitution.
We are in agreement with the contention of Mr. Tarkunde regarding this aspect and, in our opinion, the High Court was justified in striking down the provision regarding reservation of 40% of seats to the H.S.C. candidates under rule 9.
We have already indicated the scheme of the Rules as well as the basis for selection, as could be gathered fro in these rules.
We will now briefly advert to the decisions referred to by the learned counsel on both sides.
Mr. Gupte drew our attention to the following decisions, In Gullapalli Nageswara Rao and others vs Principal Medical College, Guntur and others,(1) the High Court had considered the provision made in a rule by the Government regarding reservation of 1/3rd of total number of seats in favour of Multipurpose candidates in the Pre Professional Course in medicine.
The rule, no doubt, provided that admission for the said course should be both from the category of Multipurpose and P.U.C. students on the basis of merit.
Nevertheless a reservation of 1/3rd of the total number to be admitted was made in favour of H.S.C.
This reservation was attacked as being arbitrary and unjust.
On behalf of the State it was urged that the said reservation is not hit by article 14 as it was necessary to afford equal opportunities to Multipurpose candidates.
The High Court considered in this connection the syllabus for study prescribed for the P.U.C. and H.S.C. candidates in their respective courses.
The High Court held that the Multipurpose candidates have to study more subjects than the P.U.C. candidates and that their examinations also covers a course extending over a period of four years.
In this view the High Court held that, the H.S.C. candidates are at a disadvantage in the matter of securing higher percentage of marks in their optional subjects, whereas a P.U.C. candidate had a distinct advantage over them.
It was further held that in such a situation there are possibilities of P.U.C. candidates securing higher percentage of marks in their optional subjects than the Multipurpose candidates and securing on the basis of the result of their qualifying examination a larger number of seats in the Pre Professional Course in medicine.
Ultimately, the reservation of 1/3rd number (1) A.I.R. 1962 A.P. 212.
258 of seats in favour of the H.S.C. candidates was held by the High Court.
It must be noted that at the time when the High Court deal(.
with the matter, there was no uniform Entrance Test to be taken, by both the P.U.C. and the H.S.C. candidates as is the position at present.
On the other hand, the selection to the Pre Professional Course in medicine was then made on the basis of the marks obtained in the optional subjects by the respective students in their previous course of study.
The above decision, in our opinion, has no application to the facts of the present case.
The fact that the High Court approved of reservation in the circumstances then existing will not help the State in the case before us.
The next decision to which our attention was drawn by Mr. Gupte is P. Sagar and others vs State of Andhra Pradesh, represented by Health Department, Hyderabad and others(1).
To this decision we will have to revert when we deal with the validity of reservation made for the Backward Classes under G.O. No. 1793 of 1970.
But so far as the question of reservation for the P.U.C. and H.S.C. students is concerned, it is seen that certain rules provided for reservation of percentage of seats for the candidates belonging to the H.S.C. and P.U.C.
Here again the rule was that 1/3rd of the total number of seats in all categories put together should be given to the H.S.C., Multipurpose and I.S.C. candidates and that at least 50% of the seats should be given to the P.U.C. candidates.
It appears that the reservation of 50% of seats for P.U.C. candidates was challenged as being unjust.
It was urged before the High Court that the H.S.C. (Multipurpose) Examination is very difficult and as such those candidates will not be able to secure higher marks as compared to the P.U.C. candidates and in support of this contention the earlier decision in Gullapalli Nageswara Rao and others vs Principal Medical College, Guntur and others(, ') was relied on.
But we find that during the course of the hearing the Advocate General intimated the High Court that the Government was aware that the reservation of 50% seats to the P.U.C. candidates was working a hardship on the Multipurpose candidates and that the rules were being amended.
It was later on represented that rules had also been amended.
Therefore, the High Court ultimately held that in view of the amendment to the rules, it was not necessary to consider the challenge with respect to the reservations made for the Multipurpose and the P.U.C. candidates.
Here again, it is to be stated that there was common Entrance test for all the candidates belonging to the P.U.C. and H.S.C. categories.
On the other hand, the selections were made on the basis of the marks obtained by them in their qualifying examinations.
It was further held in the said decision that even (1) A.I.R. 1968 A.P. 165.
(2) A.I.R. 1962 A.P. 212.
259 in the basis that the qualifying examinations taken by the P.U.C. and H.S.C. candidates were equal, still the reservation is not invalid as discreminatory under article 14 of the Constitution.
But hereagain it is to be noted that selection were made on the basis of the marks obtained in the qualifying examinations and not on the basis of marks obtained in a common Entrance Test held for all the candidates uniformly.
This decision is also, more or less similar to the one in Gullapalli Nageswara Rao and others vs Principal Medical College, Guntur and others.(1) The decision in Sagar and others vs State of Andhra Pradesh (2 ) had also to deal with the reservation of seat in the Professional Colleges for the Backward Classes on the basis of the G.O. which was then in force.
It was held that the said reservation was not saved by article 15 (4).
The decision of the High Court striking down the reservation for the Backward Classes alone was challenged by the State in this Court in State of Andhra Pradesh and another vs P. Sagar.
(3) This Court upheld the decision of the High Court.
We will have to refer to the above sections of the High Court Rs well as of this Court when we deal with the second aspect which arises for consideration before us regarding the reservation made for the Backward Classes under G.O. No. 1793 of 1970.
Mr. Gupte then referred us to the decision in Chitra Ghosh and another vs Union of India and others.
(4) That decision related to a challenge made by certain students who were denied admission to the Maulana Azad Medical College, New Delhi.
The said college was established by the Government of India.
Of the 125 students, who are to be admitted annually, 15% of the seats are reserved for Scheduled Caste candidates and 5% for candidates belonging to the Scheduled Tribes, 25 % of the seats (excluding the seats reserved for Government of India nominees) were reserved for girl students.
In particular 23 seats were reserved to certain categories and they were to be filled up by the candidates who were nominated by the Central Government.
The categories to which the said nomination had to be so made were as follows (1) Sons/daughters of residents of Union Territories specified below including displaced persons registered therein and sponsored by their respective Administration of Territory : (a) Himachal Pradesh, (b) Tripura, (c) Mani pur, (d) Naga Hills, (e) N.E.F.A. and (f) Andaman.
(1) A.I.R. 1962 A.P. 212.
(2) A.I.R. 1968 A.P. 165.
(3) (4) ; 260 (2) Sons/daughters of Central Government servants posted in Indian Missions abroad.
(3) Cultural Scholars.
(4) Colombo Plan Scholars.
(5) Thailand Scholars.
(6) Jammu & Kashmir State Scholars.
The appellants therein had obtained about 62.5% marks and were domiciled in Delhi.
According to them, they were entitled to admission on the basis of merit and would have been so admitted but for the reservations, which were filled by the nominations made by the Central Government.
It was their further contention that the students who had been so nominated by the Central Government and got admission had obtained less percentage of marks than the appellants.
Mainly the power of the Central Government to make the nominations was challenged on the ground that the provision for reservation in favour of such nominees of Central Government was not based on any reasonable classification and suffered from the vice of discrimination and hence the reservation was hit by article 14 read with cls.
(A) and f (iv) of article 15 and Cl.
(ii) of article 29.
This Court rejected the contention and held that neither cls.
(i) and (iv) of article 15 nor cl.
(ii) of article 29 violated.
In support of the challenge of discrimination under article 14, it was claimed by the appellants that merit being the sole criteria for admission, the provisions made for reservation for candi dates to be nominated by the Central Government, introduced discrimination, or it had no reasonable nexus to the object sought to be achieved.
After a reference to the provisions made in respect of each of the categories to be nominated by the Central Government on merits, it was held that the classification in all those cases was based on intelligible differentia, which distinguished them from the group to which the appellants belonged.
In particular, Mr. Gupte relied on the following observations in the said decision "It is the Central Government which bears the financial burden of running the medical college.
It is for it to lay down the criteria for eligibility.
From the very nature of things it is not possible to throw the admission open to students from all over the country.
The Government cannot be denied the right to decide from what courses the admission will be made.
That essentially is a question of policy and depends inter alia on all overall assessment and survey of the requirements of residents of particular territories and other categories of persons for whom it is essential to provide facilities for medical 261 education.
If the sources are properly classified whether on territorial, geographical or other reasonable basis, it is not for the courts to interfere with the manner and method of making the classification.
The next question that has to be determined is whether the differentia on which classification has been made has rational relation with the object to be achieved.
The main purpose of admission to a medical college is to impart education in the theory and practice of medicine.
As noticed before the sources from which students have to be drawn are primarily determined by the authorities who maintain and run the institution e.g., the Central Government in the present case.
In Minor P. Rajendran vs State of Madras(1) it has been stated that the object of selection for admission is to secure the best possible material.
This can surely be achieved by making proper rules in the matter of selection but there can be no doubt that such selection has to be confined to the sources that are intended to supply the material.
If the sources have been classified in the manner done in the present case it is difficult to see how that classification has no rational nexus with the object of imparting medical education and also of selection for the purpose.
" Based upon these observations, Mr. Gupte, contended that the sources for selecting candidates as well as the reservation made in respect of admission to the Maulana Azad Medical College have both been approved by this Court as valid and not violative of Art, 14.
On this analogy, the counsel urged, the present classification of P.U.C. and H.S.C. into two categories and the reservation of 40% for H.S.C. candidates are valid.
In our opinion, the above decision does not lead to the result contended on behalf of the State.
The special circumstances and the reasons for making the reservation to enable the Central Government to make nominations so that candidates belonging to those categories can get adequate representation by way of admission in the Medical Colleges have been elaborately adverted to by this Court and it is on that basis that this Court accepted the classification as valid.
It was further held that the said classification has got a rational relation to the object sought to be achieved.
The object was stated to he to impart medical education to the candidates belonging to those groups or area where adequate facilities for imparting such education were not available.
But the point to be noted in the said decision is that in respect of other candidates, who are not governed by any reservation, the selection on the basis of merit, namely, the marks obtained by them.
On the other hand, in the (1) ; 262 case before us, though a uniform Entrance Test has been prescribed for both the P.U.C. and H.S.C. candidates, still the selection is not made on the basis of the marks obtained in the Entrance Test.
On the other hand, the selections are made after disregarding those marks.
At any rate, so far as some P.U.C. candidates are concerned it shows a preference to the H.S.C. candidates, who may have got lesser number of marks and would not have got admission, but for the reservation of 40% made for the group to which they belonged.
It is no doubt true that it is open to the State to prescribe the sources from which candidates will be selected and also prescribe the criteria for eligibility.
In fact, in the case before us, as we have already pointed out, the rules provide for the qualifications which have to be satisfied to enable a candidate to apply and the sources from which selections will have to be made, have also been prescribed.
We have also pointed out that in respect of eligibility for applying for admission to the 1st Year Integrated M.B.B.S. Course, no distinction has been drawn between P.U.C. and H.S.C. candidates, both of whom have to get at least 50% marks in Physical and Biological Sciences.
So that clearly shows that they have been put on a par so far as eligibility is concerned.
But the discrimination is made only after the Entrance Test is over by denying admission to the P.U.C. candidates who may have got higher marks than some of the H.S.C. candidates who get admission because of the 40% reservation.
Mr. Gupte then referred us to the decision in Ganga Ram and Others V. The Union of India and others(1), wherein the classification of direct recruits and promotees into two different categories in the Accounts Department of the Railway Establishment was hold to be a reasonable classification not attracting the vice of article 14 or 16.
In that case this Court was considering a claim for promotion based upon the test of Seniority cum suitability.
After considering the background of the service concerned, it was held that the State which encounters diverse problems arising from a variety of circumstances is entitled to Jay down the conditions of efficiency and other qualifications for securing best service for being eligible for promotion in its different departments.
It was emphasised that the object sought to be achieved by the relevant provisions which were under attack was the requisite efficiency in the Accounts Department of the Railway Establishment.
It was in that connection held that the direct recruits and promotees constitute different classes or categories and such a classification is sustainable on intelligible differentia, which has a reasonable connection with the object of efficiency in the Department.
This decision also does not help the appellants as there was no distinction made inter se between the promotees and the direct (1) ; 263 recruits.
On the other hand, the same criteria was adopted for purposes of promotion to the persons forming the class of direct recruits.
Similarly, the same test was applied to the persons coming under the group of promotees.
It was under such circumstances that this Court held the classification to be valid, and the situation which this Court had to consider in that connection was entirely different, from the one before us where all the candidates belonging to both the P.U.C. and H.S.C. merge under the Rules when they take the Entrance Test.
In D. N. Chanchala etc.
vs The State of Mysore and others(1), one of the questions this Court had to consider was the validity of the university distribution of seats in the medical colleges run by the State of Mysore.
There were three Universities in Mysore State, namely, Karnatak, Mysore and Bangalore Universities.
The challenge to such distribution of seats was that candidates having lesser marks might obtain admission at the cost of another having higher marks from another university.
This Court after a reference to the different standards of examinations held in the three universities, rejected the challenge of discrimination as follows "Further, the Government which bears the financial burden of running the Government colleges is entitled to lay down criteria for admission in its own colleges and to decide the sources from which admission would be made, provided of course, such classification is not arbitrary and has a rational basis and a reasonable connection with the object of the rules.
So long as there is no discrimination within each of such sources, the validity of the rules laying down such sources cannot be successfully challenged. .
In our view the rules lay down a valid classification.
Candidates passing through the qualifying examination held by a university form a class by themselves as distinguished from those passing through such examination from the other two universities.
Such a classification has a reasonable nexus with the object of the rules, namely, to cater to the needs of candidates who would naturally look to their own university to advance their training in technical studies, such as medical studies.
In our opinion, the rules can.
not j ustly be attacked on the ground of hostile discrimi nation or as being otherwise in breach of Article 14.
" It will be seen that the above decision has empbasised that the selection which was made on the basis of the marks obtained in the qualifying examination held by each of the universities was valid and the distribution of seats in the medical colleges universitywise was also valid in view of the different standards adopted by each (1) ; 264 university.
Again it is to be noted in the said decision, there was no question of all the students of the three universities taking a common Entrance Test on the basis of which a selection was made.
This decision also does not help the appellants.
The decision in The State of Maharashtra and another vs Lok Shikshan Sansatha and others(1) which has laid down that in the matter of permitting colleges to be started in particular areas having due regard to the need of the area concerned, is essentially a matter of policy for the State which has to take a decision on overall assessment and summary of the requirements of a particular area, so long as the decision is not arbitrary or mala fide, it was further held that the courts will not interfere with the assessment made by the State in pursuance of its policy.
This decision is also of no avail to the appellants.
Mr. Tarkunde, apart from distinguishing the above decisions, for the reasons mentioned by us earlier pointed, out that in Gullapalli Nageswara Rao and others vs Principal Medical College, Guntur and others (2), the basis of classification of P.U.C. and H.S.C. was not challenged as there was no necessity for those students to take a common test as in the case before us.
He referred us to the averments in the counter affidavit filed by the Assistant Secretary to the Government in Writ Petition No. 3859 of 1970 in which conducting of Entrance Test was then challenged.
The Assistant Secretary in paragraph 9 of the said counter affidavit in respect of holding of the Entrance Test has stated that the selection of candidates for the 1st Year Integrated M.B.B.S. Course is made on the basis of marks obtained at the Entrance Examination, as such a method of selection ensures fair play and affords equal opportunity to all candidates.
He has again referred us to the fact that by introducing the method of selection by the Entrance Test the Government had done away with the reservations originally made for the P.U.C. and H.S.C. candidates and thus has offered equal opportunity to all candidates.
He has further stated that both the P.U.C. and the H.S.C. students apart from having obtained not less than 50% of marks in Physical and Biological Sciences to be eligible to apply for admission to the medical colleges, have also take the Entrance Test in the subjects mentioned in the rules.
According to the State, the result of the Entrance Test is a method of making selection to the medical colleges, thus ensuring fair play and justice.
In the same Writ Petition the Add].
Director of Medical and Health Services, (Professional Education) has referred to the necessity of holding an Entrance Test.
In this connection he refers (1) ; (2) A.I.R. 1962 A.P. 212.
265 to the marks obtained by certain P.U.C. and H.S.C. students in their qualifying examinations and also to their marks in the Entrance Test.
The Officer has stated that the marks obtained by the candidates in their qualifying examinations are not a reliable guide to assess their merits as the marks obtained by those candidates in the Entrance Test were very poor.
Therefore, it has been emphasised that the marks obtained in the Entrance Test is the guiding factor to assess the merits of both the sets of candidates for admission to the Medical College.
We have referred to the avernments contained in the counter affidavit of the two officers above as they form part of the present record and they have also been relied on for one purpose or other by both the State and the respondents.
The above averments clearly establish that even according to the State the marks obtained in the Entrance Test according to the rules is the decisive test for the purpose of considering the merits of the candidates, who seek admission to the Medical College.
These averments clearly show that there is absolutely no jurisdiction for making of special reservation of 40% in favour of H.S.C. candidates, when once a common Entrance Test is held for all the candidates and selection is made on an assessment of merit of marks obtained at the said examination.
Mr. Tarkunde referred us to Minor P. Rajendran vs State of Madras and others(1) where the validity of the scheme of districtwise distribution of seats as per the rules framed by the State of Madras, to the Medical Colleges, was challenged as violative of article 14.
The State attempted to justify the said method of districtwise distribution on the ground that if districtwise distribution is not made, the candidates from Madras City would have an advantage and would secure the largest number of seats in the Medical Colleges, which will not be justified on the basis of the proportion of population of the Madras City.
The challenge based on discrimination under article 14 was accepted by this Court and it was held that the allocation of seats districtwise results in discrimination and there is no nexus between the districtwise distribution and the object to be achieved, namely, admission of the best talent from the sources indicated in the rules.
On this ground, the allo cation of seats on districtwise basis was struck down as violative of article 14.
Similarly unitwise distribution of seats in the Medical Colleges in Tamil, Nadu was declared by this Court in Minor A. Periakeruppan and another vs State of Tamil Nadu and others(2) as violative of articles 14 and 15.
(1) ; (2) ; 266 These two decisions clearly establish that a classification which has no rational basis and has no relation to the object sought to be achieved is violative of article 14.
It is not necessary for us to refer to the various decisions laying down the contents of article 14.
Suffice it to say that it does not forbid reasonable classification.
In order to pass the test of permissible classification, two conditions must be fulfilled : (1) The classification is founded on an intelligible differentia which distinguishes persons or things that are grouped together from those left out of the group, and (2) the differentia must have a rational relation to the object sought to be achieved.
It is no doubt open to the State to prescribe the sources from which the candidates are declared eligible for applying for admission to the Medical College; but when once a common Entrance Test has been prescribed for all the candidates on the basis of which selection is to be made, the rule providing further that 40% of the seats will have to be reserved for the H.S.C. candidates is arbitrary.
In the first place, after a common test has been prescribed there cannot be a valid classification of the P.U.C. and H.S.C. candidates.
Even assuming that such a classification is valid, the said classification has no reasonable relation to the object sought to be achieved.
namely, selecting the best candidates for admission to the Medical Colleges.
The reservation of 40% to the H.S.C. candidates has .no reasonable relation or nexus to the said object.1.
Hence we agree with the High Court, when it struck down this reservation under rule 9 contained in G. No. 1648 of 1970 as violative of article 14.
The next question that arises for consideration is the correctness ,of the order of the High Court striking down the reservation of seats made for Backward Classes in the Professional Colleges under G.O. No. 1793 of 1970.
The said reservation has been struck down on the ground that it violates article 15(1) and falls outside article 15(4) of the Constitution.
The view of the High Court is very strenuously challenged by 'Mr. section V. Gupte, learned counsel for the appellants.
Mr. V. M. Tarkunde, learned counsel for the respondents, supported the various, reasons given by the High Court for striking down the said reservation.
Before we deal with the reasons given by the High Court for striking down the reservation made for the Backward Classes under the said G.O., we will refer to the circumstances under which the Backward Classes Commission was appointed and whose report has formed the basis for providing the reservation for the various ,persons mentioned therein.
267 The State of Andhra was formed on October 1, 1953 and the Andhra Pradesh State came into existence with effect from November 1, 1956.
The State of Andhra originally formed part of the Composite Madras State.
The Composite Madras State had maintained a list of Backward Classes (other than the Scheduled Castes Tribes), in that State and had made special provisions with regard to admission to educational institutions, reservation of posts in Government Service, grant of scholarships and other concessions to assist those Backward Classes.
After the formation of the Andhra State on October 1, 1953, the list maintained by the Composite Madras State was continued in the Andhra area with some modifications.
The former Princely State of Hyderabad was also maintaining a list of Backward Classes in that State, and this was also continued after the formation of Andhra Pradesh, which included Telangana area.
Thus with effect from November 1, 1956, there were two lists of Backward Classes in the State of Andhra Pradesh one for Andhra area and the other for Telangana area.
Both the lists together comprised about 146 communities 86 and 60 in the Andhra and Telangana areas respectively.
The President of India appointed in January, 1953, a Backward Classes Commission under article 341 nf the Constitution headed by Sri Kaka Kalelkar, to determine the criteria to be adopted for treating any section of the people, other than Scheduled Castes and Scheduled Tribes, as socially and educationally Backward Classes.
The said commission was also to draw up a list of such Classes on.
the basis of the criteria laid down by it.
The report of this Commission was considered by the Central Government, which issued a memorandum pointing out that some of the tests applied by the Commission were very vague.
It was further pointed out that if those tests were applied, a large majority of the Country 's population will have to be considered backward.
The Central Government decided to undertake further investigation to draw some positive and workable criteria for this purpose.
The State Governments were desired in the meanwhile to render every assistance possible to those persons who, in the opinion of the State Governments were backward.
Further attempts by the Central Government to draw up a list of Backward Classes on an All India basis did not meet with much of a success.
Even here some State Governments were in favour of adopting economic backwardness as a criteria while others were inclined to stick on to the list prepared by them on the basis of caste.
The Central Government conveyed to the State Governments on August 14, 1961 expressing its view that while the State Governments have the discretion to choose their own criteria for defining backwardness it would be better to apply economic tests rather than classifying people by their castes.
268 The State of Andhra Pradesh issued G.O. No. 1886 dated June 21, 1963 specifying a list of certain persons as belonging to Backward Classes.
The list was prepared for the purpose of selecting candidates to the seats reserved for backward communities in the Medical Colleges in Andhra Pradesh.
Under the said G.O., 25% of the seats were reserved for Backward Classes in accordance with the list contained therein.
The reservation for the Backward Classes was challenged before the Andhra Pradesh High Court by ,certain applicants on the ground that the Government order offends articles 15 and 29(2) of the Constitution.
It was alleged that the State Government acting in fraud of its powers listed more than 139 castes as socially and educationally backward.
It was the further allegation that the list had been prepared exclusively on the basis of caste.
The State Government contested the writ petitions on the ground that the Government was maintaining a list of Backward Classes based on socially and educationally backwardness of the caste and to such people 25 % of the seats had been reserved.
It was further averred that such reservation had 'been going on for a long time and the list was also being suitably revised by making additions or deletions whenever found necessary.
A learned Single Judge of the High Court in P. Sukhadev The Government of Andhra Pradesh(1) considered the validity of the impugned G.O. No. 1886 of 1.963 from two points of view: (1) whether the list of backward classes was based solely on consideration of caste; and (2) whether the Government had adopted any standard or method of determining the social and educational backwardness of the classes specified and, if so, the material upon which the Government has so acted.
The High Court held that the State on which lay the onus of supporting the classification as valid had placed no materials before the Court as to the economic condition of the various classes, their occupation and habitation and social status and their educational backwardness.
The High Court is also of the view that the enumeration of persons as B ackward Classes in the Government Order has been made almost exclusively on the basis of caste.
On these grounds the Government Order was struck down as violative of article 15 (1) and 29(2.) as being in fraud of powers conferred on the State.
After the G.O. No. 1886 of 1963 was struck down by the High Court, the State Government decided that the criteria for determining backwardness should be only economic factors and should be applied to individual family rather than to a whole caste.
The Government issued a G.O. No. 301/Education dated February 3.
1964 scrapping the then existing list of Backward Classes with (1) 269 effect from April 1, 1964 and directed that financial assistance be given to the economically poorer sections of the population, whose family income was below Rs. 1,500 / per annum.
The State Government again took up the question of drawing up a list of Backward Classes in consonance with the provisions of the Constitution.
For this purpose a Cabinet Sub Committee was constituted to draw up a list of persons who could be considered backward.
The Cabinet Sub Committee obtained information from other States and as per the advice of its Law Secretary, it was decided that certain criteria is to be adopted for determining the backwardness of the people.
The criteria included Poverty Low standard of education, Low standing of living, Place of habitation; Inferiority of occupation and caste.
The Cabinet Sub Committee having taken a decision regarding the criteria to be applied, directed the State Director of Social Welfare to check up the lists of Backward Classes which had been scrapped on February 3, 1964 and to select from those lists the castes or communities which could be considered backward on the basis of the above criteria.
The Director of Social Welfare, in consultation with the Law Secretary drew up a list of persons who could be included in the list of Backward Classes.
The said Cabinet Sub Committee considered the recommendations made by the Director of Social Welfare and accordingly drew up a Est of 112 communities which were considered as backward.
Accordingly, G.O. No. 1880/Education dated July 29, 1966 was issued with a list showing 112 communities as backward as being eligible for scholarships and reservation of seats to Professional Colleges and Government Services.
The validity of the above Government Order was again chal lenged before the High Court of Andhra Pradesh on the ground that the list was prepared solely on the basis of caste and violated the provisions of the Constitution.
Here again the students who filed the writ petitions in the High Court urged that there was no material difference between the list drawn up under this G.O. and the list which was struck down by the High Court as per G.O. No. 1886 of 1963.
The attack was that the list of 1966 was also prepared exclusively on the basis of caste.
The State attempted to justify the preparation of the list of Backward Classes as having been properly done after investigation by the Director of Social Welfare in consultation with the Law Secretary.
The State further urged that all relevant factors had been taken into account by the Director of Social Welfare before preparing the list.
The Division Bench of the Andhra Pradesh High Court in its decision in P. Sagar and others vs State of Andhra Pradesh(1) upheld the challenge leveled against the reservation made in the G.O. for Backward Classes on the ground that the State has not (1) A.I.R. 1968 A P. 165. 270 placed materials which were available before the Cabinet SubCommittee or the Council of Ministers.
The High Court is of the view that the list has been drawn up by the Director of Social Welfare and the Law Secretary, who cannot be considered in any sense to be experts and that they had made no investigation; nor collected material data for classifying the persons mentioned in the G.O. as backward.
It was further emphasised that neither the Director of Social Welfare nor the Cabinet Sub Committee had before them the population of the various classes, their economic conditions, percentage of literacy or their social and economic status.
It is the view of the High Court that no substantial change had been made from the list prepared under G.O. No. 1886 of 1963 And which had already been struck down by the High Court.
Ultimately, the High Court held that the preparation of the list of Backward Classes under G.O. No. 1880 of 1966 had been made without any material and as such the list was struck down as not being saved by article 15 (4).
We have referred rather elaborately to the list prepared by the State Government under Government Orders Nos 1986 of 1963 and 1880 of 1966 as well as the decisions of the High Court striking down those lists.
Even at the time when the earlier decision was given by the Andhra Pradesh High Court in P. Sukhadev vs The Government of Andhra Pradesh(1), the decision of this Court in M. R. Balaji and others vs State of Mysore(2) had been pronounced.
It is really on the basis of the said decision, that the High Court, on the former two occasions struck.down the reservations made under the two Government Orders on the ground that the preparation of the two lists of Backward Classes had not been made in accordance with the principles laid down by this Court.
In fact, in both the decisions the High Court has emphasised that there has been no investigation whatsoever regarding the various factors that are necessary to he obtained as laid down by this Court for the Purpose of making special provisions for the advancement of any socially and educationally Backward Classes of citizens as envisaged in article 15(4).
The sole reason given in the two decisions by the High Court for striking down the reservation is the fact that the necessary data or material, as laid down by this Court, had not been collected by the State Government.
We are again emphasising this aspect because the High Court in the decision, which is under attack before us, has relied on the above two earlier decisions, to a large extent for coming to the Conclusion that the present list of Backward Classes suffers from the same infirmity, as pointed out on the former occasion.
The High Court has further held that the same persons who had been included in the original list, as belonging to Backward Classes and which list was struck down twice, have again been included in the present G.O. No. 1793 (1) (2) [1963] Supp. 1 S.C.R. 439 271 of 1970.
In the course of the judgment, we will be pointing out that the High Court has committed a basic error in proceeding on the basis that the present lists suffers from the same vice, pointed out in he earlier decisions by the High Court.
The State of Andhra Pradesh challenged before this Court the decision of the High Court striking down the reservations made for Backward Classes as well as the preparation of list under G.O. No. 1880 of1966.
This Court in State of Andhra Pradesh and another vs P. Sagar(1) upheld the decision of the High Court striking down 'the reservation.
This Court agreed with the view of the High Court that no enquiry or investigation had been made by the State Government before preparing the list of Backward Classes enumerated in the said Government Order.
It was further held that the State had placed no materials before the Court, on the basis of which the list of Backward Classes was prepared, excepting relying on the fact that it was prepared by the Director of Social Welfare with the assistance of the Law Secretary.
It is to be noted that this Court upheld the decision of the Andhra Pradesh High Court in view of the fact that the State had made no investigation of enquiry, nor had it collected the necessary materials to ascertain the socially and educationally backwardness of the persons mentioned in the list.
The decision of this Court was rendered on March 27, 1968.
On April 12, 1968, the State Government by G.O. No. 870, appointed a Commission to determine the criteria to be adopted in considering whether any sections of the citizens of India in the State of Andhra Pradesh are to be treated as socially and educationally Backward Classes.
The Commission was also desired to prepare a list of such Backward Classes in accordance with the criteria to be adopted.
The Commission consisted of nine members, presided over by the retired Chief Justice of the Andhra Pradesh High Court.
The other members of the Commission included the members of the State legislature.
The terms of Reference have been printed as Appendix 1 in the report Submitted by the Backward Classes Commission.
A perusal of the terms of Reference shows that the Commission was desired to investigate and determine the various matters regarding the preparation of list of Backward Classes for providing a reservation in educational Institutions and also for appointments for posts in Government service.
The Commission was authorised to obtain any information that it considered necessary from the Government Departments, Collectors, Organisations, Individuals and from such other persons as it considered necessary.
It was also authorised to visit any part of the State for the purpose of investigation and enquiry.
Later on, it is seen that the retired Chief Justice of the High Court, Who was originally the Chairman of the 'Commission, resigned and (1) 87Sup Cl/72 272 the Commission was headed by a retired I.C.S. Officer.
The terms of Reference were as follows "The Commission shall (i) determine the criteria to be adopted in considering whether any sections of citizens of India in the State of Andhra Pradesh (other than the Scheduled Castes and Scheduled Tribes specified by notifications issued by the President of India under article 341 & 342 of the Constitution of India) may be treated as socially and educationally Backward Classes and in accordance with such criteria prepare a list of such backward classes setting out also their approximate numbers and their territorial distribution; (ii) investigate the conditions of all such socially and educationally backward classes and the difficulties under which they labour; and make recommendations as to the special provisions which may be made by the Government for their advancement and for prom otion of their educational and economic interests, generally and with particular reference to (1) th e reservation in educational institutions maintained by the State or receiving aid out of State funds; (2) the concessions, such as scholarships, which may be given by way of assistance; (3) the percentage or proportion of such reservation the quantum of such assistance and the period during which such reservation or assistance may be made or given; and (iii) advise the Government as to the backward classes of citizens (other than the Scheduled Castes and the Scheduled Tribes) which are not ,adequately represented in the services under the State and prepare a list of all such backward classes and make recommendation as to: (1) the reservation of appointments or posts in favour of such backward Classes, and (2) the percentage or proportion of such reservation and the period during which such reservation may be made.
273 The Commission submitted its report to the Government on June 20, 1970.
The report was placed before the State legislature as also the Andhra Pradesh Regional Committee.
The Commission in its report had drawn up a list of 92 classes, which according to it, are socially and educationally backward and have to be classified as Backward Classes and for whom reservations have to be made.
After having regard to the views expressed by the Legislature as well as the Regional Committee and after an examination of the Report, the Government issued G.O. No. 1793 of 1970.
The Government accepted the criteria adopted by the Commission for determining the social and educational backwardness of the citizens, namely, (i) the general poverty of the class or community as a whole; (ii) Occupations pursued by the classes of citizens, the nature of which must be inferior or unclean or undignified and unremunerative or one which does not carry influence or power; (iii) Caste in relation to Hindus; and (iv) Educational backwardness.
The Government also accepted the list drawn up by the Com mission in toto and declared that the castes and communities specified in the annexure to the G.O. are socially and educationally, Backward Classes for the purpose of article 15(4) of the Constitution.
Though the Commission had recommended reservation of 30% of seats for the Backward Classes in the Professional College, ,, the Government in the Order decided that only 25% of seats in the Professional Colleges should be reserved for Backward Classes, The Government also agreed to the recommendations of the Commission to the classification of the Backward classes into four groups, and directed that on the basis of the population of those four groups, the 25% reservation of seats in the Professional Colleges was to be apportioned amongst the said four groups in the proportion mentioned in the Government Order.
The Government made it clear that the acceptance of the recommendations of the Commission regarding reservations shall be in force for a period of 10 years in the first instance and the positions will be reviewed thereafter.
We have referred to the circumstances leading up to the passing of the impugned G.O. No. 1793 of 1970.
In order to appreciate the criticism made by the High Court regarding the approach made by the Commission, it is necessary to refer to the salient feature.
, , of the report of the Backward Classes Commission.
The report of the Backward Classes Commission is Annexure B before us.
As soon as the Commission was appointed, the Commission issued a questionnaire and circulated it very widely to the various authorities and organisations mentioned in its report.
The questionnaire refers to various matters regarding the criteria to be adopted for 274 ascertaining the backwardness of persons as well as the information on matters relating to the social and educational backwardness of the persons.
Apart from the distribution of the questionnaire, the Commission called for information from the Heads of all Government Departments regarding the number of persons belonging to each class or community employed in their Departments.
Information was, also asked from the Principals of Colleges, including the Professional and_Technical Colleges regarding the number of students belonging to each class or community in the, academic year 1967 68.
Similarly, the Head Masters of all the High Schools and Multipurpose High Schools in the State were also requested to furnish information regarding the total number of students belonging to each community who studied in those schools during the last 10 years as well as the number of students classwise and community wise who studied in classes VI to XI in 1968 69.
The Commission toured all the districts in the State and recorded oral evidence on oath from the representatives of a number of communities.
During the tour of the districts, the Commission visited the houses and huts belonging to different communities of the people and also made oral enquiries from the inmates about their conditions of living, their customs, relations _with other communities and their problems.
The names of places visited by the Commission together with the dates of such visits are given in Appendix IV of its Report.
The Commission also visited the neighboring States of Madras, Mysore and Kerala with a view to have discussion with the officers of those Governments, which were connected with the welfare of Backward Classes.
The report says that about 820 persons were examined at various places and that about 480 persons submitted written memoranda.
A large number of replies were received from the public to the questionnaire issued by the Commission.
The Commission has stated that it had an opportunity, during its tour and visit of the villages, of studying the living conditions and standard of life of the various communities.
The Commission has, no doubt, referred to the fact that upto date statistical information with regard to population of the several communities as well as the percentage of literacy was not available.
The difficulty was enhanced by the fact that no caste wise statistic had been collected after 1931 census.
So far as Andhra area is concerned, the figures of 1921 census were available, a$ it had been prepared on caste wise basis.
Regarding Telangana area, the 1931 census of caste wise statistic was available.
It had to estimate the 1968 population in the two areas on the basis of the respective census datas available.
The population figures for 1968 for each caste was fixed by the Commission by the percentage of the increase of the total population.
The estimate so made by the Commission is given in Appendix V of the Report.
275 Regarding literacy, the Commission adopted the percentage of student population per thousand of particular class or community in standards X and XI with reference to the average student population in the whole State.
The reasons for adopting this, procedure have been given in Chapter VI.
Though information was called for regarding the student population community wise in standards X and XI from about 2224 High Schools and Higher Secondary Schools in the State, only about 50% of the institutions sent the information regarding the student population community wise, in those two classes.
The Commission worked out an average on the basis of the replies received from the 50% of the institutions which itself comes to nearly more than 100 schools.
It is not necessary to refer to the employment statistics collected by the Commission.
The Commission itself has indicated the difficult problems it had to tackle.
Chapters IV and V deal with the constitutional provisions regarding the Backward Class as well as the general principles laid down by the High Court and this Court for ascertainment of their social and educational backwardness.
Chapter VI deals with the tests of criteria adopted by the Commission for ascertaining the social and educational backwardness of versions.
Regarding social backwardness, after a very exhaustive survey of the trade or occupations carried on by the persons concerned and other allied matters, the Commission has indicated that only such persons belonging to a caste or community who have traditionally followed unclean and undignified occupation, can be grouped under the classification of Backward Classes.
In this connection the Commission has adverted to the general poverty of the class or community as a whole, the occupation pursued by the class of citizens, the nature of which is considered inferior and unclean, undignified or unremunerative or one which does not carry influence or power, and caste in relation to Hindus.
Regarding educational backwardness, the Commission has adverted to the fact that during the past 10 years, the State has introduced many measures for the general educational advancement of its people by introducing com pulsory primary education for children and free education for boys upto Vlllth class and for (,Iris upto Xllth class. 'It has taken note of the fact that in 1968 69, free education for boys was also extended upto High School stage.
Having regard to the fact that because of literacy and educational advancement, passing in the School Final Class (XI Class) is taken as the minimum qualification for appointment in Public Service as also for admission to University and Technical Education, the Commission is of the view that it is proper to take the last two classes, 276 namely, Classes X and XI as standard for ascertaining the educational backwardness.
In this connection it has referred to the Report of the Backward Classes Committee, appointed by the Jammu and Kashmir Government, presided over by Dr. P. B. Gajendragadkar, former Chief Justice of India.
This Committee has expressed the view that the number of students on the rolls of IX and X classes should be ascertained for determining educational backwardness.
The reasons given by the said Committee for this view are quoted by the Commission in its report.
The Commission then has adverted to the fact that the average student population in classes X and XI in the State works out to about 4.55 per thousand.
On this basis, it has proceeded to apply the principle that communities whose student population in these standards is well below the State average, have to be considered as educationally backward.
Here again the Commission has referred to the fact that as only 50% of the schools had furnished figure$ with reference to the student population, it had to work out an average based on those figures applicable to the entire State.
Though the figures received from the schools show that certain groups showed a slightly higher level of education, the Commission felt in the light of their having personally seen their living conditions, the percentage supplied by the schools may not be accurate.
In view of this, the Commission has held even those persons as really backward from the educational point of view.
Chapter VII gives the list of socially and educationally Backward Classes and there is a very exhaustive note attached to each of these groups as to why the Commission regards them as socially and educationally backward.
In that Chapter the Commission has also exhaustively dealt with the names of the groups, the subdivisions in those groups, their traditional occupation and various other matters having a bearing on their social, economic and educational set up.
Appendix VI which enumerates the list of socially and educationally Backward Classes item by item gives a tabular statement containing information about the name of the community, its traditional occupation as well as its population in 1968.
Appendix VII contains a note about each of the classes enumerated by the Commission as Backwardness Classes.
Appendix VII contains information regarding the principal occupation, approximate family income, percentage of school going students in the particular groups and various other information regarding the persons mentioned in the list.
A perusal of the Appendix VII and VII shows that the traditional occupations of he persons enumerated as backward were of a very low order such as beggars, washermen, fishermen, watchmen at burial grounds etc.
The Commission had made certain recommendations regarding reservation in the Government Service and it had also made recommendations regarding other 277 assistance to be given to the Backward Classes.
In these appeals it is not necessary to refer to those recommendations.
For the purposes of these appeals it is only necessary to state that the observations made by this Court in Triloki Nath Tiku and another vs State of Jammu & Kashmir and others(1) that the principles laid down in M. R. Balaji and others vs State of Mysore (2) will equally apply for consideration on a question arising under article 16(4).
We have fairly elaborately dealt with the manner in which the Backward Classes Commission conducted its enquiries and investigation before submitting the report because that gives an idea of the complexity of the problem that it had to face as well as the volume of materials collected by it.
The main grounds on which the High Court has held invalid the enumeration of the Backward Classes as well as the reservation made for them are as follows : The Commission has classified the groups as Backward Classes mainly on the basis of caste, which is contrary to the principles laid down by this Court beginning from M. R. Balaji and others vs State of Mysore(2).
The Commission has not collected the necessary data and particulars for the purpose of ascertaining the social and educational backwardness of the groups.
The Commission has committed a very serious error in taking census figures of 1921 and 1931 for the Telangana and Andhra areas respectively and projecting those figures and arriving at a conclusion for enumeration of Backward Classes in 1968.
Certain communities whose inclusion in the list of.
Backward Classes by Government Orders Nos.
1886 and 1880 of 1963 and 1966 respectively and which had been struck down as invalid by the High Court have again been included in the list of Backward Classes.
This, according to the High Court, shows that no proper investigation has been made by the Commission, The Commission committed a mistake in adopting the average of student population per thousand of a particular class or community in the X and XI Classes with reference to the State average for the purpose of deter mining educational backwardness.
The Commission, and the Government through the vast machinery at their command should have collected more particulars on the various criteria which have been laid down by this Court for ascertaining the backwardness of a particular group or class.
The Commission has ignored the principle laid down by this Court that the social and educational backwardness of persons classified in the list should be comparable or similar to the Schedule Castes and Scheduled Tribes.
The groups in which the percentage of literacy is well above the State average have been included in the list of Backward Classes.
The Commission has further sub divided the groups into more backward and less backward classes.
(1) ; (2) [1963] SLIPP.
I S.C.R. 439.
278 We have thus indicating broadly the reasons given by the High Court for striking down the reservation made for the Backward Classes.
Mr. Gupte, learned counsel for the appellants, urged that the High Court has grossly erred in striking down the list of Backward Classes prepared by the Commission as well as the reservation made by the State.
Mr. Gupte, at one stage even urged that the view of the High Court that before a group can be included in the list of Backward Class, its social and educational backwardness must be similar or comparable to that of Scheduled Castes and Scheduled Tribes, is erroneous.
According to the learned counsel, there is no warrant for any such assumption on a clear reading of article 15 (4).
Counsel further urged that to treat article 15(4) as an "exception is also equally erroneous.
We are not inclined to accept these two contentions of Mr. Gupte because the said two principles have been laid down by this Court in M. R. Balaji and others vs State of Mysore(1), R. Chitralekha and another vs State of Mysore and others(2) and in Stale of Andhra Pradesh and another vs P. Sagar(3).
In all these decisions it has been held that article 15 (4) has to be read as a proviso or exception to articles 15(1) and 29(2).
The said decisions have also laid down that the Backward Classes for whose improvement special provision is contemplated by article 15 (4) must in the matter of their backwardness be comparable to Scheduled Castes and Scheduled Tribes.
In fact the attempt of Mr. Gupte was that the principles laid down in the above decisions require reconsideration.
It is not necessary for us to consider that aspect in this particular case because as we will be indicating later, factually the classes enumerated as Backward Classes are really socially and educationally backward, on the application of the principles laid down by this Court.
It must be pointed out that none of the above decisions lay down that social and educational backwardness must be exactly similar in all respects to that of the Scheduled Castes and Scheduled Tribes.
Those decisions also lay down that article 15(4) being in the nature of an exception, the conditions which justify the departure from article 15 (1) must be strictly shown to exist.
Therefore, we have to consider the correctness of the decision of the High Court taking into consideration also the above principles laid down by this Court.
By article 15 of the Constitution, as originally enacted, it was provided that : "(1) The State shall not discriminate, against any citizen on grounds only of religion, race, caste, sex, place of birth or any of them.
(2) . . . . . . (1) [1963] Supp.
I.S.C.R. 439.
(2) ; (3) 279 (3) Nothing in this article shall prevent the State from making any special provisions for women and children.
" Article 29(2) provided that " No citizen shall be denied admission into any educational institution maintained by the State or receiving out of State funds on grounds only of religion, race, caste, language or any of them." In Article 46, which occurs in Part IV of the Constitution relating to the Directive Principles of State Policy, the State has been enjoined to promote with special care the educational and economic interest of the weaker sections of the people and in particular of the Scheduled Castes and Scheduled Tribes and to protect them from social injustice and all forms of exploitation.
Articles 15 and 29, as originally framed, prohibited the making of any discrimination against any citizen on the ground only of religion.
race, caste, sex, place of birth or any of them.
In State of Madras vs Shrimati Champakam Dorajrajan(1), this Court had to consider the validity of an order issued by the Government of Madras fixing the number of students for particular communities for selection of candidates for admis sion to the Engineering and Medical Colleges in the State.
The challenge was on the ground that it violated the guarantee against discrimination under article 29(2).
This Court held that the Government Order constitutes a violation of the fundamental right guaranteed to the citizens of all by article 29(2) of the Constitution, notwithstanding the Directive Principles laid down in part IV of the Constitution.
This led to Parliament addin Cl.
(iv) in article 15 by the Constitution (First Amendment) Act, 1951.
Article 15(4) is as follows : "15(4) Nothing in this article, or in clause (2) of article 29 shall prevent the State from making any special provision for the advancement of any socially and educationally backward classes of citizens or for the Sche duled Castes and the Scheduled Tribes.
" This clause contained a special provision for the advancement of any socially and educationally backward classes of citizens or for the Scheduled Castes or Scheduled Tribes.
The reservation has to be adopted to advance the interest of weaker sections of Society, but in doing so it is necessary also to see that deserving and qualified candidates are not excluded from admission to higher educational institutions.
In the determination of a class to be grouped as backward, a test solely based upon caste or community cannot be accepted as valid.
But, in our opinion, though Directive Principles contained in article 46 cannot be enforced by courts, (1) ; 280 Art, 15(4) will have to be given effect to in order to assist the weaker sections of the citizens, as the State has been charged with such a duty.
No doubt, we are aware that any provision made under this clause must be within the well defined limits and should not be on the basis of caste alone.
But it should not also be missed that a caste is also a class of citizens and that a caste as such may be socially and educationally backward.
If after collecting the necessary data, it is found that the caste as a whole is socially and educationally backward, in our opinion, the reservation made of such persons will have to be upheld notwithstanding the fact that a few individuals in that group may be both socially and educationally above the general average.
There is no gainsaying the fact that there are numerous castes in 'the country, which are socially and educationally backward and therefore a suitable provision will have to be made by the State as charged in article 15 (4) to safeguard their interest.
The question before us is whether the Backward Classes Com mission had before it the relevant data and materials for enumerating the persons included in the list as Backward Classes.
Various factors or criteria to be adopted for such enumeration have been laid down in several decisions by this Court.
In particular there is a very exhaustive discussion on all aspects bearing on this matter in M. R. Balaji, and others vs State of Mysore(1) regarding the factors to be taken into account.
for the purpose of ascertaining whether a particular class of persons are socially and educationally backward.
Though Mr. Tarkunde, learned counsel for the respondents, supported the various reasons given by the High Court for striking down the reservations made for the Backward Classes, we are of the opinion that the criticisms leveled against the report of the Backward Classes Commission by the High Court are not justified.
It may 'be that something more could have been done and some further investigation could have been carried out.
But, in our opinion, the question is whether on the materials collected by the Commission and referred to in its report, can it be stated that those materials are not adequate or sufficient to support its conclusion that the persons mentioned in the list as Backward Classes are socially and educationally backward.
We may mention in passing that we have not been able to find any definite averment in the affidavits filed by the writ petitioners that any particular group or class included in the list by the Commission is not really socially and educationally backward.
In our opinion, the Commission has taken considerable pains to collect as much relevant material as possible to judge the social and educational backwardness of the persons concerned.
When, for instance, it had called for information regarding the student population in classes X and XI from (1) [1963] Supp.
I. section C. R. 439.
281 nearly 2224 institutions, if only 50% of the institutions sent replies, it is not the fault of the Commission for they could not get more particulars.
If the Commission has only to go on doing the work of collecting particulars and materials, it will be a never ending matter.
In spite of best efforts that any commission may make in collecting materials and datas, its conclusions cannot be always scientifically accurate in such matters.
Therefore, the proper approach, in our opinion, should be to see whether the relevant data and materials referred to in the report of the Commission justify its conclusions.
In our opinion, there was sufficient material to enable the Commission to be satisfied that the persons included in the list are really socially and educationally backward.
No doubt there are few instances where the educational average is slightly above the State average, but that circumstances by itself is not enough to strike down the entire list.
In fact, even there, it is seen that when the whole class in which that particular group is included, is considered the average works out to be less than the State average.
Even assuming there are few categories which are little above the State average, in literacy, that is a matter for the State to take note of and review the position of such categories of persons and take a suitable decision.
We have been referred to various decisions particularly of this Court where reservations for Backward Classes made by the concerned State have been either accepted as valid or struck down.
But it is not necessary for us to refer to those decisions because each case will have to be considered on its own merits, after finding out the nature of the materials collected by a commission or by the State when it enumerated certain persons as forming the Backward Classes.
But one thing is clear that if an entire caste, is as a fact.found to be socially and educationally backward, their inclusion in the list of Backward Classes by their caste name is not violative of article 15 (4).
In M. R. Balaji and others vs State Of Mysore(1) it was held that caste in relation to Hindus may be a relevant factor to consider in determining social backwardness of a group or class of citizens: but it cannot be made the sole or dominant basis in that behalf.
In the said decision enumeration of persons as Backward Classes on the basis solely of caste was struck down.
In State of Andhra Pradesh and another vs P. Sagar(2) a similar list prepared by the State of Andhra Pradesh solely on the basis of caste was struck down.
In Triloki Nath and another vs State of Jammu & Kashmir and others(3), the Constitution Bench of this Court held that the members of an entire caste or community may in the social, economic and educational scale of values, at a given time be backward and may on that account be (1) [1963] Supp.
I.S.C.R. 419.
(2) (3) 282 treated as backward classes, but that is not because they are members of a caste or community but because they form a class.
Therefore, it is clear that there may be instances of an entire cast, or a community being socially and educationally backward for being considered to be given protection under article 15(4).
In M. R. Balaji and others vs State of Mysore(1), it was ob served that it is doubtful if the test of average student population in the last, three High School Classes as appropriate in determining the educational backwardness and that it may not be necessary or proper to put the test as high.
Even in respect of educational State average it was observed in the said decision that the legitimate view to take would be that classes of citizens whose average is well below the State average can be treated as educationally backward.
But here again it was emphasised that the court does not propose to lay down any hard and fast rule as it is for the State to consider the matter and decide it in a manner which is consistent with the requirements of article _ 15 (4).
These observations made by this ,Court in the above decisions have, in our opinion, been misapplied by the High Court to the case on hand.
It has proceeded on the basis that it is axiomatic that the educational average of the class should not be calculated on the basis of the student population in the last three high school classes and that only those classes whose average is below the State average, that can be treated as educationally backward.
This Court has only indicated the broad principles to be kept in view when making the provision under article 15(4).
The High Court has committed another error in that it has proceeded on the basis that the groups whose inclusion as backward classes in the 1963 and 1966 lists, prepared by the State, which were struck down by the High Court, have again been included in the present list by the Commission.
The High Court has missed the fundamental fact that those two lists were struck down by the High Court on the ground that the State had made no investigation whatsoever, nor had the State collected the relevant materials before classifying the groups as Back ward Classes.
It was on that ground that those lists were struck down by the High Court.
In fact this Court also affirmed the latter decision of the Andhra Pradesh High Court striking down the 1966 list in its decision in State of Andhra Pradesh and another vs P. Sagar(2).
Though we are not inclined to agree with the decision of the High Court that the enumeration of groups as Backward Classes by the Commission is solely on the basis of caste, we will assume that the High Court is right in that view.
There are two decisions of this Court where the list prepared of Back ward Classes, on the basis of caste had been accepted as valid.
No doubt, this Court was satisfied on (1) [1963] Supp.
I S.C.R. 439.
(2) 283 the materials that the classification of caste as Backward Classes was justified.
The first decision is Minor P. Rajendran vs State of Madras.
(1) A Constitution Bench of this Court had to consider certain rules framed by the State of Madras for selection of candidates for admission to the last Year Integrated M.B.B.S. Course.
One of the rules, the validity of which had to be considered, was rule 5 providing for reservation for socially and educationally Backward Classes, referred to in the Government Order No. 839/Education, dated April 6, 195 1, as subsequently amended.
The challenge was that the said rule violated Article 15 of the Constitution as the list prepared by the State was exclusively on the basis of caste.
The State of Madras, after giving the history as to how the list of Backward Classes was made starting from the year 1906, had referred to the fact that the list was made upto date by making necessary amendments thereto.
It was further pointed out on behalf of the State that the main criteria for inclusion in the list was the social and educational backwardness of the caste based on occupations pursued by those castes.
It was further pleaded that as the members of the caste as a whole were found to be socially and educationally back ward, they were put in the list.
The, State further pointed out that after the Constitution came into force, the list was examined in the light of article 15 (4) and the same list which continued from 1906 was adopted for purposes of article 15 (4) as the entire caste was socially and educationally backward.
This Court accepted the explanation given by the State of Madras and held that though the list shows certain castes, members of those castes were really a class of socially and educationally backward citizens.
This Court held as a fact that the list prepared by the State was caste wise, nevertheless, as the castes included in the list were as a whole socially and educationally backward, the list was not violative of article 15.
In this view rule 5 was well as the lists of Backward Classes were held to be valid.
The following observations of this Court are apposite "The contention is that the list of socially and educationally backward classes for whom rese rvation is made r. 5 nothing but a list of certain castes.
Therefore, reservation in favour of certain castes, based only on caste considerations violates article 15(1), which prohibits discrimination on the ground of caste only.
Now if the reservation in question had been based only on caste and had not taken into account the social and educational backwardness of the caste in question, it would be violative of article 15(1).
But it must not be (1) ; 284 forgotten that a caste is also a class of citizens and if the caste as a whole is socially and educationally backward reservation can be made in favour of such a caste on the ground that it is socially and educationally backward class of citizens within the meaning of article 15 (4). . .
It is true that in the present cases the list of socially and educationally backward classes has been specified by caste.
But that does not necessarily mean that caste was the sole consideration and that persons belonging to these castes are also not a class of socially and educationally backward citizens. . " The above decision has been quoted with approval in State of Andhra Pradesh and another vs P. Sagar,(1) and it was empha sised that the principles laid down therein do not make any departure from those laid down in the previous decision The next decision of this Court where a list prepared on the basis of caste, on the ground that the entire caste was socially and educationally backward was approved as valid under article 15(4) is Minor A. Pertakaruppan vs State of Tamil Nadu and others.
(2) In this decision unit wise distribution of seats for the Medical Colleges was struck down by this Court as violative of articles 14 and 15, nevertheless the list of Backward Classes, which was challenged, as having been framed on the basis exclusively of caste, was held to be valid.
This Court after referring to the decisions in M. R. Balaji and others vs State of Mysore(1) and R. Chitralekha and others vs State of Mysore(1) held ' that caste is a relevant factor in ascertaining a class for the purpose of article 15(4).
The decision in Minor P. Rajendran vs State of Madras and others(5) was also quoted with approval and the said decision was relied on as an authority for the proposition that the classification of Backward Classes on the basis of caste is within the purview of article 15 (4), if those castes are shown to be socially and educationally backward.
After a perusal of the list of Backward Classes, which was under challenge, this Court held that though the list has been framed on the basis of caste, it does not suffer from any infirmity because the entire caste was substantially socially and educationally backward.
On this basis the list of Backward Classes was held on to be valid.
It may be mentioned that the list which was under challenge was more or less substantially the same as this Court held to be valid in Minor P. Rajendran vs State of Madras and others(5).
At this stage it may be recalled that the State of Andhra Pradesh originally formed part of the composite State of Madras.
We (1) [1968] 39.C.R. 595.
(2) ; (3) [1963] Supp.
I.S.C.R. 439.
(4) ; (5) ; 285 sent for the paper book in Writ Petition No. 285 of 1970, the decision of which is reported in Minor P. Rajendran vs State of Madras and others.(1) On a comparison of the list, which was under challenge in the said decision, but accepted as correct by this Court, with the list which is under attack before us, we find that most of the groups whose inclusion in the list by the State of Madras was held to be valid are also found in the list prepare by the Backward Classes Commission appointed by the Andhra Pradesh State.
To conclude, though prima facie the list of Backward Classes which is under attack before us may be considered to be on the basis of caste, a closer examination will clearly show that it is only a description of the group following the particular occupations or professions, exhaustively referred to by the Commission.
Even on the assumption that the list is based exclusively on caste, it is clear from the materials before the Commission and the reasons given by it in its report that the entire caste is socially and educa tionally backward and therefore their inclusion in the list of Backward Classes is warranted by article 15(4).
The groups mentioned therein have been included in the list of Backward Classes as they satisfy the various tests, which have been laid down by this Court for ascertaining the social and educational backwardness of a class.
The Commission has given very good reasons as to why it had to take into account the population figures based upon the 1921 and 1931 censuses.
It was also justified in taking the average student population of Classes X and XI, especially as the said procedure has been accepted by the Committee appointed by the Jammu and Kashmir Governments, presided by Dr. P. B. Gajendragadkar, former Chief Justice of India.
That Committee took into account IX and X standards average.
The decided cases have laid down the principles for ascertaining the social and educational backwardness of a class.
The Backward Classes Commission in this case has taken considerable pains in collecting data regarding the various aspects before including a particular group as Backward Class in the list.
There is a criticism levelled that the Commission has used its personal knowledge for the purpose of characterising a particular group as backward.
That, in the circumstances of the case, is inevitable and there is nothing improper or illegal.
The very object of the Commission in touring the various areas and visiting the huts and habitations of people is to find out their actual living conditions.
After all that information has been gathered by the Commission not secretly but openly.
In fact the actual living conditions of habitation can be very satisfactorily judged (1) ; 286 and found out only on a personal visit to the areas, which will give a more accurate picture of their living conditions and their surroundings.
If the personal impressions gathered by the members of the Commission have also been utilised to augment the various other materials gathered as a result of detailed investigation, it cannot be said that the report of the Commission suffers from any vice merely on the ground that they imported personal knowledge.
In our opinion, the High Court has not been fair to the Commission when it says that whenever the Commission found the figures obtained in respect of certain groups as relating to their educational standard being higher than the State average, it adopted an ingenious method of getting over that obstacle by importing personal knowledge.
In fact the Commission has categorically stated that the information received from the various schools showed that the percentage of education was slightly higher than the State average in respect of certain small groups; but in view of the fact that their living conditions were deplorably poor, the slight higher percentage of literacy should not operate to their disadvantage.
Regarding the criticism that the Commission has divided classes into more backward and less backward, in our opinion, this is not also well founded.
On the other hand, what the Commission has recommended was the distribution of seats amongst the reserved classes in proportion to their population.
This is not a division of the Backward Classes as more backward and less backward as was the case which was dealt with by this Court in M. R. Balaji and others vs State of Mysore.(1) There was a contention raised by Mr. Tarkunde, learned coun sel for the respondents, that the total number of seats that could be given to the candidates belonging to the Backward Classes cannot exceed the percentage of reservation made in their favour.
That is, according to the learned counsel, if more than the reserved quota amongst the Backward Classes candidates, have secured seats on merit, there can be no further selection of candidates from the reserved group.
No doubt our attention was drawn to a decision of the Kerala High Court, which has held that the reservation is irrespective of some of the candidates belongings to the Backward Classes, getting admission on their own merit.
The Andhra Pradesh High Court has taken a slightly different view.
If a situation arises wherein the candidates belonging to the groups included in the list of Backward Classes, are able to obtain more seats on the basis of their own merits, we can only state that it is the duty of the Government to review the question of further reservation of seats for such groups.
This has to be emphasised because the (1) [1963] Supp.
I S.C.R. 439.
287 Government should not act on the basis that once a class is considered as a backward class, it should continue to be backward for all time.
If once a class appears to have reached a stage of progress, from which it could be safely inferred that no further protection is necessary, the State will do well to review such instances and suitably revise the list of Backward Classes.
In fact it was noticed by this Court in Minor A. Periakarauppan vs State of Tamil Nadu and others(1) that candidates of Backward Classes had secured nearly 50% of seats in the general pool.
On that ground this Court did not hold that the further reservation made for the Backward Classes is invalid.
On the other hand it was held The fact that candidates of backward classes have secured about 50% of the seats.
in the general pool does show that the time has come for a de novo comprehensive examination of the question.
It must be remembered that the Government 's decision in this regard is open to judicial review.
" The only other aspect that has to be dealt with is the quantum of reservation made for the Backward Classes.
It was held in M. R. Balaji and others vs State of Mysore(2) that the total of reservation for Backward Classes, Scheduled Castes and Scheduled Tribes should not ordinarily exceed 50% of the available seats.
In the case before us, under G.O. No. 1793 of 1970, the total reservation is only 43%.
The break up of that percentage is 25%, 4% and 14%, for the Backward Classes, Scheduled Tribes and Scheduled Castes respectively.
The quantum of reservation is thus well within the limits mentioned in the decision, referred to above.
For the reasons given above, we are of the opinion that the list of Backward Classes, as well as the reservation of 25% of seats in Professional Colleges for the persons mentioned in the said list is valid and is saved by article 15(4) of the Constitution.
We are not inclined to agree with the reasons given by the High Court that the said G.O. offends article 15 (4) of the Constitution.
To conclude, we agree with the Wings of the High Court that reservation of 40% of seats to the H.S.C. candidates to the 1st Year Integrated M.B.B.S. Course under rule 9 of G.O. No. 1648 of 1970 is invalid.
That provision has been rightly struck down by the High Court.
To that extent the judgment and orders of the High Court are confirmed.
We, however, differ from the decision of the High Court regarding the invalidity of G.O. No. 1793 of 1970.
On the (1) ; 6 L8879upCI/72 (2) [1963] Supp.
I section C.R. 439.
288 other hand we hold that the said G.O. is valid and is saved by article 15(4) of the Constitution.
The judgment and orders of the High Court to the extent of striking down the said G.O., in consequence set aside.
In the result, the judgment and orders of the High Court striking down G.O. No. 1793 of 1970 are set aside and the appeals allowed in part to that txtent.
In other respects the appeals will stand dismissed.
There will be no order as to costs in the appeals.
It has been represented on behalf of the State that the admissions already given to the writ petitioners will not be disturbed.
G.C. Appeals allowed in part.
| The petitioner was detained under section 6 of the West Bengal Prevention of Violent Activities Act, 1970.
One of the grounds of detention which was supplied to the petitioner under sub section (1) of section 8 was that he alongwith his associates went to a pharmacy posing himself as a purchaser of medicine and demanded money from the owner of the pharmacy in the name of collection towards party fund and out of fear the owner delivered Rs. 10/ to him.
Quashing the order of detention, HELD : (i) The ground does not fall under any of the clauses of section 3 setting out the circumstances under which a person can be ordered to be detained and is therefore extraneous in character.
(ii) There is no allegation in the ground that the petitioner had put any person in fear of any injury to that person or to any other.
As such it cannot be said that the petitioner was guilty of extortion.
Intention ally putting a person in.
fear of injury to himself or any other is a necessary ingredient of the offence of extortion.
[403 B] (iii) There is nothing to show that the District Magistrate would, have passed the order of detention of the petitioner in case he was not influenced by the facts mentioned in the ground.
Therefore, the extraneous nature of even one of the grounds of detention would vitiate the order of detention.
[403 D]
|
: Writ Petition No. 153 of 1966.
(Under Article 32 of the Constitution of India for enforcement of the Fundamental Rights) And Writ Petition No. 202 of 1966.
(Under Article 32 of the Constitution of India for enforce ment of the Fundamental Rights) And Writ Petition No. 205 of 1966.
(Under Article 32 of the Constitution of India for enforcement of the Fundamental Rights) 778 In Writ Petition No. 153 of 1966.
R. V. section Mani, section K, Mehta and K. L. Mehta, for the petitioners.
Niren,De, Additional Solicitor General of India,and R. N. Sachthey, for the Respondents.
Niren De, Additional Solicitor General of India,G.Rajagopal, and R. H. Dhebar,for Intervener Ng.
1. section D. Banerjee, Advocate General for the State of West Bengal, B. Sen and P. K. Bose,for Intervener No.2.
Lal Narain Sinha, Advocate General for the State of Bihar, Bajrang Saha, M. M. Gajadhar, K. M. K. Nair, D. P. Singh, M. K. Ramamurthi, R. K. Garg, section C. Agarwala and G. D. Gupta, for Intervener No. 3.
Mohan Kumaramangalam., Advocate General for the State of Madras, B. Ramamurthi and A. V. Rangam, for Intervener No. V. D. Mahajan and R. H. Dhebar, for Intervener No., 5.
K. L. Mishra, Advocate General for the State of Uttar Pradesh, and O. P. Rana, for Intervener No., 6.
V. A. Seyid Muhamad, Advocate General for the State of Kerala, B. R. L. Iyengar, A. G. Pudissery, for Intervener No. 7.
Naunit Lal, for Intervener No. 8.
K. B. Mehta, for Intervener No. 9.
P. Ram Reddy and T. V. R. Tatachari, for Intervener No. 10.
M. C. Stealvad, B. R. L. Iyengar and R. H. Dhebar, for Inter vener No. 11.
R. Thiagarajan, for Intervener No. 12.
D. N. Mukherjee, for Interveners Nos. 13 and 19 to 21.
E. Udayairatnam, section section Dalal and D. D. Sharma, for Inter veners Nos. 14 and 15.
R. K Garg, D. P. Singh, M. K. Ramamurthi, section C. Agarwala, G. D. Gupta and K. M. K. Nair ' for Intervener No. 16. 'K. Parasaran and K. R. Chaudhuri, for Intervener No. 17.
Basudev Prasad, K. Parasaran and K. R. Chaudhuri, for Intervener No. 18.
Basudev Prasad, K. Rajendra Chaudhuri, K. R. Chaudhuri and section N. Prasad, for Interveners Nos.
22 to 24.
779 in Writ Petition No. 202 of 1966.
M.K. Nambyar, K. B. Jinaraja Hegde, N. A., Subramaniam, Bhuvanesh Kumari, O. C. Mathur, J. B. Dadachanji and Ravin der Narain, for the Petitioner.
H. R. Gokhale, B. P. G. K. Achar, K. H. Dhebar, R. N. Sachthey and section P. Nayyar, for Respondent No. 1.
Niren De, Additional Solicitor General, N. section Bindra and R. N. Sachthey, for Respondent No. 2.
A. K. Sen, F. section Nariman, M. L. Bhakte, section I. Thakere, J. B. Dadachanji, O. C. Mathur and Ravinder Narain, for Intervener No. 1.
N. A. Palkhiwala, F. section Nariman, M. L. Bhakte, D. M. Popat,0.
P. Malhotra, J. B. Dadachanji, O. C. Mathur and Ravinder Narain, for Intervener No. 2. D. M., Parulekar B. Dutta, J. B. Dadachanji, O. C. Mathur and Ravinder Narain, for Intervener No. 3.
In Writ Petition No. 205 of 1966.
M. K. Nambyar, K. B. Jinaraja Hegde, N. A. Subramaniam, Bhuvanesh Kumari, O. C. Mathur, J. B. Dadachanji and Ravin der Narain, for the Petitioner.
H. R. Gokhale, B. R. G. K. Achar, R. H. Dhebar and section P. Nayyar, for Respondent No. 1. section G. Patwardhan, D. M. Parulekar, B. Dutta, section K. Dhelika, 1.
B. Dadachanji, O. C. Mathur and Ravinder Narain, for the Intervener.
The Judgment Of SUBBA RAO, C.J., SHAH, SIKRI, SHELAT and VAIDIALINGAM, JJ. was delivered by SUBBA RAO, C.I. According to this Judgment (i) the power to amend the Constitution is not to be found in article 368 but in articles 245, 246 and 248 read with Entry 97 of List 1; (ii) the amending power can.
not be used to abridge or take away the fundamental rights guaranteed in Part III of the Constitution; (iii) a law amending the Constitution is "Law" within the meaning of article 13(2) and (iv).
the First, Fourth and Seventeenth Amendments though they abridged fundamental rights were valid in the past on the basis of earlier decisions of this Court and continue to be valid for the future.
On the application of the doctrine of "prospective over ruling", as enunciated in the judgment, the decision will have only prospective operation and Parliament will have no power to abridge or take away Fundamental Rights from the date of the judgment.
The Judgment of WANCHOO, BHARGAVA and MITTER, JJ. was delivered by WANCHOO, J.
According to this Judgment (i) the 780 power of amending the Constitution resides in article 368 and not in articles 245, 246 and 248, read with EntrY 97 of List 1; (ii) there, are no restrictions on the power if the procedure in article 368 is followed and all the Parts of the Constitution including Part III, can be amended, (iii) an amendment of the Constitution is not " 'law" under article 13(2); and (iv) the doctrine of "prospective overruling" cannot be applied in India.
HIDAYATULLAH, J. delivered a separate judgment agreeing with SUBBA RAo, CJ.
on the following two points: (i) that the power to amend the Constitution cannot be used to abridge or take away fundamental rights; and (ii) that a law amending the Constitution is "law" under article 13 (2).
He agrees With WANCHOO, J. that the power to amend does not reside in articles 245 and 248 read wish Entry 97 of List 1. article 368, according to him, is sui generis and procedural and the procedure when correctly followed, results in an amendment.
He does not rely on the doctrine of "prospective overruling".
As regards the First, Fourth and Seventh Amendments, these having long enured and been acquiesced in, he does not treat the question of their validity as being before him.
As regards the Seventeenth Amendment he finds sufficient support for it in the Constitution as amended by the First, Fourth and Seventh Amendments and holds that the new definition of "estate", introduced by the Amendment, though it is "law" under article 13 (2) and is an inroad into fundamental rights, is beyond the reach of the courts because it falls within the word "law" in articles 31 (1), (2), 2A and 31A(1).
He, however, declares section 3 of the Seventeenth Amendment Act ultra vires the amending process as an illegitimate exercise of the amending power.
[BACHAWAT and RAMASWAMI, JJ. delivered separate judgments concurring with WANCHOO, J.] Subbarao, C.J.
These three writ petitions raise the important question of the validity of the Constitution (Seventeenth Amendment) Act, 1964.
Writ Petition No. 153 of 1966, is filed by the petitioners therein against the State of Punjab and the Financial Commissioner, Punjab.
The petitioners are the son, daughter and granddaughters of one Henry Golak Nath, who died on July 30, 1953.
The Financial Commissioner, in revision against the order made by the Additional Commissioner, Jullundur Division, held by an order dated January 22, 1962 that an area of 418 standard acres and 9 1/4 units was surplus in the hands of the petitioners under the provisions of the Punjab Security of Land Tenures Act X of 1953, read with section 10 B thereof.
The petitioners, alleging that the relevant provisions of the said Act where under the said area was 781 declared surplus were void on the ground that they infringed their rights under cls.
(f) and (g) of article 19 and article 14 of the Constitution, filed a writ in this Court under article 32 of the Constitution for a direction that the Constitution (First Amendment) Act 1951, Constitution (Fourth Amendment) Act, 1955, Constitution (Seventeenth Amendment) Act, 1964, insofar as they affected their fundamental rights were unconstitutional and inoperative and for a direction that section 10 B of the said Act X of 1953 was void as violative of articles 14 and 19 (1) (f) and (g) of the Constitution.
Writ Petitions Nos. 202 and 203 of 1966 were filed by different petitioners under article 32 of the Constitution for a declaration that the Mysore Land Reforms Act (Act 10 of 1962) as amended by Act 14 of 1965, which fixed ceilings on land holdings and conferred ownership of surplus lands on tenants infringed articles 14, 19 and 31 of the Constitution and, therefore, was unconstitutional and void.
The States of Punjab and Mysore, inter alia, contended that the said Acts were saved from attack on the ground that they infringed the fundamental rights of the petitioners by reason of the Constitution (Seventeenth Amendment) Act, 1964, which, by amending article 31 A of the Constitution and including the said two Arts in the 9th Schedule thereto, had placed them beyond attack.
In Writ Petition No. 153 of 1966, 7 parties intervened.
In Writ Petition No. 202 of 1966 one party intervened.
In addition, in the first petition, notice was given to the Advocates General of various States.
A11 the learned counsel appearing for the parties, the Advocates General appearing for the States and the learned counsel for the interveners have, placed their respective viewpoints exhaustively before us.
We are indebted to all of them for their thorough preparation and clear exposition of the difficult questions of law that were raised in the said petitions.
At the outset it would be convenient to place briefly the respective contentions under different heads : (1) The Constitution is intended to be permanent and, therefore, it cannot be amended in a way which would injure, maim or destroy its indestructible character.
(2) The word "amendment" implies such an addition or change within the lines of the original instrument as will effect an improvement or better carry out the purpose for which it was framed and it cannot be so construed as to enable the Parliament to destroy the permanent character of the Constitution.
(3) The fundamental rights are a part of the basic structure of the Constitution and, therefore, the said power can be exercised only to preserve rather than destroy the essence of those rights.
(4) The limits on the power to amend are implied in article 368, for the 782 expression "amend" has a limited meaning.
The wide phraseo logy used in the Constitution in other Articles, such as "repeal" and "re enact" indicates that article 368 only enables a modification of the Articles within the framework of the Constitution and a destruction of them.
(5) The debates in the Constituent Assembly, particularly the speech of Mr. Jawahar Lal Nehru, the first PA= Minister of India, and the reply of Dr. Ambedkar, who piloted the Bill disclose clearly that it was never the intention of the makers of the Constitution by putting in article 368 to enable the Parliament to repeal the fundamental rights, the circumstances under which the amendment moved by Mr. H. V. Kamath, one of the members of Constituent Assembly, was withdrawn and article 368 was finally adopted, support the contention that amendment of Part II, is outside the scope of article 368.
(6) Part III of the Constitution is a self contained Code.
and its provisions are elastic enough to meet all reasonable requirements of changing situations.
(7) The power to amend is sought to be derived from three sources, namely, (i) by implication under article 368 itself; The procedure to amend culminating in the amendment of the Constitution necessarily implies that power, (ii) the power and ,the limits of the power to amend are implied in the Articles sought to be amended, and (iii) article 368 only lays down the procedure to amend, but the power to amend is only the legislative power conferred on the Parliament under articles 245, 246 and 248 of the Constitution.
(8) The definition of "law" in article 13(2) of the Constitution includes every branch of law, statutory, constitutional, etc., ' and therefore, the power to amend in whichever branch it may be classified, if it takes away or abridges fundamental rights would be void thereunder.
(9) The impugned amendment detracts from the jurisdiction of the High Court under article 226 of the Constitution and also the legislative powers of the States and therefore it falls within the scope of the proviso to article 368.
The said summary, though not exhaustive, broadly gives the various nuances of the contentions raised by the learned counsel, who question the validity of the 17th Amendment.
We have not noticed the other arguments of Mr. Nambiar, which are peculiar to the Writ Petition No. 153 of 1966 as those questions do not arise for decision, in the view we are taking on the common questions.
On behalf of the Union and the States the following points were pressed : (1) A Constitutional amendment is made in exercise of the sovereign power and not legislative power of Parliament and,.
therefore, it partakes the quality and character of the Constitution itself.
(2) The real distinction is between a rigid and a flexible Constitution.
The distinction is based upon the express limits of the amending power.
(3) The provisions of article 783 368 axe clear and unequivocal and there is no scope for invoking implied limitations on that power: further the doctrine of impliedpower has been rejected by the American courts and jurists.
(4) The object of the amending clause in a flexible Consetitution is to enable the Parliament to amend the Constitution in order to express the will of the people according to the changing course of events and if amending power is restricted by implied limitations, the Constitution itself might be destroyed by revolution.
Indeed, it is a safety valve and an alternative for a violent change by revolution.
(5) There are no basic and non basic features of the Constitution; everything in the Constitution is basic and it can be amended in order to help the future growth and progress of the country.
(6) Debates.
in the Constituent Assembly cannot be relied upon for construing article 368 of the Constitution and even if they can be, there is nothing in the debates to prove, positively that fundamental rights were excluded from amendment.
(7) Most of the amendments are made out of political necessity: they involve, questions, such.
as, how to exercise power,, how to make the lot of the citizens better and the like and, therefore, not being judicial questions, they are outside the court 's jurisdiction.
(8) The language of article 368 is clear, categorical, imperative and universal, on the other hand, the language of article 13(2) is such as to admit qualifications or limitations and, therefore, the Court must construe them in such a manner as that Article could not control article 368.
(9) In order to enforce the Directive Principles the Constitution was amended from time to time and the great fabric of the Indian Union has been built since 1950 on the basis that the Constitution could be amended and, therefore, any reversal of, the previous I decisions would introduce economic chaos in our country and that, therefore, the burden is very heavy uponthe petitioners to establish that the fundamental rights cannot be amended under article 368 of the Constitution.
(10) article 31 A and the 9th Schedule do not affect the power of the High Court under article 226 or the legislative power of the States though the area of their operation is limited and, therefore, they do not fall within the scope of the proviso to article 3 68.
The aforesaid contentions only represent a brief summary of elaborate arguments, advanced by learned counsel.
We shall deal in appropriate context with the other points mooted before US.
It will be convenient to read the material provisions of theConstitution at.
this stage.
Article 13(1) (2) The State shall not make any law which takes away or abridges the rights conferred by this part and any law made in contravention of this clause shall, toy the extent of the contravention, be void.
784 (3) In this article, unless the context otherwise requires, (a) "law" includes any Ordinance, order, bye law, rule regulation, notification, custom or usage having in the territory of India the force of law.
Article 31 A(1), Notwithstanding anything contained in article 13, no law providing for, (a) the acquisition by the State of any estate or of any rights therein or the extinguishment or modification of any such rights, shall be deemed to be void on the ground that it is inconsistent with, or takes away or abridges any of the rights conferred by article 14, article 19 or article 31.
(2) (a) the expression "estate" shall, in relation to any local area, have the same meaning as that expression or its local equivalent has in the existing law relating to land tenure in force in that area and shall also include, (ii) any land held under ryotwari settlement, (iii) any land held or let for purposes of agriculture or for purposes ancillary thereto.
Article 31 D. Without prejudice to the generality of the provisions contained in article 31 A, none of the Acts and Regulations specified in the Ninth Schedule nor any of the provisions thereof shall be deemed to be void, or ever to have become void, on the ground that such Act, Regulation or provision is inconsistent with, or takes away or abridges any of the rights conferred by, any provisions of this Part, and not withstanding any judgment decree or order of any court or tribunal to the contrary, each of the said Acts and Regulations shall, subject to the power of any competent Legislature to repeal or amend it, continue in force.
In the Ninth Schedule to the Constitution the Mysore Land Reforms Act, 1961, (Mysore Act 10 of 1962) is included as item 51 and the Punjab Security of Land Tenures Act, 1953 (Punjab Act 10 of 1953) is included as item 54.
The definition of "estate" was amended and the Ninth Schedule was amended by including therein the said two Acts by the Constitution (Seventeenth Amendment) Act, 1964.
785 The result of the said amendments is that both the said Acts dealing with estates, within their wide definition introduced by the Constitution (Seventeenth Amendment) Act, 1964, having been included in the Ninth Schedule, are placed beyond any attack on the ground that their provisions are inconsistent with or take away or abridge any of the rights conferred by Part III of the Constitution.
It is common case that if the Constitution (Seventeenth Amendment) Act, 1964, was constitutionally valid, the said Acts could not be impugned on any of the said grounds.
The question of the amendability of the fundamental rights was considered by this Court earlier in two decisions, namely, Sri Sankari Prasad Singh Deo vs Union of India and State of Bihar(1) and in Sajjan Singh vs State of Rajasthan (2) In the former the validity of the Constitution (First Amend ment) Act, 1951, which inserted, inter alia, articles 31 A and 31 B in the Constitution, was questioned.
That amendment was made under article 368 of the Constitution by the Provisional Parliament.
This Court held that Parliament had power to amend Part III of the Constitution.
The Court came to that conclusion on two grounds, namely, (1) the word "law" in article 13(2) was one made in exercise of legislative power and not constitutional law made in exercise of constituent power; and (ii) there were two articles (articles 13(2) and 368) each of which was widely phrased and, therefore, harmonious construction required that one should be so read as to be controlled and qualified by the other, and having regard to the circumstances mentioned in the judgment article 13 must be read subject to article 368.
A careful perusal of ' the judgment indicates that the whole decision turned upon an assumption that the expression "law" in Art 13(2) does not include constitutional law and on that assumption an attempt was made to harmonise Article 13 (2) and 368 of the Constitution.
The decision in Sajjan Singh 's case(2) was given in the con text of the question of the validity of the Constitution (Seventeenth Amendment) Act, 1964.
Two questions arose in that case: (1) Whether the amendment Act insofar it purported to take away or abridge the rights conferred by Part III of the Constitution fell within the prohibition of article 13(2) and (2) Whether Articles 31 A and 31 B sought to make changes in articles 132, 136 or 226 or in any of the lists in the Seventh Schedule and therefore the requirements of the proviso to Article 368 had to be satisfied.
Both the Chief Justice and Mudholkar, J. made it clear that the first contention was not raised before the Court.
The learned counsel appearing for both the parties accepted the correctness of the decision in Sankari Prasad 's case(1) in that (1) ; ,105.
(2) ; , 946, 950, 959, 961, 963.
786 regard.
Yet Gajendragadkar, C.J. speaking for the majority ,agreed with the reasons given in Sankari Prasad 's case(1) on the first question and Hidayatullah and Mudholkar, JJ.
expressed their dissent from the said view.
But all of them agreed, though for different reasons on the second question.
Gajendragadkar, C.J. speaking for himself, Wanchoo and Raghubar Dayal, JJ. rejected the contention that article 368 did not confer power on Parliament to take.
away the fundamental rights guaranteed by Part III.
When a suggestion was made that the decision in the aforesaid case should be reconsidered and reviewed, the learned Chief Justice though he conceded that in a case where a decision had a significant impact on the fundamental rights of citizens, the Court would be inclined to review its earlier decision in the interests of the public good, he did not find considerations of substantial and compelling character to do so in that case.
But after: referring to the reasoning given in Sankari Prasad 's case(1) the; learned Chief Justice observed "In our opinion , the expression "amendment of the, Constitution" plainly and unambiguously means amendment of all the provisions of the Constitution.
" Referring, to article 13 (2), he restated the same reasoning found in, the earlier decision and added that if it was the intention of the Constitution makers to save, fundamental rights from the amending,process they should have taken the precaution of making A .
clear provision in that regard.
In short, the majority, speaking through Gajendragadkar, C.L agreed that no case had been made, out for reviewing the earlier decision and practically accepted the reasons given in the earlier decision.
Hidyatullah J. speaking for himself, observed "But I make it clear that I must not be understood to have subscribed to the view that the word "law" in article 13(2) does not control constitutional amendments.
, I reserve my opinion on that case for I apprehend that it depends on how wide is the "law"in that Article." After giving his reasons for doubting the correctness of the reasoning given in Sankari Prasad 's case(1), the learned Judge concluded thus : "I would require stronger reasons than those given in Sankari Prasad 's case(1) to make me accept the view that Fundamental Rights were not really fundamental but were intended to be within the powers of amendment in common with the other parts of the Constitution and without the concurrence of the States." (1) ; 787 The.
learned Judge continued "The Constitution gives so many assurances in Part III that it would be difficult to think that they were the playthings of a special majority.
" Mudholkar, J. was positive that the result of a legislative action of a legislature could not be other than "law" and, therefore, it seemed to him that the fact that the legislation dealt with the amendment of a provision of the Constitution would not make, its results anytheless a 'law".
He further pointed out that article 368 did not say that whenever Parliament made an amendment to the Constitution it assumed a different capacity from that of a constituent body.
He also brought out other defects in the line of reasoning adopted in Sankari Prasad 's case(1).
It will, therefore,be seen that the correctness of the decision in Sankari Prasad 's case(1) was not questioned in Sajjan Singh 's case(2) Though it was not questioned, three of the learned Judges agreed with the view expressed therein, but two learned Judges were inclined to take a different view.
But, as that question was not raised, the minority agreed with the conclusion, arrived at by the majority on the question whether the Seventeenth Amendment Act was, covered by the proviso.
to article 368 of the Constitution.
The conflict between the majority and the minority in Sajjan 's Singh 's case(1) falls to be resolved in this case.
The said conflict and, the great importance of the question raised is the justification for . the Constitution of the larger Bench.
, The decision in Sankri Prasad 's case(1) was assumed to be correct in subsequent decisions of this Court.
See section Krishnan vs State of Madras(1), The State ' of West Bengal vs Anwar All Sarkar(1) and Basheshar Nath vs The Commissioner of Income tax, Delhi and Rajasthan(5).
But nothing turns upon that fact, as the correctness of the derision was not questioned .
in those cases.
A correct appreciation of the scope and the place of funda mental rights in our Constitution will give its the right perspective for solving the problem presented before us, Its scope cannot be appreciated unless we have a conspectus of the Constitution, its objects.
and its machinery to achieve those object.
The objective sought to be achieved by the Constitution is declared in sonorous terms.
in its preamble which reads "We the people of India having solemnly resolved to constitute India into a Sovereign, Democratic, Republic and to secure to all its citizens justice.
liberty.
equality.
and fraternity .
(1) ; (3) ; at page 652.
(2) [1965] 1 S.C.R.933.
(4) ; , 366.
(5) [1959] Supp. 1 S.C.R. 528,563.
788 It contains in a nutshell, its ideals and its aspirations.
The preamble is not a platitude but the, mode of its realisation is worked out in detail in the Constitution.
The Constitution brings into existence different constitutional entities, namely, the Union, the States and the Union Territories.
It creates three major instruments of power, namely, the Legislature, the Executive and the Judiciary.
It demarcates their jurisdiction minutely and expects them to exercise their respective powers without overstepping their limits.
They should function within the spheres allotted to them.
Some powers overlap and some are superseded during emergencies.
The mode of resolution of conflicts and conditions for supersession are also prescribed.
In short, the scope of the power and the manner of its exercise are regulated by law.
No authority created under the Constitution is supreme; the Constitution is supreme; and all the authorities function under the supreme law of the land.
The rule of law under the Constitution has a glorious content.
It embodies the.
modem concept of law evolved over the centuries.
It empowers the Legislatures to make laws in respect of matters enumerated in the 3 Lists annexed to Schedule VII.
In Part IV of the Constitution, the Directive Principles of State Policy are laid down.
It enjoins it to bring about a social order in which justice, social.
economic and political shall inform all the institutions of national life.
It directs it to work for an egalitarian society where there is no concentration of wealth, where there is plenty, where there is equal opportunity for all, to education, to work, to livelihood '.
and where there is social justice.
But, having regard to the past history of our country, it could not implicitly believe the representatives of the people, for uncontrolled and unrestricted power might lead to an authoritarian State.
It, therefore, preserves the natural rights against the State encroachment and constitutes the higher judiciary of the State as the sentinel of the said rights and the balancing wheel between the rights, subject to social control.
In short, the fundamental rights, subject to social control, have been incorporated in the rule of law.
That is brought about by an interesting process.
In the implementation of the Directive Principles, Parliament or the Legislature of a State makes laws in respect of matter or matters allotted to it.
But the higher Judiciary tests their validity on certain objective criteria, namely, (i) whether the appropriate Legislature has the legislative competency to make the law; (ii) whether the said law infringes any of the fundamental rights; (iii) even if it Infringement the freedoms under article 19, whether the infringement only amounts to "reasonable restriction" on such rights in "public interest.
" By this process of scrutiny, the court maintains the validity of only such laws as keep a just balance between freedoms and social control.
The duty of reconciling fundamental rights in article 19 and the laws of social control is cast upon the courts 789 and the touchstone or the standard is contained in the said two expressions.
The standard is an elastic one; it varies with time, space and condition.
What is reasonable under certain circumstances may not be so under different circumstances.
The constitutional philosophy of law is reflected in Parts 1111 and IV of the Constitution.
The rule of law under the Constitution serves the needs of the people without unduly infringing their rights.
It recognizes the social reality and tries to adjust itself to it from time, to time avoiding the authoritarian pat@. EKery institution or political party that functions under the Constitution must accept it; otherwise it has no place under the Constitution.
Now, what are the fundamental rights ? They are embodied in Part III of the Constitution and they may be classified thus : (i) right to equality, (ii) right to freedom, (iii)right against exploitation, (iv) right to freedom of religion, (v) cultural and educational rights, (vi) right to property, and (vii) right to constitutional remedies.
They are the rights of the people preserved by our Constitution.
"Fundamental rights" are the modern name for what have been traditionally known as "natural rights".
As one author puts: "they are moral rights which every human being everywhere at all times ought to have sim y because of the fact that in contradistinction with ot moral.
" They are the primordial ment of human personality.
man to chalk out his own life in is rational and ry for the developrights which enable a he likes best.
Our Constitution, in addition to the well known fundamental rights, also included the rights of the minorities, untouchables and other backward communities, in such rights.
After having declared the fundamental rights, our Constitution says that all laws in force in the territory of India immediately before the commencement of the Constitution, insofar as they are inconsistent with the said rights, are, to the extent of such inconsistency, void.
The Constitution also enjoins the State not to make any law which takes away or abridges the said rights and declares such laws, to the extent of such inconsistency, to be void.
As we have stated earlier, the only limitation c)n the freedom enshrined in article 19 of the Constitution is that imposed by a valid law rating as a reasonable restriction in the interests of the public.
It will, therefore, be seen that fundamental rights are given transcendental position under our Constitution and are kept beyond the reach of Parliament.
At the same time Parts 1111 and V constituted an integrated scheme forming a self contained code.
The scheme is made so elastic that all the Directive ' Principles of State Policy can reasonably be enforced 'without taking up.
Cl/67 5 790 away or abridging the fundamental rights.
While recognizing the immutability of fundamental rights, subject to social control, the Constitutional itself provides for the suspension or the modification of fundamental rights under specific circumstances, for instance, article 33 empowers Parliament to modify the rights conferred by Part III in their application to the members of the armed forces, article 34 enables it to impose restrictions on the rights conferred by the said parts while martial law is in force in an area, article 35 confers the power on it to make laws with respect to any of the matters which under clause (3) of article 16, Clause (3) of article 32, article 33 and article 34 may be provided for by law.
The non obstante clause with which the last article opens makes it clear that all the other provisions of the Constitution are subject to this provision.
Article 32 makes the right to move the Supreme Court, by appropriate proceedings for the enforcement of the rights conferred by the said Parts a guaranteed right.
Even during grave emergencies article 358 only suspends the provisions of article 19; and article 359 enables the President by order to declare the right to move any court for the enforcement of such of the rights conferred by Part III as may be mentioned in that order to be suspended; that is to say, even during emergency, only article 19 is suspended temporarily and all other rights are untouched except those specifically suspended by the President.
In the Book "Indian Constitution Corerstone of a Nation" by Granville Austin, the scope origin and the object of funda mental rights have been graphically stated.
Therein the learned author says : ". . the core of the commitment to the social revolution lies in Parts III and IV, in the Fundamental Rights and fit the Directive Principles of State Policy.
These are the conscience of the Constitution.
" Adverting to the necessity for incorporating fundamental rights in a Constitution, the learned author says That a declaration of rights had assumed such importance was not surprising; India was a land of communities, of minorities, racial, religious, linguistic, social and caste.
For India to become a state these minorities had to agree to be governed both at the centre and in the provinces by fellow Indian members, perhaps, of another minority and not by a mediatory third power, the British.
On both psychological and political, rounds.
, therefore , the demand for written right rights would provide tangible safeguards, against oppression proved overwhelming.
791 Motilal Nehru, who presided over the Committee called for by the Madras Congress resolution, in May, 1928 observed in his report : "It is obvious that our first care should be to have our Fundamental Rights guaranteed in a manner which will not permit their withdrawal under any circumstances .
Another reason why great importance attached to a Declaration of Rights is the unfortunate existence of communal differences in the country.
Certain safeguards are necessary to create and establish a sense of security among those who look upon each other with distrust and suspicion.
We could dot, better secure the full enjoyment of religious and communal rights to all communities than by including them among the basic principles of the Constitution." Pandit Jawaharlal Nehru, on April 30, 1947 in proposing for the adoption of the Interim Report on Fundamental Rights, said thus : "A fundamental right should be looked upon, not from the point of view of any particular difficulty of the moment, but as something that you want to make permanent in the Constitution.
The other matter should be looked upon however important it might be not from this permanent and fundamental point of view, but from the more temporary point of view." Pandit Jawaharlal Nehru, who was Prime Minister at that time and.
who must have had an effective voice in the framing of the Constitution, made this distinction between fundamental rights and other provisions of the Constitution, namely, the former were permanent and the latter were amendable.
On September 18, 1949 Dr. Ambedkar in speaking on the amendment proposed by Mr. Kamath to article 304 of the Draft Constitution corresponding to the present article 368, namely, "Any provision of this Constitution may be amended, whether by way of variation, addition or repeal, in the manner provided in this article", said thus "Now, what is it we do ? We divide the articles of the Constitution under three categories.
The first category is the one which consists of articles which can be amended by Parliament by a bare majority.
The second set of articles are articles which require two thirds majority.
If the future Parliament wishes to amend any particular article which is not mentioned in Part III or article 304, all that is necessary for them is to have two thirds majority.
Then they can amend it.
" 792 Therefore, in Dr. Ambedkar 's view the fundamental rights were so important that they could not be amended in the manner provided by article 304 of the Draft Constitution, which corresponds to the present article 368.
We have referred to the speeches of Pandit Jawaharlal Nehru and Dr. Ambedkar not with a view to interpret the provisions of article 368, which we propose to do on its own terms, but only to notice the transcendental character given to the fundamental rights by two of the important architects of the Constitution.
This Court also noticed the paramountcy of the fundamental rights in many decisions.
In A. K. Gopalan vs State of Mad ras(1) they are described as "paramount ', in State of Madras vs Smt.
Champakam Dorairajan(2) as "sacrosanct", in Pandit M. section M. Sharma vs Shri Sri Krishna Sinha(s) as "rights reserved by the people ', in Smt.
Vijam Bai vs State of Uttar Pradesh(1) as "inalienable and inviolable",and in other cases as "transcendental".
The minorities regarded them as the bedrock of their political existence and the majority considered them as a guarantee for their way of life.
This, however, does not mean that the problem is one of mere dialectics.
The Constitution has given by its scheme a place of permanence to the fundamental freedoms.
In giving to themselves the Constitution, the people have reserved the fundamental freedoms to themselves.
Article 13 merely incorporates that reservation.
That Article is however not the source of the protection of fundamental rights but the expression of the reservation.
The importance attached to the fundamental freedoms is so transcendental that a bill enacted by a unanimous vote of all the members of both the Houses is ineffective to dero gate from its guaranteed exercise.
It is not what the Parliament regards at a given moment as conducive to the public benefit, but what Part III declares protected, which determines the ambit of the freedom.
The incapacity of the Parliament therefore in exercise of its amending power to modify, restrict or impair fundamental freedoms in Part III arises from the scheme of the Constitution and the nature of the freedoms.
Briefly stated, the, Constitution declares certain rights as fundamental laws infringing the said rights of social control infringing the said power on Parliament and the them in specified circumstances; if the decisions in San Prasad 's case(1) and Sajjan Singh 's case(1) laid down the correct law, it enables the same Parliament to abrogate them with one stroke, provided the party in power singly or in combination with other parties commands the neces (1) ; 198.
(3) [1959] Supp. 1 S.C.R. 806.
(5) [1952] S.C.P. 89,105.
(2) ; (4) [1963] 1 S.C.R. 778.
(6) ; 793 sary majority.
While articles of less significance would require consent of the majority of the States, fundamental rights can.
be dropped without such consent.
While a single fundamental right cannot be abridged or taken away by the entire Parliament unanimously voting to that effect, a two thirds ' majority can do away with all the fundamental rights.
The entire super structure built with precision and high ideals may crumble at one false step.
Such a conclusion would attribute unreasonableness to the makers of the Constitution, for, in that event they would be speaking in two voices.
Such an intention cannot be attributed to the makers of the Constitution unless the provisions of the Constitution compel us to do so.
With this background let us proceed to consider the provisions of article 368, vis a vis article 13(2) of the Constitution.
The first question is whether amendment of the Constitution under article 368 is "law" within the meaning of article 13(2).
The marginal note to article 368 describes that article as one prescribing the procedure for amendment.
The article in terms only prescribes various procedural steps in the matter of amendment: it shall be initiated by the introduction of a bill in either House of Parliament; it shall be passed by the prescribed majority in both the Houses; it shall then be presented to the President for his assent; and upon such assent the Constitution shall stand amended.
The article assumes the power to amend found else and says that it shall be exercised in the manner laid down therein.
The argument that the completion of the procedural AM culminates in the exercise of the power to amend may be subtle but does not carry conviction.
If that was the intention of the provisions, nothing prevented the makers of the Constitution from stating that the Constitution may be amended in the manner suggested.
Indeed, whenever the Constitution sought to confer a special power to amend on any authority it expressly said so : (See articles 4 and 392).
The alternative contention that the said power shall be implied either from article 368 or from the nature of the articles sought to be amended cannot be accepted, for the simple reason that the doctrine of necessary implication cannot be invoked if there is an express sion or unless but for such implication the article will no necessity to imply any plenary power to make any Constitution subject to the Uninfluenced by any foreign doctrines let us look at the provisions of our Constitution.
Under article 245, "subject to the provisions of the Constitution, Parliament may make laws for the whole or any part of the territory of India. .
Article 246 demarcates the matters in respect of which Parliament and State 794 Legislatures may make laws.
In the field reserved for Parliament there is Entry 97 which empowers it to make laws in respect of " any other matter not enumerated in Lists II and III including any tax not mentioned in either of those lists.
" Article 248 expressly states that Parliament has exclusive power to make any law with respect to any matter not enumerated in the Concurrent List ,or State List.
It is, therefore, clear that the residuary power of legislation is vested in Parliament.
Subject to the argument based upon the alleged nature of the amending power as understood by jurists in other countries, which we shal consider at a later stage, it cannot be contended, and indeed, it was not contended, that the Constituent Assembly, if it were so minded, could not have conferred an express legislative power on Parliament to amend the Constitution by ordinary legislative process.
Articles 4 and 169, and para 7 of the 5th Schedule and para 21 of the 6th Schedule have expressly conferred such power.
There is, therefore, no inherent Inconsistency between legislative process and the amending one.
Whether in the field of a constitutional law or statutory law amendment can be brought about only by law.
The residuary power of Parliament, unles there is anything contrary in the ,Constitution, certainly takes in the power to amend the Constitution.
It is said that two Articles 'indicate the contrary intention.
As article 245, the argument proceeds, is subject to the provisions of the Constitution, every law of amendment will necessarily be inconsistent with the articles sought to be amended. 'Ibis is an argument in a circle.
Can it be said reasonably that a law amending an article is inconsistent with the article amended ? If an article of the Constitution expressly says that it cannot be amended, a law cannot be made amending it, as the power of Parliament to make a law is subject to the said Article.
It may well be that in a given case such a limitation may also necessarily be implied.
The limitation in article 245 is in respect of the power to make a law and not of the content of the law made Within the scope of its power.
The second criticism is based upon article 39 of the Constitution.
That provision confers power on the President to remove difficulties; in the circumstances mentioned in that provision, he can by order direct that the Constitution shall during such period as may be specified in that order have effect subject to such adaptations, whether by way of modification, addition ,or omission, as he may deem to be necessary or expedient.
The argument is that the President 's power, though confined to a temporqry period,is co extensive with legislative power and if the power to amend is a legislative power it would have to be held that the President can amend the Constitution in terms of article 368.
Apart from the limited scope of article 392, which is intended only for the purpose of removing difficulties and for bringing about a smooth transition, an order made by the Presi 795 dent cannot attract article 368, as the amendment contemplated by that provision can be initiated only by the introduction of a bill in the Parliament.
There is no force in either of the two criticisms.
Further, there is, internal evidence in the Constitution itself which indicates that amendment to the Constitution is a "law" within the meaning of article 245.
Now, what is "law" under the Constitution ? It is not denied that in its comprehensive sense it includes constitutional law and the law amending the Constitution is constitutional law.
But article 13(2) for the purpose of that Article gives an inclusive definition.
It does not exclude Constitutional law.
It prima facie,takes in constitutional law.
Article 368 itself gives the necessary clue to the problem.
The amendment can be initiated by.
the introduction of a bill; it shall be passed by the two Houses; it shall ' receive the assent of the President.
These are well known procedural steps in the process of law making : Indeed this Court in Sankari Prasads case(1) brought out this idea in clear terms.
It said "in the first place, it is provided that the amendment must be initiated by the introduction of a "bill in either House of Parliament ' a familiar feature of Parliament procedure (of Article 107(1) which says "A bill may originate in either House of Parliament"). 'Then, the bill must be "Passed in each House," just what Parliament does when it is called upon to exercise its normal legisrative function Article 107(2)1; and finally, the bull thus passed must be "president to the President" for his "assent", again a parliamentary process through which every bill must pass before it can reach the statute book, (Article 1 1 1 ).
We thus find that each of the component units of Parliament is to play its allotted part in bringing about an amendment to the Constitution.
We have already seen that Parliament effects amendments of the first class mentioned above by going through the same three fold procedure but with a simple majority.
The fact that a different majority in the same body is required for effecting the second and third categories of 1 amendments make the amending agency a different body.
" In the same decision it is pointed out that article 368 is not a complete code in respect of the procedure.
This Court said "There are gaps in the procedure as to how and after what notice a bill is to be introduced, how it is to be passed by each House and how the President 's assent is to be obtained.
Having provided for the Constitution of a Parliament and prescribed a certain procedure for the conduct of its ordinary legislative business to be supplemented by rules made by each House (Article 118), the makers of the Constitution must be taken to have intended Parliament to follow that procedure, so far as they may be applicable consistently with the express provision of article 368, when they have entrusted to it the power of =ending the Con (1) ( 1 952) S.C. R. 89.
796 stitution.
" The House of the People made rules providing procedure for amendments, the same as for other Bills with the addition of certain special provisions viz., Rules 155, 156, 157 and 158.
If amendment is intended to be something other than law, the constitutional insistence on the said legislative process is unnecessary.
In short, amendment cannot be made otherwise than by following the legislative process.
The fact that there are other conditions, such as, a larger majority and in the case of articles mentioned in the proviso a ratification by Legislatures is provided, does not make the amendment anytheless a law.
The imposition of further conditions is only a safeguard against hasty action or a protection to the States, but does not change the Legislative character of the amendment.
This conclusion is reinforced by the other articles of the Constitution.
Article 3 enables Parliament by law to form now States and alter areas, boundaries or the names of existing States.
imposed two, further conditions, of the President, and (ii) in therein, the views expressed by the Legislatures.
Notwithstanding the said conditions it cannot be suggested that the expression "law" under the said Article is not one made by the Legislative process.
Under article 4, such a law can contain provisions for amendment of Schedules I and IV indicating thereby that amendments are only made by Legislative process.
What is more, cl.
(2) thereof introduces a fiction to the affect that such a law shall not be deemed to be an amendment to the Constitution.
This shows that the amendment is law and that but for the fiction it would be an amendment within the meaning of article 368.
Article 169 which empowers Parliament by law to abolish or create Legislative Councils in States, para 7 of the 5th Schedule and para 21 of the 6th Schedule which enable Parliament by law to amend the said Schedules, also bring out the two ideas that the amendment is law made by legislative process and that but for the fiction introduced it would attract Article 368.
That apart amendments under the said provisions can be made by the Union Parliament by simple majority.
That an amendment is made only by legislative process with or without conditions will be clear if two decisions of the Privy Council are considered in juxta position.
They are McCawley vs The King(1) and The Bribery Commissioner vs Pedrick Rana singhe(2).
The facts in McCawley vs The King(1) were these: In 1859 Queensland had been granted a Constitution in the terms of an Order in Council made on June 6 of that year under powers derived by Her Majesty from the Imperial Statute, 18 & 19 Vict.
(1) (2) 797 c. 54.
The Order in Council had set up a legislature for the territory, consisting of the Queen, a Legislative Council and a. Legislative Assembly, and the law making power was vested in Her Majesty acting with the advice and consent of the Council and Assembly.
Any laws could be made for the "peace, welfare and good government of the Colony".
The said legislature of Queensland in the year 1867 passed the Constitution Act of that year.
Under that Act power was given to the said legislature to make laws for "peace, welfare and good Government of the Colony in all cases whatsoever".
But, under section 9 thereof a two thirds majority of the Council and of the Assembly %,as required as a condition precedent to the validity of legislation altering the constitution,of the Council.
The Legislature, there fore, had, except in the case covered by section 9 of the Act, an unrestricted power to make laws.
The Legislature passed a law which conflicted with one of the existing terms of the Constitution Act.
Lord Birkenhead, L.C., upheld the law, as the Constitution Act conferred an absolute power upon the legislature to pass any law by majority even though it, in substance, amended the terms of the Constitution Act.
In The Bribery Commissioner vs Pedrick Ranasinghe(1), the facts are these : By section 29 of the Ceylon (Constitution) Order in Council, 1946, Parliament shall have power to make laws for the, "peace.
order and good government" of the Island and in the exercise of its power under the said section it may amend or repeal any of the provisions of the Order in its application to the Island.
The proviso to that section says that no Bill for the amendment or repeal of any of the provisions of the Order shall be presented for the Royal assent unless it has endorsed on it a certificate under the hand of the Speaker that the number of votes cast in favour thereof in the House of Representatives amounted to not less than two thirds of the whole number of members of the House.
Under section 55 of the said Order the appointment of Judicial Officers was vested in the Judicial Service Com mission.
But the Parliament under section 41 of the Bribery Amendment Act, 1958, provided for the appointment of the personnel of the Bribery Tribunals by the Governor General on the advice of the Minister of Justice.
The said Amendment Act was in conflict with the said section 55 of the Order and it was passed without complying with the terms of the proviso to section 29 of the Order.
The Privy Council held that the Amendment Act was void.
Lord Pearce, after considering McCawley 's case(2) made the following observations, at p. 1310 : ". . a legislature has no power to ignore, the conditions of law making that are imposed by the (1) ; (2) 1. 798 instrument which itself regulates its power to make law.
This restriction exists independently of the , question whether the legislature is sovereign, as is the legislature of Ceylon, or whether the Constitution is "uncontrolled", as the Board held the Constitution of Queensland to be.
Such a Constitution can, indeed, be altered or amended by the legislature, if the regulating instrument so provides and if the terms of those provisions are complied with. .
It will be seen from the said judgments that an amendment of the Constitution is made only by legislative process with ordinary majority or with special majority, as the case may be.
There.fore, amendments either under article 368 or under other Articles ,axe made only by Parliament by following the legislative process adopted by it ' n making other law,.
In the premises, an amendment "Of the Constitution can be nothing but "law".
A comparative study of other Constitutions indicates that no particular pattern is followed.
AR the Constitutions confer an ,express power to amend, most of them provide for legislative procedure with special majority, referendum, convention, etc., and a few with simple majority.
Indeed, Parliament of England, which is a supreme body, can amend the constitution like any other :statute.
As none of the Constitutions contains provisions similar to article 368 and article 13(2), neither the said Constitutions nor the decisions given by courts thereon would be of any assistance in construing the scope of article 368 of our Constitution.
A brief survey of the nature of the amending process adopted by various constitutions will bring out the futility of any attempt to draw inspiration from the said opinions or decisions on the said constitutions.
The nature of the amending power in different constitutions generally depends on the nature of the polity created by the constitution, namely, whether it is federal or unitary constitution or on the fact whether it is a written or an unwritten constitution or on the circumstances whether it is a rigid or a flexible constitution.
Particularly the difference can be traced to the "spirit and genius of the nation in which a particular constitution has its birth".
The following articles of the 'Constitution of the different countries are brought to our notice by one or other of the counsel that appeared before us.
article 5 of the Constitution of the United States of America, articles 125 and 128 of the Commonwealth of Australia Constitution Act, article 92 (1) of the British North American Act, section 152 of the South African Act, article 217 of the Constitution of, the United States of Brazil, Section 46 of the Constitution of Ireland, 1937, articles 207, 208 and 209 of the Constitution of the Union of Burma, article 88 ,of the Constitution of the Kingdom of Denmark Act, article 90 of 799 the Constitution of the French Republic, 1954, article 135 of the United States of Mexico, article 96 of the Constitution of Japan, article 112 of the Constitution of Norway, article 85 of the Constitution of the Kingdom of Sweden, articles 118, 119, 120, 121, 122 and 123 of the Constitution of the Swiss Federation, articles 140, 141 and 142 of the Constitution of Venezuela, and article 146 of the Constitution of the Union of Soviet Socialist Republics, 1936 and section 29(4) of Ceylon Constitution Order in Council, 1946.
Broadly speaking amendments can be made by four methods (i) by ordinary legislative process with or without restrictions, (ii) by the people through, referendum, (iii) by majority of all the units of a federal State; and (iv) by a special convention.
The first method can be in four different ways, namely, (i) by the ordinary course of legislation by absolute majority or by special majority, (See Section 92 (1 ) of the British North America Act, sub section 152 South African Apt, where under except sections 35, 137 and 152, other provisions could be amended by ordinary legislative process by absolute majority.
Many constitutions provide for special majorities.); (ii) by a fixed quorum of members for the consideration of the proposed amendment and a special majority for its passage; (see the defunct Constitution of Rumania), (iii) by dissolution and general election on a particular issue; (see the Constitutions of Belgium, Holland, Denmark and Norway), and (iv) by a majority of two Houses of Parliament in joint session as in the Constitution of the South Africa.
The second method demands a popular vote, referendum , or plebiscite as in Switzerland, Australia, Ireland, Italy, France and Denmark.
The third method is by an agreement in some form or other of either of the majority or of all the federating units as in Switzerland, Australia and the United States of America.
The fourth method is generally by creation of a special body ad hoc for the purpose of constitution revision as in Latin America.
Lastly, some constitutions impose express limitation on the power to amend.
(See article 5 of the United States Constitution and the Constitution of the Fourth French Republic).
A more elaborate discussion of this topic may be found in the American political Constitution by Strong.
It will, therefore, be seen that the power to amend and the procedure to amend radically differ from State to State; it is left to the constitution makers to prescribe the scope of the power and the method of amendment having regard to the requirements of the particular State.
There is no article in any of the constitutions referred to us similar to article 13(2) of our Constitution.
India adopted a different system altogether: it empowered the Parliament to amend the Constitution by the legislative process subject to fundamental rights.
The Indian 1 Constitution has made the amending process comparatively flexible, but it is made subject to fundamental rights.
800 Now let us consider the argument that the power to amend is a sovereign power, that the said power is supreme to the legislative power, that it does not permit any implied limitations and that amendments made in exercise of that power involve political questions and that, therefore, they are outside judicial review, This wide proposition is sought to be supported on the basis of opinions of jurists and judicial decisions.
Long extracts have been read to us from the book "The Amending of the Federal Constitution (1942)" by Lester Bernhardt Orfield, and particular reference was made to the following passages : "At the point it may be well to note that when the Congress is engaged in the amending process it is not legislating.
It is exercising a peculiar power bestowed upon it by Article Five.
This Article for the most part ,controls the process; and other provisions of the Constitution, such as those relating to the passage of legislation, having but little bearing.
" Adverting to the Bill of Rights, the learned author remarks that they may be repealed just as any other amendment and that they are no more sacred from a legal standpoint than any other part of the Constitution.
Dealing with the doctrine of implied limitations, he says that it is clearly untenable.
Posing the question 'Is other a law about the amending power of the Constitution ?", he answers, "there is none".
He would even go to the extent of saying that the sovereignty, if it can be said to exist at all, is located in the amending body.
The author is certainly a strong advocate of the supremacy of the amending power and an opponent of the doctrine of implied limitations.
His opinion is based upon the terms of article 5 of the Constitution of the United States of America and his interpretation of the decisions of the Supreme Court of America.
Even such an extreme exponent of the doctrine does not say that a particular constitution cannot expressly impore restrictions on the power to amend or that a court cannot reconcile the articles couched in unlimited phraseology.
Indeed article 5 of the American Constitution imposes express limitations on the amending power.
Some passages from the book "Political Science and Government" by James Wilford Garner are cited.
Garner points out : "An unamendable constitution, said Mulford, is the &&worst tyranny of time, or rather the very tyranny of time" But he also notices "The provision for amendment should be neither so rigid as to make needed changes practically impossible nor so flexible as to encourage frequent and 801 unnecessary changes and thereby lower the authority of the Constitution.
" Munro in his book "The Government of the United States", 5th Edition, uses strong words when he says ". . it is impossible to conceive of an unamendable constitution as anything but a contradiction in terms.
" The learned author says that such a constitution would constitute "government by the graveyards." Hugh Evander Wills in his book "Constitutional Law of the United States" avers that the doctrine of amendability of the Constitution is grounded in the doctrine of the sovereignty of the people and that it has no such implied limitations as that an amendment shall not contain a new grant of power or change the dual form of government or change the protection of the Bill of Rights, or make any other change in the Constitution.
Herman Finer in his book "The Theory and Practice of Modem Government" defines "constitution" as its process of amendment, for, in his view, to amend is to deconstitute and reconstitute.
The learned author concludes that the amending clause is so fundamental to a constitution that he is tempted to call it the constitution itself.
But the learned author recognizes that difficulty in amendment certainly products circumstances and makes impossible the surreptitious abrogation of rights guaranteed in the constitution.
William section Livingston in "Federalism and Constitutional Change" says : "The formal procedure of amendment is of greater importance than the informal processes, because it constitutes a higher authority to which appeal lies on any question that may arise.
" But there are equally eminent authors who express a different view.
In "American Jurisprudence", 2nd Edition, Vol.
16, it is stated that a statute and a constitution though of unequal dignity are both laws.
Another calls the constitution of a State as one of the laws of the State.
Cooley in his book on "Constitutional Law" opines that changes in the fundamental laws of the State must be indicated by the people themselves.
He further implies limitations to the amending power from the belief in the constitution itself, such as, the republican form of Government cannot be abolished as it would be revolutionary in ifs characters.
In the same book it is further said that the power to amend the constitution by legislative action does not confer the power to break it any more than it confers the power to legislate on any other subject contrary to the prohibitions.
C. F. Strong in his book "Modem Poliical Constitutions", 1963 edition, does not accept the theory of absolute sovereignty of the amending power which does not brook any limitations, for he says.
802 "In short, it attempts to arrange for the recreation of a constituent assembly whenever such matters are in future to be considered, even though that assembly be nothing more than the ordinary legislature acting under certain restrictions.
At the same time, there may be some elements of the constitution which the constituent assembly wants to remain unalterable by the action of any authority whatsoever.
These elements are to be distinguished from the rest, and generally come under the heading of fundamental law.
Thus, for example, the American Constitution, the oldest of the existing Constitutions, asserts that by no process of amendment shall any State, without its own consent, be deprived of its equal suffrage in the Senate, , while among the Constitutions more recently promulgated, those of the Republics of; France and Italy, each containing a clause stating that the republican form of government cannot be the subject of an amending proposals" it is not necessary to multiply citations from text books.
A catena of American decisions have been cited before us in support of the contention that the unending power is a supreme power or that it involves political issues which are not justiciable.
It would be futile to consider them.
at length, for after going through them carefully we find that there are no considered judgments of the American Courts, which would have a persuasive effect in that regard.
In the Constitution of the United States of America, prepared by Edwards section Corwin, Legislative Reference Service, Library of Congress, (1953 edn.), the following summary under the heading "Judicial Review under Article V" is given : "Prior to 1939, the Supreme Court had taken cognizance of a number of diverse objections to the validity of specific amendments.
Apart from holding that official notice of ratification by the several States was con clusive upon the Courts, it had treated these questions as justiciable, although it had uniformly rejected them on the merits.
In that year, however, the whole subject was thrown into confusion by the inconclusive decision in Coleman vs Miller.
This case came up on a writ of certiorari to the Supreme Court of Kansas to review the denial of a writ of mandamus to compel the Secretary of the Kansas Senate to erase an endorsement on a resolution ratifying the child labour amendment to the Constitution to re effect that it had been adopted by the Kansas Senate.
The attempted ratification was 803 assailed on three grounds : (1) that the amendment had been previously rejected by the State Legislature; (2) that it was no longer open to ratification because an unreasonable period of time thirteen years, had elapsed since its submission to the States, and (3) that the lieutenant governor had no right to cast the deciding vote in the Senate in favour of ratification.
Four opinions were written in the Supreme Court, no one of which commanded the support of more than four mem bers of the Court.
The majority ruled that the plain tiffs, members of the Kansas State Senate, had a sufficient interest in the controversy to give the federal courts jurisdiction to review the case.
Without agreement as to the grounds for their decision, a different majority affirmed the judgment of the Kansas court denying the relief sought.
Four members who concur red in the result had voted to dismiss the writ on the ground that the amending process "is political" in its.
entirety, from submission until an amendment becomes part of the Constitution, and is not subject to judicial guidance, control or interference at any point.
" whether the contention that the lieutenant governor should have been permitted to cast the deciding vote in favour of ratification presented a justiciable controversy was left undecided, the court being equally divided on the point.
In an opinion reported as "the opinion of the Court" ' but in which it appears that only three Justices concurred, Chief Justice Hughes declared that the writ of ' mandamus was properly denied because the question as to the effect of the previous rejection of the amendment and the lapse of time since it was submitted to the States were political questions which should be left to Congress.
On the same day, the Court dismissed a. writ of certiorari to review a decision 'of the Kentucky Court of Appeals declaring the action of the Kentucky General Assembly purporting to ratifying the child labour amendment illegal and void.
Inasmuch as the governor had forwarded the certified copy of the resolution to the Secretary of State before being served with a copy of the restraining order issued by the State Court, the Supreme Court found that there 'was no longer a controversy susceptible of judicial determination.
" This passage, in our view, correctly summarises the American law on the subject.
It will be clear therefrom that prior to 1939 the Supreme Court of America had treated the objections to the validity of specific amendments as justiciable and that only in 1939 it rejected them in an inconclusive judgment without 804 discussion.
In this state of affairs we cannot usefully draw much from the judicial wisdom of the Judges of the Supreme Court of America.
One need not cavil at the description of an amending power as sovereign power, for it is sovereign only within the scope of the power conferred by a particular constitution.
All the authors also agree, that a particular constitution can expressly limit the power of amendment, both substantive and procedural.
The only conflict lies in the fact that some authors do not pen nit implied limitations when the power of amendment is expressed in general words.
But others countenance such limitations by construction or otherwise.
But none of the authors goes to the extent of saying, which is the problem before us, that when there are conflicting articles couched in widest terms, the court has no jurisdiction to construe and harmonize them.
If some of the authors meant to say that in our view, they did not we cannot agree with them, for, in that event this Court would not be discharging its duty.
Nor can we appreciate the arguments repeated before us by learned counsel for the respondents that the amending process involves political questions which are, outside the scope of judicial review.
When a matter comes before the Court, its jurisdiction does not depend upon the nature of the question raised but on die, question whether the said matter is expressly or by necesssary implication excluded from its jurisdiction.
Secondly, it is not possible to define what is a political question and what is not.
The character of a question depends upon the circumstances and the nature of a political society.
To put if differently, the court does not decide any political question at all in the ordinary sense of the. term, but only ascertains whether Parliament is acting within the scope of the amending power.
It may be that Parliament seeks to amend the Constitution for political reasons, but the Court in denying that power will not be deciding on political questions, but will only be holding that Parliament has no power to amend particular articles of the Constitution for any purpose whatsoever, be it political or otherwise.
We, therefore, hold that there is nothing in the nature of the amending power which enables Parliament to override all the express or implied limi tations imposed on that power.
As we have pointed out earlier, our Constitution adopted a novel method in the sense that Parliament makes the amendment by legislative process subject to certain restrictions and,that the amendment so made being law" is.subject to article 13(2).
The next argument is based upon the expression "amendment" in article 368 of the Constitution and if is contended that the said 805 expression has .a
Positive and a negative content and that in exercise of the power amendment parliament cannot destroy the structure of the Constitution, but it can only modify the provisions thereof within the framework of the original instrument for its better effectuation.
If the fundamentals would be amenable to the ordinary process of amendment with a special majority, the argument proceeds, the institutions of the President can be abolished, the parliamentary executive can be removed, the fundamental rights can be abrogated, the concept of federalism ' can be obliterated and in short the sovereign democratic republic can be converted into a totalitarian system of government.
There is considerable force in this argument.
Learned and lengthy arguments are advanced to sustain it or to reject it.
But we are relieved of the necessity to express our opinion on this all important question as, so far as the fundamental rights are concerned, the question raised can be answered on a narrower basis.
This question may arise for consideration only if Parliament seeks to destroy the structure of the Constitution embodied in the provisions other than in Part III of the Constitution.
We do not, therefore, propose to express our opinion in that regard.
In the view we have taken on the scope of article 368 vis a vis the fundamental rights, it is also unnecessary to express our opinion on the question whether the amendment of the fundamental rights is covered by the proviso to article 368.
The result is that the Constitution (Seventeenth Amendment) Act, 1964, inasmuch as it takes away or abridges the funda mental rights is void under article 13(2) of the Constitution.
The next question is whether our decision should be given retrospective operation.
During the period between 1950 and 1967 i.e 17 years as many as 20 amendments were made in our Constitution.
But in the context of the present petitions it would be enough if we notice the amendments affecting fundamental right to property.
The Constitution came into force on January 26, 1950.
The Constitution (First Amendment) Act, 1951, amended articles 15 and 19, and articles 31 A and 31 B were inserted with retrospective effect.
The object of the amendment was said to be to validate the acquisition of zamindaries or the abolition of permanent settlement without interference from courts.
The occasion for the amendment was that the High Court of Patna in Kameshwar Singh v, State of Bihar(1) held that the Bihar Land Reforms Act (30 of 1950) passed by the State of Bihar was unconstitutional, while the High Courts of Allahabad and Nagpur upheld the validity of corresponding legislations in Uttar Pradesh and Madhya Pradesh respectively.
(1) A. I. R. 1951 Patna 91.
C.T.167 6 806 The amendment was made when the appeals from those decisions were pending in the Supreme Court.
In Sankari Prasad 's case(1) the constitutionality of the said amendment was questioned but the amendment was upheld.
It may be noticed that the said amendment was not made on the basis of the power to amend fundamental rights recognized by this Court but only in view of the conflicting decisions of High Courts and without waiting for the final decision from this Court.
article 31 A was again amended by the Constitution (Fourth Amendment) Act, 1955.
Under that amendment cl.
(2) of article 31 was amended and cl.
(2 A) was inserted therein.
While in the original article 31 A the general expression "any provisions of his Part" was found, in the amended article the scope was restricted only.to the violation of articles 14, 19 and 31 and 4 other clauses were included, namely, clauses providing for (a) taking over the management of any property by the State for a limited period; (b) amalgamation of two or more corporations; (c) extinguishment or modification of rights of person; interested in corporations; and (d) extinguishment or modification of rights accruing under any agreement, lease or licence relating to minerals, and the definition of "estate" was enlarged in order to include the interests of raiyats and under raiyats.
The expressed object of the amendment was to carry out important social welfare legislations on the desired lines, to improve the national economy of the State and to avoid serious difficulties raised by courts in that regard.
Article 31A has further been amended by the Constitution (Fourth Amendment) Act, 1955.
By the said amendment in the Ninth Schedule to the Constitution entries 14 to 20 were added.
The main objects of this amending Act was to distinguish the power of compulsory acquisition or requisitioning of private property and the deprivation of property and to extend the scope of article 31 A to cover different categories of social welfare legislations and to enable monopolies in particular trade or business to be created in favour of the State.
Amended article 31(2)makes the adequacy of compensation not justiciable.
It may be said that the Constitution (Fourth Amendment) Act, 1955 was made by Parliament as this Court recognized the power of Parliament to amend Part III of the Constitution; but it can ' also be said with some plausi bility that, as Parliament had exercised the power even before the.
decision of this Court in Sankari Prasad 's case(1), it would have amended the Constitution even if the said decision was not given by this Court.
The Seventeenth Amendment Act was made on June 20, 1964.
The occasion for this amendment was the decision of this Court in Karimbil Kunhikoman vs State of Kerala(2), which struck down the Kerala Agrarian Relations Act IV of 1961 relating to ryotwari lands.
Under that amendment the definition of the expression "estate" was enlarged so as to take (1) ; , 105 (2) [1962] Supp. 1 S.C.R. 829 807 in any land held under ryotwari settlement and any held or let for purposes of agriculture or for purposes ancillary thereto, including waste land, forest land, land for pasture or sites of buildings and other structures occupied by cultivators of land, agricultural labourers and village artisans.
In the Ninth Schedule the amendment included items 21 to 65.
In the objects and reasons it was stated that the definition" 'estate" was not wide enough, that the courts had struck down many land reform Acts and that, therefore, in order to give them protection the amendment was made.
The validity of the Seventeenth Amendment Act was questioned in this Court and was held to be valid in Sajian Singh 's case(1).
From the history of these amendments, two things appear, namely, unconstitutional laws were made and they were protected by the amendment of the Constitution or the amendments were made in order to protect the future laws which would be void but for the amendments.
But the fact remains that this Court held as early as in 1951 that Parliament had power to amend the fundamental rights.
It may, therefore, said that the Constitution (Fourth Amendment) Act, 1955, and the Constitution (Seventeenth Amendment) Act, 1964, were based upon the scope of the power to end recognized by this Court.
Further the Seventeenth Amendment Act was also approved by this Court.
Between 1950 and 1967 the Legislatures of various States made laws bringing about an agrarian revolution in our country zamindaries, inams and other intermediary estates were abolished, vested rights were created in tenants, consolidation of holdings of villages was made, ceilings were fixed and the surplus lands transferred to tenants.
All these were done on the, basis of the correctness of the decisions in Sankari Prasads case(2) and Sajjan Singh 's case(1), namely, that Parliament had the power to amend the fundamental rights and that Acts in regard to estates were outside judicial scrutiny on the ground they infringed the said rights.
The agrarian structure of our country has been revolutionised on the basis of the said laws.
Should we now give retrospectivity to our decision, it would introduce chaos and unsettle the conditions in our country.
Should we hold that because of the said consequences Parliament had power to take away fundamental rights, a time might come when we would gradually and imperceptibly pass under a totalitarian rate.
Learned counsel for the petitioners as well as those for the respondents placed us on the horns of this dilemma, for they have taken extreme positions leamed counsel for the petitioners want us to reach the logical position by holding that all the said laws are void and the learned counsel for the respondents persuade us to hold that Parliament has unlimited power and, if it chooses, it can do away with fundamental rights.
We do not think that (1) ; (2) ; , 808 this Court is so helpless.
As the highest Court in the land we must evolve some reasonable principle to meet this extraordinary situation.
There is an essential distinction between Constitution and statutes.
Comparatively speaking, Constitution is permanent; it is an organic statute; it grows by its own inherent force.
The constitutional concepts are couched in elastic terms.
Courts are expected to and indeed should interpret, its terms without doing violence to the language, to suit the expanding needs of the society.
In this process and in a real sense they make laws.
Though it is not admitted, the said role of this Court is effective and cannot be ignored.
Even in the realm of ordinary statutes, the subtle working of the process is apparent though the approach is more conservative and inhibitive.
In the constitutional field, therefore, to meet the present extraordinary situation that may be caused by our decision, we must evolve some doctrine which has roots in reason and precedents so that the past may be preserved and the future protected.
There are two doctrines familiar to American Jurisprudence, one is described as Blackstonian theory and the other as "prospective over ruling", which may have some relevance to the present enquiry.
Blackstone in his Commentaries, 69 (15th edn., 1809) stated the common law rule that the duty of the Court was "not to pronounce a new rule but to maintain and expound .the old one".
It means the Judge does not make law but only discovers or finds the true law.
The law has always been the same.
If a subsequent decision changes the earlier one, the latter decision does not make law but only discovers the correct principle of law.
The result of this view is that it is necessarily retrospective ,operation.
But Jurists, George F. Canfield, Robert Hill Freeman, John Henry Wigmore and Cardozo, have expounded the doctrine of "prospective over ruling" and suggested it as "a useful judicial .tool".
In the words of Canfield the said expression means ". a court should recognize a duty to an nounce a new and better rule for future transactions whenever the court has reached the conviction that an old rule (as established by the precedents) is unsound even though feeling compelled by stare decisis to apply the old and condemned rule to the instant case and to transactions which had already taken place.
" Cardozo, before he became a Judge of the Supreme Court of the United States of America, when he was the Chief Justice of New York State addressing the Bar Association said thus The rule (the Blackstonian rule) that we are asked to apply is out of tune with the life about us.
It has been made discordant by the forces that generate a 809 living law.
We apply it to this case because the repeal might work hardship to those who have trusted to its existence.
We give notice however that any one trusting to it hereafter will do at his peril.
" The Supreme Court of the United States of America, in the year 1932, after Cardozo became an Associate Justice of that Court in Great Northern Railway vs Sunburst Oil & Ref.
Co.,(1) applied the said doctrine to the facts of that case.
In that case the Montana Court had adhered to its previous construction of the statute in question but had announced that that interpretation would not be followed in the future.
It was contended before the Supreme Court of the United States of America that a decision of a court over ruling earlier decision and not giving its ruling retroactive operation violated the due process clause of the 14th Amendment.
Rejecting that plea, Cardozo said : "This is not a case where a Court in overruling an earlier decision has come to the new ruling of retroactive dealing and thereby has made invalid what was followed in the doing.
Even that may often be done though litigants not infrequently have argued to the contrary .
This is a case where a Court has refused to make its ruling retroactive, and the novel stand is taken that the Constitution of the United States is infringed by the refusal.
We think that the Federal Constitution has no voice upon the subject.
A state in defining the elements of adherence to precedent may make a choice for itself between the principle of forward operation and that of relation backward.
It may be so that the decision of the highest courts, though later over ruled, was law nonetheless for intermediate transactions .
On the other hand, it may hold to the ancient dogma that the law declared by its Courts had a platonic or ideal existence before the act of declara tion, in which event, the discredited declaration will be viewed as if it had never been and to reconsider declaration as law from the beginning.
The choice for any state maybe determined by the juristic philosophy of the Judges of her Courts, their considerations of law, its origin and nature.
" The opinion of Cardozo tried to harmonize the doctrine of prospective over ruling with that of stare decisis.
In 1940, Hughes, C.J., in Chicot County Drainage District vs Baxter State Bank(2) stated thus (1) ; , 366. ; (2) ; 810 "The law prior to the determination of unconstitutionality is an operative fact and may have consequences which cannot justly be ignored.
The past cannot always be erased by a new judicial declaration.
" In Griffin vs Illionis(1) the Supreme Court of America reaffirmed the doctrine laid down in Sunburst 's case (2).
There, a statute required defendants to Submit bills of exceptions as a pre requisite to an appeal from a conviction; the Act was held unconstitutional in that it provided no means whereby indigent defendants could secure a copy of the record for this purpose.
Frankfurter, J., in that context observed ". in arriving at a new principle, the judicial process is not important to, define its scope and limits.
Adjudication is not a mechanical exercise nor does it compel 'either/or ' determination." In Wolf vs Colorado(3) a majority of the Supreme Court held that in a prosecution in a State Court for a state crime, the 14th Amendment did not forbid the admission of evidence obtained by an unreasonable search and seizure.
But in Mapp.
vs Ohio(4) the Supreme Court reversed that decision and held that all evidence obtained by searches and seizure in violation of the 4th Amendment of the Federal Constitution was, by virtue of the due process clause of the 14th Amendment guaranteeing the right to privacy free from unreasonable State instrusion, inadmissible in a State court.
In Linkletter vs Walker(5) the question arose whether the exclusion of the rule enunciated in Mapp vs Ohio(4) did not apply to State Court convictions which had become final before the date of that judgment.
Mr. Justice Clarke, speaking for the majority observed "We believe that the existence of the Wolf doctrine prior to Mapp is 'an operative ' fact and may have consequences which cannot justly be ignored.
The past cannot always be erased by a new judicial declaration." "Mapp had as its prima purpose the enforcement of the Fourth Amendment through the inclusion of the exclusionary rule within its rights. . .
We cannot say that this purpose would be advanced by making the rule retrospective.
The misconduct of the police prior to Mapp has already occurred and win (1) [1956]351U.S.12,2. (2) (1932) 287 U. section 358,366: ; (3) ; 193L.Ed. 872.
(4) ; 6 L. Ed.
(5) ; 1081.
811 not be corrected by releasing the prisoners involved.
On the other hand, the States relied on Wolf and followed its command.
Final judgments of conviction were entered prior to Mapp.
Again and again the Court refused to reconsider Wolf and gave its implicit approval to hundreds of cases in their application of its rule.
In rejecting the Wolf doctrine as to, the exclusionary rule the purpose was to deter the lawless action of the police add to effectively enforce the Fourth Amendment.
That purpose will not at this late date be served by the wholesale release of the guilty victims." "Finally, there are interests in the, administration of justice and the integrity of the judicial process to consider.
To make the rule of Mapp retrospective would tax the administration of justice to the utmost.
Hearings would have to be held on the excludability of evidence long since destroyed, misplaced or deteriorated.
If it is excluded, the witness available at the time of the original trial will not be available or if located their memory will be dimmed.
To thus legitimate such an extraordinary procedural weapon that has no bearing on guilt would seriously disrupt the administration of justice.
" This case has reaffirmed the doctrine of prospective overruling and has taken a pragmatic approach in refusing to give it retroactivity.
In short, in America the doctrine of prospective overruling is now accepted in all branches of law, including constitutional law.
But the carving of the limits of retrospectivity of the new rule is left to courts to be done, having regard to the requirements of justice.
Even in England the Blackstonian theory was criticized by Bentham and Austin.
In Austin 's Jurisprudence, 4th Ed., at page 65, the learned author says : "What hindered Blackstone was 'the childish fiction ' employed by our judges, that the judiciary or common law is not 'Made by them, but is a miraculous something made, by nobody, existing, I suppose, from eternity, and merely declared from time to time by the Judges." Though English Courts in the past accepted the Blackstonian theory and though the House of Lords strictly adhered to the doctrine of 'precedent ' in the earlier years, both the doctrines were practically given up by the "Practice Statement (Judicial Precedent)" issued by the House of Lords recorded in (1966) 1 W.L.R. 1234.
Lord Gardiner L.C., speaking for the House of Lords made the following observations 812 "Their Lordships nevertheless recognise that too rigid adherence to precedent may lead to injustice in a particular case and also unduly restrict the proper development of the law.
They propose, therefore, to modify their present practice and, while treating former decisions of this House as normally binding, to depart from a previous decision when it appears right to do so.
In this connection they will bear in mind the danger of disturbing retrospectively the basis on which contracts, settlements of property and fiscal arrangements have been entered into and also the especial need for certainty as to the criminal law." This announcement is not intended to affect the use of precedent elsewhere than in this House.
" It will be seen from this passage that the House of Lords hereafter in appropriate cases may depart from its previous decision when it appears right to do so and in so departing will bear in mind the danger of giving effect to the said decision retroactivity.
We consider that what the House of Lords means by this statement is that in differing from the precedents it will do so only without interefering with the transactions that had taken place on the basis of earlier decisions.
This decision, to a large extent, modifies the Blackstonian theory and accepts, though not expressly but by necessary implication the doctrine of "prospective overruling.
" Let us now consider some of the objections to this doctrine.
The objections are: (1) the doctrine involved legislation by courts; (2) it would not encourage parties to prefer appeals as they would not get any benefit therefrom; (3) the declaration for the future would only be obiter, (4) it is not a desirable change; and (5) the doctrine of retroactivity serves as a brake on court which otherwise might be tempted to be so fascile in overruling.
But in our view, these objections are not insurmountable.
If a court can over rule its earlier decision there cannot be any dis pute now that the court can do so there cannot be any valid reason why it should not restrict its ruling to the future and not to the past.
Even if the party filing an appeal may not be benefited by it, in similar appeals which he may file after the change in the law he will have the benefit.
The decision cannot be obiter for what the court in effect does is to declare the law but on the basis of another doctrine restricts its scope.
Stability in law does not mean that injustice shall be perpetuated.
An illuminating article on the subject is found in Pennsylvania Law Review, [Vol.
I 10 p. 650].
813 It is a modem doctrine suitable for a fast moving society.
It does not do away with the doctrine of stare decisis, but confines it to past transactions.
It is true that in one sense the court only declares the law, either customary or statutory or personal law.
While in strict theory it may be said that the doctrine involves making of law, what the court really does is to declare the law but refuses to give retroactivity to it.
It is really a pragmatic solution reconciling the two conflicting doctrines, namely, that a court finds law and that it does make law.
It finds law but restricts its operation to the future.
It enables the court to bring about a smooth transition by correcting its errors without disturbing the impact of those errors on the past transactions.
It is left to the discretion of the court to prescribe the limits of the retroactivity and thereby it enables it to would the relief to meet the ends of justice.
In India there is no statutory prohibition against the court refusing to give retroactivity to the law declared by it.
Indeed,.
the doctrine of res judicata precludes any scope for retroactivity in respect of a subject matter that has been finally decided between the parties.
Further, Indian court by interpretation reject retroactivity.
to statutory provisions though couched in general terms on the ground that they affect vested rights.
The present case only attempts a further extension of the said rule against retroactivity.
Our Constitution does not expressly or by necessary implica tion speak against the doctrine of prospective over ruling.
Indeed, articles 32, 141 and 142 are couched in such wide and elastic terms as to enable this Court to formulate legal doctrines to meet the ends of justice.
The only limitation thereon is reason, restraint and injustice.
Under article 32, for the enforcement of the fundamental rights the Supreme Court has the power to issue suitable directions or orders or writs.
Article 141 says that the law declared by the Supreme Court shall be binding on all courts; and article 142 enables it in the exercise of its jurisdiction to pass such decree or make such order as is necessary for doing complete justice in any cause or matter pending before it.
These articles are designedly made comprehensive to enable the Supreme Court to declare law and to give such directions or pass such orders as are necessary to do complete justice.
The expression "declared" is wider than the words "found or made".
To declare is to announce opinion.
Indeed, the latter involves the process, while the former expresses result.
Interpretation, ascertainment and evolution are parts of the process, while that interpreted, ascertained or evolved is declared as law.
The law declared by the Supreme Court is the law of the and.
If so, we do not see any acceptable reason why it, in declaring the law in superses 814 sion of the law declared by it earlier, could not restrict the operation of the law as declared to future and save the transactions, whether statutory or otherwise that were effected on the basis of the earlier law.
To deny this power to the Supreme Court on the basis of some outmoded theory that the Court only finds law but does not make it is to make ineffective the powerful instrument of.
justice placed in the hands of the highest judiciary of this country.
As this Court for the first time has been called upon to apply the doctrine evolved in a different country under different ,circumstances, we would like to move warily in the beginning.
We would lay down the following propositions : (I) The doctrine of prospective over ruling, can be invoked only in matters arising under our Constitution; (2 it an be applied only by the highest court of the country, i.e., the Supreme Court as it has the constitutional jurisdiction to declare an binding on all the courts in India; (3) the scope of the retroactive operation of the law declared by the Supreme Court superseding its earlier decisions .is left to its discretion to be moulded in accordance with the justice of the cause or matter before it.
We have arrived at two conclusions, namely, (1) Parliament has no power to amend Part III of the Constitution so as to take away or abridge the fundamental rights; and (2) this is a fit case to invoke and apply the doctrine or prospective overruling.
What then is the effect of our conclusion on the instant case ?.
Having regard to the history of the amendments their impact on the social and economic affairs of our country and the chaotic situation that may be brought about by the sudden withdrawal at this stage of the amendments from the Constitution, we think that considerable judicial restraint is called for.
We, therefore, declare that our decision will not affect the validity of the Constitution (Seventeenth Amendment) Act, 1964, or other amendments made to the Constitution taking away or abridging the fundamental rights.
We further declare that in future Parliament will have no power to amend Part III of the Constitution so as to take away or abridge the fundamental rights.
In this case we do not propose to express our opinion on the question of the scope of the amendability of the provisions of the Constitution other than the fundamental rights, as it does not arise for consideration before us.
Nor are we called upon to express out opinion on the question regarding the scope of the amends ability of Part Ill of the constitution otherwise than by taking away or abridging the fundamental rights.
We will not also in dicate our view one way or other whether any of the Acts questioned can be sustained under the provisions of the Constitution without the aid of articles 31A, 31B and the 9th Schedule.
815 The aforesaid discussion leads to the following results (1) The power of the Parliament to amend the Constitution is derived from articles 245, 246 and 248 of the Constitution and not from article 368 thereof which only deals with procedure.
Amendment is a legislative process.
(2) Amendment is 'law ' within the meaning of article 13 of the Constitution and, therefore, if it takes away or abridges the rights conferred by Part III thereof, it is void.
(3) The Constitution (First Amendment) Act, 1951, Constitution (Fourth Amendment) Act, 1955, and,the Constitution (Seventeenth Amendment) Act, 1964, abridge the scope.
of the fundamental rights.
But, on the basis of earlier decisions of this Court, they were valid.
(4) On the application of the doctrine of 'prospective over ruling ', as explained by us earlier, our decision will have only prospective operation and, therefore, the said amendments will continue to be valid.
(5) We declare that the Parliament will have no power from the date of this decision to amend any of the provisions of Part III of the Constitution so as to take away or abridge the fundamental rights enshrined therein.
(6) As the Constitution (Seventeenth Amendment) Act holds the field, the validity of the two impugned Acts, namely, the Punjab Security of Land Tenures Act X of 1953, and the Mysore Land Reforms Act X of 1962, as amended by Act XIV of 1965, cannot be questioned on the ground that they offend articles 13, 14 or 31 of the Constitution.
Before we close, it would be necessary to advert to an argu ment advanced on emotional plane.
It was said that if the provisions of the Constitution could not be amended it would lead to revolution.
We have not said that the provisions of the Constitution cannot be amended but what we have said is that they cannot be amended so as to take away or abridge the fundamental rights.
Nor can we appreciate the argument that all the agrarian reforms which the Parliament in power wants to effectuate cannot be brought about without amending the fundamental rights.
It was exactly to prevent this attitude and to project the rights of the that the fundamental rights were inserted in the Constitution.
If it is the duty of the Parliament to enforce the directive principles, it is equally its duty to enforce them without infringing the fundamental rights.
The Constitution makers thought that it could be done and we also think that the directive prin 816 ciples can reasonably be enforced within the self regulatory machinery provided by Part III.
Indeed both Parts III and IV of the Constitution form an integrated scheme and is elastic enough to respond to the changing needs of the society.
The verdict of the Parliament on the scope of the law of social control of fundamental rights is not final, but justiciable.
If not so, the whole scheme of the Constitution will break.
What we can I not understand is how the enforcement of the provisions of the Constitution can bring about a revolution.
History shows that revolutions are brought about not by the majorities but by the minorities and some time by military coups.
The existence of an all comprehensive amending power cannot prevent revolutions, if there is chaos in the country brought about by mis rule or abuse of power.
On the other hand, such a restrictive power gives stability to the country and prevents it from passing under a totalitarian or dictatorial regime.
We cannot obviously base our decision on such hypothetical or extraordinary situations which may be brought about with or without amendments.
Indeed, a Constitution is only permanent and not eternal.
There is nothing to choose between destruction by amendment or by revolution, the former is brought about by totalitarian rule, which cannot brook constitutional checks and the other by the discontentment brought about by mis rule.
If either happens, the constitution will be a scrap of paper.
Such considerations are out of place in construing the provisions of the Constitution by a court of law.
Nor are we impressed by the argument that if the, power of amendment is 'not all comprehensive there will be no way to change the structure of our Constitution or abridge the fundamental rights even if the whole country demands for such a change.
Firstly, this visualizes an extremely unforeseeable and extravagant demand; but even if such a contingency arises the residuary power of the Parliament may be relied upon to call for a Constituent Assembly for making a new Constitution or radically changing it.
The recent Act providing for a poll in Goa, Daman and Diu is an instance of analogous exercise of such residuary power by the Parliament.
We do not express our final opinion on this important question.
A final appeal is made to us that we shall not take a different view as the decision in Sankari Prasad 's case(1) held the field for many years.
While ordinarily this Court will be reluctant to reverse its previous decision, it is its duty in the constitutional field to correct itself as early as possible, for otherwise the future progress of the country and the happiness of the people will be at stake.
As we are convinced that the decision in Sankari Prasad 's case(1) is wrong, it is pre eminently a typical case where this Court should over rule it.
The longer it holds the field the greater will (1) ; , 105 817 be the scope for erosion of fundamental rights.
As it contains the seeds of destruction of the cherished rights of the people the sooner it is over ruled the better for the country.
This argument is answered by the remarks made by this Court in the recent judgment in The Superintendent and Legal Remembrancer State of West Bengal vs, The Corporation of Calcutta(1).
"The third contention need not detain us ] 'or it has been rejected by this Court in The Bengal Immunity Company Limited vs The State of Bihar(2) .
There a Bench of 7 Judges unanimously held that there was nothing in the Constitution that prevented the Supreme Court from departing from a previous decision of its own if it was satisfied of its error and of its baneful effect on the general interest of the public.
If the aforesaid rule of construction accepted by this Court is in consistent with the legal philosophy of our Constitution, it is our duty to correct ourselves and lay down the right rule.
In constitutional matters which affect the evolution of our polity, we must more readily do so than in other branches of law, as perpetuation of a mistake will be harmful to public interests.
While continuity and consistency are conducive to the smooth evolution of the rule of law, hesitancy to set right deviation will retard its growth.
In this case, as we are satisfied that the said rule of construction is inconsistent with our republican polity and, if accepted, bristles with anomalies, we have no hesitation to reconsider our earlier decision." In the result the petitions are dismissed, but in the circumstances without costs.
Wanchoo, J.
This Special Bench of eleven Judges of this Court has been constituted to consider the correctness of the decision of this Court in Sri Sankari Prasad Singh Deo vs Union of India(,,) which was accepted as correct by the majority in Sajjan Singh vs State of Rajasthan (4) .
The reference has been made in three petitions challenging the constitutionality of the Seventeenth Amendment to the Constitution.
In one of the petitions, the inclusion, of the Punjab Security of Land Tenures Act, (No. X of 1953) in the Ninth Schedule, which makes it immune from.
attack under any provisions contained in Part III of the Constitution ' has been attacked on the ground that the Seventeenth Amendment is in itself unconstitutional.
In the other two petitions, the inclusion of the Mysore Land Reforms Act, (No. 10 of 1962) has been attacked on the same grounds.
It is not necessary to set out the facts in (1) ; ,176 (2) [1955] 2S.C.R.603.
(3) ; (4) [1965] 1.C.S.R. 933. 818 the three petitions for present purposes.
The main argument in all the three petitions has been as to the scope and effect of article 368 of the Constitution and the power conferred thereby to amend the Constitution.
Before we come to the specific I points raised in the present petitions, we may indicate the circumstances in which Sankari Prasad 's case(1) as well as Sajjan Singh 's case (2) came to be decided and what they actually decided.
The Constitution came into force on January 26,.1950.
It provides in Part III for certain fundamental rights.
Article 31 which is in Part 111, as it originally stood, provided for compulsory acquisition of property.
By clause (1) it provided that "no person shall be deprived of his property save by authority of law".
Clause (2) ;hereof provided that any law authorising taking of Possession or acquisition of property must provide for compensation therefor and either fix the amount of compensation or specify the principles on which, and the manner in which the compensation was to be determined and paid.
Clause(4) made a special provision to the effect that if any Bill pending at the commencement of the Constitution in the Legislature of a State had, after it had been passed by such Legis lature, been reserved for the consideration of the President and had received his assent, then such law would not be called in question though it contravened the provisions of cl.
(2) relating to compensation.
Clause (6) provided that any law of the State enacted not more than eighteen months before the Constitution might be submitted to the President for his certification, and if so certified, it could not be called in question on the ground that it contravened the provision of cl.
(2) of article 31 relating to compensation.
These two clauses of article 31 were meant to safeguard legislation which either had been passed by Provincial or State legislatures or which was on the anvil of State legislatures for the purpose of agrarian reforms.
One such piece of legislation was the Bihar Land Reforms Act, which was passed in 1950.
That Act received the assent of the President as required under cl.
(6) of article 31.
It was however challenged before the Patna High Court and was struck down by that court on the ground that it violated Art ' 14 of the Constitution.
Then there was an appeal before this Court, but while that appeal was pending, the First Amendment to the Constitution was made.
We may briefly refer to what the First Amendment provided for.
It was the First Amendment which was challenged and was upheld in Sankari Prasad 's case(1).
The First Amendment contained a number of provisions; but it is necessary for present purposes only to refer to those provisions which made changes in Part III of the Constitution.
These changes related to articles 15 (1) ; (2) ; 819 and 19 and in addition, provided for insertion of two Articles, numbered 31 A and 31 Bin Part III Article 31 A provided that no law providing for the acquisition by the State of any estate or of any rights therein or the extinguishment or modification of any such rights shall be deemed to be void on the ground that it was.
inconsistent with, or took away or abridged any of the rights conferred by any provision in part Ill. 'The word "estate" was also defined for the purpose of article 31 A Further Article 31 B. provided for validation of certain Acts and Regulations and specified such Acts and Regulations in the Ninth Schedule, which was for the first time added to the Constitution.
The Ninth Schedule then contained 13 Acts, all relating to estates , passed by various legislatures of the Provinces or States.
It laid down that those Acts and Regulations would not be deemed to be void or ever to have become void, on the ground that they were inconsistent with.
or took away or abridged any of the rights conferred by any provision of Part III.
It further provided that notwithstanding any judgment, decree or order of any court or tribunal to the contrary, all such Acts and Regulations subject to the power of any competent legislature to repeal or amend them, continue in force.
This amendment, and in particular articles 31 A and 31 B were.
immediately challenged by various writ petitions in this Court and these came to be decided on October 5, 1951 in Sankari Prasad 's case(1).
The attack on the validity of the First Amendment was made on various grounds; but three main grounds which were.
taken were, first 1 , that amendments to the Constitution made under article 368 were liable to be tested under article 13(2); secondly that in any case as articles 31 A and 31 B insert the Constitution by the First.
Amendment affected the power of the High Court under article 226 1 and of this Court under Articles 132 and 136; the amendment required ratification under the proviso to article 368; and, thirdly that Acts.
31 A and 31 B were invalid on the ground that they related to matters covered by the State List, namely, item 18 of List 11, and could not therefore be passed by Parliament.
This Court rejected all the three contentions.
It held that although ."law" would ordinarily include constitutional law, there was a clear demarcation between ordinary law made in the exercise of legislative power and constitutional law made in the exercise of constituent power, and in the context of article 13, "law" must be taken to mean rules or regulations made.
in exercise of ordinary legislative power and not amendments to, the Constitution made in the exercise of constituent power; in consequence article 13(2) did not affect amendments made under article 3 68.
It further held that articles 3 1 A and 31 B did not curtail the power of the High Court under article 226 or of this court under articles 132 and 136 and did not require ratification under the (1) ; 820 proviso contained in article 368.
Finally, it was held that articles 31.
A and 31 B were essentially amendments to the Constitution and Parliament as such had the power to enact such amendments.
In consequence, the First Amendment to the Constitution was upheld as valid.
After this decision, there followed sixteen more amendment .to the Constitution till we come to the Seventeenth Amendment, which was passed on June 20, 1964.
There does not seem to have been challenge to any amendment up to the Sixteenth Amendment, even though two of them, namely, the Fourth Amendment and the Sixteenth Amendment,, contained changes in the provisions of Part III of the Constitution.
Further the nature of these amendments was to add to, or alter or delete various other provisions of the Constitution contained in Part III thereof On December 5, 1961 came the decision of this Court by which the Kerala Agrarain Reforms Act (No. 4 of 1961), passed by the Kerala legislature, was struck down, among other grounds, for the reason that ryotwari lands in South India were not estates within the meaning of article 31 A and therefore acquisition of reyotwari land was not protected under article 31 A of the Constitution : [see Karimbil Kunhikoman vs State of Kerala(1)].
This decision was followed by the Seventeenth Amendment on June 20, 1964.
By this amendment, changes were made in article 31 A of the Constitution and 44 Acts were included in the Ninth Schedule to give them complete protection from attack under any provision of Part III of the Constitution.
Practically all these Acts related to land tenures and were concerned with agrarian reforms.
This amendment was challenged before this 'Court in Sajjan Singh 's case(2).
The points then urged were that as article 226 was likely to be affected by the Seventeenth Amendment, it required ratification under the proviso to article 368 and that the decision in Sankari Prasads case(3) which had negatived this contention required re consideration.
It was also urged that the Seventeenth Amendment was legislation with respect to land and Parliament bad no right to legislate in that behalf, and further that as the Seventeenth Amendment provided that the Acts put in the Ninth Schedule would be valid in spite of the decision of the Courts, it was unconstitutional.
This Court by a majority of 3 to 2 upheld the correctness of the decision in Sankari Prasad 's case(,,).
It further held unanimously that the Seventeenth Amendment did not require ratification under the proviso to article 368 because of its indirect effect on article 226, and that Parliament in enacting the Amendment was not legislating with respect to land and that it was open to Parliament to validate legislation which had been invalid by courts.
Finally this Court held by majority (1) [1962] Supp. 1 S.C.R. 829.
(2) ; (3) ; 821 that the power conferred by article 368 included the power to take away fundamental rights guaranteed by Part HI and that the power to amend was a very wide power and could not be controlled by the literal dictionary meaning of the word "amend" and that the word "law" in article 13 (2) did not include an amendment of the Constitution made in pursuance of article 368.
The minority however doubted the correctness of the view taken in Sankari Prasads case(1) to the effect that the word 'law" in article 13 (2) did not include amendment to the Constitution made under article 368 and therefore doubted the competence of Parliament to make any amendment to Part III of the Constitution.
One of the learned Judges further doubted whether making a change in the basic features of the Constitution could be regarded merely as an amendment or would, in effect, be re writing a part of the Constitution, and if so, whether it could ' be done under article 368.
It was because of this doubt thrown on the correctness of the view taken in Sankari Prasad 's case(1) that the present reference has been made to this Special Bench.
As the question referred to this Bench is of great constitutional importance and affected legislation passed by various States, notice was issued to the Advocates General of all States and they have appeared and, intervened before us.
Further a number of persons who were also affected by the Seventeenth Amendment have been permitted to intervene.
The arguments on behalf of the petitioners and the interveners who support them may now.
be briefly summarised.
It is urged that article 368 when it provides for the amendment of the Constitution merely ' contains the procedure for doing so and that the power to make amendment has to be found.
in article 248 read with item 97 of List 1.
It is further urged that the word "amendment" in article 368 means that the provisions in the Constitution can be changed so as to important upon them And that this power is of a limited character and does not authorise Parliament to make any addition to, alteration of or deletion of any ,provision of the Constitution, including the provision contained in Part III.
So article 368 authorises only those amendments which have the effect of improving the Constitution.
Then it is urged that amendment permissible under article 368 is subject to certain implied limitations and the these limitations are that basic features of the Constitution cannot be amended at all.
An attempt was made to indicate some of these basic features, as, f( example, the provisions in Part III, the federal structure, the republican character of the State, elected Parliament and State Legislatures on the basis of adult suffrage, control by the judiciary and so on, and it is.
said that an amendment under article 3 69 is subject to the implied limi (1) (1952] S.C.R. 89.
L3Sup.
CI/67 7 822 tations that these basic features and others of the kind cannot be, changed.
Thus in effect the argument is that there is a very limited power of amendment under the Constitution.
It is further urged that apart from these implied limitations, there is an express limitation under article 13(2) and the word "law in that Article includes an amendment of the Constitution.
The argument thus in the alternative is that as the word "law" in article 13(2) includes a constitutional amendment, no amendment can be made in Part HI under article 368 which would actually take away or abridge the rights guaranteed under that Part.
In effect, it is said that even if there are no implied limitations to amend the Constitution under article 368, article 13(2) is an express limitation insofar as the power to amend Part III is concerned and by virtue of article 13(2) the rights guaranteed under Part III cannot be taken away or abridged under article 368, though it is conceded that Part III may be amended by way of enlarging the rights contained therein.
Another line of argument is that in any case it was necessary to take action under the proviso to article 368 and as that was not done the Seventeenth Amendment is not valid.
It is urged that article 2,26 is seriously affected by the provisions contained in the Seventeenth Amendment and that amounts to an amendment of Aft.
226 and in consequence action under the proviso was necessary.
It is also urged that article 245 was addition of a number of Acts in the Ninth 13 (2) and therefore also it was necessary to take action under the proviso.
It is further urged that it was not competent for Parliament to amend the Constitution by putting a large number of Acts in the Ninth Schedule as the power to legislate with respect to land is solely within the.
competence of State Legislatures and that is another reason why the addition to the Ninth Schedule read with article 31 B should be struck down.
Lastly an argument had been advanced which we may call the argument of fear.
It is said that if Art.368 is held to confer full to amend each and every part of the Constitution as has been held in Sankari Prasad 's case(1).
Parliament May do all kinds of things, which were never intended, under this unfettered power and may, for example, abolish elected legislatures, abolish the President or change the present form of Government into a Presedential type like the United States.
Constitution or do away with the federal structure altogether.
So it is urged that, we should,interpret article 368 in such a way that Parliament may not be able to do all these things.
In effect this argument of fear has been put forward to reinforce the contention that this Court should (1)[1952] S.C.R. 89.
823 hold that there are some implied limitations on the amending power and these implied limitations should be that there is no power any where in the Constitution to change the basic features of the Constitution to which reference has already been made.
This is in brief the submission on behalf of the petitioners and the interveners who support them.
The submission on behalf of the Union of India and the States may now be summarised.
It is urged that article 368 not only provides procedure or amendment but also contains in it the power to amend the Constitution.
It is further urged that the word "amendment" in law does not merely mean making such changes in the Constitution as would improve it but includes the power to make any addition to the Constitution, any alteration of any of the existing provisions and its substitution by another provisions, and any deletion of any particular provision of the Constitution.
In .effect, it is urged that even if the word "amendment" used in article 368 does not take in the power to abrogate the entire 'Constitu tion and replace it by another new Constitution, it certainly means that any provisions of the Constitution may be changed and this change can be in the form of addition to, alteration of or deletion of any provision of the Constitution.
So long therefore as the Constitution is not entirely abrogated and replaced by a new Constitution at one stroke, the power of amendment would enable Parliament to make all changes in the existing Constitution by addition, alteration or deletion.
Subject only to co repeal being not possible, the power of amendment contained in article 368 is unfettered.
It is further urged that there can be no implied limitations on the power to amend and the limitations if any on this.
power must be found hi express terms in the Article providing for amendment.
It is conceded that there may be an express limitation not merely in the Article providing for amendment, but in some other part of the Constitution.
But it is said that if that is so, there must be a clear provision to that effect.
In the absence of express limitations, therefore, there can be no implied limitations ,on the power to amend the Constitution contained in article 368 and that power will take in all changes whether by way of addition, alteration or deletion, subject only to this that the power of amendment may riot contain the, power to abrogate and repeal the entire Constitution and substitute it with a new one.
It is then urged that there is no express provision in Art.368 itself so far as any amendment relating to the substance of the amending power is concerned , die only limitations in Art, 368 are as to procedure and courts can only see that the procedure as indicated in article 368 is followed before an amendment can be said to be valid.
It is further urged that the word "law", in article 13 does not include an amendment of the Constitution and only 824 moans law as made.
under the legislative provisions contained in Chapter, I of Part XI read with, Chapters II and III of Part V of the.
Constitution and Chapters III and V of Part VI thereof.
In effect it is a law which is made under the Constitution which included in the word "law" in article 13(2) and not an amendment to the Constitution under article 368.
As to Articles 226 and 245 and the necessity of taking action under the proviso to article 368, it is urged that there is no change in articles 226 and 245on account of any provision in the Seventeenth Amendment and therefore no action under the proviso was necessary.
it is only direct change in articles 226 and 245 which would require following the procedure as to ratification or at any rate such change in other Articles which would have the effect of directly compelling change in Arts 226 and 245 and that in the present case no such direct compulsion arises.
Lastly as to the argument of fear it is urged that there is always a provision with respect to amendment in written federal Constitutions.
Such a provision may be rigid or flexible.
In our Constitution article 368 provides for a comparatively flexible provision for amendment and there is ' no reason to make it rigid by implying any limitations on that power.
Further there Is no reason to suppose that all those things will be done by Parliament which are being urged to deny the power under article 368 which flows naturally from its terms.
Besides the above, reliance is also placed on behalf of the Union of India and the States on the doctrine.
of stare decisis.
It is urged that since the decision of this Court in Sankari Prasad 's case(1), sixteen further amendments have been made by Parliament on the faith of that decision involving over 200 Articles of the Constitution.
The amendments relating to Part III have been mainly with respect to agrarian reforms resulting in transfers of title of millions of acres of land in favour of millions of people.
Therefore ', even though Sankari Prasad 's case(1) has stood only for fifteen years there has been a vast agrarian revolution effected on the faith of that decision and this Court should not now go back on what was decided in that case.
Further, besides the argument based on state decisis, it is urged on the basis of certain decisions of this Court that the unanimous decision in Sankari Prasad 's case(1) which had stood practically unchallenged for about '15 'years till the decision in Sajjan Singh 's case(2), should not be over ruled unless it is found to be incorrect by a large majority of the Judges constituting this Special Bench.
It is urged that if the present Bench is more or less evenly divided it should not over rule the unanimous decision in ' Sankari Prasad 's case(1) by a Majority of one.
(1) (1952] S.C.R. 89.
(2) ; 825 We shall first take Art, 368.
It is found in Part XX of the Constitution which is headed.
Amendment of the Constitution" and is the only Article in that Part.
That Part thus provides specifically for the amendment of the Constitution, and the first question that arises is whether it provides power for the amendment of the Constitution as well as the procedure for doing so.
It is not disputed that the procedure for amendment of the Constitution is to be found in article 368, but what is in dispute is whether article 368 confers power also in that behalf.
Now the procedure for the amendment of the Constitution is this: The amendment is initiated by the introduction of a Bill in either House of Parliament.
The Bill has to be passed in each House by a majority of the total membership of that House and by a Majority of not less two thirds of the members of that House present and voting.
After it is so passed, it has to be presented to the President for his assent.
On such presentation if the President assents to the Bill, article 3 68 provides that the Constitution shall stand amended in accordance with the terms of the Bill.
Further there is a proviso for ratification with respect to certain Articles and other provisions of the Constitution including article 368, and those matters can only be amended if the Bill passed by the two Houses by necessary majority is ratified by the legislatures of not less than one half of the States by resolutions to that effect.
In such a case the Bill cannot be presented for his assent to the President until necessary ratification is available.
But when the. necessary ratification has been made, the Bill with respect to these matters is then presented to the President and on his assent being given, the Constitution stands amended.
in accordance with the terms of the Bill.
The argument is that there is no express provision in terms in article 368 conferring power on Parliament to amend the Constitution, and in this connection our attention has been invited to an analogous provision in the Constitution of Ireland in article 46, where cl. 1 provides that any provision of the Constitution, may be amended in the manner provided in that Article, and then follows the procedure for amendment in clauses 2 to 5.
Reference is also made to similar provisions in.
other constitutions, but it is unnecessary to refer to them.
It is urged that as article 368 has nothing comparable to cl.
I of article 46 of the Irish Constitution, the power to amend the Constitution is not in.
article 3 68 and must .be.
found elsewhere.
We are not prepared to accept this argument.
The fact that article 368 is not in two parts, the first part indicating that the Constitution shall be amended in the manner provided thereafter, and the second part indicating the procedure for amendment, does not mean that the power to amend the Cons titution is not contained in article 368 itself.
The very fact that a 826 separate Part has been devoted in the Constitution for amendment thereof and there is only one Article in that Part shows that both the power to amend and the procedure for amendment are to be found in article 368.
Besides, the words "the Constitution shall stands amended in accordance 'with the terms of the Bill" in article 368 clearly in our opinion provide for the power to amend after the procedure has been followed.
It appears that our Constitution makers were apparently thinking of economy of words and elegance of language in enacting article 368 in the terms in which it appears and that is why it is not in two parts on the model of Art.46 of the Irish Constitution.
But there can in our opinion.
be not doubt, when a separate Part was provided headed "Amendment of the Constitution" that the power to amend the Constitution must also be contained in article 368 which is the only Article in that Part.
If there was any doubt about the matter, that doubt in our opinion is resolved by the words to which we have already referred namely "the Constitution shall stand amended in the terms of the Bill".
These words can only mean that the.
power is there to amend the Constitution after the procedure has been followed.
It is however urged that the power to amend the Constitution is not to be found in article 368 but is contained in the residuary power of Parliament in article 48 read with item 97 of List 1.
It is true that article 248 read with item 97 of List I, insofar as it provides for residuary power of legislation, is very wide in its scope and the argument that the, power to amend the Constitution is contained in this provision appears prima facie attractive 'in view of the width of the residuary power.
But we fail to see why when there is a whole Part devoted to the amendment of the Cons titution the power to amend should not be found in that Part, if it can be reasonably found there and why article 368 should only be confined to providing for procedure for amendment.
It is true that the marginal note to article 368 is "procedure for amendment of the Constitution", but.
the marginal note cannot control the meaning of the words in the Article itself, and we have no doubt that the words "the Constitution shall stand amended in accord the power of amendment.
If we were to compare the language of cls.
2 to 5of article 46 of the Irish Constitution which prescribes the procedure for amendment, we find no words therein comparable to these words in article 368.
These words clearly are com parable to cl.
I of article 46 of the Irish Constitution and must be rod as conferring power on Parliament to amend the Constitution.
Besides it is remarkable in contrast that article 248 read with List I does not in terms mention the amendment of the Constitution.
while therefore there is a whole Part devoted to the amendment of the Constitution, we do not find any specific mention of the 827 amendment of the Constitution in article 248 or in any entry of List 1.
It would in the circumstances be more appropriate to read in power in article 3 68 in view of the, words which we have already referred to than in article 248 read with item 97 of List I.
Besides it is a historical fact to which we can refer that originally the intention was to vest residuary power in States, and if that intention had been eventually carried out, it would have been impossible for any one to argue that the power to amend the Constitution was to be found in the residuary power if it had been vested in the States and not in the Union.
The mere fact that during the passage of the Constitution by the Constituent Assembly, residuary power was finally vested in the Union would not therefore mean that it includes the power to amend the Cons titution.
On a comparison of the scheme, of the words in Art 368 and the scheme of the words in article 248 read with item 97 of List 1, therefore, there is no doubt in our mind that both the procedure and power to amend the Constitution are to be found in article 368 and they are not to be found in article 248 read with item 97 of List I which provides for residuary legislative power of Parliament.
There is in our opinion another reason why the power to amend the Constitution cannot found in article 248 read with item 97 of List 1.
The Constitution is the fundamental law and no law passed under mere legislative power conferred by the Constitution can affect any change, in the Constitution unless there is an express power to that effect given in the Constitution itself.
But subject to such express power given by the Constitution itself, the fundamental law, namely the Constitution, cannot be changed by a law passed under the legislative provisions contained in the Constitution as all legislative acts passed under the power conferred by the Constitution must conform to the Constitution can make no change therein.
There are a number of Articles in the Constitution, which expressly provide for amendment by law, as,.
for example, 3, 4, 10, 59(3), 65(3), 73(2), 97, 98(3), 106, 120(2), 135, 137, 142(1), 146(2), 148(3), 149, 169, 171(2), 196, 187(3), 189(3), 194(3), 195, 210(2), 221(2).
225, 229(2), 239(1), 241(3), 283(1) and (2), 285(2), 287, 306(1), 313, 345, 373, Sch.
V. cl. 7 and Sch.
VI, cl. 21,, and so far as these Articles are concerned they can be amended by Parliament by.
ordinary law making process.
But so far as the other Articles are concerned they can only be amended by amendment of 'the Constitution under article 368.
Now article 245 which gives power to make law for the whole or any part of the territory of India by Parliament is "subject to the provisions of this Consti tution" and any law made by Parliament whether under article 246 read with List I or under article 248 read with item 97 of List I be subject to the provisions of the Constitution.
If therefore the power to amend the Constitution is contained in article 248 828 read with item 97 of List 1, that power has to be exercised subject to the provisions of the Constitution and cannot be used to change the fundamental law (namely, the Constitution) itself.
But it is argued that article 368 which provides a special procedure for amendment of the Constitution should be read along with articles 245 248, and so read it would be open to amend any provision of the Constitution by law passed under article 248 on the ground that article 248 is subject to article 368 and therefore the two together give power to Parliament to pass a law under article 248 which will amend even those provisions of the Constitution which are not expressly made amendable by law passed under the legislative power of Parliament.
This in our opinion is arguing in a circle.
If the fundamental law (ie.
the Constitution) cannot be I changed by any law passed under the legislative powers contained therein, for legislation so passed must conform to the fundamental law, we fail to see how a law, passed under the residuary power which is nothing, more than legislative power conferred on parliament under the Constitution, can change the Constitution (namely, the fundamental law) Itself.
We,may in this connection refer to the following passage in The Law.and the Constitution by W. Ivor Jennings (1933 Ed.) at p. 51 onwards : "A written constitution is thus the fundamental law of a country, the express embodiment of the doctrine of the region of law.
All public uthorities legislative, administrative and judical take their powers directly or indirectly from it. .Whatever the nature of the written constitution it is clear that there "is a fundamental distinction between constitutional law and the rest of the law. .
There is a clear separation, therefore, between the constitutional law and the rest of the law.
" It is because of this difference between the.
fundamental law (namely, the Constitution) and the law passed under the legislative provisions of the Constitution that it is not possible in the absence of an express provision to that effect in the fundamental law to ,change the fundamental law by ordinary legislation passed thereunder, for such ordinary legislation must always conform to the fundamental law (i.e. the Constitution).
If the power to amend the Constitution is to be found in article 248 read with item 97 of List 1.
It will mean that ordinary legislation passed under fundamental law would amend that law and this cannot be done unless there is express provision as in article 3 etc.
to that effect In the absence of such express provisions any law passed under the legislative powers granted under the fundamental ' law cannot amend it.
So if we were to hold that the power to amend the 829 Constitution is comprised in article
248, that would mean that no amendment ,of the Constitution would be possible at all except to the extent expressly provided in various Articles to which we have referred already, for the power to legislate under article 245 read with article 248 is itself subject to the Constitution.
Therefore reading article 368 and considering the scheme of the legislative powers conferred by Articles 245 and 248 read with item 97 of List I" this to our mind is clear, firstly that the power to amend the, Constitution is to be found in article 368 itself, and secondly, that the power to amend the Constitution can never reside in article 245 and article 248 read with item 97 of List 1, for that would make any amendment of the Constitution impossible except with respect to the express provisions contained in certain Articles thereof for amendment by law .
We may in this connection add that all this argument that power to amend the Constitution is to be found in article 245 and article 248 read with item 97 of List I has been based on one accidental circumstance, and that accidental circumstance is that the procedure for amendment of the Constitution contained in article 368 is more or less assimilated to the procedure for making ordinary laws under the Constitution.
The argument is that constitutional amendment is also passed by the two Houses of Parliament, and is assented to by the President like ordinary legislation, with this difference that a special majority is required for certain purposes and a special majority plus ratification is required for certain other purposes.
It may be admitted that the procedure for amendment under article 368 is somewhat similar to the procedure for passing ordinary legislation under the Constitution.
Even so, as pointed out by Sir Ivor Jennings in the passage already quoted, there is a clear separation between constitutional law and the rest of the law and that must never be forgotten.
An amendment to the Constitution is a constitutional law and as observed in Sankari Prasad 's case(1) is in exercise of constituent power; passing of ordinary law is in exercise of ordinary legislative power and is clearly different from the power to amend the Constitution.
We may in this connection refer, for example, to article V of other U.S. Constitution, which provides for the, amendment thereof.
It will be clearly seen that the power contained in article V of the U.S. Constitution is not ordinary legislative power and no one can possibly call it ordinary legislative power, because the procedure provided for the amendment of the Constitution in article V differs radically from the procedure provided for ordinary legislation, for example, the President 's assent is not required constitutional amendment under article V of the U.S. Constitution,; Now if article 368 also had made a similar departure from the procedure provided for ordinary legislation, it could never have (1) [1952 ] 1 section C. R. 89 830 said that article 368 merely contained the procedure for amendment and that what emerges after that procedure is followed is ordinary law of the same quality and nature as emerges after following the procedure for passing ordinary law.
If, for example, the assent of the President which is to be found in article 368 had not been there and the Constitution would have stood amended after the Bill had been passed by the two Houses by necessary majority and after ratification by not less than one half of the States where so required , it could never have been argued that the power to amend the Constitution was contained in article 245 and 248 read with item 97 of List I and article 368 merely con tained the procedure.
We are however of opinion that we should look at the quality and nature of what is done under article 368 and not lay so much stress on the similarity of the procedure contained in article 368 with the procedure for ordinary lawmaking.
If we thus look at the quality and nature of what is done under article 368, we find that it is the exercise of constituent power for the purpose of amending the Constitution itself land is very different from the exercise of ordinary legislative power for passing laws which must be in conformity with the Constitution and cannot go against any provision thereof, unless there is express provision to that effect to which we have already referred.
If we thus refer to the nature and quality of what is done under article 368, we immediately See that what emerges after the procedure in article 368 is gone through is not ordinary law which emerges after the legislative procedure contained in the Constitution is gone through.
Thus article 368 provides for the coming into existence of what may be called the fundamental law in the form of an amendment of the Constitution and therefore what emerges after the procedure under article 368 is gone through is not ordinary legislation but an amendment of the Constitution which becoming a part of the fundamental law itself, by virtue of the words contained in article 368 to the effect that the Constitution shall stand amended in accordance with the terms of the 'Bill.
It is urged in this connection on behalf of the Union of India that even though the assent of the President is required under Aft. 368, the ;President must assent thereto and cannot withhold his assent as is possible in the case of ordinary law in view of article III of the Constitution, for the words "that he withholds assent therefrom" found in article III are not to be found in article 368.
It is however difficult to accept the argument on behalf of the Union that the President cannot withhold his assent when a Bill for amendment of the Constitution is presented to him.
Article '368 provides that a Bill for the amendment of the, Constitution shall be presented to the President for his assent.
It further provides 831 that upon such assent by the President, the Constitution shall, stand amended.
That in our opinion postulates that if assent is not given, the Constitution cannot be amended.
Whether a President will ever withhold his assent in our form of Government is a different matter altogether, but as we road article 368 we cannot.
hold that the President is bound to assent and cannot withhold his assent when a Bill for amendment of the Constitution is presented to him.
We are of opinion that 'the President can refuse to give his assent when a Bill for amendment of the Constitution is presented to him, the result being that the Bill altogether falls, for there is no specific provision for anything further to be done,: about the Bill in article 368 as there is in article III.
We may in this.
connection refer to the different language used in cl. 5 of article 46 of the Irish Constitution which says that "a Bill containing a proposal for the amendment of this Constitution shall be signed by the President Forthwith upon his being satisfied that the provisions of this Article have been complied with, in respect thereof '.
It will be seen therefore that if the intention kinder article 368 had been that the President cannot withhold his assent, we would have found language similar in terms to that in cl. 5 of article 46 of the Irish Constitution.
We thus see that in one respect at any rate article 368 even on its present terms differs from the power of the President in connection with ordinary legislation under the Constitution and that is if the President withholds his assent the Bill for amendment of ' the Constitution immediately falls.
We cannot accept that the procedure provided under the proviso to article 111 can apply in such a case, for this much cannot be disputed that so far as the procedure for amendment of the Constitution is concerned we must look to article 368 only and nothing else.
In any case the mere fact that the procedure in article 368 is very much assimilated.
to the procedure for passing ordinary legislation is no reason for, holding that what emerges after the procedure under article 368 is followed is ordinary law and no more.
We repeat that we must look at the quality and nature of what is done under article 368, and that is, the amendment of the Constitution.
If we look at that we must bold that what emerges is not ordinary law passed under the Constitution but something which has the effect of amending the fundamental law itself which could not be done by ordinary legislative process under the Constitution unless there is express provision to that effect.
We have already referred to such express provisions in various Articles, but article 368 cannot be treated as such an Article, for it deals specifically with the amendment of the Constitution as a whole.
It is also remarkable to note in this connection that the, word "law" which has been used in so many Articles of 'the Consti 832 tution has been avoided apparently with great care in article 368.
We again refer to the concluding words 368 which says that the "Constitution shall stand amended in accordance with the terms of the Bill.
Now it is well known that in the case of ordinary legislation as soon both Houses and has received the assent of the main part of article stand amended in ac it is well known that as the Bill is passed by of the President it becomes an Act.
But article 368 provides that as soon as the Bill for amendment of the Constitution has been passed in accordance with the procedure provided there in the Constitution shall stand amendmend in accordance with the terms of the Bill.
These words in our opinion have significance of their own.
It is also remarkable that these words clearly show the difference between the, quality of what emerges after the procedure under article, 368 is followed and what happens when ordinary law making procedure is followed.
Under article III, in the case of ordinary law making when a Bill is passed by the two Houses of parliament it is presented to the President and the President shall declare either that he assents to the Bill or that he withholds assent therefrom.
But it is remarkable that article 111 does not provide that when the Bill has been assented to by the President it becomes an Act ' The reason for this is that the Bill assented to by the President though it may become law is still not declared by article I I I to be a law, for such law is open to challenge in courts on various ,grounds, namely, on the ground that it violates any fundamental rights, or on the ground that Parliament was not competent to pass it or on the ground that it is in breach of any provision of the Constitution.
On the other hand we find that when a Bill for the amendment of the Constitution is passed by requisite majority and assented to by the President, the Constitution itself ,declares that the Constitution shall stand amended in accordance with the terms of the Bill.
Thereafter what courts can see is whether the procedure provided in article 368 has been followed, for if that is not done, the Constitution cannot stand amended in accordance with the terms of the Bill.
But if the procedure has been followed, the Constitution stands amended, and there is no question of testing the amendment of the Constitution thereafter on the anvil of fundamental rights or in any other way as in the case of ordinary legislation.
In view of an this we have no doubt that even though.
by accident the procedure provided in the Constitution for amendment thereof is very akin to the procedure for passing ordinary legislation, the power contained in article 368 is still not ordinary legislative power but constituent power for the specific purpose of amendment of the Constitution; and it is the quality of that power which determines the nature of what emerges after the procedure in article 368 has been followed and what thus emerges is not ordinary legislation but fundamental law which cannot be tested,.
for example, under article 13(2) of the Constitution or under any other provision of the Constitution.
833 We may briefly refer to an argument on behalf of the Union of India that the amending power contained in article 368 is same sovereign power which was possessed by the Constituent Assembly when it made the Constitution and therefore it is not subject to any fetters of any kind.
We do not think it necessary to enter into the academic question as to where sovereignty re sides and whether legal sovereignty is in the people and political.
sovereignty in the body which has the power to amend the Constitution and vice versa.
In our view the words of article 368 clearly confer the power to amend the Constitution and also provide the procedure for doing so, and that in our opinion is enough for the purpose of deciding whether the Seventeenth Amendment is valid or not.
Further as we have already stated, the power conferred under article 368 is constituent power to change the fundamental law i.e. the Constitution, and is distinct and different from the ordinary legislative power conferred on Parliament by various other provisions in the Constitution.
So long as this distinction is kept in mind Parliament would have the power under article 368 to amend the Constitution and what Parliament does under article 368 is not ordinary law making which is subject to article 13 (2) or any other Article of the Constitution.
What is the extent of the power conferred on Parliament and whether there are any limitations on it express or implied will be considered by us presently.
But we have no doubt, without entering into the question of sovereignty and of whether article 368 confers the same sovereign power on Parliament as the Constituent Assembly had when framing the Constitution, that article 368 does confer power on Parliament subject to the procedure provided therein for amendment of any provision of the Constitution.
This brings us to the scope and extent of the power conferred, for amendment under article 368.
It is urged that article 368 only gives power to amend the Constitution.
Recourse is had on behalf of the petitioners to the dictionary meaning of the word, "amendment".
It is said that amendment implies and means improvement in detail and cannot take in any change in the basic features of the Constitution.
Reference in this connection may be made to the following meaning of the word " 'amend" in the Oxford English Dictionary, namely, "to make professed improvements in a, measure before Parliament; formally, to after in detail, though practically it may be to alter its principle, so as to thwart ".
This meaning lit any rate does not support the case of the petitioners that amendment merely means such change as results in improvement in detail.
It shows that in law though amendment MAY professedly, be intended to make improvements and to alter only in detail, in reality, it may make a radical change in the provision which is amended.
In any case, as was pointed out in Sajjan Singh 's case(1) the word "amend" or "amendment" ' is well under (1) ; 834 stood in law and will certainly include any change whether by way of addition or alteration or deletion of any provision in the Constitution.
This is no reason to suppose that when the word.
"amendment" of the Constitution was being used in article 368, the intention was to give any meaning less than what we have stated above.
To say that "amendment" in law only means a change 'which results in improvement would make amendments impossible, for what is improvement of an existing law is a matter of opinion and what, for example, the legislature may consider an improvement may not be so considered by others.
It is therefore in our opinion impossible to introduce in the concept of amendment as used in article 368 any idea of improvement as to details of the Constitution.
The word "amendment" used in article 368 must therefore be given its full meaning as used in law and that .means that by amendment an existing Constitution or law can be changed and this change can take the form either of addition to the existing provisions, or alteration of existing provisions and their substitution by others or deletion of certain provisions.
altogether.
In this connection reference has been made to contrast certain other provisions of the Constitution, where, for example the word "amend" has been followed by such words as "by way of addition, variance or repeal" (see Sixth Schedule, paragraph 2 1) and more or less similar expressions in other Articles,of the Constitution.
it is very difficult to say fact, that no such words appear in article make any difference, for the meaning of the word why this was done.
But the 368 does not in our, mind "amendmend" in law is clearly as indicated above by us and the presence or sense, of explanatory words of the nature indicated above do not in our opinion make any difference.
The question whether the power of amendment given by article 368 also 'includes the power to abrogate the Constitution completely and to replace it by an entire new Constitution, does not really arise in the present case, for the Seventeenth Amendment has not done any such thing and need not be considered.
It is enough to say that it may be open to doubt whether the power of amendment contained in article 568 goes to the extent of completely abrogating the present Constitution and substituting it by an entirely new one.
But short of that, we are of opinion that the power to amend includes the power to add any provision to the Constitution.
to alter any provision and substitute any other provision in its place and to delete any provision.
The Seventeenth Amendment is merely in exercise of the power of amendment a indicated above and cannot be struck down on the ground that it goes beyond the power conferred on Parliament to amend the Constitution by article 368.
The next question that arises is whether there is any limi tation on the power of amendment as explained by us above.
835 Limitations may be of two kinds, namely, express or implied.
So far as express limitations are concerned, there are none such in ' article 368.
When it speaks of the "amendment of this Constitution it obviously and clearly refers to amendment of any provision thereof, including the provisions contained in Part III relating to fundamental rights.
Whether article 13(2) is an express limitation on the power of amendment will be considered by us law, but so far as, article 368 is concerned there are no limitation whatsoever in the matter of substance on the amending power and any provision of the Constitution, be it in Part III and any other Part, can be amended under article 368.
The next question is whether there are any implied limita tions on the power of amendment contained in article 368, and this Wags us to the argument that there are certain basic features of the Constitution which cannot be amended at all and there is an implied limitation on the power of amendment contained in article 5 68 so far as these basic features are concerned.
We may in this connection refer to the view prevailing amongst jurists in the United States of America as to whether there are any plied limitations on the power of amendment contained in article V of the U.S. Constitution.
There are two lines of thought in this matter in the United States.
Some jurists take the, view that there are certain implied limitations on the power to amend contained in article V of the U.S. Constitution.
These are said to be with respect to certain basic features, like, the republican character of Government, the federal structure etc.
On the other hand, it is that the more prevalent view amongst jurists in the United States is that there are no implied limitations on the scope of the amending power in article V of the U.S. Constitution.
Willis on the Constitutional Law of the United States of America (1936 Edition says that probably the correct position is that the amending power embraces everything; in other words there are no legal limitations whatever on the power of amendment, except what is expressly provided, in article V : (see discussion on pp. 1.22 to 127).
Even with respect to these express limitations, Munro in The Government of the United States (Fifth Edition) at p. 77 says that even these express limitations can be removed and one of the ways of doing so is "to remove, the exception by a preliminary amendment and thus clear the way for further action".
Besides, as a matter of fact there is no decision of the Supreme Court of the United States holding that there are implied limitations on the power of amendment contained in article V of the U.S. Constitution and all amendments so far made in the United States have been upheld by the Supreme Court there in the few cases that have been taken to it for testing the validity of the amendments.
836 We have given careful consideration to the argument that certain basic features of our Constitution cannot be amended under article 368 and have come to, the conclusion that no limitations can be and should be implied upon the power of amendment under article 368.
reason for coming to this conclusion is that if we were to accept that certain basic features of the Constitution cannot be amended under article 368, it will lead to the position that any amendment made to any Article of the Constitution would be liable to challenge before courts on the ground that it amounts to amendment of a basic feature.
Parliament would thus never be able to know what amendments it can make in the Constitution and what it cannot; for, till a complete catalogue of basic features of the Constitution is available, it would be impossible to make any amendment under article 368 with any certainty that it would be upheld by courts.
If such an implied limitation were to be put on the power of amendment contained in article 368, it would only be the courts which would have the power to decide what are basic features of the Constitution and then to declare whether a particular amendment is valid or not on the ground that it amends a particular basic feature or not.
The .result would be that every amendment made in the Constitution would provide a harvest of legal wrangles so much so that Parliament may never know what provisions can be amended and what cannot.
The power to amend being a constituent power cannot in our opinion for these reasons be held subject to any implied limitations thereon on the ground that certain basic features of the Constitution cannot be amended.
We fail to see why if there was any intention to make any part of the Constitution unamendable, the Constituent Assembly failed to indicate it expressly in article 368.
If, for example, the Constitution makers intended certain provisions in the Constitution, and Part III in particular, to be not amendable, we can see no reason why it was not so stated in article 368.
On the clear words of article 368 which provides for amendment of the Constitution which means any provision thereof,.
we cannot infer an implied limitation on the power of amendment of any provision of the Constitution ', be it basic or otherwise.
Our conclusion is that constituent power, like that contained,in article 368, can only be subject to express limitations and not to any implied limitations so,far as substance of the amendments are concerned and in the absence of anything in article 368 making any provision of the Constitution unamendable, it Must be held that the power to.
amend in article .3 68 reaches every provision of the Constitution and can be used to amend any provision thereof provided the procedure indicated, in article 368 is followed.
Copious references were made during the course of arguments to debates in Parliament and it is urged that it is open to this 837 Court to look into the debates in order to interpret article 368 to find out the intention of the Constitution makers.
We are of opinion that we cannot and should not look into the debates that took place in the Constituent Assembly to determine the interpretation of article 368 and the scope and extent of the provision contained therein.
It may be conceded that historical background and perhaps what was accepted or what was rejected by the Constituent Assembly while the Constitution was being framed, may be taken into account in finding out the scope and extent of article 368.
But we have no doubt that what was spoken in the debates in the Constituent Assembly cannot and should not be looked into in order to interpret article 368.
Craies on Statute Law (Sixth Edition) at p. 128 says that "it is not permissible in discussing the meaning of an obscure enactment, to refer to 'parliamentary history ' of a statute, in the sense of the debates which took place in Parliament when the statute was under consideration", and supports his view with reference to a large number of English cases.
The same is the view in Maxwell on Interpretation of Statutes, (11th Edition) p. 26.
Crawford on Statutory Construction (1940 Edition) at p. 340 says that resort may not be had to debates to ascertain legislative Intent though historical background in which the legislation came to be passed, can be taken into consideration .
In Administrator General of Bengal vs Prem Lai Mullick(1), the Privy Council held that "proceedings of the legislature cannot be referred to as legitimate aids to the construction of the Act in which they result.
" In Baxter vs Commissioner of Taxation(2), it was said that reference to historical facts can be made in order to interpret a statute.
There was however no reference to the debates in order to arrive at the meaning of a particular provision of the Constitution there in dispute.
In A. K. Gopalan vs the State of Madras(3), Kania C.J. re ferring to the debates and reports of the Drafting Committee of the Constituent Assembly in respect of the words of article 21 observed at p. I 10 that they might not be read to control the meaning of the Article.
In that case all that was accepted was that "due process of law" which was a term used in the.
U.S. Constitution, was not accepted for the purpose of article 21 which used the words 44 the procedure established by law".
Patanjali Sastri J. (at p. 202) also refused to look at the debates 'and particularly the speeches made in order to determine the meaning of article 21.
Fazl Ali, J. (at p. 158) was of opinion that the pro (1) (2) ; (3) ; Sup.
CI/67 8 838 ceedings and discuss ions In Constituent Assembly were not relevant for the purpose of construing the expressions used in article 2 1.
Again in The Automobile Transport (Rajasthan) Limited vs the State of Rajasthan(. '), this Court looked into the historical background but refused to look into the debates in order to determine the meaning of the provisions of the Constitution in dispute in that case.
We are therefore of opinion that it is not possible to read the speeches made in the Constituent Assembly in order to interpret An. 368 or to define its extent and scope and to determine what it,takes in and what it does not.
As to this historical facts. namely, what was accepted or what was avoided in the Constituent Assembly in connection with article 368, it is enough to say that we have not been able to find any help from the material relating to this.
There were proposals for restricting the power of amendment under article 368 and making fundamental rights immune from and there were counter proposals before the Constituent assembly for making the power, of amendment all embracing They were all either dropped or negatived and in the circumstanses are of no help in determining the interpretation of article 368 which must be interpreted on the words thereof as they finally found place in the Constitution, and on those words we have no doubt that there are no implied limitations of any kind on the power to amend given therein.
An argument is also raised that limitations on the power to amend the Constitution can be found in the preamble to the Constitution.
As to that we may refer only to in re: the Berubari Union and Exchange of Enclaves(2) with respect to the value of the preamble to the Constitution and its importance therein.
It was observed in that case unanimously by a Bench of nine judges that "although it may be correct to describe the preamble as a key to the mind of the Constitution makers, it form no part of the Constitution and cannot be regarded as the source of any substantive power which the body of the Constitution alone can confer on the Government , expressly or by implication.
This is equally true to prohibitions and limitations".
The Court there was considering whether the preamble could in any way limit the power of Parliament to cede any part of the national teritory and held that it was not correct to say that "the preamble in any way limit the power of Parliament to cede parts of the national territory".
On a parity, of reasoning we are of opinion that the preamble cannot prohibit or control in any way or impose any implied prohibitions or limitations oft Me power to amend the Constitution contained in article 368.
(1) [1963] 1 S.C.R. 491.
(2) 839 This brings us to the question whether the word "law" in article 13 (2) includes an amendment of the Constitution, and therefore there is an express provision in article 1 3 (2) which at least limits the power of amendment under article 3 68 to this extent that by such amendment fundamental rights guaranteed by Part 111 cannot be taken away or abridged.
We have already pointed out that in Sankari Prasad 's case(1) as well as Sajjan Singh 's case(1) it has already been held, in one case unanimously and in the other by majority, that the word "law" in article 13(2) does not include an amendment of the Constitution, and it is the correctness of this view which is being imputed before this Bench, Article 13 is in three parts.
The first part lays down that "all laws in force in the territory of India immediately before the commencement of this Constitution, insofar as they are inconsistent with the provisions of this Part, shall, to the extent of such inconsistency, be void".
Further all previous constitutional,provisions were repealed by article 395 which provided that " 'the Indian Independence Act, 1947, and the Government of India Act, 1935, together with all enactments amending or supplementing the latter Act, but not including the Abolition of Privy Council Jurisdiction Act, 1949, are hereby repealed." ' Thus it is clear that the word "law" in article 13(1) does not include any law in the nature of a constitutional provision, for no such law remained after the repeal 'in article 395.
Then comes the second part of article 13, which says that State shall not make any law which takes away or abridges the rights conferred by this Part and any law made in contravention of this clause shall, to the extent of the contravention, be void".
The third part defines the word "law" for the purpose of article 13; the definition is inclusive and not exhaustive.
It is because of the definition in cl.
(3 ) of article 13 being inclusive that it is urged that the word "law" in article 13 (2) includes an amendment of the Constitution also.
Now we see no reason why if the word "law" in article 13(1) relating to past laws does not include any constitutional provision the word "law" in cl.
(2) would take in an amendment of the Constitution, for it would be reasonable to the word "law" 'in article 13(2) includes an amendment of the 13.
But apart from this consideration, we are of opinion that the word "law" in Art 13(2) could never have been intended to take in an amendment of the Constitution.
What article 13(2) means is that a law made under the constitutional provisions would, be tested on the anvil of Part III and if it takes away or abridges rights conferred by Part III it would be void to the extent of the contraventions.
There are many Articles in the Con stitution, which directly for making law in addition to Articles 245, 246, 248, etc.
and the three Lists and Aft.
13(2) (1) ; (2) ; 840 prohibits the State from making any law under these provisions.
We see no difficulty in the circumstances in holding that article 13 (2) when it talks of the State making any law, refers to the law made under the provisions contained in Ch.
I of Part XI of the Constitution beginning with article 245 and also other provisions already referred to earlier.
Article 246 provides that Parliament may make laws for the whole or any part of the territory of India and the legislature of a State may make laws for the whole or any part of the State.
Article 246(1) gives exclusive power to Parliament to make laws with respect to subjects enumerated in List 1.
Article 246(3) gives exclusive power to State legislatures to make laws with respect to List II.
Article 248(1) gives exclusive power to Parliament to make laws with respect to any matter not enumerated in the Concurrent List or the State List.
We are referring to these provisions merely to show that the various provisions in Chapter I of Part XI provide for making laws,and these laws are all laws which are made under the legislative power conferred on Parliament or on State legislatures under the Constitution.
Therefore when in article 13( ) it is said that the State shall not make any law (State there including Parliament and legislature of each State), its meaning could only take in laws made by Parliament and State legislatures under the powers conferred under Chapter I of Part XI.
and also other provisions already referred to earlier.
We have already held that the power to amend the Constitution is to be found in article 368 along with the procedure and that such power is not to be found in article 248 read item 97 of List I. Therefore an amendment of the Constitution is not an ordinary law made under the powers conferred under Chapter I of Part XI of the Constitution and cannot be subject to article 13(2) where the word "law" must be read as meaning law made under the ordinary legislative power.
We have already referred to a large number of Articles where Parliament is given the power to make law with respect to those Articles.
So far as this power of Parliament is concerned it is ordi nary legislative power and it will certainly be subject to article 13 (2).
But there can in our opinion be no doubt that when article 13(2) prohibits the State from making any law which takes away or abridges rights conferred by Part III, it is only referring to ordinary legislative power conferred on Parliament and legislatures of States and cannot halve any reference to the constituent power for amendment of the Constitution contained in article 368.
We have already pointed out that there are no implied limitative on the power to amend under article 368 and it is open to Parliament under that Article to amend any part of the Constitution, including Part M.
It is worth remembering that a whole Part XX is devoted by the Constitution makers to the subject of 841 amendment of the Constitution.
If it was their intention that Part III of the Constitution will not be liable to amendment by way of abridgement or abrogation under the amending power contained in article 368 we see no reason why an express provision to that effect was not made in article 368.
We cannot see what prevented the Constituent Assembly from making that clear by an express provision in article 368.
It is however said that it was not necessary to say so in article 368, because the provision was already made in article 13(2).
We are unable to accept this contention, for we have no doubt that article 13(2), when it refers to making of laws is only referring to the ordinary legislative power and not to the constituent power which results in amendment of the Con stitution.
In any case it seems to us somewhat contradictory that in article 368 power should have been given to amend any provision of the Constitution without any limitations but indirectly that power is limited by using words of doubtful import in article 13(2).
It is remarkable that in article 13(2) there is no express provision that amendment of the Constitution, under article 368, would be subject thereto.
It seems strange indeed that no express provision was made in Part XX in this matter and even in article 13(2) no express provision is made to this effect, and in both places the matter is left in a state of uncertainty.
It is also remarkable that in article 368 the word "law", which we find so often used in so many Articles of the Constitution is conspicuously avoided, and it is specifically provided that after the procedure has been gone through the Constitution shall stand amended in accordance with the terms of the Bill.
This language of article 368 is very significant and clearly makes a distinction between a constitutional Amendment and an ordinary law passed as an Amending Act.
The validity of a law has to be determined at the time when the Bill actually matures into an Act and not at the stage while it is still a Bill.
The provision in article 368 has the effect that when a Bill amending the Constitution receives the assent of the President, the Constitution stands amended in accordance with the terms of the Bill.
The Constitution thus stands amended in terms of the Bill if the Bill has been introduced, passed and assented to by the President in accordance with the procedure laid down in article 368 and not as a result of the Bill becoming an Amendment Act introducing amendment in the Constitution.
The provision that the Constitution shall stand amended in terms of the Bill was thus clearly intended to indicate that the amendment of the Constitution is not dependent on the Bill being treated as a law or an Act duly passed by Parliament.
Thus it is clear that by indicating that the Constitution is to stand amended in accordance with the terms of the Bill, article 368 clearly envisages that the power of amendment of the Constitution stands on an entirely different footing from an ordinary law made by Parliament in exercise of its legislative power.
842 If We keep in mind this difference, between constitutional amendment or constitutional law and an ordinary amending Act or law, it should not be difficult to hold that when Art 13 (2), speaks of the St ate making a law, it is referring to ordinary law made under the powers conferred by article 245 etc read with various Lists and various provisions of the Constitution where express provision to that effect has been made and is not referring to the amendment of the Constitution which is made under the 'constituent power.
Once it is held that the power to amend is found in article 368 and is not to be found in article 248 read with item 97 of List I, it must follow that the power to amend the Constitution under article 368 is a different power (namely, constituent power) and when article 13 (2) speaks of making 'law, it can only refer to making ordinary law, particularly when we compare the words of article 13 (2) (namely, the State shall not make any law) and the words of articles 245, 248, and 250 (which all speak of Parliament making law, State legislatures making law, and so on).
Lastly, as the power to amend is in article 368 and on the words, as they stand in that Article, that power is unfettered and includes the power to amend Part III, it is strange that that power should be limited by putting an interpretation on the word "law" in article 13(2), which would include constitutional law also.
There is nothing to suggest this even in the inclusive definition of the words "law" and "laws in force" in article 13(3).
Besides, it is conceded on behalf of the petitioners that article 368 gives power to amend Part 111, but that power is only to amend one way, namely, towards enlargement of the rights contained therein, and not the other way, namely, for, abridging or taking away the rights contained therein.
W. , must say that it would require a very clear provision in the Constitution to read the power to amend the Constitution relating to Part III in this manner.
We cannot find that clear provision in article 1 3 (2).
We repeat that when the Constituent Assembly was taking the trouble of providing a whole Part for amendment of the Constitution and when the words in article 368 clearly give the power to amend the Constitution and are subject to no implied limitations and contain no express limitations, it is strange indeed that it should have omitted to provide in that very Article that Part III is not liable to amendment thereunder.
In any case if the power of amendment conferred by the words of article 368 is unfettered, we must avoid any inconsistency between that power and the provision contained in article 13 (2).
We avoid that in keeping with the unfettered power in article 368 by reading the word "law" in article 13 (2) as meaning law passed under: ordinary legislative power and thus not including an amendment of the Constitution therein.
The words in article
II (2) are in our opinion not specific and clear ' enough to take in 843 the power of amendment under article 368 and must be confined only to the power of ordinary law making contained in articles 245 etc., and other provisions of the Constitution read with various Lists.
We have therefore no hesitation in agreeing with the view taken in Sankari Prasad 's case(1) which was upheld by the majority in Sajjan Singh 's case(2).
The next argument is that action under the proviso to article 368 is necessary as the Seventeenth Amendment affects the power of the High Court contained in article 226.
It is said that by including various Acts in the Ninth Schedule and making them immune from challenge under the provisions contained in Part III, the power of the High Court under article 226 is affected inasmuch as the High Court cannot strike down any of the Acts included in the Ninth Schedule on the ground that they take away or abridge the rights conferred by Part III.
So it is said that there has been a change in article 226 and it was necessary that the Seventeenth Amendment should have been ratified by more than half the States under the proviso.
A similar argument was raised in Sankari Prasad 's case(1) and was turned down unanimously.
The same argument was again raised in Sajjan Singh 's case(2) and was also turned down.
Now ratification is required under the proviso if the amendment seeks to make any change in various provisions mentioned therein and one such provision is article 226.
The question therefore is whether the Seventeenth Amendment makes any change in article 226 and whether this change has to be a direct change in the words of article 226 or whether merely because there may be some effect by the Seventeenth Amendment on the, content of the power in article 226 it will amount to change in article 226.
We are of opinion that when the proviso lays down that there must be ratification when there is any change in the entrenched provisions, including article 226, it means that there must be actual change in the terms of the provision concerned.
If there is no actual change directly in the entrenched provision, no ratification is required, even if any amendment of any other provision of the Constitution may have some effect indirectly on the entrenched provisions mentioned in the proviso.
But it is urged that there may be such a change in some other provision as would seriously affect an entrenched provision, and in such a case ratification should be necessary.
This argument was also dealt with 'in the majority judgment in Sajjan Singh 's case(2) where the doctrine of pith and substance was applied and it was held that where the amendment in any other Article so affects the entrenched Article as to amount to an amendment therein, then ratification may be necessary, even though the entrenched Article may not be directly touched.
Perhaps the use of the doctrine of pith and substance (1) ; (2) [1965] 1 S.C.P. 933.
844 in such a case is not quite apt.
But what was meant in Sajjan Singh 's case(1) was that if there is such an amendment of an unentrenched Article that it will directly affect an entrenched Article and necessitate a change therein, then recourse must be had to ratification under the proviso.
We may illustrate this by two examples.
Article 226 lays down inter alia that the High Court shall have power to issue writs for the enforcement of any of the rights conferred by Part III and for any other purpose.
Now assume that Part III is completely deleted by amendment of the Constitution.
If that takes place, it will necessitate an amendment of article 226 also and deletion therefrom of the words "for the enforcement of any of the rights conferred by Part III".
We have no doubt that if such a contingency ever happens and Part III is completely deleted, Parliament will amend article 226 also and that will necessitate ratification under the proviso.
But suppose Parliament merely deletes Part III and does not make the necessary consequential amendment in article 226, it can then be said that deletion of Part III necessitates change in article 226 also, and therefore in such a case ratification is necessary, even though Parliament may not have in fact provided for amendment of Art 226.
Take another example.
Article 54 is an entrenched Article and provides for the election of the President.
So is article 55 which provides for the manner of election.
Article 52 which lays down that there shall be a President is on the other hand not an entrenched Article.
It is said that article 52 may be altered and something else may be substituted in its place and that would not require ratification in terms as article 52 is not among the entrenched Articles.
But we are of opinion that if Parliament amends article 52, it is bound to make consequential amendments in articles 54 and 55 which deal with the election of the President and the manner thereof and if it is so the entire amendment must be submitted for ratification.
But suppose Parliament merely amends article 52 and makes no change in articles 54 and 55 (a supposition which is impossible to visualise).
In that case it would in our opinion be right to hold that article 52 could not be altered by abolition of the office of the President without necessi tating a change in articles 54 and 55 and in such a case if article 52 alone is altered by Parliament, to abolish the office of President, it will require ratification.
These two examples will show where alteration or deletion of an unentrenched Article would necessitate amendment of an entrenched Article, and in such a case if Parliament takes the incredible course of amending only the unentrenched Article and not amending the entrenched Article, courts can say that ratifi (1) ; 845 cation is necessary even for amending the unentrenched Article, for it directly necessitates, a change in an entrenched Article.
But short of that we are of opinion that merely because there is some effect indirectly on an entrenched Article by amendment of an unentrenched Article it is not necessary that there should be ratification in such circumstances also.
Besides, let us consider what would happen if the argument on behalf of the petitioners is accepted that ratification is necessary whenever there is even indirect effect on an entrenched Article by amending an unentrenched Article.
Take the case of article 226 itself.
It gives power to the High Court not only to issue writs for the enforcement of fundamental rights but to issue them for any other purpose.
Writs have thus been issued by High Courts for enforcing other rights conferred by ordinary laws as well as under other provisions of the Constitution, like articles 301 and 311.
On this argument if any change is made in articles 301 and 311 there is bound to be an effect on article 216 and therefore ratification would be necessary, even though both articles 301 and 311 are not entrenched in the proviso.
Further, take an ordinary law which confers certain rights and it is amended and those rights are taken away.
Article 226 would be clearly affected.
Before the amendment those rights may be enforced through article 226 while after the amendment the rights having disappeared there can be no enforcement thereof.
Therefore, on this argument even if there is amendment of ordinary law there would be an effect on article 226 and it must therefore be amended every time even when ordinary law is changed and the entire procedure under article 368 must be gone through including ratification under the proviso.
It is however said that when ordinary law is amended, rights disappear and therefore there is no question of enforcement thereof; if that is correct with respect to ordinary law, it is in our opinion equally correct with respect to the amendment of an unentrenched provision of the Constitution.
The answer given in Sankari Prasad 's case(1) to this argument was that article 226 remained just the same as it was before, and only a certain class of cases had been excluded from the purview of Part III and the courts could no longer interfere, not because their powers were curtailed in any manner or to any extent, but because there would be no occasion thereafter for the exercise of their power in such cases.
We respectfully agree with these observations and are of opinion that merely because there is some indirect effect on article 226 it was not necessary that the Seventeenth Amendment should have been ratified by more than one half of the States.
It is only in the extreme case, the examples of which we have given above, that an amendment of an unentrenched Article without amendment of entrenched Article (1) ; 846 might be had for want of ratification, and this is what was intended by the majority judgment in Sajjan Singh 's case(1), when it applied the doctrine of pith and substance in these circumstances.
The argument that ratification is necessary as article 226 is indirectly affected has therefore no force and must be rejected.
This is equally true with respect to the power of this Court under articles 132 and 136.
Then it is urged that article 245 is enlarged by the Seventeenth Amendment inasmuch as State legislatures and Parliament were freed from the control of Part III in the matter of certain laws affecting, for example.
ryotwari lands, and therefore as article 245 is an entrenched Article there should have been ratification under the proviso.
This argument in our opinion is of the same type as the argument with respect to the effect on article 226 and our answer is the same, namely, that there is no direct effect on article 245 by the amendment and the indirect effect, if. any, does not require that there should have been ratification in the present case.
It is then urged that ratification is necessary as article 31 B deals with State legislation and in any case Parliament cannot make, any law with respect to Acts which were put in the Ninth Schedule and therefore Parliament could not amend the Constitution in the manner in which it was done by making additions in the Ninth Schedule, both for want of ratification and for want of legislative competence.
The answer to this argument was given in Sahkari Prasad 's case(2) and it was observed there that "Article 31 A and 31 B really seek to save a certain class of laws and certain specified laws already passed from the combined operation of article 13 read with other relevant Articles of Part III.
The new Articles being thus essentially amendments of the Con stitution, Parliament had the power of enacting them.
That laws thus saved relate to matters covered by List II does not in any way affect the position.
It was said that Parliament could not validate a law which it had no power to enact.
The proposition holds good where.
the validity of the impugned provision turns on whether the subject matter, falls within or without the jurisdiction of the legislature which passed it.
But to make a law which contravenes the Constitution, constitutionally valid is a matter of constitutional amendment and as such it falls within the exclusive power of Parliament." (1) ; (2) ; 847 We respectfully agree with these observations.
They succinctly put the legal and constitutional position with respect to the 'validity of Arts, 3 1 A and 3 1 B.
It seems to us that article 3 1 B in particular is a legislative drafting device which compendiously puts in one place amendments which would otherwise have been added to the Constitution under various Articles in Part III.
The laws in the Ninth Schedule have by the device of article 3 1 B been excepted from the various provisions in Part ]III, which affected them and this exception could only be made by Parliament.
The infirmity in the Arts put in the Ninth Schedule was apprehended to be a constitutional infirmity on the ground that those laws might take away or abridge rights conferred by Part HI.
Such a constitutional infirmity could not be cured by State legislatures in any way and could only be cured by Parliament by constitutional amendment.
What Parliament in fact did by including various Acts in the Ninth Schedule read with article 3 1 B was to amend the various provisions in Part III, which affected these Acts by making them an exception to those provisions in Part III.
This could only be done by Parliament under the constituent power it had under article 368 and there was no question of the application of the proviso in such a case, for Parliament was amending Part III only with respect to these laws.
The laws had already been passed by State legislatures and it was their constitutional infirmity, if any, which was being cured by the device adopted in article 3 1 B read with the Ninth Schedule, the amendment 'being only of the relevant provisions of Part III which was compendiously put in one place in article 3 1 B. Parliament could alone do it under article 368 and there was no necessity for any ratification under the proviso, for amendment of Part III is not entrenched in the proviso.
Nor is there any force in the argument that Parliament could ' not validate those laws by curing the constitutional infirmity because they dealt with land which is in List 11 of the Seventh Schedule to the Constitution over which State Legislatures have exclusive legislative power.
The laws had already been passed by State legislatures under their exclusive powers; what has been done by the Seventeenth Amendment is to cure the constitutional ' infirmity, if any, in these laws in relation to Part III.
That could only be done by Parliament and in so doing Parliament was not encroaching on the exclusive legislative power of the State.
The States had already passed the laws and all that was done by the Seventeenth Amendment was to cure any constitutional infirmity in the laws by including them in the Ninth Schedule read with article 31 B. We must therefore reject the argument that the Seventeenth Amendment required ratification because laws put in the Ninth Schedule were State law ,.
We must equally reject the argument that as these laws dealt with land, which is in the 848 exclusive legislative power of State legislature, Parliament could not cure the constitutional infirmity, if any, in these laws by putting them in the Ninth Schedule.
We now come to what may be called the argument of fear.
It is urged that if article 368 confers complete power to amend each and every provision of the Constitution as we have held that it does frightful consequences will follow on such an interpretation.
If Parliament is clothed with such a power to amend the Constitution it may proceed to do away with fundamental rights altogether, it may abolish elected legislatures, it may change the present form of Government, it may do away with the federal structure and create a unitary state instead, and so on.
It is therefore argued that we should give a limited interpretation to the power of amendment contained in article 368, as otherwise we shall be giving power to Parliament to destroy the Constitution itself.
This argument is really a political argument and cannot be taken into account in interpreting article 368 when its meaning to our mind is clear.
But as the argument was urged with a good deal of force on behalf of the petitioners and was met with equal force on behalf of the Union and the States, we propose to deal with it briefly.
Now, if this argument means that Parliament may abuse its power of amendment conferred by article 368, all that need be said in reply is that mere possibility of abuse cannot result in courts withholding the power if the Constitution grants it.
It is well settled so far as ordinary laws are concerned that mere possibility of abuse will not induce courts to hold that the power is not there, if the law is valid and its terms clearly confer the power.
The same principle in our opinion applies to the Constitution.
If the Constitution gives a certain power and its terms are clear, there is no reason why that power should be withheld simply because of possibility of abuse.
If we may say so, possibility of abuse of any power granted to any authority is always there; and if possibility of abuse is a reason for withholding the power, no power whatever can ever be conferred on any authority, be it "executive, legislative or even judicial.
Therefore, the so called fear of frightful consequences, which has been urged on behalf of the Petitioners (if we hold, as we do, that the power to amend the Constitution is unfettered by any implied limitations), is no ground for withholding the power, for we have no reason to suppose that Parliament on whom such power is ,conferred will abuse it.
Further even if it abuses the power of constitutional amendment under article 368 the check in such circumstances is not in courts but is in the people who elect members of Parliament.
The argument for giving a limited 849 meaning to article 368 because of possibility of abuse must therefore be rejected.
The other aspect of this argument of fear is that we should not make the Constitution too flexible so that it may be open to the requisite majority with the requisite ratification to make changes too frequently in the Constitution.
It is said that the Constitution is an organic document for the governance of the country and it is expected to endure and give stability to the institution which it provides.
That is undoubtedly so and this is.
very true of a written federal Constitution.
But a perusal of.
various Constitutions of the world shows that there are usually provisions for amendment of the Constitution in the Constitution itself.
This power to amend a Constitution may be rigid or flexible in varying degrees.
Jurists have felt that where the power to amend the Constitution is made too rigid and the people outgrow a particular Constitution and feel that it should be amended but cannot do so because of the rigidity of the Constitution, they break the Constitution, and this breaking is more often than not by violent revolution.
It is admitted by even those writers on the United States Constitution who are of the view that there are certain basic features which cannot be amended and who would thus make the U. section Constitution even more rigid ' than it is; that howsoever rigid the Constitution may be its rigidity will not stop the people from breaking it if they have outgrown it and this breaking is, generally speaking, by violent revolution.
So, making our Constitution rigid by putting the interpretation which the petitioners want us to put on it will not stop the frightfulness which is conjured up before us on behalf of the petitioners.
If anything, an interpretation which will make our Constitution rigid in the manner in which the petitioner want the amending power in article 368 to be interpreted will make a violent revolution, followed by frightfulness of which the petitioners are afraid, a nearer possibility than an interpretation which will make it flexible.
It is clear that our Constitution makers wanted to avoid ' making the Constitution too rigid.
It is equally clear that they did not want to make an amendment of the Constitution too easy.
They preferred an intermediate course which would make,the Constitution flexible and would still not allow it to be amended too easily.
That is why article 368 provides for special majorities of the two Houses for the purpose of amendment of the Constitution.
Besides it also provides for ratification by more than half the States in case of entrenched Provisions in the proviso.
Subject to these limitations, the Constitution has been, made moderately flexible to allow any change when the people feel that change is necessary.
The necessity for special majorities 850 in each House separately and, the necessity for, ratification by more than half the States in certain cases appear to us to be sufficient safeguards to prevent too easy change in the Constitution without making it too rigid.
But it is said that, in the last sixteen Years, a large number of amendments have been made to the constitution and that shows that the power to amend is much too easy and should be restricted by judicial interpretation.
Now, judicial interpretation cannot restrict the power on the basis of a political argument.
It has to interpret the Constitution and finds it on the basis of well known,canons of construction,and on the terms of article 368 in particular.
If on those terms it is clear we think it is that power to amend is subject to no limitations except those to be expressly found in the Constitution, courts must give effect to that.
The fact that 'm the last sixteen years a large number of amendments could be made and have been made is in our opinion due to the accident that one party has been returned by electors in sufficient strength to be able to command the special majorities which are required under article 368, not only at the Centre but also in all the Stites.
It ' is because of this circumstance that we have had so many amendments in the course of the last sixteen years.
But that in our opinion is no ground for limiting the clear words of article 368.
The power of amendment contained in a written federal Con stitution is a safety valve which to a large extent provides for stable growth and makes violent revolution more or less unnecessary.
It has been said by text book writers that the power of amendment, though it allows for change, also makes a Constitution long lived and stable and serves the needs of the people from time to time.
If this power to amend is made too rigid it loses its value as a safety valve.
The more rigid a Constitution the more likely it is that people will outgrow it and throw it over board violently.
On the other hand, if the Constitution is flexible (though it may not be made too easy to modify it) the power of amendment provides for stability of the Constitution itself and for ordered progress of the nation.
If therefore there had to be a choice between giving an interpretation to article 368 which would make our Constitution rigid and giving an interpretation which would make it flexible, we would prefer to make it flexible, so that it may endure for a long period of time and may, if necessary, be amended from time to time in accordance with the progress in the ideas of the people for whom it is meant.
But we feel that it is not necessary to go to this extent, for that would be entering into the field of politics.
As we see the terms of article 368, we are clearly Df opinion that the Constitutionmakers wanted to make our Constitution reasonably flexible and ,.that the interpretation that we have given to article 368 is in 851 consonance with the terms thereof and the intention of those who made it.
We therefore reject the argument of fear altogether.
This brings us to the argument of stare decisis raised on behalf of the Union of India and the States.
The argument is put thus.
After the decision of the Patna High Court invalidating the Bihar Land Reforms Act, 1950, Parliament passed the First Amendment to the Constitution.
That Amendment was challenged in this Court by a number of writ petitions and was upheld in Sankari Prasad 's case( ) in 1951.
That case practically stood unchallenged till Sajjan Singh 's case(2) in 1964 after the Seventeenth Amendment was passed.
Thus in the course of these fifteen years or so a large number of State Acts were passed on the basis of the First Amendment by which in particular articles 31 A and 31 B were introduced in the Constitution.
It is said that though Sankari Prasad 's case (1) has stood for less than 15 years there have been so many laws dealing with agrarian reforms passed on the basis of the First Amendment which was upheld by this Court that the short period for which that case has stood should not stand in the way of this Court acting an the principle of, stare decisis.
The reason for this is that an agrarian revolution, has taken place all over the country after the First Amendment by State laws passed on the faith of the decision of this Court in Sankari Prasad 's case(1).
This agrarian revolution has led to millions of acres of land having changed hands and millions of now titles having been created.
So it is urged that the un animous decision in Sankari Prasad 's case(2), which was challenged when the Seventeenth Amendment was passed and was upheld by majority in Sajjan Singh 's case(2) should not now be disturbed as its disturbance would create chaos in the country, particularly in the agrarian sector which constitutes the vast majority of the population in this country.
We are of opinion that there is force in this argument .
Though the period for which Sankari Prasad 's case(1) has stood unchallenged is not long, the effects which have followed in, the passing of State laws on the faith of that decision ', are so overwhelming that we should not disturb the decision in that case.
It is not disputed that millions of acres of land have changed hands and millions of new titles in agricultural lands have been created and the State laws dealing with Agricultural land which have been passed in the course of the last fifteen years after the decision in Samkari Prasad 's case(1) have brought about an agrarian revolution.
Agricultural population constitutes a vast majority of the population in this country.
In these circumstances it would in our opinion be wrong to hold now that (1) ; (2) ; 852 Sankari Prasad 's case (1) was not correctly decided and thus disturb all that has been done during the last fifteen years and create chaos into the lives of millions.
of our countrymen who have benefited by these laws relating, to agrarian reforms.
We would in the circumstances accept the argument on behalf of the Union of India and the States that this is the fittest possible case in which the principle of stare decisis should be applied.
On this basis also, apart from our view that Sankari Prasad 's case (1) was in fact rightly decided, we would not interfere with that decision now.
But it is urged that instead of following the principle of stare decisis which would make die decision in Sankari Prasad 's case(1) good for all times.
, we should follow the doctrine of prospective over ruling, which has been evolved by some United States courts so that everything that has been done up to now, including the Seventeenth Amendment would be held good but in future it would not be open to Parliament to amend Part III by taking away or abridging any of the rights conferred thereby and, if the argument as to implied limitations on the power to amend is accepted, further limit the power of Parliament to amend what may be called basic features of the Constitution.
We must say that we are not prepared to accept the doctrine of prospective over ruling.
We do not know whether this doctrine which it is urged should be applied to constitutional amendment would also be applied to amendments of ordinary laws.
We find it difficult to visualise what would be the effect of this doctrine if it is applied to amendment of ordinary laws.
We have so far been following in this country the well known doctrine that courts declare law and that a declaration made by a court is the law of the land and takes effect from the date the law came into force.
We would on principle be loath to change that well known doctrine and supersede it by the doctrine of prospective over ruling.
Further it seems to us that in view of the provisions of article 13(2) it would be impossible to apply the doctrine of prospective over ruling in our country, particularly where a law infringes fundamental rights.
Article 13(2) lays down that all.
laws taking away or abridging fundamental rights would be void to the extent of contravention.
It has been held by this Court in Deep Chand vs The State of Uttar Pradesh (2) that a law made after the Constitution came into force which infringes fundamental rights is a stillborn law and that the prohibition contained in article 13(2) went to the root of the State power of legislation and any law made in contravention of that provision was void ab initio.
This case has been followed in Mahendra Lal Jaini vs The State of Uttar Pradesh(3).
In the face of these (1) ; (2) [1959] Supp. 2 S.C.R. 8.
(3) [1963] Supp. 1.
S.C.R. 912.
853 decisions it is impossible to apply the principle of prospective over ruling in this country so far as ordinary laws are concerned.
Further, if the word "law" in article 13(2) includes an amendment of the Constitution, the same principle will apply, for that amendment would be stillborn if it infringes any fundamental rights contained in Part III.
In these circumstances, it would be impossible to apply the principle of prospective over ruling to constitutional amendments also.
On the other hand, if the word "law" in article 13(2) does not include an amendment of the Constitution, then there is no necessity of applying the principle of prospective over ruling, for in that case unless some limitations on the power of amendment of the Constitution are implied the amendment under article 368 would not be liable to be tested under article 13(2).
We are therefore unable to apply the doctrine of prospective over ruling in the circumstances.
Further as we are of opinion that this is the fittest possible case in which the prin ciple of stare decisis applies,we must uphold Sankari Prasad 's case (1) for this reason also.
Lastly we would refer to the following observations in Sajjan Singh 's case(2) (at pp.
947 48) with respect to over ruling earlier judgments of this Court and specially those which are unanimious like Sankari Prasad 's case(1): "It is true that the Constitution does not place any restriction on our powers to review our earlier decisions or even to depart from them and there can be no doubt that in matters relating to the decision of constitutional points which have a significant impact on the fundamental rights of citizens, we would be prepared to. ' review our earlier decisions in the interest of public good. . .
Even so, the normal principle that "judgments pronounced by this Court would be final, cannot be ignored and unless considerations of a substantial and compelling character make it necessary to.
do so, we should be slow to doubt the correctness of previous decisions.or to depart from them.
"It is universally recognised that in regard to a large number of constitutional problems which are brought before this Court for its decision, complex and difficult questions arise and on many of such questions two views are possible.
Therefore, if one view has been taken.
by this Court after mature deliberation, the fact that another Bench is inclined to take a different view may not justify the Court in reconsidering the earlier decision or in departing from, it. . .
Even so, the Court should be re (1) (1952] S.C.R. 89.
(2) [1965] 1 S.C.R. 933.
p. CI/67 9 854 luctant to accede to the suggestion that its earlier decisions should be light heartedly reviewed and departed from.
In such a case the test should be: is it absolutely necessary and essential that the question already decided should be reopened The answer to this question would depend on the nature of the infirmity alleged in the earlier decision, its impact on public good, and the validity and compelling character of the considerations urged in support of the contrary view.
If the said decision has been followed in a large number of cases, that again is a factor which must be taken into account.
" A similar view was taken in the Keshav Mills Company Limited vs Commissioner of Income tax,(1) where it was observed that ". before a previous decision is pronounced to be plainly erroneous, the Court must be satisfied with a fair amount of unanimity amongst its members that a revision of the said view is fully justified.
" These principles were applied in Sajjan Singh 's case(2) and it was observed that if Sankari Prasad 's case(3) were to be overruled, "it would lead to the inevitable consequence that the amendments made in the Constitution both in 1951 and 1955 would be rendered invalid and a large number of decisions dealing with the validity of the Acts included in the Ninth Schedule which have been pronounced by, different High Courts ever since the decision of this Court in Sankari Prasad 's case(3) was declared, would also be exposed.
to serious jeopardy.
" The majority in that case therefore was not in favour of reviewing Sankari Prasad 's case(".) even so in View of the argument raised and the importance of the question it considered the arguments against that decision and came to the conclusion its that that case was rightly decided We may add that besides so many cases in the High Courts there have been a large number of cases in this Court to which it is unnecessary to refer where on the faith of various amendments made in the Constitution, particularly the First, the Fourth and the Sixteenth, amending fundamental rights, this Court has upheld the, validity of various Acts on the basis of these amendments.
Further we would be very reluctant to over rule the unanimous decision in Sankari Prasad 's case.(3) or any other unanimous decision by the slender majority of one in a larger Bench constituted for the purpose.
We say this with great respect and would hold that apart 'from the principle of stare decisis we should not say that the (1) ; (2) ; (3) ; 855 unanimous judgment in Sankari Prasad 's case(,) was wrongly decided by such a slender majority in this Special Bench.
We therefore hold that Sankari Prasad 's cases(1) was correctly decided and that the majority,in Sajjan Singh 's case(2) WAS Correct in following that decision.
We would follow the decision in Sankari Prasad 's case(1) even now as in our opinion it was correctly decided. ' Following that decision we hold that the Seventeenth Amendment is good.
In view of this decision it is unnecessary to refer to other arguments raised with respect to the two petitions challenging the Mysore Land Reforms Act.
In our view therefore all the three petitions should fail and we would dismiss them.
In the circumstances we would pass no order as to costs.
Hidayatulla.
J In these three writ petitions, the facts of which appear in the two judgment just delivered, the validity of the Punjab Security of Land Tenures Act, 1953 and the Mysore Land Reforms Act, 1953, is principally involved. ' Since these Acts are protected by the Constitution (Seventeenth Amendment) Act, 1964, the validity of the constitutional amendment is also questioned.
Therefore, a much larger field must be traversed because of the claim of the State that no part of the Constitution from the Preamble to the Ninth Schedule, is beyond the provision for amendment contained in article 368.
The article, forms the Twentieth Part of the Constitution and is said to be a code by itself in which reposes a sovereign power, transcending anything elsewhere in the Constitution.
The State submits that (except as stated in the article) there are no limitations on the amending power and denies that there are any implied restrictions.
It claims, therefore, that an amendment of the Constitution Or of any of its part can never be a justiciable issue if the procedure for amendment has been duly followed.
In this claim no exception is made the Preamble, the Fundamental Rights, the guaranteed remedy to uphold them all of them severally and together are said to be capable of being Partially or wholly abrogated by an amendment.
Looked at from, this Point of view the Seven teenth Amendment Act not only 'must be valid but also beyond the Power of the courts to question.
The petitioners, on the other hand, contend that this is to deny the real importance and inviolability of the Fundamental Rights which the Constitution itself, paramount even to article, 368 consideration. ' before we can Acts are valid or not.
(1) ; (2) ; 856 The same questions were before this Court on two earlier occasions.
They arose for the first time immediately after the Constitution (First Amendment) Act, 1951 was adopted and became the subject of a decision of this Court reported in Sri Sankari Prasad Singh Deo vs Union of India(1).
There Patanjali Sastri J. speaking for Harilal Kania C.J., Mukherjea, Das and Chandrasekhara Aiyar, JJ.and himself upholds the First Amendment on the grounds that the power conferred by Part XX is constituent, paramount and sovereign and is, therefore, not subject to article 13(2) which prohibits the making of ordinary laws tending to abridge or take away Fundamental Rights.
The questions were again before the Court in sajjan Singh c. State of Rajasthan(2) when the Seventeenth Amendment was impugned.
The authority of Sankari Prasad 's case(1) was the ministry ofof the argument in support of the validity of the new amendment.
This time the Court was not unanimous although the Court as aas a whole did not strike down the Act.
Three opinions weredelivered by Gajendragadkar, C.J. on behalf of Wanchoo and Raghubar Dayal, JJ.
and himself, by Mudholkar, J. and by me.
I found the reasoning in Sankari Prasad 's case(1) to be unaccept able, although for reasons which I shall give, I refrained from expressing a final opinion.
Mudholkar, J. in his opinion supported me with additional and forceful reasons but he also did not express himself finally on the broader question.
I closed my opinion with the following observations : "I would require stronger reasons than those given in Sankari Prasad 's case(1) to make me accept the view that Fundamental Rights were not really fundamental but were intended to be within the powers of amendment in common with the other parts of the Constitution and without the concurrence of the States.
No doubt article 19 by clauses numbered 2 to 6 allows a curtailment of rights in the public interest.
Ibis shows that Part III is not static.
It Visualises changes and progress but at the same time it preserves the individual rights.
There is hardly any measure of reform which cannot be introduced reasonably, the guarantee of individual liberty notwithstanding.
Even the agrarian reforms could have been partly carried out without Article 31 A and 31 B but they would have cost more to the public exchequer. 'the rights of society are made paramount and they ire placed above those of the individual.
This is as it should be.
But restricting the Fundamental Rights by resort to cls.
2 to 6 of Mt. 19 is (1) ; (2) ; 857 one thing and removing the rights from the Constitution or debilitating them by an amendment is quite another.
This is the implication of Sankari Prasad 's case(1).
It is true that such things would never be, but one is concerned to know if such a doing would be possible." "The Constitution gives so many assurances in Part III that it would be difficult to think that they were the playthings of a special majority.
To hold this would prima facie that the most solemn parts of our Constitution stand on the same footing as any other provision and even on a less firm ground than one on which the articles mentioned in the proviso stand.
The anomaly that article 226 should be somewhat protected but not article 32 must give us pause.
Article 32 does not erect a shield against private conduct but against state conduct including the legislatures (See article 12).
Can the legislature take away this shield ? Perhaps by adopting a liberal construction of article 368 one can say that.
But I am not inclined to play a grammarian 's role.
As at present advised I can only say that the power to make amendments ought not ordinarily to be a means of escape from absolute constitutional restrictions.
" My opposition (lest one misunderstands its veridical charac ter) appears to be cautious and even timid but this was because it was attended by an uneasy feeling that I might have missed some immanent truth beyond what was said in Sankari Prasad 's case(1).
The arguments then were extremely brief.
After hearing full arguments in this case, which have not added to the reasoning of the earlier cases, I am not satisfied that the reasons are cogent enough for me to accept them.
I say it with respect that I felt then, as I do so even more strongly now, that in the two earlier cases, the result was reached by a mechanical juris prudence in which harmonious construction was taken to mean that unless article 368 itself made an exception the existence of any other provision indicative of an implied limitation on the amending power, could not be considered.
This was really to refuse to consider any argument which did not square with the a priori view of the omnicompetence of article 368.
Such reasoning appears to me to be a kind of doctrinaire conceptualism based on an and textual approach supplemented by one concept that an amendment of the Constitution is not an exercise of legislative (1) ; 858 power but of constituent Dower and, therefore, an amendment of the Constitution is not law at all as contemplated by article 13(2).
I. am reminded of the.
words of.
Justice Holmes that "we ,must think things and not words".
The true principle is that if there are two provisions in the Constitution which seem to be hostile, juridical hermeneutics requires the Court to interpret them by combining them and not by destroying one with the aid of the other.
No part in a Constitution is superior to another part unless the Constitution itself says so and there is no accession 'of strength to any provision by calling it a code.
Portalis, the great.
French Jurist .(who helped in the making of the Code Napole on) supplied the correct principle when he said that it is the context of the legal provisions which serves to illustrate the meaning.
of the different parts, so that among them and between them there should be correspondence and harmony.
We have two provisions to reconcile.
Article 368 which says that the Constitution may be amended by, following this and this.
procedure, and article 13(2) which says, the State shall not make any law which takes away or abridges the rights conferred by Part III and that any law made in contravention of the clause shall, to the extent of the contravention, be void.
The question, therefore, is : does this create any limitation upon the amending process ? On the answer to this question depends the solution of all the problems in this case.
It is an error to view our Constitution as if it were a mere organisational document by which the people established the atructure and the mechanism of their Government.
Our Constitution is intended to be much more because it aims at being a social document In which the relationship of society to the indiVidual and of Government to both and the rights of the minorities and the backward classes are clearly laid down.
This social document is headed by a Preamble* which epitomizes the principles on which the Government is intended to function and these principles are later expanded into Fundamental Rights in Part III and the Directive Principles of Policy in Part TV.
The former 'are protected but the latter are not.
The former represent the "PREAMBLE WE THE PEOPLE OF INDIA having solemnly Resolved to .constitute
India into a SOVEREIGN DEMOCRATIC REPUBLIC and to secure all Its citizens: JUSTICE, social, economic and political; EQUALITY of status and of opportunity; and to promote among them.all FRATERNITY assuring the, dignity of the individual and.the unity of Nation: IN OUR CONSTITUENT ASSEMBLY this twenty sixth day of November,1949,do HEREBY ADOPT,ENACT AND GIVE TO OURSELVES THIS CONSTffUTION.
" 859 limits of State action and the latter are the obligations and the duties of the Government as a good and social Government.
Why was it necessary to have the Fundamental Rights at all and make them justiciable ? As we seem to be forgetting our own history so soon let me say that the answer lies there the Nationalist Movement and the birth of the Indian National Congm in 1885 were the direct result of the discriminatory treatment of the Indians in their own country.
The demand for the guarantee of Fundamental Rights had unfortunately to be made.
then to a foreign ruler and it appeared in the Constitution of India Bill framed by the Indian National Congress ten years later.
All that is valuable to an Individual in civilized society, including free speech, imprisonment only by a competent authority, free law education, etc. were claimed therein.
Resolutions of the Congress since then reiterated this demand and the securing of Fundamental Rights in any future Constitution became one of the articles of faith.
To cut the narration short, the main steps may only be mentioned.
Mrs. Besant 's Commonwealth of India Bill 1925 with its seven fundamental rights (the precursor of article 19), the Madras Congress Resolution of 1927 "a constitution on the basis of declaration of rights" the Nehru Report it is obviour, that our first care should be to have the Fundamental Rights guaranteed in a manner which will not permit their withdrawal in any circumstancees , the draft article in the Nehru Constitution "No person shall be deprived of his liberty, nor shall his dwelling or property be entered, requisitioned or confiscated save in accordance with law" , the Independence Resolution of 26th January, 1930 We believe that it is the inalienable right of the Indian people, as of any other people, to have freedom and to enjoy the fruits of their toil and have the necessities of life, so that they may have full opportunities of growth" the Karachi Resolution on Fundamental Rights, Economic and Social Change (1931), the Sapru Report (1945) which for the first time distinguished between justiciable and non ,justiciable rights, the Suggestion of the Cabinet Mission for the constitution of an Advisory Committee on Fundamental and Minority Rights, and, lastly the Committee on Fundamental Rights of the Constituent Assembly, are just a few of the steps to be remembered.
The Fundamental Rights and the Directive Principles were the result.
Fundamental laws are needed to make a Government of laws and not of men and the Directive Principles are needed to lay down the objectives of a good Government.
Our Constitution was not the cause but the result of political and personal freedom".
Since Dicey had said that "the proclamation .
in a Constitution or Charter of the right to personal freedom, or indeed of any other right, gives of itself but slight security that the right has more than a 860 nominal existence",(1) provision had to be made for guaranteeing them andto make them justiciable and enforceable.
This result is reachedby means of articles 12, 13, 32, 136, 141, 144 and 226.
The The High Courts and finally this Court have been made the Judges of whether any legislative or executive action on the part oft the State considered as comprehensively as is possible, offends the Fundamental Rights and article 13(2) declares that legislation which so offends is to be deemed to be void.
It is thus that Parliament cannot today abridge or take away a single Fundamental Right even by a 'unanimous vote in both the Chambers.
But on the argument of the State it has only 'to change the title of the same Act to an Amendment of the Constitution Act and then a majority of the total strength and a 2/3rds majority of the members present and voting in each House may remove not only any of the Fundamental Rights, but the whole Chapter giving them.
And this is said to be possible because of article 368 and its general language which, it is claimed, makes no exception in its text and, therefore, no exception can be implied.
It is obvious that if an Act amending the Constitution is treated as a law it must also be subject to the provisions of article 13(2).
Since the definition of the word 'law ', makes no exception a strenuous eeffort is made on the basis of argument and authority to establish that a constituent power does not result in a law in the ordinary sense.
Distinction is thus made between laws made ordinarily that is to say, from day to day by ordinary majority and laws made occasionally for the amendment of the Constitution by a slightly enhanced majority.
In our Constitution this distinction is not valid in the eye of article 13(2).
It is not essential,, of course, that a difference must always exist in the procedure for the exercise of constituent and ordinary, legislative power.
One has not to go far to find the example of a country in which constitutional law as such may be made by the same agency which makes ordinary laws.
The most outstanding, example is that of England about which de Tocqueville observed.
"the Parliament has an acknowledged right to modify the Constitution; as, therefore, the Constitution may undergo perpetual changes, it does not in reality exist; the Parliament is at once a legislative and a constituent assembly:"(2) of course, the dictum of de Tocqueville that the English Constitution "elle n 'existe point" (it does not exist) is far from accu (1)Dicey: "Law of the Constitution" 10th Edn.
p. 207.
(2)Introduction to the Study of the Law of the Constitution A.V. Dicey Tenth Edn p. 88 quoting from OEuvres completes (14th ed.,1864) (Democratie en Amerique), pp. 166, 167.
861 rate.
There is a vast body of constitutional laws in England which is written and statutory but it is not all found in one place and arranged as a written Constitution usually is.
The Act of Settlement (1701), the Act of Union with Scotland (1707), the Act of Union with Ireland (1800) the Parliament Act (1911) the Representation of the Peoples Acts of 1832, 1867, 1884, 1918, 1928 and 1948, the Ballot Act (1872), the Judicature Acts 1873, 1875 and 1925, the Incitement to Disaffection Act (1934), His Majesty 's Declaration of Abdication Act (1936), the Regency Act (1937) and the various Acts setting up different ministries are examples of what will pass for constitutional law under our system(1).
The Bill of Rights (1689) lays down the fundamental rule in England that taxation may not be levied without the consent of Parliament which in our Constitution has its counterpart in article 265.
In our Constitution also the laws relating to delimitation of constituencies or allotment of seats to such constituencies made or purporting to be made under article 327 or article 328, by reason of the exclusion of the powers of the courts to question them, are rendered constitutional instruments.
Other examples of constitutions which, in addition to constitution proper, contain certain ordinary legislation, having constitutional qualities, also exist.
(2) What then is the real distinction between ordinary law and the law made in the exercise of constituent power? I would say under the scheme of our Constitution none at all.
This distinction has been attempted to be worked out by several authors.
It is not necessary to quote them.
Taking the results obtained by Willoughby(3) it may be said that the fact that a Constitution is written as a Constitution is no distinction because in Britain constitutional law is of both kinds and both parts coexist.
The test that the Constitution requires a different kind of procedure for amendment, also fails because in Britain Parliament by a simple majority makes laws and also amends constitutional statutes.
In our Constitution too, in spite of the claim that article 368 is a code (whatever is meant by the word ,code, here), articles 4, 11 and 169 show that the amendment of the Constitution can be by the ordinary law making procedure.
By this method one of the legislative limbs in a State can be removed or created. 'This destroys at one stroke the claim that article 368 is a code arid also that any special method of amendment of the Constitution is fundamentally necessary.
(1) The list is raken from K. C. Wheare 's: "The Statute of Westminster and Dominion Status" (4th Edn) p. 8.
Dicey and others give different list.
(2) See Constitutions of Austria, Honduras, Nicaragua Peru, Spain and Sweden among others.
The Constitution of Spain, in particular is in several Instruments.
The Constitution of Austria (A t. 149) makes special mention of these constitutional instruments.
(3) Tagore Law Lectures (1924) p. 83.
862 The next test that the courts must apply the Constitution in preference to the ordinary law may also be rejected on the ansalogy of the British practice.
There, every statute has equal standing.
Therefore, the only difference can be said to arise from the fact that.constitutional laws are generally amendable under a process which in varying degrees, is more difficult or elaborate.
This may give a distinct character to the law of the Constitution but it does not serve to distinguish it from the other laws of the land for purposes of article 13(2).
Another difference is that in the written constitutions the form and power of Government alone are to be found and not rules of private law as is the case with ordinary laws.
But this is also not an invariable rule.
The Ame Constitution and our Constitution itself are outstanding examples There are certain other differences of degree, such as that nary _legislation may be tentative or temporary, more detailed or secondary, while the Constitution is intended to be permanent, general and primary.
Because it creates limitations on the ordinary legislative power, constitutional law in a sense is fundamental law, but if the legislative and constituent processes can become one, Ls there any reason why the result should be regarded as law in the one case and not in the other ? On the whole, therefore, as observed in the American Jurisprudence "It should be noticed however that a statute and a constitution, though of unequal dignity are both laws and each rests on the will of the people. . " A Constitution is law which is intended to be, for all time and is difficult to change so that it may not be subject to "impulses ofmajority" "temporary excitement and popular caprice or passion"(2).
I agree with the authors cited before us that the power of amendment must be possessed by the State.
I do not take a narrow view of the word "amendment" as including only minor changes within the general framework.
By an amendment new matter may be added, old matter removed or altered.
I alm concede that the reason for the amendment of the Constitution is a political matter although I do not go as far as some Justice of the Supreme court of the United States did in Coleman vs Miller(3) that the whole process is "political in its entirely from submission until an Amendment becomes part of the Constitution and is not subject to judicial guidance, control or interference at any point.
" There are fundamental differences between our Con (1) American Jurispruence Vol.
II Section 3.
(2) Amendment is expressly called a legislative process in the Constitutions of Colombia:, Costa Rica, Hungary, Panama and Peru.
In Portugal the ordinary legislatures enjoy constituent powers every 10 years.
(3) 3)7 U.S. 443 ; 863 stitution and the Constitution of the United States of America.
Indeed this: dictum of the four Justices based upon, the case of Luther vs Borden(1) has lost some of its force after Baker vs Carr(2) A Republic must, as says Story, (8) possess the means for altering and improving the fabric of the Government so as, to promote the happiness and safety of the people.
The power is also needed to disarm opposition and prevent factions over the Constitution.
The power, however, is not intended to be used for experiments or as an escape from restrictions against undue state action enacted in the Constitution itself.
Nor % 'LS the power of amendment available for the purpose of removing express or fmplied restrictions against the State.
Here I make a difference between Government and State which I shall explain presently.
As Willoughby(4) points out constitutional law ordinarily limits Government but not the State because a constitutional law is the creation of the State for its own purpose.
But there is nothing to prevent the State from limiting itself.
The rights and duties of the individual and the manner in which such rights are to be exercised and enforced ;ire ordinarily to be found in the laws though some of the Constitutions also fix them.
It is now customary to have such rights guaranteed in the Constitution.
Peaslee,(5) writing in 1956 says that about 88% of the national Constitutions contain clauses respecting individual liberty and fair legal process; 83% respecting freedom of speech and the press; 82% respecting property right; 80% respecting rights of assembly and association; 80% respecting rights of conscience and religion; 79% res pecting secrecy of correspondence and inviolability of domi cile; 78% respecting education; 73% respecting equality 64% respecting right to petition; 56% respecting labour; 51% respecting social security; 47% respecting rights of movement within, and to and from the nation; 47% respecting health and motherhood; and 35% respecting the non retroactivity of laws.
In some of the Constitutions there is an attempt to put a restriction against the State seeking to whittle down the rights conferred on the individual.
Our Constitution is the most outstanding example of this restriction which is to be found in article 13(2). 'The State is no doubt legally supreme but in the supremacy of its powers it may create, impediments on its own sovereignty.
Government is always bound by the restrictions created in favour of fundamental Rights but the State may or may not be.
Amendment may be open to the State according to the procedure laid (1) (2) ; (7 L. Ed.
2d 633).
(3) Commentaries on the Constittition of the United States (1833) Vol.
III pp 686 687.
(4) Tagore Law Lectures, p. 84.
(5) Constitutions of Nations, Vol.
I (2nd Edn.) p. 7.
863 stitution and the Constitution of the United States of America.this: dicttan of the four Justices based upon, the case of Luther vs Borden(1) has lost some of its force after Baker vs Carr(2).
A Republic must, as says Story, (,,) ssess the means for ai and:improving the 'fabric of tc Government so as, to promote the happiness and safety, of the people.
The power, is dw needed to disarm opposition and prevent factions over theThe power, however, is not intended to be used for experiments or as an escape from restrictions against undue state action enacted in the Constitution itself.
Nor is the power of amendment available for the purpose of removing express or implied restrictions against the State.
Here I make a difference between Government and Statewhich I shall explain presently.
As Willoughby(4) points out wmtitutional law ordinarily limits Government but not the State because a constitutional la,* is the creation of the State for its own pu, se.
But there is nothing to prevent the State from rpo limiting itself.
The rights and duties of the individual and the. manner in which such rights are to be exercised and enforced are ordinarily to be found in the laws though some of the Constitutions also fix them.
It now customary to have such rights guaranteed in the Constitution.
Peaslee,(5) writing in 1956 says that about 88,Yo of the, national Constitutions contain clauses respecting individual liberty and fair legal process; 83% respecting freedom of speech and the press; 82% respecting property right; 80% respecting rights of assembly and association; 80% respecting rights of conscience and religion; 79% respecting secrecy of correspondence and ' inviolability of domicile; 78% respecting education; 73% respecting equality; .64% respecting right to petition; 56% respecting labour; 51% respecting social security; 47% respecting rights of movement within, and to and from the nation; 47% respecting health and motherhood; and 35% respecting the non retroactivity of laws.
In some of the Constitutions there is an attempt to put a restriction Against the State seeking to whittle down the rights conferred ' on the 'individual.
Our Constitution is the most outstanding i6xample of this restriction Which is to be found in article 1.3(2).
,Tbe State is no doubt legally supreme but in the supremacy of its powers it may creat e impediments on its OI%M sovereignty.
Govent is always bound by the restrictions created in favour of Fundamental Rights but the State may or may not be.
Amendment may be open to the State according to the procedure lai(r (1)7 How. 1 (2) ; (7 L. Ed.
2d 633).
(3) Commentaries on the Constitution of the United, Sta:tes (1 833) 'Vol.
III PP, 686 687.
(4)Tagore Law Lectures, p. 84.
(5)Constitutions of Nations, Vol.
I (2nd Edn.) p. 7. 864 down by the Constitution.
There is nothing, however, to prevent the State from placing certain matters outside the amending procedure( ').
Examples of this exist in several Constitutions of the world : see article 5 of the American Constitution; article 95 of the Constitution of France,; article 95 of the Constitution of Finland; article 97 of the Constitution of Cambodia; article 183 of the Constitution of Greece; article 97 of the Japanese Constitution; article 139 of the Italian Constitution, to mention only a few.
When this happens the ordinary procedure of amendment ,ceases to apply.
The unlimited competence (the kompetenz kompetenz of the Germans) does not flow from the amendatory process.
Amendment can then be by a fresh constituent body.
To attempt to do this otherwise is to attempt a revolution.
I do not known why the word "revolution", which I have used before, should evoke in some persons an image of violence and subversion.
The whole American Constitution was the result of a bloodless revolution and in a sense so was ours.
The adoption of the whole Constitution and the adoption of an amendment to the Constitution have much in common.
An amendment of the Constitution has been aptly called a Constitution in little and the same question arises whether it is by a legal process or by revolution.
There is no third alternative.
An amendment, which repeals the earlier Constitution, unless legal, is achieved by revolution.
As stated in the American Jurisprudence : "An attempt by the majority to change the fundamental law in violation of self imposed restrictions is unconstitutional and revolutionary".
( ') There are illegal and violent revolutions and illegal and peaceful revolutions.
Modification of Constitution can only be by the operation of a certain number of wills acting on other wills.
The pressure runs through a broad spectrum, harsh at one end and gentle at the other.
But whatever the pressure may be, kind or cruel, the revolution is always there if the change is not legal.
The difference is one of method, not of kind.
Political thinking starts from the few at the top and works downward more often than in the reverse direction.
It is wrong to think that masses alone, called "the people" after Mazini, or "the proletariate" after Marx, 'begin a revolutionary change.
Political changes are always preceded by changes in thought in a few.
They may be outside the (1) In the Constitution of Honduras, partial amendment only is possible.
For a complete amendment a Constituent Assembly has to be convoked.
In the Constitution of Brazil, the Constitution cannot be amended when there is a state of seige (our emergency).
In Turkey an amendment of Article 1 cannot even be proposed.
(2) Vol.
12, Section 25 pp.
629 630.
865 Government or in it.
It is a revolution nevertheless, if an attempt is made to alter the will of the people in an illegal manner.
A revolution is successful only if there is consent and acquiescence and a failure if there is not.
Courts can interfere to nullify the revolutionary change because in all cases of revolution there is infraction of existing legality.
It is wrong to classify as revolution some thing coming from outside the Government and an illegality committed by the Government against the Constitution as evolution.
I am mindful of the observations of Justice Holmes, that "We need education in the obvious to learn to transcend our own convictions and to leave room for much that we hold dear to be done away with short of revolution, by the orderly change of law.
"(1) But the problem we are faced with is not an orderly change of law but of a claim to a revolutionary change against the vitals of the Constitution.
In such a case the apprehension is that democracy may be lost if there is no liberty based on law and law based on equality.
The protection of the fundamental Rights is necessary so that we may not walk in fear of democracy itself.
Having assumed the distinction between Government and ' State let me now explain what I mean by that distinction and what the force of article 13(2) in that context is.
I shall begin first by reading the pertinent article.
Article 13 (2), which I quoted earlier, may again be read here: "13. . . . . . (2)The State shall not make any law which takes away or abridges the rights conferred by this Part and any law made in contravention of this clause shall, to the extent of contravention, be void.
" The definition of the State in article 12 reads "12.
In this Part, unless the context otherwise requires, "the State" includes.the Government and Parliament of India and the Government and the Legislature of each of the States and all local or other authorities within the territory of India or under the control of the Government of India.
" The State is the sum total of all the agencies which are also individually mentioned in article 12 and by the definition all the parts severally are also included in the prohibition.
Now see how 'law ' is defined: "13. . . . . (1) The Mind and Faith of Justice Holmes p. 390. 866 (3)In this article, unless the context otherwise requires, (a) "law" includes any ordinance, order, bye law, rule, regulation, notification, custom or usage having in the territory of India the force of law;" In Sajjan Singh 's case(1) I said that if amendments of the constitution were meant to be excluded from the word "law" it was the easiest thing to add to the definition the further words "but shall not include an amendment of the Constitution".
it 'LS argued now before us that this wag not necessary because article 368 does not make any exception.
This argument came at all stages like a refrain and is the real cause of the obfuscation in the opposite view.
Those who entertain this thought do not pause to consider : why make a prohibition against the State? As Cooley said: "there never was a republican Constitution which delegated to functionaries all the latent powers which lie dormant in every nation and are boundless in extent.
and incapable of definition.
", If the State wields more power than the functionaries there must be a difference between the.
State and its agencies such as Government, Parliament, the Legislatures of the States and the local and other authorities.
Obviously, the State means more than any of there or all of them put together.
By making the State subject 'to Fundamental Rights it is clearly stated in article 13 (2) that any ' ,of the agencies acting alone or all the agencies, acting together are not above the Fundamental Rights.
Therefore, when the House .of the People or the Council of States introduces a Bill for the abridgement of the Fundamental Rights, it ignores the injunction against it and even if the two Houses pass the Bill the injunction is next operative against the President since the expression "Government of India" in the General Clauses Act means the President of India.
This is equally true of ordinary laws and laws seeking to amend the Constitution.
The meaning of the word "State" will become clear if I draw attention at this stage to article 325 of the Constitution of Nicargua, which reads as follows: "325.
The agencies of the Government, jointly or separately, are, for bidden to suspend the Constitution or to restrict she rights granted by it, except in the cases provided therein.
" In our Constitution the agencies of the State are controlled jointly and separately and the prohibition is against the whole force of (1) ; 867 the State acting either in its executive or legislative capacity.
Ile of the Executive is more important than even the Legislature.
In modem politics run on parliamentary democracy the Cabinet attains a position of dominance over the Legislature.
The Executive, therefore, can use the Legislature as a means of securing changes in the laws which it desires.
It happened in Germany under Hitler.
The fact has been noticed by numerous writers.
for example, Wade and Philips(1), Sir Ivor Jennings(2) , Dawson(3), Keith(4) and Ramsay Muir(5).
Dawson in particular said that a Cabinet is no longer responsible to the Commons but the Commons has become instead responsible to the Government.
Ivor Jennings added that if a Government had majority it could always secure the legislation.
The others pointed out that the position of the Cabinet towards Parliament tends to assume more or less dictatorial powers and that was why people blamed Government, this is to say, the Cabinet rather than Parliament for ineffective and harsh laws.
This is true of our country also regarding administration and Station.
Fortunately, this is avoided at least in so far as the Fundamental Rights are concerned.
Absolute, arbitrary power in defiance of Fundamental Rights exist nowhere under our Constitution, not even in the largest majority.
The people 's representatives have, of course, inalienable and undisputable right to alter, reform or abolish the Government in any manner they think fit, but the declarations of the Fundamental Rights of the citizens are the inalienable rights of the people.
Ile extent of the power of the rulers at any time is, measured by the Fundamental Rights.
It is wrong to think of them as rights within the Parliament 's giving or taking.
Our Constitution enables an individual to oppose successfully the whole community and the State and claim his rights.
This is because the Fundamental Rights are I so safe guarded that within the limits set by the Constitution they are inviolate.
The Constitution has itself said what protection has been created round the person and property of the citi zens and to what extent this protection may give way to the general good.
it is wrong to invoke the Directive Principles as if there is some antinomy between them and the Fundamental Rights.
The Directive Principles lay down the routes of State but such action must avoid the restrictions stated in the Fundamental Rights.
Prof. Anderson (6) taking the constitutional amendments, as they have been in our country, considered the Directive principles to be more potent than the Fundamental (1) Constitutional Law, 6th Edn.
p. 27.
(2) Parliament (1957) pp.
11 12.
(3) Government of Canada (1952) Chapter XIX.
(4) An Introduction to British Constitutional Law (1931) P. 48, (5) How Britain is Governed P. 5,6.
(6) Changing Law in Developing Countries, pp. 88, 89. 868 Rights.
That they are not, is clear when one takes the Fundamental Rights.
with the guaranteed remedies.
The Directive Principles are not justiciable but the Fundamental Rights are ' made justiciable.
This gives a judicial control and check over State action even within the four corners of the Directive Principles.
It cannot be conceived that in following the Directive Principles the Fundamental Rights (say for example, the equality clause) can be ignored.
If it is attempted, then .
the action is capable of being struck down.
In the same way, if an amendment of the Constitution is law for the reasons explained by me, such an amendment is also open to challenge under article 32, if it offends against the Fundamental Rights by abridging or taking them away.
Of course, it is always open to better Fundamental Rights.
A law or amendment of the Constitution would offend the Fundamental Rights only when it attempts to abridge or take them away.
The importance of Fundamental Rights in the world of today cannot be lost sight of.
On December 10, 1948, the General.
Assembly of the United Nations adopted the Universal Declaration of Human Rights without a dissent.
This draft was made after the Third Committee of the United Nations had devoted 85 meetings to it.
The Declaration represents the civil, political and religious liberties for which men have struggled through the centuries and those new social and economic rights of the Individual which the Nations are increasingly recognising in their Constitutions.
Some of these were proclaimed during the French Revolution and areincluded in the declarations of Nations taking pride in the dignity and liberty of the Individual.
They are epitomized in the Preamble, and more fully expressed in Parts III and IV of our Constitution.
These Declarations wherever found are intended to give a key to social progress by envisaging rights to work, to education and to 'social insurance.
The Nations of the world are now in the second stage, where Covenants are being signed on the part of the States to respect such rights.
United Nations Human Rights Commission has worked to produce two drafts one dealing, with civil and political rights and the other with economic, social and cultural rights.
, The third stage is still in its infancy in which it is hoped to provide for the enforcement of these rights on an international basis.
The Regional Charter of the Human Rights under which there is established already a European Commission of Human Rights to investigate and report on violations of Human Rights, is a significant step in that direction.
After 1955 the European Commission has become competent to receive complaints from individuals although the enforceability of Human Rights on an international basis is still far from being achieved.
If one compares the Uni 869 versal Declaration with Parts III and IV of our Constitution one finds remarkable similarity in the two.
It is significant that our Committee on Fundamental Rights was deliberating when the This Committee of the United Nations was deliberating on the.
Universal Declaration of Human Rights.
Both are manifestos of man 's inviolable and fundamental freedoms.
While the world is anxious to secure Fundamental Rights in ternationally, it is a little surprising that some intellectuals in our country, whom we may call "classe non classe" after Hegel, think of the Directive Principles in our Constitution as if they were superior to Fundamental Rights.
As a modern philosopher(1) said such people 'do lip service ' to freedom thinking all the time in terms of social justice "with 'freedom ' as a by product".
Therefore, in.
their scheme of things Fundamental Rights become only an epitheton ornans.
One does not know what they believe in the communistic millennium of Marx or the individualistic Utopia of Bastiat.
To them an amendment of the Fundamental Rights is permissible if it can be said to be within a scheme of a supposed socioeconomic reform, however, much the danger to liberty, dignity and freedom of the Individual.
There are others who hold to liberty and freedom of the.
Individual under all conditions.
Compare the attitude of Middleton Murray who would have Communism provided "there was universal freedom of speech, of association, of elections and of Parliament" To such the liberty and dignity of the Individual are inviolable.
Of course, the liberty of the individual under our Constitution, though meant to be fundamental, is subject to such restrictions as the .
needs of society dictate.
These are expressly mentioned in the Constitution itself in the hope that no further limitations would require to be imposed at any time.
I do not for a moment suggest that the question about reasonableness, expediency or desirability of the amendments of the Constitution from a political angle is to be considered by the courts.
But what I do say is that the possession of the necessary majority does not put 'any party above the constitutional limitations implicit in the Constitution.
It is obvious that the Constituent Assembly in making the Fundamental Rights justiciable was not justisfied with reliance on the sense of self restraint or public opinion(2) on which the majority in Sajjan Singh 's(3) case does.
This is not argument of fear: The question to ask is : can a party, which enjoys 2/3rds majority today, before it (1)Benedetto Croce.
(2)Sir Robert Peel calls it "that great compound of foiiy, weakness, prejudice, wrong feeling, right feeling, obstinacy and newspaper paragraphs" (3)[1965] 1 S.C.R. 933.
CI/67 10 870 loses it, amend article 368 in such wise that a simple majority would be sufficient for the future amendments of the constitution ? Suppose it did so, would there be any difference between the constitutional and the Ordinary laws made thereafter ? The liberty of the Individual has to be fundamental and it has been so declared by the people.
Parliament today is not the constituent body as the Constituent Assembly was, but is a constituted body which must bear true, allegiance to the Constitution 'as by law established.
To change the Fundamental part of the Individual 's liberty is a usurpation of constituent functions be cause they have been placed outside the scope of the power of constituted.
Parliament.
It is obvious that Parliament need not now legislate at all.
It has spread the umbrella of article 31 B and .has only to add, a clause that all legislation involving Fundamental Rights would be deemed to be within that protection hereafter.
Thus the only palladium against legislative dictatorship may be removed by a 2/3rds majority not only in praesanti but, defuturo.
This can hardly be open to a constituted Parliament.
Having established, that there is no difference between the ordinary legislative and the amending processes in so far as cl.(2) of Aft. 13 is concerned, because both being laws in their true character, come within the prohibition created, by that, clause against the State and that the Directive Principles cannot be invoked to destroy Fundamental Rights.
I proceed now to examine whether the English and Amercan precedents lay down any principle applicable to amendments of our Constitution.
In, Britain the question whether a constitutional amendment is valid or not at arise because the courts are powerless ' Parliamentary Sovereignty under the English Constitution means that Parliament enjoys the right to make or unmake any law whatever and no person or body has any right to question the legislation.
The utmost and absolute despotic power belongs to Parliament.
It "make, confirm, enlarge, restrain, abrogate, repeal, revise and expand law concerning matters of all possible denominations".
What Parliament does, no authority on earth can undo.
The The Queen, each House of Parliament the constituencies and the law courts have in the past claimed independent legislative powers but these claims are unfounded.
It is impossible to compare the Indian Parliament with the Brittsh Parliament as the former con codedly in the ordinary legislation is subject to judicial review, both on the ground of competence arising from a federal structure And the existence of Fundamental Rights.
The question of competence in the matter of amendment of the Constitution depends upon, firstly, compliance with the procedure laid down in article 368 and, secondly, upon the question whether,the.process is in 871 any manner restricted by the Fundamental Rights.
Such questions cannot obviously arise in the British Parliament( ').
The example of the Constitution of the United States cannot also serve any purpose although the greatest amount of support was sought to be derived from the decisions of the Supreme Court and the institutional writings in the United States.
The power of amend in the United States Constitution flows from article V. (1).
It must be noticed that the power is clearly not made equal to ordinary legislative process.
One salient point of difference is that the President is nowhere in ' this scheme because his negative does not run.
( ') The amendment is thus not of the same quality as ordinary legislation.
The Supreme Court of the United States has no doubt brushed aside objections to amendments of the Constitution on the score of incompetence, but has refrained from giving any reasons.
In the most important of them, which questioned the 18th Amendment, the Court only stated its conclusions.
After recalling the texts of the Article under which Amendments may be made and of the 18th Amendment proposed by the Congress in 1917 and proclaimed as ratified by the States in 1919, the Court announced : "4.
The prohibition of the manufacture, sale, trans portation, importation, and exportation of intoxicating liquors for beverage purposes, as embodied in the 18th amendment, Is within the power to amend reserved by article 5 of the Constitution." (emphasis supplied) (4) One would have very much liked to know why this proposition was laid down in the terms emphasised above if the effective exercise of the.
power depended upon a particular procedure which was immaculately followed.
The silence of the Court about its reasons has been noticed in the same judgment by Mr. Justice (1) Dicey gives three supposed limitations on the power of Parliament.
Of these one that language has been used in Acts of Parliament which implies that one Parliament can make laws which cannot be touched by any subsequent Parliament, is not true.
The best examples are Act of treaties with Scotland and Ireland but these same Acts have been amended later.
Francis Bacon found this claim to be untenable.
See Dicey 'The Law of the Constitution pp. 64, 65.
(2) Article V.
The Congress, whenever two thirds of both houses shall deem it necessary, shall propose amendments to this Constitution, or, on the application of the legislatures of two thirds of the several States, shall call a convention for proposing amendments, which, in either case, shall be valid to all intents and purposes, as part of this Constitution, when ratified by the legislatures of three fourths of the several States, or by conventions in three fourths thereof, as the one or the other mode of ratification may be proposed by the Congress, provided that no amendment which may be made prior to the year ' one thousand eight hundred and eight shall in any manner affect the first and fourth clauses in the ninth section of the first article; and that no State, without its consent, shall be deprived of its equal suffrage in the Senate." (3) Hollingsworth vs Virginia ; (4) National Prohibition Cases; , 872 Mckenna.
In feser vs Garnett(1) the Court was hardly more expressive.
The only question considered by the Court was "The first contention is that the power of amendment conferred by the ' Federal Constitution, and sought to be exercised, does not dxtend to this Amendment, because of its character." (emphasis supplied).
This was repelled by Brandeis, J on behalf of the unanimous court on the grx)und that the Amendment was in character and phraseology similar to the 15th Amendment and was adopted by following the same method.
As the,lsth Amendment had been accepted for half a century the suggestion that it was not in accordance with law, but as a war measure validated by acquiescence was not accepted.
It is significant, however, that at the time of the 18th Amendment, the arguments were (a) that 'amendment ' was ' limited to the correction of error in the framing of the Constitution, (b) Article V did not comprehend the adoption of additional or supplementary provisions, (c) ordinary legislation could not be embodied.
in the constitutional amendment, and (d) Congress could not 'propose amendment which pared the sovereign power of the States.
None of these at I guin ents was accepted.
At the time of the 19th Amendment, which increased the franchise in the States, the narrow ground was that a State which had not ratified the Amendment would be, deprived of its equal suffrage in the Senate because its representatives in that body would be persons not of its choosing, i.e. persons,chosen by voters whom the State itself had not authorised to vote for Senators.
This argument was rejected.
However, in Dillion vs Gloss(2) the Supreme Court held that Congress had the, power to a time limit for ratification because article V implied that application must be within some reasonable time after.
the proposal".
The fixation of 7 years was held by the Court to be reasonable.
In 1939 came the case of Coleman vs Miller(3) which dealt with the Child Labour Amendment.
Such a law was earlier re jected by the Kansas Leizislature.
Later the State ratified the amendment after a lapse of 13 years by the casting vote of the Lt. Governor.
Mandamus was asked against the Secretary of Kansas Senate to erase the endorsement of ratification from its record and it was denied.
The Supreme Court of Kansas refused to review this denial on certiorari.
The Supreme Court of the United States in an opinion, in which not more than 4 Justices (1) 258 U.S. 130.
(2)256 U.S. 368.
(3) 307 U.S. 443.
873 took any particular view,.
declined to interfere.
Majority affirmed the decision of Supreme Court of Kansas.
Four Justices considered that the question was political from start to finish and three Justices that the previous rejection of the law and the extraordinary time taken to ratify were political questions.
Although the Supreme Court has scrupulously refrained from passing on the ambit of article V it has nowhere said that it will not take jurisdiction in any case involving the amending process.
(1) In Hollingsworth vs Virginia(2) the supreme Court assumed that the question was legal.
The Attorney General did not even raise an objection.
In Luther vs Borden($) the matter was finally held to be political which opinion prevailed unimpaired 'till some doubts have arisen after Baker vs Carr(4).
In the case the Court remarked "We conclude. that the non justiciability of claims resting on the guarantee clause which arises from the embodiment of questions that were thought 'Political ' can have no bearing upon the justiciability of the, equal protection claim presented in this case.
We ernphasise that it is the involvement in guarantee clause claims of the elements thought to define "political questions" and no other feature, which could render them non justiciable.
specifically, We have said that such claims are not held non justiciable because they touch matters of State governmental Organisation.
It would appear that the Equal Protection Clause was held to supply a guide for examination of apportionment methods better than the Guarantee Clause.
Although there is no clear pronouncement, a great contro versy exists whether questions of substance can ever come before the Court and whether there are any implied limitations upon the amendatory Power.
In the cases above noted, the other articles (particularly the Bill of Rights) were not read as limitations and no limitation outside the amending clause was implied.
In the two cases inwhich the express limitation of Equal suffrage Clause was involved the Court did not enter the question.
Thus the 15th and, on its strength, the 19th Amendments were upheld.
In Coleman vs Miller(5) the political question doctrine brought the support of only four Justices and in Baker vs Carr(4) the Federal, Courts were held to have jurisdiction to scrutinise the fairness of legislative apportionment, under the 14th Amendment and to take steps to assure that serious inequities were wiped out.
The (1) See Rottschaeffer: Handbook of American Constitutional Law (1939) pp.
397, 398, though the author 's opinion is that it will deny jurisdiction.
(2) ; (3) (4) ; (5) 307 U. section 443 874 courts have thus entered the political thicket '.The question of delimitation of constituencies cannot, of, course, arise before courts under our Constitution because of article 329.
Baker vs Carr(1) makes the Court sit in judgement over the possession and distribution of politcal power which is an essential part of a Constitution.
The magical formula of "political questions" is losing ground and it is to be hoped that a change may be Soon.
coming.
Many of the attacks on the amendments were the result of a misunderstanding that the Constitution Was a compact between States and that the allocation of powers was not to be changed at all.
This was finally decided by Texas vs White (2) as far back as 1869.
The main question of implied limitations has evoked a spate of writings. Bryce(s), Weaver(4), Mathews(5), Burdick(6), Willoughby(7), Willis(8), Rottshaefer(9), Orfield(10) (to name only a few) are of the opinion that there are no, implied limitations, although, as Cooley points out, "it is sometimes expressly declared what indeed is implied without the declaration that everything in the declaration of rights contained is excepted out of the general powers of Government, and all laws contrary thereto shall be void(11).
" Ex press checks there are only three.
Two temporary checks were operative till 1808 and dealt with interference with importation of slaves and the levying of a direct tax without apportionment among then States according to population.
Permanent check that now remains is equality of representation of States in the Senate.
Some writers suggest that this, check may also be removed in two moves.
By the first the Article can be, amended and by the second the equality removed.
When this happens it will be seen whether the Supreme Court invokes any doctrine such as achieving.
indirectly what cannot be done directly.
It will, of course, be completely out of place in a judgment to discuss the.
views of the several writers and so I shall confine myself to the observation of Orfield to whom again and again counsel for the State turned either for support or inspiration.
Accord.
ing to him, there are ' no implied limitations unless the Courts adopt (1) ; (2) Wall.700.
(3) The American Commonwealth Vol.
I. (4) Constitutional law and its Administration (1946).
(5) American Constitutional System (2nd Edn.) p. 43 45.
(6)The Law of the American Constitution (7th Imp.) p. 45.
(7) Tagore Law Lectures (1924).
(8)constitutionaI Law of United States (1936).
(9) Handbook of American Constitutional Law.
(10)The Amending of the Federal Constitution (11)Constitutional Limitations Vol.
I, 8th Edn.
95, 96.
875 that view and therefore no limitations on the substance of the amendments except the Equality Clause.
His view is that when Congress is in the amending process, it is not legislating but exercising a peculiar power bestowed by article V.
I have already shown that under our Constitution the amending process is a legislative process, the only difference being a special majority and the existence of article 13(2).
Orfield brushes aside the argument that this would destroy the very concept of the Union which, as Chief Justice.
Marshall had said, was indestructible.
Orfield faces boldly the question whether the whole Constitution can be overthrown by an amendment and answers yes.
But he says that the amendment must not be in violation of the Equality Clause.
This seems to be a great concession.
He makes this exception but Munro( '), who finds it difficult to conceive of an unamendable constitution suggests that it should be possible to begin with that clause and then the door to amendments would be wide open.
Of course, the Supreme, Court has not yet faced an amendment of this.
character and it has not yet denied jurisdiction to itself.
In the.
United States the Constitution works because, as observed by Willis, the Supreme Court is allowed to do " 'the work of remolding the Constitution to keep it abreast with new conditions and new times, and to allow the agencies expressly endowed with the; amending process to act only in extraordinary emergencies or when, the general opinion disagrees with the opinion of the Supreme Court.
" In our country amendments, so far have bean made only with the object of negativing the Supreme Court,decisions, but more of it later.
I have referred to Orfield although there are greater names than his expounding the same views.
I have refrained from referring to the opposite view which in the words of Willoughby has been "strenuously argued by reputable writers" although Willis discourteously referred to them in his book.
My reason for not doing so is plainly this.
The process of amendment in the United States is clearly not a legislative process and there is no provision like article 13 (2) under which "laws" abridging or taking away Fundamental Rights can be declared void.
Our liberal Constitution has given to the Individual all that he should have freedom of speech, of association, of assembly, of religion, of motion and locomotion, of property and trade and profession.
In addition it has made the State incapable of abridging or taking away these rights to the extent guaranteed, and has itself shown how far the enjoyment of those rights can be curtailed.
It; has given a guaranteed right 'to the person affected to move the Court. , I le guarantee is worthless if the rights are capable of being taken away.
This makes our Constitution unique and the American precedents cannot be of much assistance.
(1) The Govenment of the United States (5th Edn.) p. 77.
876 The Advocate General of Madras relied upon Vedel.(1) According to Vedel, a prohibition in the Constitution against its own amendment has a political but not juridical value, and from the juridical point of view, a declaration of absolute constitutional immutability cannot be imagined.
The constituent power being supreme, the State cannot be fettered even by itself.
He notices, however, that the Constitution of 1791 limited the power of amendment (revision) for a certain time and that of 1875 prohibited the alteration of the Republican form of Govermment.
He thinks that this hindrance can be removed by a two step amendment.
He concludes that the constituent of today cannot bind the nation of tomorrow and no Constitution can prohibit its amend Of course, the French have experimented with over a dozen Constitutions, all very much alike, while the British have slowly changed their entire structure from a monarchical executive to an executive from Parliament and have reduced the power of the House of Lords.
Cambell Bannerman former Prime Minister of England summed up the difference to Ambassador M. de Fleurian thus : ".
Quand nous faisons une Revolution, nous ne ditruisons pas notre maison, nous en conservons avec soin la facade, et, derriere cette facade, nous reconstruisons une nouvelle maison.
Vous, Francais, agissez autrement; vous jetez bas le vieil edifice et vous reconstruisez la mime maison avec une autre facade et sous un nom different." (When we make a Revolution we do not destroy an house, we save with care the facade and behind construct a new house.
You, Frenchmen, act differently.
You throw down the old edifice and you reconstruct the same house with a different facade and under a different name).
M.de Fleurian agreed that there was a lot of truth in it (ll ya du vrai dans cette boutade) (2).
But of course to a Frenchman brought up in a legal system in which the Courts do not declare even an ordinary statute to be invalid, the idea of the unconstitutionality of a constitutional amendment does not even occur.
France and Belgium have created no machinery for questioning legislation and rely on moral and political sanctions.
Even an English lawyer and less so an American lawyer find it difficult to understand how the legality of an amendment of the Constitution can ever be questioned.
It (1) Mannual Elementaire da Droil Constitutional (Sirey) p. 117.
(2) Recounted by M. de Fleuriau in the Preface to J. Magnan de Bornier, L 'Empire Britannique, son evolution politique et constitutionnelle p. 6, quoted in Wheare: The Statute of Westminster and Dominion status, P. 9 10.
877 appears to them that the procedure for the amendment being gone through there is no one to question and what emerges is the Constitution as valid as the old Constitution and just as binding.
The matter, however, has to be looked at in this way.
Where the Constitution is overthrown and the Courts lose their position under the old Constitution, they may not be able to pass on the validity of the new Constitution.
This is the, result of a revolution pure and simple.
Where the new Constitution is not accepted and the people have not acquiesced in the change and the courts under the old Constitution function, the courts can declare the new Constitution to be void.
Perhaps even when the people acquiesce and a new Government comes into being, the courts may still declare the new Constitution to be invalid but only if moved to do so.
It is only when the courts begin to function under the new Constitution that they cannot consider the vires of that Constitution because then they owe their existence to it.
I agree with Or field in these observations taken from his book.
He, however, does not include amendments of the Constitution in these remarks and expressly omits them.
His opinion seems to indicate that in the case of amendments courts are completely free to see that the prescribed constitutional mode, of alteration is complied with and the alteration is within the permissive limits to which the Constitution wishes the amendments to go.
This is true of all amendments but particularly of an amendment seeking to repeal the courts ' decision and being small in dimension, leaves the courts free to consider its validity.
The courts derive the power from the existing terms of the Constitution and the amendment fails if it seeks to overbear some existing restriction on legislation.
What I have said does not mean that Fundamental Rights are not subject to change or modification.
In the most inalienable of such rights a distinction must be made between possession of a right and its exercise.
The first is fixed and the latter controlled by justice and necessity.
Take for example article 21 : "No person shall be deprived of his life or personal liberty except according to procedure established by law".
Of all the rights, the right to one 's life, is the most valuable.
This article of the Constitution, therefore, makes.
the right fundamental.
But the inalienable right is curtailed by a murderer 's conduct as viewed under law.
The deprivation, when it takes place, is not of the right which was immutable but of the continued exercise of the right.
Take a Directive Principle which is not enforceable at law but where the same result is reached.
The right to employ ment is a directive principle.
Some countries even view it as a Fundamental Right.
The exercise, however, of that right must depend upon the capacity of Society to afford employment to all 878 and sundry.
The possession of this right cannot be confused with its exercise.
One right here is positive and can be enforced although its, exercise can be curtailed or taken away, the other is a right which, the State must try to give but which cannot be enforced.
The Constitution permits a curtailment of the exercise of most of the Fundamental Rights by stating the limits of that curtailment.
But this power does not permit the, State itself, to take away or abridge the right beyond the limits set by the Constitution.
It must also be remembered that the rights of one% individual are often opposed by the rights of another individual and thus also become limitative.
The Constitution in this way" permits the Fundamental Rights to be controlled in their exercise but prohibits their erasure.
It is argued that such approach makes Society static and robs the State of its sovereignty.
It is submitted that it leaves revolution as the holy alternative if change is necessary.
This is not right.
The whole Constitution is open to amendment only two dozen articles are outside the reach of article 368.
That too because the Constitution has made them fundamental.
What is being suggested by the counsel or the State is itself a revolution, because as things are that method of,amendment is illegal.
There is a legal method.
Parliament must act in a different way reach the Fundamental Rights.
The State must reproduce the power which it has chosen to put under a restraint.
Just as the French or the Japanese,etc.
cannot change the articles of their Constitution which are, made free, from the power of amendment and ' must call a convention or a constituent body, so also we ' India cannot abridge or take away the Fundamental Rights by the ordinary amending process.
Parliament must amend article 369 to convoke another Constituent Assembly pass a law under item 97 of the First List of Schedule VII to call a Constituent Assembly and then that assembly may be able to abridge or take away the Fundamental Rights if desired.
It cannot be done otherwise.
The majority in Sajjan Singh 's case(1) suggested bringing article 32 under the Proviso to improve protection to the Fundamental Rights.
Article 32 does not stand in need of this Protection.
To abridge or take away that article (and the same is true of all other Fundamental Rights) a constituent body and not a constituted body is required.
Parliament today is a constituted body with powers of legislation which include amendments of the Constitution by a special majority but only so far as article 13 (2) allows.
To bring into existence a constituent body is not impossible as, I had ventured to suggest during the hearing and which I have now more fully explained here.
It may be said that.
this is not necessary because article 368 can be amended by Parliament to confer on itself constituent powers over the Fundamental Rights.
This would he wrong and against article 13 (2).
Parliament cannot.
increase its (1) ; 879 powers in this way and do indirectly which it is intended not to de.
directly.
The State does not lose its sovereignty.
but as it has chosen.
to create, self imposed restrictions through one constituent body those restrictions cannot be ignored by a constituted body which makes laws.
Laws so made can affect those parts of the Constitution which are outside the restriction in article 13 (2) but any 'law (legislative or mendatory) passed by such a body must conform to that article.
To be able to abridge, or take away the Fundamental Rights which give so many assurances and guarantees a fresh Constituent Assembly must be, convoked.
Without such action the protection of the Fundamental Rights must remain immutable and any attempt to abridge or take them away in any other way must be regarded as revolutionary.
I shall now consider the amendments of the Fundamental Rights made since the adoption of the Constitution, with a view to illustrating my meaning.
Part III is divided under different headings.
They are (a), General (b) Right to Eqility (c) Right to Freedom (d) Right against exploitation (e) Right to Freedom of Religion (f) Cultural and Educational Rights (g) Right to Property (h) Right to Constitutional Remedies.
I shall first deal with amendments of topics other than the topic (g) Right to Property. 'The articles which are amended in the past are Art 15 & and 19 by the 1st Amendment (18th June 1951) and Art, 16 by the 7th Amendment (19th October 1956).
The 16th Amendment added the words "the sovereignty and integrity of India to some clauses.
As that does not abridge or take away any Fundamental Right, I shall not refer to the 16th Amendment hereafter.
That Amendment was valid.
The changes so made may be summarized.
In article 15, which deals with.
prohibition or discrimination on the ground of religion, race, caste, sex or place of birth, clause (3) allowed the State to make special provision for women and children.
A new clause was added which reads: "(4) Nothing in this article or in clause (2) of article 29 shall prevent the State from making any special provision for the advancement of any socially and educationally backward classes of citizens or for the Scheduled Castes and the Scheduled Tribes".
It is argued by counsel for the State that by lifting the ban to make special provision for backward classes of citizens, there is discrimination against the higher classes.
This is the view which classes in a privileged position who had discriminated against the backward ,classes for centuries, might indeed take.
But I cannot accept this contention.
The Constitution is intended to secure to all citizens "Justice, social, economic and political and Equality of status and opportunity" (vide the Preamble) and the Directive Principles include article 38 which provides: 880 .lm15 "38 The State shall strive to promote the welfare of the people by securing and protecting as effectively as it may a social order in which justice, social, economic and political, shall inform all the institutions of the national life." To remove the effect of centuries of discriminatory treatment and to raise the down trodden to an equal status cannot be regarded ,as discriminatory against any one.
It is no doubt true that in State of Madras vs Champakam(1) the reservation of seats for Backward Classes, Scheduled Castes and Tribes in public educational institutions was considered invalid.
Articles 16(4) and 340 had already provided for special treatment for these backward ,classes and article 46 had provided that the State shall promote, with special care their educational and economic interests.
With all ,due respects the question of discrimination hardly arose because in view of these provisions any reasonable attempt to raise the status of the backward classes could have been upheld on the principle of classification.
In any event, the inclusion of this clause to article 16 does not abridge or take away any one 's Fundamental Rights unless the view be taken that the backward classes for ever must remain backward.
By the First Amendment the second and the sixth clauses of article 19 were also amended.
The original cl.
(2) was substituted by a new clause and certain words were added in clause (6).
The changes may be seen by comparing the unamended and the amended clauses side by side : "19( 1) All citizens shall have the right (a) to freedom of speech and expression; (2) (Before Amendment) (After Amendment) Nothing in sub clause (a) of clause (1), Nothing in sub clause (a) of clause (1)shall affect the operation of any existing law in so far as it relates to, or prevent the State from making any law relating to libel, slander, defamation, contempt of Court or any matter which offends against decency or morality or which undermines the security or tends to overthrow, the State.
shall affect the operation of any existing law, or prevent the State from making any law.
in so far as such law imposes reasonable restrictions on the exercise of the right conferred by the said sub clause in the interest of the. security of the State, friendly relations with foreign States, public order, decency or morality, or in relation to contempt of court, defamation or incitement to an offence, The amendment was necessary because in Romesh Thapar v State of Madras(2) it was held that disturbances of public tranquallity did not come within the expression "undermines the secu (1)[1951]S.C.R.525.
(2) ; 881 rity of the State".
Later the Supreme Court itself observed in the State of Bihar vs Shailabala Devi(1) that this Court did not intend to lay down that an offence against public order could not in any case come within that expression.
The changes related to (a) "friendly relations with foreign States", (b) "public order" and (c) "incitement to an offence" and the words ."undermines the security of the State or tends to, overthrow the State".
were replaced by the words "in the interests of the security of the State".
This change could be made in view of the existing provisions of the clause as the later decision of this Court above cited 'clearly show that "public order" and "incitement to offence" were already comprehended.
The amendment was within the permissible limits as it did not abridge or take away any Fundamental Right.
The Amending Act passed by Parliament also included a sub section which read "(2) No law in force in the territory of India, immediately before the commencement of the Constitution which is consistent with the provisions of article 19 of the Constitution as amended by sub section (1) of this section shall be deemed to be void, or ever to have become void, on the ground only that being a law which takes away or abridges the right conferred by sub clause (a) of clause ( I ) of the said article, its operation was not saved by clause (2) of that article as originally enacted.
Explanation.
In this sub section, the expression "law in force" has the same meaning as in clause (1) of article 1 3 of this Constitution".
This sub section was not included in the Constitution.
That device was followed in respect of certain State statutes dealing with property rights by including them in a now Schedule.
It did not then occur to Parliament that the laws could be placed.
under a special umbrella of constitutional protection.
Perhaps it was not considered ' necessary because article 19(2) was retrospectively changed, and the, enactment of this sub section was an ordinary legislative action.
If the amendment had failed, the second subsection of section 3 would not have availed at all.
Tuming now to clause (6), we may read the original and the amended clause side by side "19(1) All citizens shall have the right= (g) to practise any profession, or to carry on any occupation, trade or business.
(1) ; 882 (6) (Before, Amendment) Nothing, in sub clause (g) of the said clause shall affect the operation of any existing law in so far as it imposes, or prevent the State from making any law imposing, in the interests of the general public, reasonable restrictions on the exercise of the right conferred by the said sub clause, and, in particular nothing in the said sub clause, shall affect the operation of any existing law in so far as it prescribes or empowers any authority to prescribe, or prevent the State from making any law prescribing or empowering any authority to prescribe, the professional or technical qualifications necessary for practising any profession or carrying on any occupation, trade or business.
(After Amendment) Nothing in sub clause (g) of the said clause shall affect the operation of any existing law in so far as it imposes, or prevent the State from making any law imposing, in the interests of the general public, reasonable restrictions on the exercise of the right conferred by the said sub clause, and, in particular, nothing in the said sub clause, shall affect the operation of any existing law in so far as it relates to, or prevent the State from making any law relating to, (i)the professional or technical qualifications necessary for practising any profession or carrying on any occupation, trade or business, or (ii)the carrying on by the State, or a corporation owned or controlled by the State, of any trade, business, industry or service, whether to the exclusion, complete or partial, of citizens or otherwise, The first change is in the verbiage and is not one of substance.
It only removes some unnecessary words.
The new sub clause is innocuous except where it provides for the exclusion of citizens.
It enables nationalisation of industries and trade.
Sub clause (g) (to the generality of which the original clause (6) created some exceptions) allowed the State to make laws imposing, in the interests of the general public, reasonable restrictions on the exercise of the right conferred by the sub clause.
A law creating restrictions can, of course, be made outside the Constitution or inside it.
If it was considered that this right in the state was required in the interests of the general public, then the exercise of the right to practise profession or to carry on an occupation, trade or business could be suitably curtailed.
It cannot be said that nationalisation is never in the interest of the general public.
This amendment was thus within the provision for restricting the exercise of the Fundamental Right in sub cl.
(g) and was perfectly in order.
The Seventh Amendment introduced certain words in article 16 (3). 'no clauses may be, compared: " 16.
(3) (Before Amendment) Nothing in this article shall prevent Parliament from making any law prescribing, in regard to a class or classes of employment or appointment to an office under any State specified in the First Schedule or any local or other authority within its territory, any requirement as to residence within the 'State prior to such employment or appointment.
(After Amendment) Nothing in this article shall prevent Parliament from making any law prescribing, in regard to a class or classes of employment or appointment to an office under the Government of, or any local authority within, a State or Union territory, any requirement as to residence within that State or Union territory prior to such employment or appointment.
" 883 The change, is necessary to include a reference to Union territory.
It has no breaking upon Fundamental Rights., and, neither abridges nor, takes away any of them.
In the result none of the, amendments, of the article.
in parts other than that dealing with Right to property is, outside the amending process because article 13(2) is in no manner breached.
This brings me, to the main question in this case,, It is whether the amendments of the part Right to Property in Part, III of the Constitution were legally made or not.
To understand this part of the case I must first begin by discussing what property rights mean and how they were safeguarded by the Constitution as it was originally framed.
"Right to Property"in Part III was originally the subject of one article, namely, article 31.
Today there are three articles 3 1, 3 1 A and 31 B and the Ninth Schedule.
The original thirty first article read: "31 Compulsory acquisition of property.
(1) Nov person shall be deprived of his property save by authority of law.
(2) 'No property, movable or immovable, including any interest in or in any company owning, any commercial or industrial undertaking, shall be taken possession of or acquired for public purposes under any law authorising the taking of such possession or such acquisition, unless the law provides for compensation for the property taken possession of or acquired and either fixes the amount of the compensation, or specifies the principle on which, and the manner.
in which, the compensation is, to be determined and given.
No such law as is referred to in clause.
(2) made by the Legislature of the State shall have effect unless such law, having been reserved for the consideration of the President, has received his assent.
(4) If any Bill pending at the commencement of this Constitution in the Legislature of a State has, 'after it has been passed by such Legislature, been reserved for the consideration of the President and has received his assent, then, notwithstanding anything in this constitution, the law so assented to shall not be Called in question in any, court on the ground that it contravenes the provisions of clause (2).
(5) Nothing in clause(2) shall affect (a) the provisions of any existing law other than a law to which the provisions of clause (6) apply,.or 884 (b) the provisions of any law which the State may hereafter make (i) for the ,purpose of imposing or levying any tax or penalty, or (ii) for the promotion of public health or the prevention of danger to life or property, or (iii) in pursuance of any agreement entered into between the Government of the Dominion of India or the Government of India and the Government of .
any other country, or otherwise, with respect to property declared by law to be evacuee property.
(6) Any law of the State enacted not more than eighteen months before the commencement of this Constitution may within three months from such commencement be submitted to the President for his certification; and thereupon, if the President by public notification so certifies, it shall not be called in question in any court on the ground that it contravenes the provisions of clause (2) of this article or has contravened the provisions of sub section (2) of section 299 of the Government of India, Act, 1935".
The provisions of this article are intended to be read with article 19(1) (f) which reads "19(1) All citizens shall have the right (f) to acquire, hold and dispose of property".
Article 19 1 ) (f ) 'is subject to clause (6) which I have already set out elsewhere and considered.
Ownership and exchange of property are thus recognised by the article.
The word "property" is is not defined and I shall presently consider what may be included in 'property '.
Whatever the nature of property, it is clear that by the first clause of article 3 1 the right to property may be taken away under authority of law.
This was subject to one condition under the original article 3 1, namely, that the law must either fix the compensation for the deprivation or specify the principles on which and the manner in which compensation was to, be determined and given.
This was the heart of the institution 'of property as understood by the Constituent Assembly.
The rest of the article only gave constitutional support against the second clause, to legislation already on foot in the States.
This created a Fundamental Right in property.
The question may now be 885, asked,:why was it necessary to make such a Fundamental Right at all ? There is no natural right in property and as Burke said in his Reflections, Government is not made in virtue of natural rights, which may and do exist in total independence of it.
Natural rights embrace activity outside the status of citizen.
Legal rights are required for free existence as a social being and the State undertakes to protect them.
Fundamental Rights are those rights which the State enforces against itself.
Looking at the matter briefly but historically, it may be said that the Greeks were not aware of these distinctions for as Gierke(1) points out they did not distinguish between personality as a citizen and personality as a human being.
For them the Individual was merged in the citizen and the citizen in the State.
There was personal liberty and private law but there was no sharp division between the different kinds of laws.
The Romans evolved this gradually not when the Roman Republic existed, but when the notion of a Fiscus developed in the Empire And the legal personality of the Individual was separated from his membership of the State.
It was then that the State began to recognize the rights of the Individual in his dealings with the State.
It was Cicero(2) who was the first to declare that the ' primary duty of the Governor of a State was to secure to each individual in the possession of his property.
Here we may see a recognition of the ownership of property as a Fundamental Right.
This idea wasso engrained in early social philosophy that we find Locke opining in his Civil Government ' (Ch. 7) that "Government has no other end but the preservation of property".
The concepts of liberty, equality and religious freedom were well known.
To them was added the concept of property rights.
Later the list included "equalitas, libertas ius securitatis, ius defensionis and ius puniendi.
The concept of property right gained further support from Bentham and Spencer and Kant and Hegel(3).
The term property in its pristine meaning embraced only land but it soon came to mean much more.
According to Noyes(4)_ "Property is any protected right or bundle of rights (interest or thing) with direct, or indirect regard to any external object (i.e. other than the person himself) which is material or quasi material (i.e. a protected ,process) and which the then and there Organisation of Society permits to be either private or public, which is connoted by the legal concepts of occupying, possessing or, using".
(1) Das Doutscheg Genossenschaftrecht (III, 10).
(2) De Off.
(The Offices) It Ch.
XXI (Everyman) p. 105.
(3) W. Friedman:Legal Theory (4th Edn.) see pp.
373 376.
(4) The Institution of Property (1936) p. 436. L3Sup CI/67 11 886 The right is enforced by excluding entry or interference by a per.
son not legally entitled.
The position of the State vis a vis the individual is the subject of articles 19 and 31, 31 A and 31 B. Now in the enjoyment, the ultimate right may be an interest which is connected to the object through a series of intermediaries in which each 'holder ' from the last to the first 'holds of ' 'the holder ' before him.
Time was when there was a lot of 'free property ' which was open for appropriation.
As Noyes( ') puts it, "all physical manifestations capable of being detected, localised and identified" can be the objects of property.
One exception now made by all civilized nations is that humanbeings are no longer appropriable.
If any free property was available then it could be brought into possession and ownership by mere taking.
It has been very aptly said that all private property is a system of monopolies and the right to monopolise lies at the foundation of the institution of property.
Pound( ) in classifying right in rem puts private property along with personal integrity [right against injury to life, body and health (bodily or mental), personal liberty (free motion and locomotion)], Society and control of one 's family and dependents.
An extremely valuable definition of ownership is to be found in the Restatement of the Law of Property where it is said : "It is the totality of rights as to any specific objects which are accorded by law, at any time and place, after deducting social reservations".
This is the core from which some rights may be detached but to which they must return when liberated.
The right to property in its primordial meaning involved the acquisition, of 'a free object by possession and conversion of this possession into ownership by the protection of State or the ability to exclude interference.
As the notion of a State grew, the right of property was strong or we according to the force of political opinion backing it or the legislative support of the State.
The English considered the right as the, foundation of society.
Blackstone(&) explained it on religious; and social ground% claiming universality for it and called it the right of the English people.
William ' Paley(4),although he thought the institution paradoxical and unnatural found it full of advantage and Mackintosh in his famous diatribe against the French Revolution described it as the "sheet anchorof society".
This in"stitution ' appeared in the Magna Carta, in the American Declaration of Independence and the French Declaration of Rights of Man.
Later we find it in many (1) The Institution of Property (1936)p.
(2) Readings; p. 420. 3) Commentaries.
(4) Moral Philosophy.
887 Constitutions described as Fundamental, general and guaran teed(1).
Our Constitution accepted the theory that Right of Property is a fundamental right.
In my opinion it was an error to place it in that category.
Like the original article 16 of the Draft Bill of the Constitution which assured freedom of trade, commerce and intercourse within the territory of India as a fundamental right but was later removed, the right of property should have been placed in a different chapter.
Of all the fundamental rights it is the weakest.
Even in the most democratic of Constitutions, (namely, the West German Constitution of 1949) there was a provision that lands, minerals and means of production might be socialised or subjected to control.
article 31, if it contemplated socialization in the same way in India should not have insisted so plainly upon payment of compensation.
Several speakers warned Pandit Nehru and others of the danger of the second clause of article 31, but it seems that the Constituent Assembly was quite content that under it the Judiciary would have no say in the matter of compensation.
Perhaps the dead hand of section 299 of the Constitution Act of 1935 was upon the Constituent Assembly.
Ignored were the resolutions passed by the National Planning Committee of the Congress (1941) which had advocated the co operative principle for exploitation of land, the Resolution of 1947 that land with its mineral resources and all other means of production as well as distribution and exchange must belong to and be regulated by the Community, and the warning of Mahatma Gandhi that if compensation had to be paid we would have to rob Peter to pay Paul(2) In the Constituent Assembly, the Congress (Which wielded the majority then, as it does today) was satisfied with the Reprt of the Congress Agrarian Reforms Committee 1949 which declared itself in favour of the elimination of all intermediaries between the State and the tiller and imposition of prohibition against subletting.
The Abolition Bills were the result.
Obviously the Sardar Patel Committee on Fundamental Rights was not prepared to go far.
In the debates that followed, many amendments and suggestions to alter the draft article protecting property, failed.
The attitude was summed up by Sardar Patel.
He conceded that land would be required for public purposes but hopefully added : "not only land but so many other things may have to be acquired.
And the State will acquire them after paying compensation and not expropriate thenm".
(3) (1) Under the Constitution of Norway the rights (Odels and Asaete rights) cannot be abolished but if the State requires the owner must surrender the property and he is compensated.
(2) Gandhi : Constituent Assembly Debates Vol.
IX pp.
1204 06.
(3) Patel : Constituent Assembly Debates Vol.
I p. 517.
888 What was then the theory about Right to Property accepted by the Constituent Assembly ? Again I can only describe it historically.
Grotius(1) had treated the right as acquired right (ius quaesitum) and ownership (dominium) as either serving individual interests (vulgare) or for the public good (eminens).
According to him, the acquired right had to give way to eminent domain (ex vi auper eminentis dominii) but there must be public interest (publicautilitas) and if possible compensation.
In the social contract theory also .
the contract included protection of property with recognition of the power of the ruler to act in the public interest and emergency.
Our constitutional theory treated property rights as inviolable except through law for public good and on payment of compensation.
Our Constitution saw the matter in the way of Grotius but overlooked the possibility that just compensation may.
not be possible.
It follows almost literally the German jurist Ulrich Zasius (except in one respect) : Princeps non potest auferee mihi rem mean sive iure gentium, sive civile sit facta mea.
All would, have been well if the Courts had construed Article 31 differently.
However, the decisions of the High Courts and the Supreme Court, interpreting and expounding this philosophy took a different view of compensation.
I shall refer only to some of them.
, First the Patna High Court in.
Kameshwar vs Bihar(2) applied article 14 to strike down the Reforms Act in Bihar holding it to be discriminatory.
This need not have occasioned an amendment because the matter could have been righted, as indeed it wag, by,an appeal to the Supreme Court [see State of Bihar vs Kameshwar(3)].The Constitution (First Amendment) Act, 1951 followed.
It left article 31 intact but added two fresh articles, articles 31 A and 31 B which are respectively headed "saving of laws providing for acquisition of estates etc." and "Validation of certain Acts and Regulations" and added a schedule (Ninth) to be read with Art 31 B naming thirteen Acts of the State Legislatures.
Article 31 A was deemed always to have been inserted and article 31 B wiped out retrospectively all decisions of the courts which had.
declared any of the scheduled Acts to be invalid.
The texts of these new articles may now be seen: "31A. Saving of laws providing for acquisition of estates, etc. (1) Notwithstanding anything in foregoing provisions of this Part, no law providing for the acquisition by the State of any estate or of any rights therein or for (1) Grotius : De jure Belli ac Pacis.
11 c. 2 2 (5)6. 1 c. I 6 and II c. 14 7 and 8.
(2) A.L.R. 1951 Patna 91.
(3) 889 the extinguishment or modification of any such rights shall be deemed to be void on the: ground that it is consistent with, or takes away or abridges any of the rights conferred by, any provisions of this Part Provided that where such law is a law made by the Legislature of a State, the provisions of this article shall not apply thereto unless such law, having been reserved for the consideration of the President, has received his assent.
(2) In this article, (a) the expression "estate" shall, in relation to any local area, have the same meaning as that expression or its local equivalent has in the existing law relating to land tenures in force in that area, and shall also include any jagir, inam or muafi or other similar grant; (b) the expression "right" in relation to an estate shall include 'any rights vesting in a proprietor, sub proprietor, tenure holder or other intermediary and any rights or privileges in respect of land revenue." "31 B. Validation of certain Acts and Regulations.
Without prejudice to the generality of the provisions contained in article 31A, none of the Acts and Regulations specified in the Ninth Schedule nor any of the provisions thereof shall be deemed to be void, or ever to have become void, on the ground that such Act, Regulation or provision is inconsistent with, or takes away or abridges any of the rights conferred by, any provision of this Part, and notwithstanding any judgment, decree or order of any court or tribunal to the, contrary, each of the said Acts and Regulations shall, subject to the power of any competent Legislature to repeat or amend it, continue in force '.
" Article 31 A has been a Protean article.
It has changed its face many times.
Article 31 B has remained the same till today but the Ninth Schedule has grown.
The Constitution (Fourth Amendment) Act, 1955, took the number of the Scheduled statutes to 20 and the Constitution (Seventeenth Amendment) Act, 1964 to 64 and a so called explanation which saved the application of the Proviso in article 31 A, was also added.
The device [approved by Sankari Prasad 's case(1)] was,found so (1) ; 890 attractive that many more Acts were sought to be included but were dropped on second thoughts.
Even so, one wonders how the , The West Bengal Land Development and Planning Act and some others could have been thought of in this connection.
By this device, which can be extended easily to other spheres, the Fundamental Rights can be completely emasculated by a 2/3 majority, even though they cannot be touched in the ordinary way by a unanimousvote of the same body of men! The State Legislatures may drive a coach and pair through the Fundamental Rights and the Parliament by 2/3 majority will then put them outside the jurisdiction of the courts.
Was it really intended that the restriction against the State in articles 13(2) might be overcome by the two agencies acting hand in hand ? Article 3 1 A dealt with the acquisition by the State of an .estate ' or of any rights therein or the extinguishment or modification of any such rights.
A law of the State could do these with the President 's assent, although,it took away or abridged any of the rights conferred by any provisions of Part Ill. The words 'estate ' and 'rights in relation to an estate ' were defined.
The constitutional amendment was challenged in Sankari Prasad 's case(1) on various grounds but was upheld mainly on two grounds to which I objected in Sajjan Singh 's case(2).
I have shown in this judgment, for reasons which I need not repeat and which must be read in addition to what I said on the earlier occasion, that I disagree respectfully but strongly with the view of the Court in those two cases.
This touches the first part of the amendment which created Art.31 A.
I do not and cannot question Art.31 A because (a) it was not considered at the hearing of this case, and (b) it has stood for a long time as part of the Constitution under the decision of this Court and has been acquiesced in by the people.
If I was free I should say that the amendment was not legal and certainly not justified by the reasons given in the earlier cases of this Court.
Under the original article 31, compensation had to be paid for acquisition by the State.
This was the minimum requirement of article 31 (1) and (2) and no amendment could be made by a constituted parliament to avoid compensation.
A law made by a constituted Parliament had to conform to article 13(2) and article 31 could not be ignored.
In 1954 the Supreme Court in a series of cases drew the dis tinction between article 19(1)(f) and article 31, particularly in West Bengal vs Subodh Gopal(3), Dwarkadas Srinivas vs Sholapur Spinning Co. (4).
In State of I West Bengal vs Mrs. Bela Banerjee and Others(5), this Court held a compensation in article 31(2) meant (1) ; (2) ; (3)[1954] S.CR.
(4) ; (5) 891 just equivalent, i.e. full and fair money equivalent ' thus making the adequacy of compensation justiciable.
The Constitution (Fourth Amendment) Act, 1955 then amended both article 31 and article 31 A. Clause (2) of article 31 was substituted by "(2) No property shall be compulsorily acquired or requisitioned save for a public purpose and save by authority of a law which provides for compensation for the property so acquired or requisitioned and other fixes the amount of the compensation or specifies the principles on which, and the manner in which, the compensation is to be determined and given; and no such law shall be called in question in any court on the ground that the compensation provided by that law is not adequate".
The opening words of the former second clause were modified to make them more effective but the muzzling of courts in the matter of adequacy of the compensation was the important move.
As Basu says : "It is evident that the 1955 amendment of clause (2) eats into the vitals of the constitutional mandate to pay Compensation and demonstrate a drift from the meetings of the American concept of private Property and judicial review to which our Constitution was hitherto tied, to that of socialism.
"(1) It is appropriate to recall here that as expounded by Professor Beard (2) (whose views offended Holmes and the Times of New York but which are now being recognised after his further explanation(3) the Constitution of the United States is an economic document prepared by men who were wealthy or allied with property rights, that it is based on the concept that the fundamental rights of property are anterior to Government and morally beyond the, reach of popular majorities and that the Supreme Court of the United States preserved the property rights till the New Deal era.
The, threat at that time was to enlarge the Supreme Court but not to amend the Constitution.
It appears that the Indian Socialists charged with the idea of Marx, the Webbs, Green, Laski and others viewed property rights in a different way.
Pandit Nehru once said that he had no property sense,meaning that he did not value property at all.
The Constitution seems to have changed its property significantly.
In addition to avoiding (1) Basu : commentaries on the Constitution of India (5th Edn.) Vol.
2 p. 230.
(2) An Economic Interpretation of the United States Constitution (3) See Laski : The American democracy; Weaver : Constitutional Law, Brown: Charles Beard and the constitution; will is constitutional Law.
892 the concept of just compensation, the amendment added a new clause (2A) as follows : "(2A) Where a law does not provide for the transfer of the ownership or right to possession of, any property to the State or to a corporation owned or control led by the State, it shall not be deemed to provide for the compulsory acquisition or requisitioning of property, notwithstanding that ' it deprives any person of his property." This narrowed the field in which compensation was payable.
In addition to this, clause (1) of article 31 A was substituted and was deemed to be always substituted by a new clause which provided: "(1) Notwithstanding anything contained in article 13, no law providing for (a) the acquisition by the State of any estate or of any rights therein or the extinguishment or modification of any such rights, or (b) the taking over of the management of any property by the State for a limited period either in the public interest 'or in order to secure the proper management of the property, or (c) amalgamation of two or more corporations either in the public interest or in order to secure the proper management of any of the corporation, or (d) the extinguishment or modification of any rights of 'managing agents secretaries and treasurers, managing directors, directors or managers of corporations, or of any voting rights of shareholders thereof, or (e) the extinguishment or modification of any rights accruing by virtue of any agreement, lease or licence for the purpose of searching for, or winning, any mineral or mineral oil, or the premature termination or cancellation of any such agreement, lease or licence, shall be deemed to be void on the ground that it is inconsistent with, or takes away or abridges any of the rights conferred by article 14, article 19 or article 31 Provided that where such law is a law made by the Legislature of a State, the provisions of this article shall not apply thereto unless such law, having been reserved 893 for the consideration of the President, has received assent." In clause (2)(a) after the word 'grant ', the words "and in any State of Madras and Travancore Cochin any, Janmam right" were inserted 'and deemed always to have been inserted and in clause (2) (b) after the words 'tenure holder ' the words "raiyat, under raiyat" were inserted and deemed always to have been inserted.
Once again the reach of the State towards private property was made longer and curiously enough it was done retrospectively from the time of the Constituent Assembly and so to speak, in its name.
As to the retrospective operation of these, Constitutional amendment.
I entertain considerable doubt.
A Constituent Assembly makes a new Constitution for itself.
Parliament is not even a Constituent Assembly and to.
abridge fundamental rights in the name of the Constituent Assembly appears anomalous.
I am reminded of the conversation between apo leon and Abe .
Sieyes, the, great jurist whose ability to draw up one Constitution after another has been recognised and none of whose efforts lasted for long.
When Napoleon asked him "what has survived ?" Abe Sieyes answered "I have survived".
I wonder if the Constituent Assembly will be able to say the same thing What it had written or the, subject of property rights, appears to have been written on water.
The Fourth Amendment served to do away with the distinction made by this Court between articles 19 and 31 and the theory of just compensation.
The Fourth Amendment has not been challenged before us.
Nor was it challenged at any time before.
For the reasons for which I have declined to consider the First Amendment I refrain from considering the validity of the Fourth Amendment.
It may, however, be stated here that if I was free to consider it,, I would have found great difficulty in accepting that the constitutional guarantee could be abridged in this way.
I may say here that the method I have followed in not recon , sidering an amendment which has stood for a long time, was also invoked by the Supreme Court of United: States in Leser vs Garnett(1).
A constitution works only because of universal recognition.
This recognition may.
be voluntary or forced where people have lost liberty of speech.
But the acquiescence of the people is necessary for the working of the Constitution.
The examples of our neighbours, of Germany, of Rhodesia and others illustrates the recognition of Constitutions by acquiescence.
It is obvious that it is good sense and sound policy for the 'Courts to decline to take 'up an amendment for consideration after a considerable lapse of time when it was not challenged before, or was sustained on an earlier occasion after challenge.
(1) ; 894 It is necessary to pause here and see what the property rights have become under the repeated and retrospective amendments of the Constitution.
I have already said that the Constitution started with the concept of which, Grotius may ' be said to be the author, although his name is not particularly famous for theories of constitutional or municipal laws.
The socialistic tendencies which the amendments now manifest take into consideration some later theories about the institution of property.
When the original article 31 was moved by Pandit Jawaharlal Nehru, he had described it as a compromise between various approaches to the question and said that it did justice and equality not only to the individual but also to the community ' He accepted the principle of compensation but compensation as determined by the Legislature and not the Judiciary.
His words were "The law should do it.
Parliament should do it.
There is no reference in this to any judiciary coming into the picture.
Much thought has been given to it and there has been much debate as to where the judiciary comes in.
Eminent lawyers have told us that on a proper construction of this clause, normally speaking the judiciary should not come in.
Parliament fixes either the compensation itself or the principle governing that compensation and they should not be challenged except for one reason, where it is thought that there has been a gross abuse of the law, where, in fact, there has been a fraud on the Constitution.
Naturally the judiciary comes in to see if there has been a fraud on the Constitution or not.
"(1) He traced the evolution of property and observed that property was becoming a question of credit, of monopolies, that there were two approaches, the approach of the Individual and the approach of the community.
He expressed for the for protection of the indi vidual 's rights.(2) The attitude changed at the time of the First Amendment.
Pandit Nehru propheised that the basic problem would come before the House from time to, time.
That it has, there is no doubt, just as there is no doubt that each time the individual 's rights have suffered.
Of course, the growth of collectivist theories have made elsewhere considerable inroads into the right of property.
In Russia there is no private ownership of.
land and even in the Federal Capital Territory of Australia, the ownership of land is with the Crown and the individual can get a leasehold right only.
Justification for this is found in the fact that the State must benefit from (1) Constituent Assemembly Debates Vol.
IX pp.
1193 1195.
(2) Constituent Assembly Debates Vol.
IX p. 1135.
895 the rise in the value of land.
The paucity of land and of dwelling houses have led to the control of urban properties and creation of statutory tenancies.
In our country a ceiling is put on agricultural land held by an individual.
The Supreme Court, in spite of this, has not frustrated any genuine legislation for agrarian reform.
It has upheld the laws by which the lands from latifundia have been distributed among the landless.
It seems that as the Constitutions of Peru, Brazil, Poland, Latvia, Lethuania and Mexico contain provisions for such reforms, mainly without payment of compensation, our Parliament has taken the same road.
Of course, the modem theory regards the institution of proper on a functional basis(1) which means that property to be productive must be property distributed.
As many writers have said property is now a duty more than a right and ownership of property entails a social obligation.
Although Duguit(2), who is ahead of others, thinks that the institution of property has undergone a revolution, the rights of the Individual are not quite gone, except where Communism is firmly entrenched.
The rights are qualified but property belongs still to the owner.
The Seventeenth Amendment, however, seems to take us far away, from even this qualified concept, at least in so far as "estates" as defined by article 31 A.
This is the culmination of a process.
Previous to the Constitution (Seventeenth Amendment) Act the Constitution (Seventh Amendment) Act, 1956 had given power indirectly by altering entry No. 42 in List III.
The entries may be read side by side : "42.
(Before Amendment) (After Amendment) Principles on which compensation for Acquisition and requisitioning, of pro property acquired or requisitioned for perty.
the purposes of the Union or of a State or for any other public purpose is to be determined, and the form and the manner in which such compensation is to be given.
" This removed the last reference to compensation in respect of acquisition and requisition.
What this amendment began, the Constitution (Seventeenth Amendment) Act, 1964 achieved in full.
The Fourth Amendment had added to the comprehensive definition of 'right in relation to an estate, the rights of raiyats and under raiyats.
This time the expression 'estate ' in article 31 A was amended retrospectively by a new definition which reads: "the expression "estate" shall, in relation to any local area, have the same meaning as that expression or its local equivalent has in the existing law relating to (1) See G.W. Paton : Text Book of Jurisprudence (1964) pp.
484 485.
(2) Transformations du droit prive.
896 land tenures in force in that area, and shall also include (i) any jagir, inam or muafi or other similar grant and in the States of Madras and Kerala, any janmam right; (ii) any land held under ryotwari settlement; (iii) any land held or let for purposes of agriculture or for purposes ancillary thereto, including waste land, forest land, land for pasture or sites of buildings and other structures occupied by cultivators of land, agricultural labourers and village artisans," The only saving of compensation is now to be found in the second proviso added to clause (1) of the article which reads "Provided further that, where any law makes any provision for the acquisition by the State of any estate.
and where any land comprised therein is held by a per , son under his personal cultivation, it shall not be lawful for the State to acquire any portion of such land as is within the ceiling limit applicable to him under any law for.
the time being in force or any building or structure standing thereon or appurtenant thereto, unless the law relating to the acquisition of such land, building or structure, provides for payment of compensation at a rate which shall not be less than the market value thereof.
" There is also the provision for compensation introduced indirectly in an Explanation at the end of the Ninth Schedule, in respect of the Rajasthan Tenancy Act, 1955.
By this explanation the provisions of this Tenancy Act in conflict with the proviso last last quoted are declared to be void.
The sum total of this amendment is that except for land within the ceiling,all other land can be acquired ed or rights therein extinguished or modified without compensation and No. challenge to the law can be made under articles 14, 19 or 31 of the Constitution.
The same is also true of the taking over: of 'the management of any property by the State for a limited period either in the public interest or in order to secure the proper management of the property, or the amalgamation of two or more companies, or the extinguishment or modification of any rights of managing agents,, secretaries, treasurers, managing directors, directors or managers, of corporations or of any voting right, of shareholders thereof any rights by virtue of an), agreement, lease, or licence for the purpose of searching for, or winning, any mineral or mineral oil, or of the premature 897 termination.
or cancellation of any such agreement, lease or licence.
It will be noticed further that deprivation of property of any person is not to be regarded as acquisition or requisition unless the benefit of the transfer of the ownership or right to possession goes to the State or to a corporation owned or controlled by the State.
Acquisition or requisition in this limited sense alone requires that it should be for public purpose and under authority of law which fixes the compensation or lays down the principles on which and.
the manner in which compensation is to be deter mined.
and given, and the adequacy of the compensation cannot be any ground of attack.
Further still acquisition of estates and of rights therein and the taking over of property, amalgamation of corporations, extinguishment or modification of rights in companies and mines may be made regardless of articles 14, 19 and 31.
In addition 64 State Acts are given special protection from the courts regardless of therein contents which 'may be in derogation of the Fundamental Rights.
This is the kind of amendment which has been upheld in Sajjan Singh(1) case on the theory of the omnipotence of article 368.
The State had bound itself not to ' enact any law in derogation of Fundamental Rights.
Is the Seventeenth Amendment a law ? To this question my answer is a categoric yes.
It is no answer to gay that this is an amendment and; therefore; not a law, or that it is passed by a special power of voting.
It is the action of the State all the same.
The State had put restraints on itself in law making whether the laws were made without Dr. within the Constitution. it is also ' no answer to say that this Court in a Bench of five Judges on one, occasion and by a majority of 3 to 2 on another, has said the,same thing.
In a. matter of the interpretation of the Constitution this Court must,look at the functioning of the Constitution as a whole.
The rules of res indicate and stare decisis are not, always appropriate in interpreting a Constitution, particularly when article 13(2) itself declares a law to be void.
The sanctity of a former judgment is for the matter then decided .
In Plessy vs Fergusson(2), Harlan, J. alone, dissented against the "separate but equal doctrine uttering the memorable words that there was no caste and that the Constitution of the United States was 'colour blind.
This dissent made some Southern Senators to oppose his grandson (Mr. Justice John Marshall Harlan) in 1954.
It took fifty eight years for the words of Harlan, J. 's lone dissent (8 to 1) to become, the law of the united states at least in respect of segregation in the public schools [See Brown vs Board of Education(3)].
As Mark Twain (1) (1965] 1 section C. R. 933.
(2)163 U. section 537.
(3) ; 898 said very truly "Loyality to a petrified opinion never yet broke a chain or freed a human soul" I am apprehensive that the erosion of the right to property may be practised against other Fundamental Rights.
If a halt is to be called, we must declare the right of Parliament to abridge or take away Fundamental Rights.
Small inroads lead to larger inroads and become as habitual as before our freedom won The history of freedom is not only how freedom is achieved but how it is preserved.
I am of opinion that an attempt to abridge or take away Fundamental Rights by a constituted Parliament even through an amendment of the Constitution can be declared void.
This Court has the power and jurisdiction to make the declaration.
I dissent from the opposite view expressed in Sajjan Singh 's(1) case and I overrule that decision.
It remains to consider what is the extent of contravention.
Here I must make it clear that since the First, Fourth and Seventh Amendments are not before me and I have not, therefore, questioned them, I must start with the provisions of articles 31, 31 A, 31 B, List III and the Ninth Schedule as they were immediately preceding the Seventeenth Amendment.
I have elsewhere given a summary of the inroads made into property rights of individuals and Corporations by these earlier amendments.
By this amendment the definition of 'estate ' was repeated for the most part but was extended to include: "(ii) any land held under ryotwari settlement; (iii) any land held or let for purposes ancillary thereto, including waste land, forest land, land for pasture or sites of buildings and other structures occupied by cultivators of land, agricultural labourers and village artisans." Further reach of acquisition or requisition without adequate compensation and without a challenge under articles 14, 19 and 31 has now been made possible.
There is no kind of agricultural estate or land which cannot be acquired by the State even though it pays an illusory compensation.
The only exception is the second proviso added to article 31 A(1) by which, lands within the ceiling limit applicable for the time being to a person personally cultivating his land, may be acquired only on paying compensation at a rate which shall not be less than the market value.
This may prove: to be an illusory protection.
The ceiling may be lowered by legislation.
The State may leave the person an owner in name and acquire all his.
other rights.
The latter question did come before this Court in two cases Ajit Singh vs State of Punjab (2) (1) (1965] 1 & C. R. 933 (2) ; 899 and Bhagat Ram and Ors.
vs State of Punjab, and Ors.
(1) decided on December 2, 1966.
My brother Shelat and, I described the device as a fraud upon this proviso but it is obvious that a law lowering the ceiling to almost nothing cannot be declared a fraud on the Constitution.
In other words, the agricultural landholders hold land as tenants at will.
To achieve this a large number of Acts of the State Legislatures have been added to the Ninth Schedule to bring them under the umbrella of article 31 B.
This list may grow.
In my opinion the extension of the definition of 'estate ' to include ryotwari and agricultural lands is an inroad into the Fundamental Rights but it cannot be questioned in view of the existence of article 31 A(1) (a) as already amended.
The constitutional amendment is a law and article 31 (I) permits the deprivation of property by authority of law.
The law may be made outside the Constitution or within it.
The word 'law ' in this clause includes both ordinary law or an amendment of the Constitution.
Since "no law providing for the acquisition by the State of any estate or of any rights therein or the extinguishment or modification of any such rights shall be deemed to be void on the ground that it is inconsistent with, or takes away or abridges any of the rights conferred by article 14, article 19 or article 31", the Seventeenth Amendment when it gives a new definition of the word 'estate cannot be questioned by reason of the Constitution as it exists.
The new definition of estate introduced by the amendment is beyond the reach of the courts not because it is not law but because it is "law" and falls within that word in article 31 (1) (2) (2 A) and article 31 A(1).
1, therefore, sustain the new definition, not on the erroneous reasoning in Sajjan Singh 's case (2 ) but on the true construction of the word 'law ' as used in articles 13(2), 31(1)(2 A) and 31 A(1).
The above reason applies a fortiori to the inclusion of the proviso which preserves (for the time being) the notion of compensation for deprivation of a cultural property.
The proviso at least saves something.
It prevents the, agricultural lands below the ceiling from being appropriated without payment of pro per compensation.
It is clear,that the proviso at least cannot be held to abridge or take away fundamental rights.
In the result I uphold the second section of the Constitution (Seventeenth Amendment) Act, 1964.
This brings me to the third section of the Act.
That does no more than add 44 State Acts to the Ninth Schedule.
The object of article 31 B, when it was enacted, was to save certain State Acts notwithstanding judicial decision to the contrary.
These Acts were already protected by article 31.
One can with difficulty understand such a provision.
Now the Schedule is being used to (1) 11967] 2 section C. R. 165.
(2) ; 900 give advance protection to legislation which is known appre hended to derogate from the Fundamental Rights.
The power under article 368, whatever it may be, was given to amend the Constitution.
Giving.
protection to statutes of State Legislatures which offend the Constitution in its most fundamental part, can hardly merit the description amendment of the Constitution in fact in so cases it is not even known whether the statues in question stand in need of such aid.
The intent is to silence the courts and not to amend the Constitution.
If these Acts were ', not included in the Schedule they would have to face the Fundamental Rights and rely on articles 31 and 31 A to save them.
By this device protection far in excess of 'these articles is afforded to them.
This in my judgment is not a matter of amendment at all.
The power which is given is for the specific purpose of amending the Constitution and not to confer validity on State Acts against the rest of the Constitution.
If the President 's assent did not do this, no more would this section.
I consider section 3 of the Act., to be invalid as an illegitimate exercise of the powers .
of amendment however generous.
Ours is the only Constitution in the world which carries a long list of ordinary laws which it protects against itself,.
In the result I declare section 3 to be ultra vires the amending process.
As stated by me in Sajjan Singh 's case(1) article 368 outlines process, which if followed strictly results in the amendment of the Constitution.
The article gives power to no particular person or persons.
All the named authorities have to act according to the letter of the article to achieve the result.
The procedure of, amendment, if it can be called a 'power at all is a legislative power but it is sui generi and outside the three lists in Schedule 7 of the Constitution. 'It does 'not ' have to depend.
upon any entry,in the lusts.
Ordinarily there would be no limit to the extent of the , amendatory legislation but.
the Constitution itself makes distinctions.
It states three methods and places certain bars.
For some amendments an ordinary, majority fs sufficient; for some others 'a 2/3rd majority of the, members present and voting with a majority of the total members, in each House is necessary: and for some others in addition to the second requirement, ratification by at least one,half of the legislatures of the States must be forthcom ing.
Besides these methods, article 13(2) puts an embargo on the legislative power of the State and consequently upon the agencies of the State.
By its means the boundaries of legislative action of any of including legislation to amend the Constitution have been marked out.
(1) [1965]1 S.C.R 933.
901 I have attempted to show hem that under our Constitution revolution is not the only alternative to change of Constitution under article 368.
A Constitution can. be changed by consent or, revolution Rodee, Anderson and Christol (1) have shown the sovereignty of the People is either electoral or constituent.
When the People elect the Parliament and the Legislatures they exercise their electoral sovereignty.
I includes some constituent sovereignty also but only in so far as conceded.
The remaining constituent sovereignty which is contained in the Preamble and Part III is in abeyance because of the curb placed by the People on the state under article 13(2).
It is this power which can be reproduced.
I have indicated the method.
Watson(2) quoting Ames On Amendments p. 1 note 2) points out that the idea that provision should be made in the instrument of Government itself for the method of its amendment is peculiarly American.
But even in the Constitution of the United States of America some matters were kept away from the amendatory process Other temporarily or permanently.
Our Constitution has done the same .
Our Constitution provides for minorities, religions, socially and educationally backward peoples, for ameliorating the condition of depressed classes, for removing class distinctions, titles, etc.
This reservation was made so that in the words of Madison(3), men of factious tempers, of local prejudices, or sinister designs may not by intrigue, by corruption, or other means , first obtain the suffrages and then betray the interests of the people.
It was to plug the loophole such as existed in section 48 of the Weimar Constitution( 4) that article 13 (2) was.
adopted.
of course, as.
Story( ' ') says, an amendment process is a safety valve to, let off all temporary effervescence and excitement, as an effective instrument to control and adjust the Movements of the machinery when out of order or in danger of self d tion but is not an open valve to let, out ' even that which was intended to be retained.
In the words of Wheare(6) the people or a Constituent Assembly acting on their behalf, has authority to enact a Constitution and by the same token a portion of the Constitution placed outside the amenditory process by one Constituent body can only be amended by another Constituent body.
In the Commonwealth of, Australia Act the provisions of the last Paragraph of section 128 have been regarded as, mandatory, and held to be clear limitations of the power of amendment.
Dr. Jethro Brown considered that the amendment of the paragraph was logically impossible even by a two step amendment.
Similarly, section 105 A has been judicially (1) Introduction to Political Science, p. 32 et seq.
(2) Constitution" Its History, Application and Construction Vol.
II (1910) p. 1301.
(3) Federalist No. 10.
(4) See Louis L. Snyder: The Weimar Constitution, p. 42 et seq.
(5) Commentaries on the Constitution of the United States (I 833) Vol.
(6) K. C. Wheare: Modern Constitutions, p. 78.
sup Cl/67 12 902 considered in the Garnishee case( ') to be an exception to the power of amendment in section 128 although Wynes(2) does not agree.
I prefer the judicial view to that of Wynes.
The same position obtains under our Constitution in article 35 where the opening words, are more than a non obstante clause.
They exclude article 368 and even amendment of that article under the proviso.
It is, therefore, a grave error to think of article 368 as a code ;Dr as omnicompetent.
It is the duty of this Court to find the limits which the Constitution has set on the amendatory power and to enforce those limits.
This is what I have attempted to do in this judgment.
My conclusions are (i) that the Fundamental Rights are outside the amendatory process if the amendment seeks to abridge or take away any of the rights; (ii) that Sankari Prasad 's case (and Sajjan Singh 's case which followed it) conceded the power of amendment over Part III of the Constitution on an erroneous view of articles 13(2) and 368; (iii) that the First, Fourth and Seventh Amendments being part of the Constitution by acquiescence for a long time, cannot now be challenged and they contain authority for the Seventeenth Amendment; (iv) that this Court having now laid down that Fundamental Rights cannot be abridged or taken away by the exercise of amendatory process in article 368, any further inroad into these rights as they exist today will be illegal and unconstitutional unless it complies with Part III in general and article 13(2) in particular, (v) that for abridging or taking away Fundamental Rights, a Constituent body will have to be, convoked; and (vi) that the two impugned Acts, namely, the Punjab Security of Land Tenures Act, 1953 (X of 1953) and the Mysore Land Reforms Act, 1961 (X of 1962) as amended by act XIV of 1965 are valid under the Constitution not because they are included in schedule 9 of the Constitution but because the, are protected by article 31 A, and the President 's assent.
(1) ; (2) Legislative, Executive and Judicial Powers in Australia pp.
695 698.
903 In view of my decision the several petit ions will be dismissed, but without costs.
The State Acts Nos.
21 64 in the Ninth Schedule will have to be tested under Part HI with such protection as articles 31 and 31 A give to them.
Before parting with this case I only hope that the Fundamental Rights will be able to withstand the pressure of textual readings by "the depth and toughness of their roots".
Bachawat, J The constitutionality of the Constitution First, Fourth and Seventeenth Amendment Acts is challenged on the . ground that the fundamental rights conferred by Part HI are inviolable and immune from amendment.
It is said that article 368 does not give any power of amendment and, in any event, the amending power is limited expressly by article 13(2) and impliedly by the language of article 368 and other articles as also the preamble.
It is then said that the power of amendment is abused and should be subject to restrictions.
The Acts are attacked also on the ground that they made changes in articles 226 and 245 and such changes could not be made without complying with the proviso to article 368.
Article 31 B is subjected to attack on several other grounds.
The constitutionality of the First Amendment was upheld in Sri Sankari Prasad Singh Deo vs Union, of India and State of Bihar(1), and that of the Seventeenth amendment, in Sajjan Singh is that these cases were Part XX of the Constitution specifically provides for its amendment.
It consists of a single article .
Part XX is as follows "PART XX.
Amendment of the Constitution Procedure for amendment of the Constitution 368.
An amendment of this Constitution may be initiated only by the introduction of a Bill for the purpose in either House of Parliament, and when the Bill is passed in each House by a majority of the total membership of that House and by a majority of not less than two thirds of the members of that House present and voting, it shall be presented to the President for his assent and upon such assent being given to the Bill the Constitution shall stand amended in accordance with the terms of the Bill : Provided that if such amendment seeks to make any change in (a) article 54.
article 55, article 73, article 162 or (1) ; (2) ; 1196712 S.C.IL 904 (b) Chapter IV of Part V, Chapter V of Part VI, or Chapter 1 of Part XI, or (c) any of the Lists in the Seventh Schedule, or (d) the representation of States in Parliament, or (e) the provisions of this article, the amendment shall also require to be ratified by the Legislatures of not less than one half of the States by resolutions to that effect passed by those Legislatures before the Bill making provision for such amendment is presented to the President for assent.
" The contention that article 368 prescribes only the procedure of amendment cannot be accepted.
The article not only prescribes the procedure but also gives the power of amendment.
If the procedure of art.368 is followed, the Constitution "shall stand amended" in accordance with the terms of the bill.
It is because the power to amend is given by the article that the Constitution stands amended.
The proviso is enacted on the assumption that the several articles mentioned in it are amendable.
The object of the proviso is to lay down a stricter procedure for amendment of the articles which would otherwise have been amendable under the easier procedure of the main part.
There is no other provision in the Constitution under which these articles can be amended.
Articles 4, 169, Fifth Schedule Part D, and Sixth Schedule Para 21 empower the Parliament to.
pass laws amending the provisions of the First, Fourth, Fifth and Sixth Schedules and making amendments of the Constitution consequential on the abolition or creation of the legislative councils in States, and by express provision no such law is deemed to be an amendment of the Constitution for the purposes of article 368.
All other provisions of the Constitution can be amended by recourse to article 368 only.
No other article confers the power of amending the Constitution.
Some articles are expressed to continue until provision is made by law [see articles 59(3), 65(3), 73(2), 97, 98(3), 106, 135, 142(1), 148(3), 149, 171(2), 186, 187(3), 189(3), 194(3), 195, 221(2), 283(1) and (2), 285, 313, 345, 372(1), 373].
Some articles continue unless provision is made otherwise by law [see articles 120(2), 133(3), 210(2) and some continue save as otherwise provided by law [see articles 239(1), 287].
Some articles are subject to the provisions of any law to be made [see articles 137, 146(2), 225, 229(2), 241(3), 300(1), 309], and some are expressed not to derogate from the power of making laws [see articles 5 to 11, 289(2)].
All these articles are transitory in nature and cease to operate when provision is made by law on the subject.
None of them can be regarded as conferring 905 the power of 'amendment of the Constitution.
Most of articles continue until provision is made by law made by the Parliament.
But some of them continue until or unless provision is made by the State Legislature (see articles 189 (3), 194 (3), 195, 210(2), 229(2), 300(1), 345) or by the appropriate legislature (see articles 225, 241(3)); these articles do not confer a power of amendment, for the State legislature cannot amend the Constitution.
Many of the above mentioned articles and also other articles (see articles 22(7), 32(3), 33 to 35, 139,140, 239A, 241, 245 to 250, 252, 253, 258(2), 286(2), 302, 307, 315(2), 327, 369 delegate powers of making laws to the legislature.
None of these articles gives the power of amending the Constitution.
It is said that article 248 and List 1 item 97 of the 7th Schedule read with article 246 give the Parliament the power of amending the Constitution.
This argument does not bear scrutiny.
article 248 and List I item 97 vest the residual power of legislation in the Parliament.
Like other powers of legislation, the residual power of the Parliament to make laws is by virtue of article 245 subject to the provisions of the Constitution.
No law made under the residual power can derogate from the Constitution or amend it.
If such a law purports to amend the Constitution, it will 'be void.
Under the residual power of legislation, the Parliament has no power to make any law with respect to any matter enumerated in Lists II and III of the 7th Schedule but under article 368 even Lists II and III can be amended.
The procedure for constitutional amendments under article 368 is different from the legislative procedure for passing laws under the residual power of legislation.
If a constitutional amendment could be made by recourse to the residual power of legislation and the ordinary legislative procedure, article 368 would be meaningless.
The power of amending the Con stitution is to be found in article 368 and not in article 248 and List I item 97.
Like other Constitutions, our Constitution makes express provisions for amending the Constitution.
The heading of article 368 shows that it is a provision for amendment of the Constitution, the marginal note refers to the procedure for amendment and the body shows that if the procedure is followed, the Constitution shall stand amended by the power of the article.
Chapter VIII of the Australian Constitution consists of a single section (section 128).
The heading is "Alteration of the Constitution".
The marginal note is "Mode of altering the Constitution".
The body lays down the procedure for alteration.
The opening words are : "This Constitution shall not be altered except in the following manner".
Nobody has doubted that the section gives the power of amending the Constitution.
Wynes in his book on Legislative Executive and Judicial Powers in Australia, third edition, 906 p. 695, stated "The power, of amendment extends to alteration of this Constitution ' which includes section 128 itself.
It is true that section 128 is negative in form, but the power is impled by the terms of the section.
" Article 5 of the United States Constitution provides that a proposal for amendment of the constitution by the Congress on being ratified by the three fourth of the states "shall be valid to all intents and purposes as part of this Constitution".
The accepted view is that "power to amend the Constitution was reserved by article 5", Per Van Devanter, J, in Rhode Island vs Palmer(1): Art .368 uses stronger words.
On the passing of the bill for amendment under article 368, "the Constitution shall stand amended in accordance with the terms of the bill".
Article 368 gives the power of amending "this Constitution".
This Constitution means any of the provisions of the Constitution.
No limitation on the amending power can be gathered from the language of this article.
Unless this power is restricted by some ,other provision of the Constitution, each and every part of the Constitution may be amended under article 368.
AR the articles mentioned in the proviso are necessarily within this amending power.
From time to time major amendments have been made in the articles mentioned in the proviso (see articles 80 to 82, 124 (2A),131,214,217(3),222,(k2) 224A,226(IA) 230,231,241 and Seventh Schedule) and other articles (see articles 1, 3, 66, 71, 85, 153.
158, 170, 174, 239, 239A, 240, 258A, 2,69, 280, 286, 290A, 291, 298, 305, 311, 316, 350A, 350B, 371, 371A, 372A, 376, 379 to 391, the first third and fourth schedules), and minor amendments have been made in innumerable articles.
No one has doubted so far that these articles are amendable.
Part III is a part of the Constitution and is equally amendable.
It is argued that a Constitution Amendment Act.is a law and therefore the power of amendment given by article 368 is limited by article 13(2).
, article 13(2) is in these terms: "13(1). . . . . . . (2) The State shall not make any law which takes away or abridges the tights conferred by this Part and any law made in contravention of this clause shall, to the extent of the contravention, be void." Now article 3 68 gives, the power of amending each and every provision of the Constitution article 13 (2) is a part of the Constitution and is within the reach of the amending power.
In other words art 13 (2) is subject to the overriding power of an. 368 and is controlled by it.
article 368 is not controlled by article 13 (2) and the (1) ; : ; 907 prohibitory injunction in article 13(2) is not directed against the amending power Looked at from this broad angle, article 13 (2) does not forbid the making of a constitutional amendment abridaing or taking away any right confesed by Part III.
Let us now view the matter from a narrower angle.
The con tention is that a constitutional amendment under article 368 is a law within the meaning of article 13.
1 am inclined to think that this narrow contention must also be rejected.
In article 13 unless the context otherwise provides 'law ' includes any ordinance, order, bye law, rule, regulation, notification, custom or usage having in the territory of India the force of law [article 13(3).(a)].
The inclusive definition of law in article 13 (3) (c) neither expressly excludes nor expressly includes the Constitution or a constitutional amendment.
Now the term law ' in its widest and generic sense includes the Constitution and a constitutional amendment.
But in the constitution this term is employed to designate an ordinary statute or legislative act in contradistinction to the Constitution or a constitutional amendment.
The Constitution is the basic law providing the framework of government and creating the organs for the making of the laws.
The distinction between the Constitution and the laws is so fundamental that the Constitution is not regarded as a law or a legislative act.
The Constitution means the Constitution as amended.
An amendment made in conformity with article 368 is a part of the.
Constitution and is likewise not a law.
The basic theory of our Constitution is that it cannot be changed by a law or legislative Act.
It is be cause special provision is made by articles 4, 169, Fifth Schedule Part D and Sixth Schedule para 21 that some parts of the Constitution are amendable by ordinary laws.
But by express provision no such law is deemed to be a constitutional amendment.
Save as express.1y provided in articles 4, 169, Fifth Schedule Part D and Sixth Schedule para 21, no law can amend the Constitution, and a law which purports to make such an amendment is void.
In Marbury vs Madison(1), Marshall, C.J., said: "It is a proposition too plain to be contested, that the Constitution controls any legislative Act repugnant to it; or, that the legislature may alter the Constitution by an ordinary Act.
Between these alternatives there is no middle ground.
The Constitution is either a superior paramount law, unchangeable by ordinary means, or it is on a level with (1) ; ,177:.
; , 73.
908 Ordinary legislative Acts, and, like other Acts, is alter able when the legislature shall please to alter it.
If the former part of the alternative be true, then a legislative Act contrary to the Constitution is not law; if the, latter part be true, then written constitutions are absurd attempts, on the part of the people, to limit a power in its own nature illimitable.
Certainly all those who have framed written constitutions contemplate them as forming the fundamental and paramount law of the nation, and, consequently, the theory of every such government must be, that an Act of the Legislature, repugnant to the Constitution, is void.
This theory is essentially attached to a written constitution, and is consequently to be considered, by this court, as one of the fundamental principles of our society.
" It is because a Constitution Amendment Act can amend the Constitution and is not a law that article 368 avoids all reference to law making by the Parliament.
As soon as a bill is passed in conformity with article 368 the Constitution stands amended in accordance with the terms of the bill.
The power of amending the Constitution is not an ordinary law making power.
It is to be found in article 368 and not in articles 245, 246 and 248 and the Seventh Schedule.
Nor is the procedure for amending the Constitution under article 368 an ordinary law making procedure.
The common feature of the amending process under art, 368 and the legislative procedure is that a bill must be passed by each House of Parliament and assented to by the President.
In other respects the amending process under article 368 is very different from the ordinary legislative proms.
A constitution amendment Act must be initiated by a bill introduced for that purpose in either House of Parliament.
The bill must be passed in each House by not less than two thirds of the members present and voting, the requisite quorum in each House being a majority of its total membership; and in cases coming under the proviso, the amendment must be ratified by the legislature of not less than one half of the States.
Upon the bill so passed being assented to by the President, the Constitution stands.
amended in accordance with the terms of the bill.
The ordinary legislative process is much easier.
A bill initiating a law may be passed by a majority of the members present and voting at a sitting of each House or at a joint sitting of the Houses, the quorum for the meeting of either House being one tenth of the total number of members of the House.
The bill so passed on being assented to by the President becomes a law.
A bill though passed by all the members of both Houses cannot take effect as a 909 Constitution amendment Act unless it is initiated for the express purpose of amending the Constitution.
The essence of ,a written Constitution is that it cannot be changed by an ordinary law.
But most written Constitutions Provide for their organic growth by constitutional amendments.
The main method of constitutional amendments are (1) by the ordinary legislature but under certain restrictions, (2) by the people through a referendum, (3) by a majority of all the units of a Federal State; (4) by a special convocation, see C.F. strong Modem Political institutions, 5th Edition, pp.
133 4,146.
Our Constitution hag by article 368 chosen the first and a combination of the first and the third methods.
The special attributes of constitutional amendment under article 368 indicate that it is not a law or a legislative act.
Moreover it will be seen presently that the Constitution makers could not have intended that the term "law" in article 13 (2) would include a consti tutional amendment under article 368.
If a constitutional amendment creating a new fundamental right and incorporating it in Part III were a law, it would not be open to the.
parliament by a subsequent constitution to abrogate the new fundamental right for such an amendment would be repugnant to Part ]III.
Bit the conclusion is absurd for.
the body which created the right can surely take it away by the same process.
Shri A. K. Sen relied upon a decision of the Oklahoma Supreme Court in Riley vs Carter(1) where it was held that for some purposes the Constitution of a State was one of the laws of the State.
But even in America, the term "law ' does not ordinary include the Constitution or a constitutional amendment in this connection, I will read the following passage in Corpus Juris Secundum, Vol, XVI Title Constitutional Law article .lm15 "The term 'constitution ' is ordinarily employed to designate the organic law in contradistinction to the term law, which is generally used to designate statutes Or legislative enactments.
Accordingly the term 'law. ' under this distinction does not include a constitutional amendment.
However, the term "law ' may, in accordance with the context in which it is used, comprehend or included the constitution or a constitutional provision or amendment.
A statute and a constitution, although of unequal dignity,, are both 'laws ', and rest on the will of the people." (1) 88 A:A.L.R. 1008.
910 In our Constitution, the expression "law" does not include either the constitution or a constitutional amendment.
For all these reasons we must hold that a constitutional amendment under article 368 is not a law within the meaning of article 13 (2).
I find no conflict between articles 13(2) and 368.
The two articles operate in different fields.
article 13(2) operates on laws; it makes no express exception regarding a constitutional amendment, because a constitutional amendment is not a law and is outside its purview.
article 368 occupies the field of constitutional amendments.
It does not particularly refer to the, articles in Part III and many other articles, but on its true construction it gives the power of amending each and every provision of the Constitu tion and necessarily takes in Part III.
Moreover, article 368 gives the power of amending itself, and if express power for amending the provisions of Part III were needed, such a power could be taken by an amendment of the article.
It is said that the non obstante clause in article 35 shows that the article is not amendable.
No one has amended article 35 and the point does not arise.
Moreover, the non obstante clause is to be found in articles 258(1), 364, 369, 370 and 371A.
No one has suggested that these articles are not amendable.
The next contention is that there are implied limitations on the amending power.
It is said that apart from article 13 (2) there are expressions in Part III which indicate that the amending power ,cannot touch Part III.
Part III is headed " fundamental rights".
The right to move the Supreme Court for enforcement of the rights conferred by this Part is guaranteed by article 32 and cannot be suspended except as otherwise provided for by the Constitution (article 32(4)).
It is said that the terms "fundamental" and "guarantee" indicate that the rights conferred by Part HI are not amendable.
The argument overlooks the dynamic character of the Constitution.
While the Constitution is static, it is the fundamental law of the country, the rights conferred by Part III are, fundamental, the right under article 32 is guaranteed, and the principles of State policy enshrined in Part IV are fundamental 'm the governance of the country.
But the Constitution is never at rest; it changes with the progress of time.
article 368 provides the means for the dynamic changes in the Constitution.
The scale cf values embodied in Parts III and IV is not immortal.
Parts III and IV being parts of the Constitution are not immune from amendment under article 368.
Demands for safeguards of the rights embodied in Part III and IV may be traced to the Constitution of India Bill 1895, the Congress Resolutions between 1917 and 1919, Mrs. Beasan 's Commonwealth of India Bill of 1925, the Report of the Nehru Committee set up under the Congress Resolution in 1927, the Congress 911 Resolution of March.
1931 and the Sapru Report of 1945.
The American bill of rights,the constitutions of other countries the declaration of human rights by the United Nations and other declarations and charters gave impetus to the demand.
In this background the Constituent Assembly embodied in preamble to the Constitution the resolution to secure to all citizens social, economic and political justice, liberty of thought, expression, belief, faith and worship, equality of status and opportunity and fraternity assuring the dignity of the individual and the unity of the nation and incorporated safeguards as to some human rights in Parts III and IV of the Constitution after separating them into two parts on the Irish model.
Part III contains the passive obligations of the State.
It enshrines the right of life, personal liberty, expression, assembly, movement, residence, avocation, property, culture and education, constitutional remedies, and protection against exploitation and obnoxious penal laws.
The State shall not deny these rights save as provided in the Constitution.
Part IV contains the active obligations of the State.
The State shall secure a social order in which social, economic and political justice shall inform all the institutions of national life.
Wealth and its source of production shall not be concentrated in the hands of the few but shall be distributed so as to subserve the common good, and there shall be adequate means of livelihood for all and equal pay for equal work.
The State shall endeavour to secure the health and strength of workers, the right to work, to education and to assistance in cases of want, just and humane conditions of work, a living wage for workers, a uniform civil code, free and compulsory education for children.
The State shall take steps to organize village panchayats, promote the educational and economic interests of the weaker sections of the people, raise the level of nutrition and standard of living, improve public health.
organize agricultural and animal husbandry separate the judiciary from executive and promote international peace and security.
The active obligations of the State under Part IV are not justiciable.
If a law made by the State in accordance with the fundamental directives of Part IV comes in conflict with the fundamental rights embodied in Part II the law to the extent of repugnancy is void.
Soon after the Constitution came into force, it became apparent that laws for agrarian and other reforms for implementing the directives of Part IV were liable to be struck down as they infringed the provisions of Part III.
From time to time constitutional amendments were proposed with the professed object of validating these laws, superseding certain judicial inter pretations of the Constitution and curing defects in the original Constitution.
The First, Fourth, Sixteenth and Seventeenth Amendments made important changes in the fundamental rights.
The First amendment introduced cl.
(4) in article 15 enabling the State to make special provisions for the benefit of the socially and 912 educationally backward class of citizens, the,scheduled castes and the scheduled tribes in derogation of articles 15 and 29,(2) with a view to implement article 46 and to supersede the decision in State of Madras vs Champakam(1), substituted a new cl.
(2) in article 19 with retrospective effect chiefly with a view to be in public order within the permissible restrictions and to supersede the decisions in Romesh Thappar vs State of Madras( '), Brij Bhushan vs State of Delhi( '),, amended cl.
(6) of article 19 with a view to free state trading monopoly from the test of reasonable ness and to supersede the decision in Moti Lal vs Government of State of Uttar Pradesh().
Under the stress of the First amendment it is now suggested that Champakam 's case( '), Romesh Thappar 's case( ') and Motilal 's(4) case were wrongly decided, and the amendments of articles 15 and 19 were in harmony with the original Constitution and made no real change in it.
It is to be, noticed however that before the First amendment no attempt was made to overrule these cases, and but for the amendments, these judicial interpretations of the Constitution would have continued to be the law of the land.
The Zamindari Abolition Acts were the subject of bitter attack by the zamindars.
The Bihar Act though protected by cl. 6 of article 31 from attack under article 31 was struck down as violative of article 14 by the Patna High Court (see the State of Bihar vs Maharajadhiraj Sri Kameshwar Singh(5), while the Uttar Pradesh Act (see Raja Surya Pal Singh vs The State.
of U.P.) (6) and the Madhya Pradesh Act (see Visweshwar Rao vs State.of Madhya Pradesh (7), though upheld by the High Courts were under challenge in this Court.
The First amendment therefore introduced article 31A, 31B and the Ninth Schedule with a view to give effect to the policy of agrarian reforms, to secure distribution of large blocks of land in the hands of the zamindars in conformity with article 39, and to immunize specially 13 State Acts form attack under Part Ill. The validity of the First Amendment was upheld in Sri Sankari Prasad Singh Deo 's case(8).
The Fourth amendment changed article 31(2) with a view to supersede the decision in State of West Bengal vs Bela Banerjee(9) and to provide that the adequacy of compensation for property compulsorily acquired would not be justiciable, inserted Cl.
(2A) in article 31 with a view to supersede the decisions in the State of West Bengal vs Subodh Gopal Bose("), Dwarka Das Shrinivas vs Sholapur Spinning and Weaving Co., Ltd.,("), (1) ; (2) ; (3) ; (4) I.L.R. [1951] 1 All.
(5) 1951 Pat. 91).
(6) (1952] S.C.R. 1056 (A.I.R. 1961).
(7) All. 674.) (8) ; (9) ; (10) 11954] S.C.R. 587.(11) ; 913 Saghir Ahmad vs The State of Uttar Pradesh,(1) and to make it clear that clauses (1) and (2) of article 31 relate to different subject ' matters and a deprivation of property short of transference of ownership or right to possession to the State should not be treated as compulsory acquisition of property.
The Fourth amendment also amended article 31A with a view to protect certain laws other than agrarian laws and to give effect to the policy of fixing ceiling limits on land holdings and included seven more Acts in the Ninth Schedule.
One of the Acts (item 17) though upheld in Jupiter General Insurance Co. vs Rajgopalan(2) was the subject of criticism in Dwarka Das 's case (3 ) .
The Sixteenth amendment amended clauses (2), (3) and (4) of article 19 to enable the imposition of reasonable restrictions in the interest of the sovereignty and integrity of India.
The Seventeenth amendment amended the definition of estate in article 31A with a view to supersede the decisions in Karimbil Kunhikoman vs State of Kerala (4 ) and A. P. Krishnaswami Naidu vs State of Madras( ') and added a proviso to article 31A and included 44 more Acts in the Ninth Schedule, as some of the Acts had been struck down as unconstitutional.
The validity of the Seventeenth amendment was upheld in Sajjan Singh 's case( ').
Since 1951, numerous decisions of this Court have recognised the validity of the First, Fourth and Seventeenth amendments.
If the rights conferred by Part III cannot be abridged or taken away by constitutional amendments, all these amendments would be invalid.
The Constitution makers could not have intended that the rights conferred by Part TIT could not be altered for giving effect to the policy of Part TV.
Nor was it intended that defects in Part III could not be cured or that possible errors in judicial interpretations of Part III could not be rectified by constitutional amendments.
There are, other indications in the Constitution that the fundamental rights are not intended to be inviolable.
Some of the articles make express provision for abridgement of some of the fundamental rights by law (see articles 16(3), 19(1) to (6), 22(3), 23(2), 25(2), 28(2), 31(4) to (6), 33, 34).
Articles 358 and 359 enable the suspension of fundamental rights during emergency.
Likewise, article 368 enables amendment of the Constitution including all the provisions of Part Ill. It is argued that the preamble secures the liberties grouped together in Part III and as the preamble cannot be amended, Part III is not amendable.
The argument overlooks that the preamble is mirrored in the entire Constitution.
, If the rest of the Constitution is amendable, Part III cannot stand on a higher (1) [1954) S.C.R. 1218.
(3) ; ,706.
(5) ; (2) A.I.R. 1952 Pun.
(4) [1962] Supp.
I S.C.R. 829.
(6) ; 914 control the unambiguous language of the articles of the Constitution, see ' Wynes, Legislative Executive and Judicial Powers in Australia third edition, pp.
694 5; in Re Berubari Union & Exchange of Enclaves(").
The last case decided that the Parliament can under article 368 amend article 1 of the Constitution so as to enable the cession of a part of the national territory to a foreign power, The Court brushed aside the argument that "in the transfer of the areas of Berubari to Pakistan the fundamental rights of thousands of persons are involved.
" The case is an authority for the proposition that the Parliament can lawfully make a con stitutional amendment under article 368 authorising cession of a part of the national territory and thereby destroying the fundamental rights of the citizens of the Effected territory, and this power under article 368 is not limited by the preamble.
It is next argued that the people of India in exercise of their sovereign power have placed the fundamental rights beyond the reach of the amending power.
Reliance is place on the following passage in the judgment of Patanjali Sastri, J., in A. K. Gopalan V.
The State of Madras(2): "There can be no doubt that,the people of India have, in exercise of their sovereign will as expressed in the Preamble, adopted the democratic ideal which assures to the citizen the dignity of the, individual and other cherished human values as a means to the full evolution and expression of his personality, and in delegating to the Legislature the executive and the Judiciary their respective powers in the Constitution, reserved to themselves certain fundamental rights, so called, I apprehend, because they have been retained by the people and made, paramount to the delegated powers, as in the American Model.
" I find nothing in the passage contrary to the view unequivocally expressed by the same learned Judge in Sri Sankari Prasad Singh Deo 's(3) case that the fundamental rights are amendable.
The power to frame the Constitution was vested in the Constituent Assembly by section 8 (1 ) of the Indian Independence Act, 1947. 'The Constitution though legal in its origin was revolutionary in character and accordingly the Constituent Assembly exercised its powers of framing the Constitution in the name of the people.
The objective resolution of the Assembly passed on January 22, 1947 (1) ,261 2,281 (2)[1950] S.C.R. 88, 98.
(3) (1952] S.C.R. 89.
915 solemnly declared that all power and authority of sovereign independent India, its constituent parts, and organs and the Government were derived from the people.
The preamble to the Constitution declares that the people of India adopts, enacts and gives to themselves the Constitution.
In form and in substance the Constitution emanates from the people.
By the Constitution.
the people constituted themselves into a republic.
Under the republic all public power is derived from the people and is exercised by functionaries chosen either directly or 'indirectly by the people.
The Parliament can exercise only such powers as are delegated to it under the Constitution.
The people acting through the Constituent Assembly reserved for themselves certain rights and liberties and ordained that they shall not be curtailed by ordinary legislation.
But the people by the same Con stitution also authorised the Parliament to make amendments to, the Constitution.
In the exercise of the amending power the Parliament has ample authority to abridge or take away the fundamental rights under Part III.
It is urged that the word 'amend ' imposes the limitation that an amendment must be an improvement of the Constitution.
Reliance is placed on the dictum in Livermore vs E. C. Waite(1): "On, the other hand, the significance of the term 'amendment ' implies such an addition or change within the lines of the original instrument as will effect an improvement, or better carry out the purpose for which it was framed." Now an attack on the eighteenth amendment of the U.S. Constitution based on this passage was brushed aside by the U.S. Supreme Court in the decision in the National Prohibition(2) case.
The decision totally negatived the contention that "an amendment must be confined in its scope to, an alteration or improvement of that which is already contained in the Constitution and cannot change its basic structure, include new grants of power to the Federal Government nor relinquish, in the State those which already have been granted to it", see Cooley on Constitutional Law, Chapter III article 5, pp.
46 & 47.
1 may also read a passage from Corpus Juris Secundum Vol.
XVI, title 'Constitutional Law, p. 26 thus : "The term 'amendment a , used in the constitutional article giving Congress a power of proposal includes additions to, as well as corrections of, matters.
already treated, and there is nothing there which suggests that it is used in a restricted sense.
" Article 368 indicates that the term "amend" means "change".
The proviso is expressed to apply to amendments which seek to make any "change" in certain articles.
The main part of article 368 (1) (2) Rhode Island vs Palmer 253 U.S. 350 : 64 L. ed.
947, 960, 978.
916 thus gives the power to amend or to make changes in the Constitution.
A change is not necessarily an unprovement.
Normally the change is made with the object of making an improvement, but the experiment may fail to achieve the purpose.
Even the plain dictionary meaning of the word "amend" does not support the contention that an amendment must take an improvement, see Oxford English Dictionary where the word "amend" is defined thus : "4. to make professed improvements (in a measure before Parliament); formally to alter 'in detail, though practically it may be to alter its principle so as to thwart it.
" The 1st, 4th, 16th and.
17th Amendment Acts made changes in Part III of the Constitution.
All the changes are authorized by article 368.
It is argued that under the amending power, the basic features .,of the Constitution cannot be amended.
Counsel said that they could not give an exhaustive catalogue of the basic features, but sovereignty, the republican form of government the federal structure and the fundamental rights were some of the features.
The Seventeenth Amendment has not derogated from the sovereignty, ,the republican form of government and the federal structure, and 'the question whether they can be touched by amendment does not arise for decision.
For the purposes of these cases, it is sufficient to say that the fundamental rights are within the reach of the amending power.
It is said that in the course of the last 16 years there have been numerous amendments in our Constitution whereas there have been very few amendments of the American Constitution during 'the last 175 years.
Our condition is not comparable with the American.
The dynamics of the social revolution in our country may require more rapid changes.
Moreover every part of our Constitution is more easily amendable than the American.
Alan Gledhill in his book "The Republic of India", 1951 Edition, pp. 74 & 75 , said: "The Indian Founding, Fathers were less determined than were their American predecessors to impose rigidity on their Constitution. . . .
The Indian Constitution assigns different degrees of rigidity to its different parts, but any part of it can be more easily amended than the American Constitution.
" It is said that the Parliament is abusing its power of amendment by making too many frequent changes.
If the Parliament 'has the power to make the amendments, the choice of making any particular amendment must be left to it.
Questions of policy cannot be debated in ' this Court.
The possibility of, abuse of a power is not the test of its existence.
In Webb vs Outrim(1) lord (1) 917 Hobhouse said, "If they find that on the due construction of the Act a legislative power falls within section 92, it would be quite wrong of them to deny its existence because by some possibility it may be abused, or limit the range which otherwise would be open to the Dominion Parliament".
With reference to the doctrine of implied prohibition against the exercise of power ascertained in accordance with ordinary rules of construction, Knox C.J., in the Amalgamated Society of Engineers vs The Adelaide Steams Company Limited and others(1) said, "It means the necessity of protection against the aggression of some outside and possibly hostile body.
:It is based on distrust, lest powers, if once conceded to the least degree, might be abused to the point of destruction.
But possible abuse of powers is no reason in British law for Emiting the natural force of the language creating them The historical background in which the Constitution was framed shows that the ideas embodied in Part III were not intended to be immutable.
The Constituent Assembly was corn of representatives of the provinces elected by,the members of the lower houses of the provincial legislatures and representatives of the Indian States elected by electoral colleges constituted by the rules.
The draft Constitution was released on February 26, 1948While the Constitution was on the anvil it was envisaged the, future Parliaments would be elected on the basis of adult suffrage.
Such a provision was later incorporated in article 326 of the Constitution.
In a special article written on August 15, 1948, Sir B., N. Rau remarked: "It seems rather illogical that a constitution should be settled by a simple majority by an assembly elected indirectly on a very limited franchise and that it should not be capable of being amended in the same way by a Parliament elected and perhaps for the most Part elected directly by adult suffrage", (see B. N. Rau ' India 's Constitution in the making, 2nd Edition p. 394).
The conditions in India were rapidly changing and the country was in a state of flux politically and economically.
Sir B. N. Rau therefore recommended that the Parliament should be empowered to amend the Constitution by its ordinary law making process for at least the first five years.
Earlier, para 8 of the Suggestions of the Indian National Congress of May 12, 1946 and para 15 of the Proposal of the Cabinet Mission of May 16, 1946 had recom mended similar powers of revision by the Parliament during the initial years or at stated intervals.
The Constituent Assembly did not accept these recommendations.
On September 17, 1949 an amendment (No. 304) moved by Dr. Deshmukh providing (1) ; ,151.
Cf/67 13 918 for amendment of the Constitution at any time by a clear majority in each house of Parliament was negatived.
The Assembly was conscious that future Parliaments, elected on the basis of adult suffrage would be more representative, but they took the view that article 368 provided a sufficiently flexible machinery for amending all part , of the Constitution.
The Assembly never entertain the proposal that any part of the Constitution including Part III should be beyond the reach of the, amending power.
As a matter of fact, Dr. Deshmukh proposed an amendment (No. 212) habiting any amendment of the rights with respect to property or otherwise but on September 17, 1949 he withdrew this proposal (we Constituent Assembly Debates Vol.
IV pp.
1 642 43).
The best exposition of the Constitution is that which it has received from contemporaneous judicial decisions and enactments.
We find a rare unanimity of view among Judges and legislators from the very commencement of the Constitution that the fundamental rights are within the reach of the amending power.
No one in the Parliament doubted this proposition when the Constitution First Amendment Act of 1951 was passed.
It is remarkable that most of the members of this Parliament were also.
members of the Constituent Assembly.
In, section Krishnan and Others vs The state of Madras(1), a case decided on May 7, 1951 Bose, J. said: "My concept of a fundamental right is something which Parliament cannot touch save by an amendment of the Constitution".
, In Sri Sankari Prasad Singh Deo 's case(2), decided on October 5, 1951, this Court expressly decided that fundamental rights could be abridged by a constitutional amendment.
This view was acted upon in all the subsequent decisions and was reaffirmed in Sajjan Singh 's case(3).
Two learned Judges then expressed some doubt but even they agreed with the rest of the Court in upholding the validity of the amendments.
A static system of.
laws is the worst tyranny that any constitution can impose upon a country.
An unamendable constitution means that all.
reform and progress are at a standstill.
If Parliament cannot amend Part III of the Constitution even by recourse to article 368, no other power can do so.
There is no, provision in the Constitution for calling a convention for its revision or for submission of any proposal for amendment to the referendum.
Even if power to call a convention or to submit a proposal.
to the refere be taken by amendment of article 368, Part III.
would sip remain unamendable on the assumption that a constitutional amendment is a law.
Not even the unanimous vote of the 500 (1) ; , 652.
(2) ; (3) ; 919 million citizens or their representatives, at a special convocation could amend Part III.
The deadlock could be resolved by revolution only.
Such a consequence was not intended by the framers of the Constitution.
The Constitution is meant to endure.
It has been suggested that the Parliament may provide for another Constituent Assembly by amending the Constitution and that Assembly can amend Part III and take away or abridge "the fundamental rights.
Now if this proposition is correct, a suitable amendment of the Constitution may provide that the Parliament will be the Constituent Assembly and there upon the Parliament may amend Part III.
If so, I do not see why under the Constitution as it stands now, the Parliament cannot be regarded as a recreation of the Constituent Assembly.
for the special purpose of making a constitutional amendments under article 368, and why the amending power cannot be regarded a a constituent power as was held in Sri Sankari Prasad Singh Deo 's (1) case.
The contention that the constitutional amendments of Part III had the effect (I changing articles 226 and 245 and could not be passed without complying with the proviso to article 368 is not tenable; A constitutional amendment which does not profess to amend article 226 directly or by inserting or striking words therein cannot be regarded as seeking to make, any change in it and thus falling within the constitutional inhibition of the proviso.
article 226 gives power to the High Court throughout the territories in relation to which it exercises jurisdiction to issue to any person or authority within those territories directions, orders and Writs for the enforcement of any of the rights conferred by Part III and for any purpose The Seventeenth Amendment made no direct change in article 226.
It made changes in Part In and abridged or took away some of the rights conferred by that Part.
As a result of the changes, some of those rights no longer exist and as the High Court cannot issue writs for the enforcement of those rights its power under article 226 is affected incidentally.
But an alteration in the area of its territories or in the number of persons or authorities within those territories or in the number of enforceable rights under Part III or other rights incidentally affecting the Power of the High Court under article 226 cannot be regarded as an ' amendment of that article.
article 245 empowers the Parliament and the Legislatures of, the States to make laws subject to the provisions of the Constitution.
This power to make laws is subject to the limitations imposed by Part M.
The abridgement of the rights conferred by Part III by the Seventeenth Amendment necessarily enlarged the scope of the legislate power, and thus affected article 245 indirectly.
But the Seventeenth amendment made no direct change in article 145 and did not amend it.
(1) ; 920 Art 3 1B retrospectively validated the Acts mentioned in the Ninth Schedule notwithstanding any judgment decree or order of any court though they take away or abridge the rights conferred by Part Ill. It is said that the Acts are still bom and cannot be validated.
But by force of article 31B the Acts are deemed never to have become void and must be regarded as valid from their inception.
The power to amend the Constitution carries with it the power to make a retrospective amendment.
It is Said that article 3 1B amends article 141 as it alters the law declared by this Court on the validity of the Acts.
This argument is baseless.
As the Constitution is amended retrospectively, the basis upon which the judgments of this Court were pronounced no longer exists, and the law declared by this Court can have no application.
It is said that article 3 1B is a law with respect to land and other matters within the competence of the State Legislature, and the Parliament has no power to enact such a law.
The argument is based on a misconception.
The Parliament has not passed any of the Acts mentioned in the Ninth Schedule.
article 3 IB removed the constitutional bar on the making of the Acts.
Only the Parliament could remove the bar by the Constitution amendment.
It has done so by article 3 1 B.
The Parliament could amend each article in Part III separately and provide that the Acts would be protected from attack under each article.
Instead of amend ing each article separately, the Parliament has by article 3 1 B made a comprehensive amendment of all the articles by providing that the Acts shall not be deemed to be void on the ground that they are inconsistent with any of them.
The Acts as they stood on the date of the Constitution Amendments are validated.
By the last part of article 31B the competent legislatures will continue to the power to repeal or amend the Acts.
The subsequent repeals and amendments are not validated.
If in future the competent legislature passes a repealing or amending Act which is inconsistent with Part III it will be void.
I have, therefore, coma to the conclusion that the First, Fourth, Sixteenth and Seventeenth Amendments are constitutional and am not void.
If so, it is common ground that these petitions must be For the last 16 years the validity of constitutional amendments of fundamental rights have been recognized by the people and all the organs of the government 'including the legislature, the judiciary and the executive.
Revolutionary, social and economic changes have taken place on the strength of the First, Fourth and Seventeenth Amendments.
Even if two views were possible on the question of, the validity of the amendments, we should not now reverse our previous decisions and pronounce them to be invalid.
Having heard lengthy arguments on the question I have 921 come to the conclusion that the validity of the constitutional amendments was rightly upheld in Sri Sankari Prasad Singh Deo 's(1) and Sajjan Singh 's(2) cases and I find no reason for over ruling them.
The First, Fourth and Seventeenth amendment Acts are sub jected to bitter attacks because they strike it the entrenched property rights.
But the abolition of the zemindari was a necessary reform.
It is the First Constitution Amendment Act that made this reform possible.
No legal argument can restore the outmoded feudal zemindari system.
What has been done cannot be undone.
The battle for the past is lost.
The legal argument necessarily shifts.
The proposition now is that the Constitution Amendment Acts must be recognized to be valid in the past but they must be struck down for the future.
The argument leans on the ready made American doctrine of prospective overruling.
Now the First, Fourth, Sixteenth and Seventeenth Amendment Acts take away and abridge the rights conferred by Part M.
If they are laws they are necessarily rendered void by article 13(2).
If they are void, they do not legally exist from their very inception.
They cannot be valid from 1951 to 1967 and invalid thereafter.
To say that they were valid in the past and will be invalid in the future is to amend the Constitution.
Such a naked power of amendment of the Constitution is not given to the Judges.
The argument for the petitioners suffers from a double fallacy, the first that the Parliament has no power to amend Part III so as to abridge or take away the entrenched property rights, and the second that the Judges have the power to make such an amend ment.
I may add that if the First and the Fourth amendments are valid, the Seventeenth must necessarily be valid.
It is not possible to say that the First and Fourth amendments though originally invalid have now been validated by acquiescence.
If they infringed article 13(2),t they were void from their inception.
Referring to the 19th amendment of the U.S. Constitution, Brandeis, J. said in Leser vs Garnett(3) "This Amendment is in character and phraseology precisely similar to the 15th.
For each the same method of adoption was pursued.
One cannot be valid and the other invalid.
That the 15th is valid, although rejected by six states, including Maryland, has been recognized and acted on for half a century. .
The suggestion that the 15th was incorporated in the Constitution, (1) ; (2) [1965] 1 S.C.R. 933.
(3) ; : ; , 51 1.
922 not in accordance with law, but practically as a war measure, which has been validated by acquiescence, cannot be entertained.
" Moreover the Seventeenth amendment has been acted upon and its validity has been upheld by this Court in Sajjan Singh 's case.
If the First and the Fourth Amendments are validated by acquiescence, the Seventeenth is equally validated.
Before concluding this judgment I must refer to some of the speeches made by the members of the Constituent Assembly in the course of debates on the draft Constitution.
These speeches cannot be used as aids for interpreting the Constitution.
See State of Travancore Cochin and others vs The Bombay Co. Ltd.( ' ).
Accordingly, I do not rely on them as aids to construction.
But I propose to refer to them, as Shri A K. Sen relied heavily on the speeches of Dr. B. R. Ambedkar.
According to him, the speeches of Dr. Ambedkar show that he did not regard the fundamental rights as amendable.
This contention is not supported by the speeches.
Sri Sen relied on the following passage in the speech of Dr. Ambedkar on September 17, 1949 "We divide the articles of the Constitution under three categories.
The first category is the one which consists of articles which can be, amended by Parliament by a bare majority.
The second set of articles are articles which require two thirds majority.
If the future Parliament wishes to amend any particular article .which is not mentioned in Part III or article 304, all that is necessary for them is to have two thirds majority.
They can amend it.
Mr. President : Of Members present.
Now, we have no doubt put articles in a third .category where for the purposes of amendment the .mechanism is somewhat different or double.
It requires two thirds majority plus ratification by the, States.
"(2) I understand this passage to mean that according to Dr. Am bedkar an amendment of the articles mentioned in Part.
III and 368 requires two thirds majority plus ratification by the States He seems to have assumed (as reported) that the provisions of Part III fall within the. proviso to article 368.
But he never said that part III was s not amendale.
He maintained consistently that all the articles of the Constitution are amendable under article 368 On November 4, 1948, be.
said : "The second means adopted to avoid rigidity and legalism is the provision for facility with which the (1) (1952] S.C.R. 1112.
(2) Constituent Assembly Debat Vol.
IX p. 1661.
923 Constitution could be amended.
The provisions of the Constitution relating to the amendment of the Constitution divide the Articles of the Constitution into two groups.
In the one group are placed Articles relating to (a) the distribution of legislative powers between the Centre and the States, (b) the representation of the States in Parliament, and (c) the powers of I the Courts.
All other Articles are placed in another group.
Articles placed in the second group cover a very large part of the Constitution and can be amended by Parliament by a double majority, namely, a majority of not less than two thirds of the members of each House present and voting and by a majority of the total membership of each House.
The amendment of these Articles does not require ratification by the States.
It is only in those Articles which are placed in group one that an additional safeguard of ratification by the States is introduced.
One can therefore safely sky that the Indian Federation will not suffer from the faults of rigidity or legalism.
Its distinguishing feature is that it is a flexible Federation.
The provisions relating to amendment of the Constitution have come in for a virulent attack at the hands of the critics of the Draft Constitution.
it is said that the provisions contained in the Draft make amendment difficult.
It is proposed that the Constitution should be amendable by a simple majority at least for some.
years.
The argument is subtle and ingenious.
It is said that this Constituent Assembly is not elected on adult suffrage while the future Parliament will be elected on adult suffrage and yet the former has been given the right to pass the Constitution by a simple majority while 'the latter has been denied the same right.
It is paraded as one of the absurdities of the Draft Constitution.
I must repudiate the charge because it is without foundation.
To know how simple are the provisions of the Draft Constitution in respect of amending the Constitution one has only to study the provisions for amendment contained in the American and Australian Constitutions. 'Compared to them those contained in the Draft Constitution will be found to be the simplest. 'The Draft Constitution has eliminated the elaborate and difficult procedures such as a decision by a convention or are ferenduni.
The Powers of amendments left with the Legislatures Central and Provincial.
It is only, for amendment , or specific matters and they are only few, that the ratification of the State Legislatures is required.
924 All other Articles of the Constitution are left to be amended by Parliament.
The only limitation is that it shall be done by a majority, of not less than two thirds of the members of each House present and voting and a majority of the total membership of each House.
It is difficult to conceive a simpler method of amending the Constitution."(, ') On December 9, 1948 , Dr. Ambedkar said with reference to article 32: "The Constitution has invested the Supreme Court with these rights and these writs could not be taken away unless and until the Constitution itself is amended by means left open to the legislature.
"(2) On November 25, 1949, Dr. Ambedkar strongly refuted the suggestion that fundamental rights should ' be absolute and unalterable.
He said: "The condemnation of the Constitution largely comes from two quarters, the Communist Party and the Socialist Party. .
The second thing that the Socialists want is that the Fundamental Rights mentioned in the Constitution must be absolute and without any limitations so that if their Party comes into power, they would have the unfettered freedom not merely to criticize, but also to overthrow the State. .
Jefferson, the great American statesman who played so great a part in the making of the American Constitution, has expressed some very weighty views which makers of Constitution can never afford to ignore.
In one place, he has said: 'We may consider each generation as a distinct nation, with a right, by the will of the majority, to bind themselves, but none to bind the succeeding generation, more than the inhabitants of another country.
In another place, he has said: 'The idea that institutions established for the use of the nation cannot be touched or modified, even to make them answer their end, because of rights gratuitously supposed in those employed to manage the min the trust for the public, may perhaps be a Salutary provision against the abuses of a monarch, but is most absurd against the nation itself.
Yet our lawyers and priests generally inculcate this doctrine, and suppose that preceding generations held the earth more freely than we do; had a right to impose laws on us, unalterable by ourselves, and (1) Constituent Assembly Debates Vol. 7, pp.
35 6, 43 4.
(2) Constituent Assembly Debates Vol. 7, 953. 925 that we, in the like manner, can make laws and impose burdens on future generations, which they will have no right to alter; in fine, that the earth belongs to the dead and not the living.
I admit that what Jefferson has said is not merely true, but is absolutely true.
There can be no question about it.
Had the Constituent Assembly departed from this principle laid down by Jefferson it would certainly be liable to blame, even to condemnation.
But I ask, has it? Quite the contrary.
One has only to examine the provision relating to the amendment of the Constitution.
The Assembly has not only refrained from putting a seal of finality and infallibility upon this Constitution by denying to the people the right to amend the Constitution as in Canada or by making the amendment of the Constitution subject to the fulfilment of extraordinary terms and conditions as in America of Australia but has provided a most facile procedure for amending the Constitution.
I challenge any of the critics of the Constitution to prove that any Constituent Assembly anywhere in the world has, in the circumstances in which this country finds itself, provided such a facile procedure for the amendment of the Constitu tion.
If those who are dissatisfied with the Constitution have only to obtain a 2/3 majority and if they cannot obtain even a two thirds majority in the parliament elected on adult franchise in their favour, their dissatisfaction with the Constitution cannot be deemed to be shared by the general public. '(1) On November 11, 1948, Pandit Jawahar Lal Nehru said: "And remember this, that while we want this Constitution to be as solid and as permanent a structure as we can make it, nevertheless there is no permanence in Constitutions.
There should be a certain flexibility.
If you make anything rigid and permanent, you stop a Nation 's growth, the growth of living vital organic people.
Therefore it has to be flexible.
"(2) The views of Jefferson echoed by Ambedkar and Nehru were more powerful expressed by Thomas Paine in 1791 "There never did, there never will, and there never can, exist a parliament, or any description of men, or any generation of men, in any country, possessed of the (1) Constituent Assembly Debates Vol.
I 1, pp.
975 6.
(2) Constituent Assembly Debates Vol. 7, p. 322.
926 right or the power of binding and controuling posterity to the end of time ', or of commanding for ever how the world.
shall be governed, or who shall govern it , and therefore all such clauses, acts or declarations by which the makers of them attempt to do what they have neither the right nor the power to do, nor take power to execute, are in themselves null and void.
Every age and generation must be as free to act for itself in all cases as the ages and generations which preceded it.
The vanity and presumption of governing beyond the grave is the most ridiculous and insolent of all tyrannies.
Man has no property in man; neither has any generation a property in the generations which are to follow.
The parlia ment of the people of 1688 or of any other period, had no more right to dispose of the people of the present day, or to bind or to controul them in any shape whatever, than the parliament or the people of the present day have to dispose of, bind or controul those who are to live a hundred or a thousand years hence.
Every Generation is, and must be, competent to all the purposes which its occasions require.
It is the living, and not the dead, that are to be accommodated.
When man ceases to be, his power and his wants cease with him; and having no longer any participation in the concerns of this World, he has no longer any authority in directing who shall be its governors, or how its government shall be organized, or how administered." (See 'Rights of Man ' by Thomas Paine, unabridged edition by H. B. Bonner, pp. 3 & 4).
For the reasons given above, I agree with Wanchoo, J. that the writ petitions must be dismissed.
In the result, the writ petitions are dismissed without costs.
Ramaswami, J. I have perused the judgment of my learned Brother Wanchoo, J. and I agree with his conclusion that the Constitution (Seventeenth Amendment) Act, 1964 is legally valid, but in view of the importance.of the constitutional issues raised in this case I would prefer to state, my own reasons in a separate judgment.
In these petitions which have been filed under article 32 of the Constitution, a common question arises for determination, viz.,.
whether the Constitution (Seventeenth Amendment) Act, 1964 which amends article 31 A and 3 1 B of the Constitution is ultra vires and unconstitutional, .
927 The petitioners are affected either by the Punjab Security of Land Tenures Act, 1954.
(Act X of 1953) or by the Mysore Land Reforms Act (Act 10 of 1962) as amended by Act 1 1965 which were added to the 9th Schedule of the Constitution by the impugned Act and, their contention is that the impugned Act being unconstitutional and invalid , the validity of the two Acts by which they are affected cannot be saved.
The impugned Act consists of three sections.
The first section.
gives its short title.
Section 2 (i) adds a proviso to Cl. ( 1 ) of article 3 I A after the existing proviso.
This proviso reads, thus: "Provided further that where any law makes any provision for the acquisition by the State of any estate and where any land comprised therein is held by a person under his personal cultivation, it shall not be lawful for the State to acquire any portion of such land as is within the ceiling limit applicable to him under any law for the time being in force or any building or structure standing thereon or appurtenant thereto, unless the law relating to the acquisition of such land, building or structure, provides for payment of compensation at a rate which shall not be less than the market value thereof." Section 2(ii) substitutes the following sub clause for sub cl.
(a) of cl.
(2) of article 31 A "(a) the expression 'estate ' shall, in relation to any local area, have the same meaning as that expression or its local equivalent has in the existing law relating force in that area and all to land tenures in also include (i) any jagir, inam or muafi or other similar grant and in the States of Madras and Kerala, any ianmam right; (ii) any land held under ryotwari settlement; (iii) any land held or let for purposes of agriculture or for purposes ancillary there to, including wast land, forest land, land for posture or ones of buildings and other structures occupied by cultivators of land, agricultural labourers and village artisans;" Section 3 amends the 9th Schedule by adding 44 entries to it.
In dealing with the question about the validity of the im pugned Act, it is necessary to consider the scope and effect of the provisions contained in article
368 of the Constitution, because the main controversy in the present applications turns upon:the 928 decision of the question as to what is the construction of that Article.
Article 368 reads as follows: "An amendment of this Constitution may be initiated only by the introduction of a Bill for the purpose in either House of Parliament, and when the Bill is passed in each House by a majority of the total membership of that House and by a majority of not less than two thirds of the members of that House present and voting, it shall be presented to the President for his assent and upon such assent being given to the Bill, the Constitution shall stand amended in accordance with the terms of the Bill .
Provided that if such amendment seeks to make any change (a) Article 5, article 55, article, 73, article 162 or article 241, or (b) Chapter IV of Part V, Chapter V of Part VI, or Chapter I of Part XI, or (c) any of the Lists in the Seventh Schedule, or (d) the representation of States in Parliament, or (e) the provisions of this article, the amendment shall also require to be ratified by the Legislatures of not less than one half of the States by resolutions to that effect passed by those.
Legislatures before the Bill making provision for such amendment is presented to the President for assent.
" It is necessary at this stage to set out briefly the history of articles . 31 A and 31 B. These Articles were added to the Constitution with retrospective effect by section 4 of the Constitution (First Amendment) Act, 1951.
Soon after the promulgation of the Constitution, the political party in power, commanding as it did a majority of votes in the several State legislatures as well as in Parliament, carried out radical measures of agrarian reform in Bihar, may be referred to as Zamindari Abolition Acts.
Certain zamindars, feeling themselves aggrieved, attacked the validity of those Acts in courts of law on the ground that they contravened the 'fundamental rights conferred on them by Part III of the Constitution.
The High Court of Patna held that the Act passed iii Bihar was unconstitutional while the High Courts of Allahabad and Nagpur upheld the validity of the corresponding legislation in Uttar Pradesh and Madhya Pradesh respectively (See Kameshwar Uttar Pradesh and Madhya Pradesh by enacting legislation which 929 vs State of Bihar(1) and Surya Pal vs U.P. Government(1).
The parties aggrieved by these respective decisions had filed appeals by special leave before this Court.
At the same time petitions had also been preferred before this Court under article 32 by certain other Zamindars, seeking the determination of the same issues It was atstage that the Union Government, with a view to put an endall this litigation and to remedy what they considered to be certain defects brought to light in the work of the Constitution, brought forward a bill to amend the Constitution, which,.
after undergoing amendments in various particulars, was passed by the require majority as the Constitution (First Amendment) Act, 1951 by which articles 31 A and 31 B were added to the Constitution.
That was the first step taken by Parliament to assist the process of legislation to bring about agrarian reform, by introducing Articles 31 A and 31 B.
The second step in the same direction was taken by Parliament in 1955 by amending article 31 A by the Constitution (Fourth Amendment) Act, 1955.
The object of this amendment was to widen the scope of agrarian reform and to confer on the legislative measures adopted in that behalf immunity from a possible attack that they contravened ' the fundamental rights of citizens.
In other words, the amendment Protected the legislative measures in respect of certain other items of agrarian and social welfare legislation, which affected the proprietary rights of certain citizens.
At the time when the first amendment was made, article 31 B expressly provided that none, of the, Acts and Regulations specified in the 9th Schedule, nor any of the provisions thereof, shall be deemed to be void or ever to have become void on the ground that they were inconsistent with or took: away or abridged any of the rights conferred by Part III, and it added that notwithstanding any judgment, decree or order of any Court or tribunal to the contrary, each of the said Acts and Regulations shall subject to the power of any competent legislature to repeal or amend, continue in force.
At this time, 19 Acts were listed in Schedule 9, and they were thus effectively validated.
One more Act was added to this list by the Amendment Act of 1955, so that as a result of the second amendment, the Schedule contained 20 Acts which were validated.
It appears that notwithstanding these amendments, certain other legislative measures adopted by different States for the purpose of giving effect to the agrarian policy of the party in power, were effectively challenged.
For instance, the Karimbil Kunhikoman vs State of Kerala(3), the validity of the Kerala Agrarian Relations Act (IV of 1961) was challenged by writ petitions filed under article 32, and as a result of the majority decision of this Court, the whole Act was struck down.
The decision of this (1) A I R. 1951 Pat. 91 (2) A.I.R. 1951 All. 674.
(3)[1962] Supp.
1 S.CR. 829. 930 Court was pronounced on December 5, 1961.
In A. P. Krishna swami Naidu vs The State of Madras(1) the constitutionality of the Madras Land Reforms (Fixation of Ceiling on Land) Act (146.
58 of 1961) was the subject matter of debate, and by the decision of this Court pronounced, on March 9, 1964, it was declared that the whole Act was invalid.
It appears that the Rajas than Tenancy Act III of 1955 and the Maharashtra Agricultural Lands (Ceiling and Holdings) Act 27 of 1961 had been similarly declared invalid, and in consequence, Parliament thought it necessary to make a further amendment in Art: 31 B so as to gave the validity of these Acts which had been struck down and of other similar Acts which were likely to be challenged.
With that object in view, the impugned Act has enacted section 3 by which 44 Acts have been added to Schedule 9.
It is therefore clear that the object of the First, Fourth and the Seventeenth Amendments of the Constitution was to help the State Legislatures to give effect to measures of agrarian reform in a broad and comprehensive sense in the interests of a very large section of Indian ,citizens whose social and economic welfare closely depends on the persuit of progressive agrarian policy.
The first question presented for determination in this case is whether the impugned Act, in so far as it purports to take away or abridge any of the fundamental rights conferred by Part III .or the Constitution,falls within the prohibition of article 13 (2) which provides that "the State, 'shall, not make any law which takes away or abridges the rights conferred by this Part and any law made in contravention of this clause shall to the extent of the Contravention, be void".
In other words, the argument, of the petitioners was that the law to which Art, 13(2) applies, would include a law passed by Parliament by virtue of its constituent power to amend the Constitution, and so, its validity will have.
to be tested by article 13(2) itself.
It was contended that the State" includes Parliament within article 12 and "law" must include, a constitutional amendment.
It was said that it was the deliberate intention of the framers of the Constitution, who realised the sanctity of the fundamental rights conferred by Part III, to make them immune from interference not only by ordinary laws passed by the legislatures in the country but also from constitutional amendments.
In my opinion, there is no substance in this argument.
Although "law" must ordinarily include constitutional law, there is 'a juristic distinction between ordinary law made in exercise of legislative power and constitutional law which is Made in exercise of constituent power.
In a written federal form of Constitution there is a clear and well known distinction between the law of the Constitution and ordinary law made by the legislature on the basis of separation of powers and (1)[1964]7 S.C.R.82.
931 pursuant to the power of law making conferred by the Consti tution (See Dicey on 'Law of the Constitution, Tenth: Edn.
p. 110, Jennings, 'Law and the Constitution ' pp.
62 64, and 'American Jurisprudence ', 2nd Edn.
16, p. 181).
In such a written Constitution, the amendment of the Constitution is .a substantive, constituent act which is made in the exercise, of the sovereign power which created the Constitution and which is effected by a special means, namely, by a predesigned fundamental procedure unconnected with ordinary legislation.
The amending power under article 368 is hence sui generis and cannot be, compared to the law making power of Parliament pursuant to article 246 read with List I and 111.
It follows that the expresSion "law" in article 13(2) of the Constitution cannot be construed as including an amendment of the Constitution which is by Parliament in exercise of, its sovereign constituent power, but must mean law made by Parliament in its legislative capacity :pursuant to the powers of law making given by the Constitution itself under article 246 read with Lists I and In of the 7th Schedule.
It is also clear, on the same line of reasoning, that 'law ' in article 13(2) cannot be construed so as to include 'law ' made by Parliament under articles 4, 169, 392, 5th Schedule Part D and 6th Schedule para 2 1.
The amending power of Parliament exercised under these Articles stands on the same as the constitutional amendment made under article U8 so far as article 13(2) is concerned and does not fall within the definition of law within the meaning of this last article.
It is necessary to add that the definition of 'law ' in article 13(3) does not include in terms a constitutional amendments though it includes "any Ordinance,, order, bye law, rule, regulation, notification, custom or usage ".
It should be noticed that The language.
of article 3 6 8 is perfectly general and empowers Parliament to amend the Constitution without any exception Whatsoever.
H I ad it been intended by the Constitution makers that the fundamental rights guaranteed under Part III should be completely outside the scope of article 368, it is reasonable to assume that they would have made an express provision to that effect.
It was stressed by the petitioners during the course 'of the, argument that Part III is headed as 'Fundamental Rights" and that article 32 "guarantee 's ' the right to move the Supreme Court by appropriate proceedings for enforcement of rights conferred by Part M.
But the expression "fundamental" in the phrase "Fundamental Rights" means that such rights are fundamental vis a vis the laws of the legislatures and the acts of the executive authorities mentioned in article 12.
It cannot be suggested, that the expression "fundamental" lifts the fundamental rights above the Constitution itself.
Similarly, the expression "guaranteed ' in article 32(1) and 32(4) means that the right to move the Supreme Court for enforcement of fundamental rights without 932 exhausting the, normal channels through the High Courts or the lower courts is guaranteed.
This expression also does not place the fundamental rights above the Constitution.
I proceed to consider the next question arising in this case, the scope of the amending power under article 368 of the Constitution.
It is contended on behalf of the petitioners that article 368 merely lays down the procedure for amendment and does not vest the amending power as such in any agency constituted under that article.
I am unable to accept this argument as correct Part XX of the Constitution which contains only article 368 is described as a Part dealing with the Amendment of the Constitution and article 368 which prescribes the procedure for amendment of the Constitution, begins by saying that an amendment of this Constitution may be initiated in the manner therein indicated.
In MY Opinion, the expression "amendment of the Constitution" in article 368 plainly and unambiguously means amendment of all the provisions of the Constitution.
It is unreasonable to suggest that what article 368 provides is only the mechanics of the procedure to be followed in amending the Constitution without indicating which provisions of the Constitution can be amended and which cannot.
Such a restrictive construction of the substantive part of article 368 would be clearly untenable.
The significant fact , that a separate Part has been devoted in the Constitution for "amendment of the Constitution and there is only one Article in that Part shows that both the power to amend and the procedure to amend are enacted in article 368.
Again, the words "the Constitution shall stand amended in accordance with the terms of the Bill" in article 368 clearly contemplate and provide for the power to amend after the requisite procedure has been followed.
Besides, the words used in the proviso unambiguously indicate that the substantive part of the article applied to all the provisions of the Constitution.
It is on that basic assumption that the proviso prescribes a specific procedure in respect of the amendment of ,the articles mentioned in cls.
(a) to (e) thereof.
Therefore it must be held that when article 368 confers on Parliament the right to amend the Constitution the power in question can be exercised over all the provisions of the Constitution.
How the power should be exercised, has to be determined by reference to the question as to whether the proposed amendment falls under the substantive part of article 368, or whether it attracts the procedure contained in the proviso.
It was suggested for the petitioners that the power of amendment is to be found in articles 246 and 248 of the constitution read with item 97 of List I of the 7th Schedule.
I do not think that it is possible to accept this argument.
Article 246 stats that 933 Parliament has exclusive power to make laws with respect to matters enumerated in List I in the Seventh Schedule, and article 248, similarly, confers power on Parliament to make any law with respect to any matter not enumerated in the Concurrent List or State List.
But the power of law making in articles 246 and 248 is "subject to the provisions of this Constitution".
It is apparent that the power of constitutional amendment cannot fall within these Articles, because it is illogical and a contradiction in terms to say that the amending power can be exercised and at the same time it is "subject to the provisions of, the Constitution".
It was then submitted on behalf of the petitioners that the amending power under article 368 is subject to the doctrine of implied limitations.
In other words, it was contended that even if article 368 confers the power of.
amendment, it was not a general but restricted power confined only to the amendable provisions of the Constitution, the amendability of such provision being determined by the nature and character of the respective provision.
It was argued, for instance, that the amending power cannot be used to abolish the compact of the Union or to destroy the democratic character of the Constitution teeing individual and minority rights.
It was said that the Constitution was a permanent compact of the States, that the federal character of the States was individual, and that the existence of any.
of the States as part of the federal Compact Cannot4be put an end to by the power of amendment.
It was also said that the chapter of fundamental rights of the Constitution cannot be the subject matter of any amendment under article 368.
It was contended that the preamble to the Constitution declaring that India was a sovereign democratic republic was beyond the scope of the amending Power.
it, was suggested that other basic, features of the Constitution were the Articles relating to.
distribution of legislative powers, the Parliamentary form of Government and the establishment of Supreme Court and the High, Courts in the various States.
I am unable to accept this argument as correct.
If the Constitution makers considered that there were certain basic features of the Constitution which were permanent it.
is must unlikely that they should not have expressly said in Art 368 that these basic features were.
not amendable.
On the contrary, the Constitution makers have expressly provided.
that article 368 itself should be amendable by the process indicated in the proviso to that Article.
This cir cumstance is significant and suggests.
that all the articles of the Constitution are amendable either under the proviso to article 368 or under the main part of that Article.
In MY opinion, there is no room for an.
implication in the construction of article 368.
So far as the federal character of the Constitution is concerned, it was held by this Court in State of West Bengal vs Union of Cl/67 14 934 India(1) that the federal structure is not an essential pan of our Constitution and there is no compact between the States and them is no dual citizenship in India.
It was pointed out in that case that there was no constitutional guarantee against the alteration of boundaries of the States.
By An. 3 the Parliament is by law authorised to form a new State by redistribution of the territory of a. State or by uniting two or more States or parts of States or by uniting any territory to a part of any State, to increase the area of any State, to diminish the area of any State to alter the boundaries of any State, and to alter the name of any State.
In In Re The Berubari Union and Exchange of Enclaves (2) it was argued that the Indo Pakistan agreement with regard to Berubari could not be implemented even by legislation under article 368 because of the limitation imposed by the preamble to the Constitution and that such an agreement could not be implemented by a referendum.
The argument was rejected by this Court and it was held that the preamble could not, 'in i any way, limit the power of Parliament to cede parts of the national territory.
On behalf of the petitioners the argument was s that the chapter on fundamental rights was the basic feature, of the Constitution and cannot be the subject of the amending power under Art 368.
It was argued that the freedoms of democratic life are secured by the chapter on fundamental rig its and dignity of the individual cannot be preserved if any of the fundamental rights is altered or diminished.
It is not possible to accept this argument as correct.
The concepts of liberty and equality are changing and dynamic and hence the notion of permanency or immutability cannot be attached to any of the fundamental rights.
The Directive Principles of Part IV are as fundamental as the constitutional rights embodied in Part III and article 37 imposes a constitutional duty upon the States to apply these principles in making laws.
Reference should in particular be made to article 39(b) which enjoins upon the State to direct its policy towards securing that the ownership and control of the material resources of the community are so distributed as best to subserve the common good.
article 3 8 imposes a duty upon, the State to promote the welfare of the people by securing and protecting as effectively as it may, a social order in which justice, social, economic and political, shall inform all the institutions of the national life.
I have already said that the language of article 368 is clear and unambiguous in support of, the view that there is no implied limitation on the amending power.
In Principle also it aPPears unreasonable to suggest that the Constitution makers wanted to provide that the fundamental rights guaranteed by the Constitution should never be touched by way of, amendment.
In modern democratic thought I there are two main trends the liberal idea of individual 'rights (1) [1964] 1 S.C.R. 371 p 405.
(2) 935 protecting the individual and the democratic idea proper pro claiming the equality of rights and popular sovereignty .
The gradual extension of the idea of equality from political to economic and social fields in the modern State has led to the problems of social security, economic planning and industrial welfare legislation.
The implementation and harmonisation of these.
somewhat conflicting principles is a dynamic task.
The adjustment between freedom and compulsion, between the rights of individuals and the social interest and welfare must necessarily be a matter for changing needs and conditions.
The proper approach is therefore to look upon the fundamental rights of the individual as conditioned by the social responsibility, by the necessities of the Society, by the balancing of interests and not as pre ordained and untouchable private rights.
As pointed out forcefully by Laski: "The struggle for freedom is largely transferred from the plane of political to that of economic rights.
Men become less interested in the abstract fragment of politi cal power an individual can secure than in the use of massed pressure of the groups to which they belong to secure an increasing share of the social Product.
Individualism gives way before socialism.
The roots of liberty are held to be in the ownership and control of the instruments of production by the state, the latter using its power to distribute the results of its regulation with increasing approximation to equality.
So long, as there is inequality, it is argued, there cannot be liberty.
The historic inevitability of this evolution was seen a century ago by de tocqueville.
It is interesting to compare his insistence that the democratization of political power meant equality and that its absence would be regarded by the masses as oppression with the argument of Lord Action that liberty and equality are antitheses.
To the latter liberty was essentially an autocratic ideal; democracy destroyed individuality, which was the very pith of liberty, by seeking identity of conditions.
The modem emphasis is rather toward the principle that material equality is growing inescapable and that the affirmation of personality must be effective upon an immaterial plane.
it is found that doing as one likes, subject only to the demands of peace, is incompatible with either international or municipal necessities.
We pass from contract to relation as we have passed from status to contract.
Men are so involved in intricate networks of relations that the place for their 936 liberty is in a sphere where their behaviour does not impinge upon that self affirmation of others which is liberty." (Encyclopaedia of the Social Sciences, Vol. IX, 445.).
It must :not be forgotten that the fundamental right guaran teed by article 31, for.
instance.
is not absolute.
It should be not that cl.
(4) of that Article, provides an exception to the requirements of cl.
(2). 'Clause (4) relates 'to Bills of a State Legislature relating to public acquisition which were pending at the commencement of fhe Co 'stitution.
If such a Bill has been passed and assented to by the President, the Courts shall have no jurisdiction to question the validity of such law on the of contravention of cl.
(2), ie., on the ground that it does not provide for compensation or that it has been enacted without a public purpose.
Clause (6) of the, Article is another exception to cl.
(2) and provides for ouster of jurisdiction of the Courts.
While cl.
(4) relates to Bills pending in the State Legislature at the encement of the Consistitution, cl.
(6) relates to Bills enacted by the State within IS I months before commencement of the Constitution i.e., Acts providing for public acquisition which were enacted not earlier than July 26, 1948.
If the President certifies ' 'such an Act within 3 months from the commencement of the Constitution, the Courts shall have no jurisdiction to invalidate that Act on the ground of contravention of cl.
(2) of that Article Similarly, the scheme of Art 19 indicates that the fundamental rights guaranted by sub cls.
(a) to (g) of cl, (1) can be validly regulated in the light of the provisions contained in cls.
(2) to (6) of article 19.
In other words, the scheme of Art.19 is two fold; the fundamental rights of the citizens are of paramount importance, but even the said fundamental rights can be regulated to serve the interests of the general public or other objects mentioned respectively in cls.
(2) to (6) of article 19.
It is right to state that the purposes for which fundamental rights can be regulated which are s specified in cls.
(2) to (6), could not have been assumed by the Constitution makers to be static and incapable of expansion.
It cannot be assumed that the Constitution makers intended to forge a political strait jacket for generations to come.
The Constitution makers , must have anticipated that in dealing with, socioeconomic problems which the 1egislatures may have to face from time to time, the concepts of public interest and other important considerations which are the basis of cls.
(2) to (6), may change and may even expand.
As Holmes ' J. has said in Abrams vs United States (1) : "the .,Constitution is an experiMent, as all life is an experiment".
It is therefore legitimate to assume that the Constitution makers (1) ; , 630. 937 intended that Parliament should be competent to make amend ments in these rights so as to meet the challenge of the problems which may arise in the course of socioeconomic progress and development of the country.
I find it therefore difficult to accept the argument of the petitioners thal the Constitution makers contemplated that fundamental rights enshrined in Part III were finally and immutably settled and determined once and for all and these rights are beyond the ambit of any future amendment.
Today at a time when absolutes are discredited, it must riot be too readily assumed that there are basic features of the Constitution which shackle the amending power and which take precedence over the general welfare of the nation and the need for agrarian and social reform.
In construing article 368 it is moreover essential to remember the nature and subject matter of that Article and to interpret it subjectae materies.
The power of amendment is in point of quality an adjunct of sovereignty.
It is in truth the exercise of the highest sovereign :power in the State.
If the amending power is an adjunct of sovereignty it does not Admit of any limitations.
This view is expressed by Dicey in "Law of the Constitution", 10th Edn., at page 148 as follows "Hence the power of amending the constitution has been placed, so to speak, outside the constitution, and that the legal sovereignty of the United States resides in the States ' governments as forming one aggregate body represented by three fourths of the several States at any time.
belonging to the Union.
" A similar view is stated by Lord Bryce in" "The" American Commonwealth", Vol. 1, ch.
XXXII, page 366.
Lester Bernhardt Orfield states,as follows in his book he Amending of the Federal Constitution" "In the last analysis, one is brought to the conclusion that sovereignty in the United States, if it can be said to exist at all, is located in the amending body.
The amending body has often beep referred to as the sovereign, because it meets the fest of the location of sovereignty.
As Willoughby has said: 'In all those cases in which, owing to the distribution of governing power, there is doubt as to the political body in which the Sovereignty rests, the test to be applied is the determination of which authority has, in the last instance, the legal power to determine its own competence as well as that of others '.
938 Applying the criteria of sovereignty which were laid down at the beginning of this chapter, the amending, body is sovereign as a matter of both law and fact.
Article Five expressly creates the amending body.
Yet in a certain manner of speaking the amending body may be said to exist as a matter of fact since it could proceed to alter Article Five or any other part of the Constitution.
While it is true that the sovereign cannot act otherwise than in compliance with law, it is equally true that it creates the law in accordance with which it is to act.
" In his book "Constitutional Law of the United States", Hugh Evander Willis says that the doctrine of amendability of the Constitution is based on the doctrine of the sovereignty of the people ,and that it has no such implied limitations as that an amendment shall not contain a new grant of , power nor be in the form of legislation, nor change "our dual form of government nor change the protection of the Bill of Rights, nor make any other change in the Constitution." James G. Randall also enunciates the proposition that when a constitutional amendment is adopted "it is done not by the 'general government, but by the supreme sovereign power of the nation i.e., the people, acting through State Legis latures or State conventions" and that "the amending power is 'equivalent to the Constitution makin power and is wholly above 'the authority of the Federal Government" ( 'Constitutional Pro Under Lincoln ', p. 395).
, The legal position is summarised 'by Burdick at page 48 of his treaties "The Law of the American Constitution as follows : "The result of the National Prohibition Cases ; seems to be that there is no limit to the power to amend the Constitution, except that a State may not without its consent be deprived of its equal suffrage in the Senate.
To out the case most extremely, this means that by action of two third, of both Houses of Congress and of the, legislatures in three fourths , of the states all of the powers of the national government could be surrendered to the States, or all of the reserved powers of the States could be transferred to the federal government.
It is only public opinion acting upon these agencies which places any check upon the amending power.
But the alternative to this result would be to recognize the power of the Supreme Court to veto the will of the people expressed in a constitutional amendment without any possibility of the reversal of the court 's action except through revolution.
" 939 The matter has been clearly put by George Vedel in Manuel Elementaire De Droit Constitutionnel (Recueil Sirey) at page 117 as follows : "Truly speaking no constitution prohibits for ever its amendment or its amendment in all its aspects.
But it can prohibit for example, the amendment (revision) during a certain time (the Constitution of 1791) or it can prohibit the amendment (revision) on this or that point (as in the Constitution of 1875) which prohibits amendment of the republican form of Government and the present Constitution follows the same rule.
But this prohibition has only a political but no juridical value.
In truth from the juridical viewpoint a declaration of absolute , constitutional immutability cannot be imagined.
The Constituent power being the supreme power in the state cannot be fettered, even by itself.
For example,article 95 of our constitution stipulates, "The republican form of Government cannot be the subject of a proposal for amendment.
But juridically the obstacle which this provision puts in the way of an amendment of the republican form of government can be lifted as follows.
It is enough to abrogate, by way of amendment (revision) the article 95 cited, above.
After this, the obstacle being removed, a second amendment can deal with the republican form of Government.
In practice, this corresponds to the idea that the constituent assembly of today cannot bind the nation of tomorrow.
" the argument of implied limitation was advanced by Mr. N. C. Chatterji and it was contended that item No. 3 of the Indo Pakistan Agreement providing for a division of Berubari Union between India and Pakistan was outside the power of constitutional amendment and that the preamble to the, Constitution did not permit the dismemberment of India but preserved the integrity of the territory of India.
The argument was rejected by this Court and it was held that Parliament acting under article 368 can make a law to give effect to and implement the Agreement in question or to pass a law amending article 3 so as to cover cases of cession of the territory of India and thereafter make a law under the amended article 3 to implement the Agreement.
(1) 940 There is also another aspect of the matter to be taken into account.
If the fundamental rights are unamendable and if article 368 does not include any such power it follows that the amendment of, say, article 31 by insertion of articles 31 A and 31 B can only be made by a violent revolution.
It was suggested for the petitioners that an alteration of fundamental rights could be made by convening a new Constituent Assembly outside the frame work of the present Constitution, but it is doubtful if the proceeding,., of the new Constituent Assembly will have, 'any legal validity, for the reason is that if the Constitution provides its own method of amendment, any other method of amendment of the Constitution will be unconstitutional and void.
For instance, in George section Hawke vs Harvey C. Smith, as Secretairy of State of Ohio(1) it was held by the Supreme Court of the U.S.A. that Referendum provisions.
of State Constitutions ' and statutes cannot be applied in the 'ratification or rejection of amendments to the Federal Constitution without violating the requirements of Article 5 of such Constitution and that such ratification shall be by the legislatures of the several states, or by conventions therein, as Congress shall decide.
It was held in that case that the injunction was properly issued against the calling of a referendum election on the act of the legislature of a State ratifying an amendment to the Federal Constitution.
If, therefore, the petitioners are right in their contention that article 31 is not amendable within the frame work of the present Constitution, the only other recourse for making the amendment would, as I have already said, be by revolution and not through, peaceful means, It cannot be reasonably supposed.
that the Constitution makers contem plated that article 31 or any other article on fundamental rights should be altered by a violent revolution and not by peaceful change.
It was observed in Feigenspan vs Bodine (2) "If the plaintiff is right in its contention of lack of power to insert the Eighteenth Amendment into the United States Constitution because of its subject matter.
it follows that there is no way to incorporate it and others of like character into the national organic law, except, through revolution.
This, the plaintiff concedes, is the inevitable conclusion of its contention.
This is so starting a proposition that the judicial mind may be pardoned for not readily acceding to it, and for insisting that only the most convincing reasons will justify 'its acceptance.
" I am, therefore, of the opinion that the petitioners Are unable to make good their argument on this aspect of: the case.
It was then contended for the petitioners,that there would be anomalies if article 368 is interpreted to have no implied limita (1) ; (2)264 Fed.
941 tions.
It was said that the more important articles of the Constitution can be amended by the procedure mentioned in the substantive part of article 368 but the less important articles would require ratification by the legislatures of not less than half of the States under the proviso to that Article.
It was argued that the fundamental rights and also article 32 could be amended by the majority of two thirds of the members of Parliament but article 226 cannot be amended unless there was ratification of the legislatures of not less than half of the States, It was pointed out that articles 54 and 55 were more difficult to amend but not article 52.
Similarly, article ' 162 required ratification of the States but not article 163 which related to the 'Council of Ministers to aid and advise the Governor in the exercise of his functions.
In my opinion the argument proceeds on a misconception.
The scheme of article 368 is not to divide the Articles of the Constitution into two categories, viz., important and not so important Article.
It was contemplated by the Constitution makers that the amending power in the main part of article 368 should extend to each and every article of the Constitution but in the case of such articles which related to the federal principles or the relation of the States with the Union, the ratification of the legislatures of at least half the States should be obtained for any amendment.
It was also contended that if article 368 was construed without any implied limitation the amending power under that Article could be used for subverting the Constitution.
Both Mr. Asoke, Sen and Mr. Palkiwala resorted to the method of reduction ad absurdem 'MI pointing out the abuses that might occur if there were no limitations on the power to amend.
It was suggested that Parliament may, by a constitutional amendment, abolish the parliamentary system of government or repeal the chapter of fundamental rights or divide India into.
two States, or even reintroduce the rule of a monarch.
It. is inconceivable that 'Parliament should utilise the amending power for bringing about any of these contingencies.
It is, however, not permissible, in the first place, to assume that in a matter of constitutional amendment there will be abuse of power and then utilise it as a test for finding out the scope of the amending power.
This Court has declared repeatedly that the possibility of abuse is not to be used as a test of the existence or extent of a legal power [See for example, State of West Bengal vs Union of India(1), at page 407].
In the second place, the amending power is a power, of an altogether different kind from the ordinary governmental power and if an abuse occurs,, it occurs at the hands of Parliament and the State Legislatures representing an extraordinary majority of the people, so that for all practical purposes it may be said to be the people, or at least.
the highest agent of the people, and one exercising sovereign powers.
It is therefore (1) [1964]1 S.C.R. 371. 942 anomalous to speak of 'abuse ' of a power of this description.
In the last analysis, political machinery and artificial limitations will not protect the people from themselves.
The perpetuity of our democratic institutions will depend not upon special mechanisms or devices, nor even upon any particular legislation, but rather upon the character and intelligence and the good conscience of our people themselves.
As observed by Frankfurter, 1.
in American Federation of Labour vs American Sash & Door Co.(1) "But a democracy need rely on the courts to save it from its own unwisdom.
If it is alert and without alertness by the people there can be no enduring democracy unwise or unfair legislation can readily be removed from the statute books.
It is by such vigilance over its representatives that democracy proves itself" I pass on to consider the next objection of the petitioners that the true purpose and object of the impugned Act was to legislate in respect of land and that legislation 1n respect of land falls within the jurisdiction of State legislatures under Entry 18 of List 11, and the argument was.
that since the State Legislatures alone can make laws in respect of land, Parliament had no right to pass the impugned Act.
The argument was based on the assumption that the impugned Act purports to be, and in fact is, a piece of land legislation.
It was urged.
that the scheme of articles 245 and 246 of the Constitution 'clearly showS that Parliament has no right to make a law in respect of land, and since the impugned Act is a legislative measure in relation to land, it is in Valid.
In my opinion, the argument is based upon a misconception.
Whet the impugned Act purports to do is not to make any land legislation but to protect and validate the legislative measures in respect of agrarian reforms passed by the different State Legislatures in the country by granting them immunity from attack based on the plea that they contravene fundamental rights.
The impugned Act was passed by Parliament in exercise of the amending power conferred by article 368 and it is impossible to accept the argument that the constitutional power of amendment can be fettered by articles 245 and 246 or by the legislative Lists.
It was argued for, the petitioners that Parliament cannot validate a law Which it has no Power to enact.
The proposition holds good where the validity on impugned Act turns on whether the subject matter falls within or without the jurisdiction of the legislature which passed it.
But to make a law which contravenes the Constitution constitutionally valid is a matter of constitutional amendment, and as such it falls within the exclusive power of Parliament and within the amending power conferred by article 368.
I am accordingly of the opinion that the petitioners are unable to (1) ; ,556.
943 substantiate their argument on this aspect of the case.
I should like to add that in Lesser vs Garnett(1), in National Prohibition Cases(2 ) and in United States vs Sprague(3), a similar argument Was advanced to the effect that a constitutional amendment was not valid if it was in the form of legislation.
But the argument was rejected by the Supreme Court of the U.S.A. in all the three cases.
It remains to deal with the objection of the petitioners that the newly inserted articles 31 A and 31 B require ratification of the State legislatures under the proviso to article 368 of the Constitution because these articles deprive the High Courts of the power to issue appropriate writs under article 226 of the Constitution.
I do not "think there is any substance in this argument.
The impugned Act does not purport to change the provisions of article 226 and it cannot be, said even to have that effect directly or in any substantial measure.
It is manifest that the newly inserted articles do I not either in terms or in effect seek to make any change in article 226 of the Constitution.
Article 31 A aims 'at saving laws providing for the compulsory acquisition by the State of a certain kind of property from the operation of article 1 3 read with other relevant articles in Part III, while article 31 b purports to validate certain specified Acts g Regulations, already passed, which, but for such a; provision , would be liable to be impugned under article 13 It is therefore ' not correct to say that the powers of High Courts to issue writs is, in 'any way, affected.
The jurisdiaction 'of the High Courts remains just the same as it Was before.
Only 'a certain category of cases has been excluded from the purview of Part III and the High Courts can no longer intervene, not because their Jurisdiction or powers have been curtailed in any manner or to.
any but because there would be no occasion hereafter for the exercise of their power in such cases.
As I have already said, the effect of the impugned Act on the jurisdiction of the High Courts under article 226 of the, Con stitution is not direct but only incidental in character and therefore the contention " of the petitioners on this point against the validity of the impugned Act must be rejected.
It is well settled that in examining a constitutional question of this character, it is legitimate to consider whether the impugned legislation is a legislation directly in respect of the subject matter covered by any particular article of the Constitution or whether touches the said articles only incidentally or indirectly.
In A. K. Gopalan vs The State of Madras (4), kania , C.J., had occasion to consider the validity of the argument that, the Preventive detention order resulted in the detention of the applicant in a cell, and so, it contravened his fundamental rights guaranteed by (1) ; (2)253 U.S. 350.
(3) ; (4) ; 101. 944 article 19(1)(a), (b), (c), (d), (e) and (g).
, Rejecting this argument, the learned Chief Justice observed that the true approach in dealing with such a question was only to consider the directness of the legislation and not what will be the result of the detention otherwise valid, on the mode of the detenu 's life.
On that ground alone, he was inclined to reject the contention that the order of detention.contravened the fundamental rights guaranteed to the petitioner under article 19(1).
At page 100 of the report, Kania, C.J., stated as follows : "As the preventive detention order results in the detention of the applicant in a cell it was contended on his behalf that the rights specified in Article 19(1) (a), (b), (c), (d), (e) and (g) have been infringed.
It was argued that because of his detention he cannot have a free right to speech as and where he desired and the same argument was urged in respect of the rest of the rights mentioned in sub clauses (b), (c), (d) (e) and (g).
Although this argument is advanced in a case which deals with preventive detention, if correct, it should be applicable in the case of punitive detention also to any one sentenced to a term of imprisonment under the relevant section of the Indian Penal Code.
So considered, the argument must clearly be rejected.
In spite of the saving clauses (2) to (6), permitting abridgement of the rights connected with each of them, punitive detention under several sections of the Penal Code, i.e., for theft, cheating, forgery and even ordinary assault, will be illegaL Unless such conclusion necessarily follows from the article, it is obvious that such construction should be avoided.
In my opinion, suc h result is.
clearly not the outcome of the Constitution.
The article has to be read without any pre conceived notions.
So read, it clearly means that the legislation to be examined must be directly in respect of one of the rights mentioned in the sub clauses.
If there is a legislation directly attempting to control a citizen 's freedom of speech or ex pression, or his right to assemble peaceably and without arms, etc., the question whether that legislation is saved by the relevant saving clause of article 19 will arise.
If, however, the legislation is not directly in respect of any of these subjects but as a, result of the operation of other legislation, for instance, for punitive or preventive detention, his right under any of these sub clauses is abridged, the question of the application of article 19 does not arise. 'Me true approach is only to consider the direct ness of the legislation and not what will be the result of the detention otherwise valid, on the mode of the detenu 's 945 life.
On that , short ground, in my opinion, this argument about the infringement of the rights mentioned in article 19(1) generally must fail.
Arty other construction put on the article, it seems to me , will be unreason It is true that the opinion thus expressed by Kania, C.J. in the case of A. K. Gopalan vs The State of Madras( ) did not receive, the concurrence of the other learned Judges who heard the said case.
Subsequently, however, in Ram Singh & Others vs The State of Delhi & Anr.(2) the said observations were cited with approval by the Full Court.
The same.
principle was accepted by this Court in Express Newspapers (Pvt.) Ltd. vs The Union of India( '), in the majority judgment in Atiabari Tea Co. Ltd. vs The State of Assam (4 ) and in Naresh Shridhar Mirajkar vs The State of Maharashtra("),.
Applying the same principle to the present case, consider that the effect of the impugned Act on the powers of the High Court under article 226 is indirect and incidental and not direct.
I hold that the impugned Act falls under the substantive part of article 368 because the object of the impugned Act is to amend the relevant Articles in Part III which confer fundamental rights on citizens and not to change the power of the High Courts under article 226.
In this connection I should like to refer to another aspect of the matter.
The question about the validity of the Constitution (First Amendment) Act has been considered by, this Court in Sri Sankari Prasad Singh Deo vs Union of India and State of Bihar(6).
In that case, the validity of the said Amendment Act was challenged, firstly, on the ground that the newly inserted articles 31 A and 31 B sought to make changes in articles 132 and 136 in Ch.
IV of Part V and article 226 in Ch.
V of Part VI.
The second ground was that the amendment was invalid because it related to legislation in respect of land.
It was also urged, in the third place, that though it may be open to Parliament to amend the provisions in respect of fundamental rights contained in Part ITT, the amendment made in that behalf would have to be tested in the light of provisions of article 13(2) of the Constitution.
The argument was that the law to which article 13(2) applied would include a law passed by Parliament by virtue of its constituent power to amend the Constitution, and so, its validity will have to be tested by article 13(2) itself.
All these arguments were rejected by this Court and it was held in that case that the Constitution (First Amendment) Act was legally valid.
The same question arose for consideration in Sajjan Singh vs State of Rajasthan (7) with regard to the validity of the Constitution (Seventeenth Amendment) Act, 1964.
In that case, the petitioners in their (1) ; (2) ; ,456.
(3) ,129 30.
(4) ; , 864.
(5) ; (6) [1995] 1 S.C.R. 89.
(7) 946 Writ Petitions in this Court contended that the Constitution (Seventeenth Amendment) ' Act was constitutionally invalid since the powers Prescribed by article 226 which is in Ch.
V, Part VI of the Constitution Were likely to be affected by the Seventeenth Amendment, and therefore the special procedure laid down under article 368 should have been followed.
It was further contended in that case that the decision of this court in Sankari Prasads(1) case should be reconsidered. 'Both the contentions were re , rejected by this Court by ' a majority Judgment and it was held that the Constitution (Seventeenth Amendment) Act amended the fundamental rights solely with the object of assisting the State Legislatures to give effect to the socioeconomic policy of the party inpower and its effect on article 226 was incident and insignificant and the impugned Act therefore fell under the substantive part of article 368 and did not attract the proviso to that article.
It was further held.
by this Court that there Was no justification for re considering Sankari Prasad 's(1) case.
On behalf of the respondents it was submitted by the Additional Solicitor Generat that this was a very strong case for the application of the principle of stare decisis.
In my opinion, this contention must be accepted as correct.
If the arguments urged by the petitioners are to prevail it would leadto the inevitable consequence that the amendments made to the Constitution both in 1951 and in 1955 would be rendered invalid and.
a large number of decisions dealing with the validity of the Acts included in the 9th Schedule which were pronounced by this Court ever since, the decision in Sankari Prasad 's(1) case was dec lared, would also have to be overruled.
It was also pointed out that Parliament, the Government and the people have acted on the, faith of the decision of this Court in Sankari Prasad 's(1) case and titles to property have been transferred, obligations have been incurred and rights have been acquird in the implementation of the legislation included in the 9th Schedule.
The, effect of land reform legislation has been clearly summarised in ch.
VIII of Draft Outline on Fourth Plan as follows "Fifteen years ago when the First Plan was being formulated, intermediary tenures like zamindaris, jagirs and inams covered more than 40 per cent of the area.
There were large disparities in the ownership of land held under ryotwari tenurer which covered the other 60 per cent area; and ' a substantial portion of the land was cultivated through tenants at will and share croppers who paid about one half the produce as rent.
Most holdings were small and fragmented.
Besides, there was a large population of landless agricultural labourers.
In these conditions, the, principal.
measures recommended for securing the objec (1)[1952] S.C.R. 89. 947 tives of the land policy were the abolition of intermediary tenures, reform of the tenancy system, including fixation of fair rent at one fifth to one fourth of the grossproduce, security of I tenure for the tenant, bringing tenants into direct relationship with the State and investing in them ownership of land.
A ceiling on land holding was also recmmended so that some surplus land, may be made available for redistribution to the landless agricultural workers.
Another important part of, the progamme was consolidation of agricultural holdings and increse in the size of the operational unit to an economic scale through cooperative methods.
Aboiition of Intermediaries.
During the past 15 years, progress has been made in several directions.
Theprogramme for the abolition of intermediaries has been carried out practically all over, the country.
About 20 million tenants of former intermediaries came into direct relationship with the State and became owners of their holdings.
State Governments are now engaged in the assessment and payment of compensation.
There were some initial delays but a considerable progress hag been made in this direction in recent years and it is hoped that the issue of compensatory bonds will be completed in another two years.
Tenancy Reform.
TO deal with the problem of tenants at will in the ryotwari areas and of 'sub ' tenants in the zamindari areas, a good deal of legislation has been enacted.
Provisions for security of tenure, for bringing them into direct relation with the State and converting them into owners have 'been made in several States.
As a result, about 3 million tenants and share croppers have acquired ownership of 'More than 7 million acres.
Ceiling on Holdings.
Laws imposing ceiling on agri,cultural holdings bave been enacted in all the States.
In the former Punjab area, however the State Government has the power to settle tenants on land in excess of the permissible limit although it has not set a ceiling on ownership.
According to available reports over 2 million acres of surplus areas in excess of the ceiling limits have, been declared or taken possession of by Government.
" It is true that the principle of stare decisis may not strictly apply to, a decision on a constitutional point.
There is no restriction in the Constitution itself which prevents this Court from reviewing its earlier decisions or even to depart from them in the interest of public good.
It is true that the problem of construing constitutional provisions cannot be adequately solved by merely adopting 948 the literal construction of the words used in, the various articles.
The Constitution is an organic document and it is intended to serve as a guide to the solution of changing problems which the Court ' may have to face from time to time.
It is manifest that in a progressive and dynamic society the character of these problems is bound to change with the inevitable consequence that the relevant words used in the Constitution may also change their meaning and significance.
Even so., the Court is reluctant to accede to, the suggestion that its earlier decisions should be frequently reviewed or departed from.
In such a case the test should be : what is the nature of the error alleged in the earlier decision, what is its impact on the public good and what is the compelling character of the considerations urged in support of the contrary view.
It is also a relevant factor that the earlier decision has been followed in, a large number of cases, that titles to property have passed and multitude of rights and obligations have been created in consequence of the earlier decision.
I have already dealt with the merits of the contention of the petitioners with regard to the validity of the impugned Act and I have given reasons for holding that the impugned Act is constitutionally valid and the contentions ,of the petitioners are unsound.
Even on the assumption that it is possible to take a different view and to hold that the impugned Act is unconstitutional I am of opinion that the principle of state decisis must be applied to the present case and the plea made by the, petitioners for reconsideration of Sankari Prasad(1) case and the decision in Sajjan Singh vs State of Rajasohan(2) is wholly unjustified and must be rejected.
In Writ Petition No. 202 of 1966, it was contended by Mr. Nambyar that the continuance of the Proclamation of Emergency under article 352 of the Constitution was a gross violation of power because the emergency had ceased to exist.
It was also contended that article 358 should be so construed as to confine its operation on to legislative or executive action relevant to the Proclamation of Emergency.
It was submitted that the Mysore State was rot a border area and the land reform legislation of that State had no relevant connection with the Proclamation of Emergency and the fundamental rights conferred by article 19 cannot be suspended so far as the petitions are concerned.
I do not think that it is necessary to express any opinion on these points because the Writ Petition must fail on the other grounds which I have already discussed above.
It is also not necessary for me to express an opinion on the doctrine of prospective overruling of legislation.
For the reasons already expressed I hold that all these petitions fail and should be dismissed, but there will be no order as to Petitions dismissed.
Costs.
| Held, that the first portion of cl. 25 of the Rajasthan Foodgrains Control Order, 1949, relating to the freezing of stocks of foodgrains is not void under article 19(1)(f) of the Constitution because such freezing of stocks of foodgrains is reasonably related 983 to the object which the Act was intended to achieve, namely to secure the equitable distribution and availability at fair prices and to regulate transport, distribution, disposal and acquisition of an essential commodity such as foodgrains.
Hold, that the last portion of cl. 25 to the effect that " such stocks shall also be liable to be requisitioned or disposed of under orders of the said authority at the rate fixed for purposes of Government procurement ", is void both under article 19(1)(f) and article 31(2) of the Constitution: (i)because the clause places an unreasonable restriction upon the carrying on of trade or business and is thus an infringement of the respondents ' right under article 19(1)(f) of the Constitution; (ii)because the clause by vesting the power in the authority to acquire the stocks at any price fails to fix the amount of compensation or specify the principles on which it is to be determined and leaves it entirely to the discretion of the executive authority to fix any compensation it likes and is thus hit by article 31(2) of the Constitution.
|
ivil Appeal No. 1188 of 1977.
From the Judgment and Order dated 7.12.1976 of the Allahabad 3 High Court in F.A.O. No. 444 of 1975.
AND Special Leave Petition (C) No. 5344 of 1977.
From the Judgment and Order dated 7.12.1976 of the Allahabad High Court in F.A. (F.O.) No. 458 of 1975.
Praveen Swarup, Pramod Swarup, B.D. Sharma, Smt.
Sushma Suri, and Jitender Sharma for the appearing parties.
The Judgment of the Court was delivered by PUNCHHI, J.
This appeal and special leave petition are cross cases in nature and are directed against the judgment and order dated December 7, 1976 passed by a Division Bench of the High Court of Allahabad At Allahabad in F.A.O. No. 444 of 1976.
The facts established before the Motor Accident Claims Tribunal, Bulandshahr and re oriented before the High Court were that Randhir Singh while driving a tempo on October 10, 1972 on a road leading from Bulandshahr to Sikandrabad was hit head on by a speeded truck owned by Ramesh Chandra, as a result of which his tempo was thrown into a nearby ditch whereby he sustained injuries on both his legs and his several bones were fractured as well.
This was followed by lodging of a report at Police Station, Sikandrabad and putting the injured at District Hospital, Bulandshahr where from he was removed to Safdarjung Hospital, New Delhi for final treatment.
The permanent result was that a part of the right foot of Randhir Singh had to be amputated as his toes had become gangrenous.
Randhir Singh moved the Motor Accident Claims Tribunal, Bulandshahr seeking damages to the tune of Rs.1 lakh.
The contestants being Ramesh Chandra the owner of the truck, its driver and the Insurance Company took various defences to negative the claim.
The matter was focussed by the issues framed.
The Tribunal by an elaborate and well reasoned order fixed negligence on the truck driver and held the injured entitled to compensation.
In the measurement thereof the Tribunal took note of the age of the claimant to be 22 years and his expected income as a driver of a motor vehicle at a minimum rate of Rs.300 p.m., expected to be earned for at least 22 years in the coming.
The figure thus arrived was at Rs.79,200 and that 4 being lumpsum payment determined a sum of Rs.55,000 to be adequate compensation for the permanent disability suffered by the claimant.
Besides the Tribunal granted Rs.3,000 on account of expenses of treatment.
Under the head of general damages for pain, suffering and loss of enjoyment of life the Tribunal awarded a sum of Rs.20,000 as compensation.
Thus a total award of Rs.78,000 was made in favour of the claimant.
Rs.50,000 was ordered to be paid by the Insurance Company as its liability was found to be limited to that extent.
The remaining Rs.28,000 was ordered to be paid by the owner.
The claimant also got 3/4th of his costs.
Three separate appeals were filed before the High Court; one by the dissatisfied claimant; the second by the ag grieved truck owner and the third by the aggrieved Insurance Company.
The High Court dealt with the matter in equal elaboration.
It affirmed the view of the Tribunal in grant ing compensation under the three heads aforementioned.
However, the award was improved to the extent that the claimant also got interest at the rate of 6 per cent per annum on the amount of compensation from 11.11.1972, the date on which the claim petition was filed upto the date of the payment thereof; subject of course to suitable adjust ments in the event of any payment having already been made to the claimant.
In Civil Appeal No. 1188 of 1977, preferred by the owner of the truck, leave was granted limited to grounds II & XIX of the Special Leave Petition.
In Ground No. II the question raised was that when the claimant had not claimed interest in the application, and the Tribunal had not awarded any, the High Court was in error in granting interest under Section 110 CC of the where the power of the Court of the Tribunal was discretionary.
In Ground No. XIX the question raised was that a sum of Rs.20,000 on account of mental agony, pain and suffering etc.
was arbi trarily granted, and thus ought to have been taken to be covered up by the compensation granted on account of loss of earning.
In Special Leave Petition No. 5344 of 1977 the claimant has asked for more compensation, interest etc on each count.
We have heard learned counsel for the parties and have perused the appeal papers, in particular regard of the limited nature of appeal of the truck owner.
Section 110 CC, as it stood on the date of the accident, provided that where any Court or Claims Tribunal allows a claim for compensation made under the Act, such Court or Tribunal may direct that in addition to the amount of compensation simple 5 interest shall also be paid at such rate and from such date not earlier than the date of making the claim as it may specify in this behalf.
The caption of the provision is "Award of interest where any claim is allowed".
The question of award of interest is dependent on the claim being al lowed.
Should the claim be not allowed, the question of grant of interest would not arise, and if awardable, it is in addition to the amount of compensation.
The Court of Tribunal, in these circumstances, should determine, in the first instance, claim for compensation and in the event of its being allowed can further exercise the discretion to grant simple interest in terms thereof, but as an additive to the amount of compensation.
So the addition of interest to the compensation, by judicial discretion, is sequential in the eye of law and no claim in that regard, in our view, specifically need be laid in so many words in the claim petition.
The grant of interest in our view, is not depend ent on any pleading in that regard and can even be orally asked if the contingency arises.
Thus, in our view, there is no substance in Ground No. II of the Special Leave Petition and the attack to the grant of interest is negatived.
With regard to Ground No. XIX covering the question that the sum awarded for pain, suffering and loss of enjoyment of life etc.
termed as general damages should be taken to be covered by damages granted for loss of earnings is concerned that too is mis placed and without any basis.
The pain and suffering and loss of enjoyment of life which is a resultant and permanent fact occasioned by the nature of injuries received by the claimant and the ordeal he had to undergo.
If money be any solace, the grant of Rs.20,000 to the claim ant represents that solace.
Money solace is the answer discovered by the Law of Torts.
No substitute has yet been found to replace the element of money.
This, on the face of it appeals to us as a distinct head, quite apart from the inability to earn livelihood on the basis of incapacity or disability which is quite different.
The incapacity or disability to earn a livelihood would have to be viewed not only in presenti but in futuro on reasonable expectancies and taking into account deprival of earnings of a conceiva ble period.
: This head being totally different cannot in our view overlap, the grant of compensation under the head of pain, suffering and loss of enjoyment of life.
One head relates to the impairment of a person 's capacity to earn, the other relates to the pain and suffering and loss of enjoyment of life by the person himself.
For these reasons, we are of the considered view that the contentions raised by the truck owner appellant in that behalf must be negatived and we hereby negative them.
6 With regard to further enhancement of compensation and further enhancement of interest, as claimed in the special leave petition by the claimant, we find in the facts and circumstances of this case, no scope in that regard.
As a result of the afore discussion, both these matters are without merit and are accordingly dismissed.
Parties to bear their own costs.
N.P.V. Appeals dis missed.
| In a claim for damages for the permanent disability suffered by the claimant, the Motor Accident Claims Tribunal awarded compensation under different beads, viz., (a) com pensation for permanent disability (b) expenses of treat ment, and (c) general damages for pain, suffering and loss of enjoyment of life, against the Insurance Company and the truck owner.
On Separate appeals by the claimant, truck owner and the Insurance Company, the High Court, not only affirmed the award but also improved it by granting interest at 6 per cent per annum on the amount of compensation from the date the claim petition was filed upto the date of payment of compensation.
The truck owner filed an appeal, by special leave, before this Court on several grounds including that when the claimant had not claimed interest in the application, and the Tribunal had not awarded any, the High Court was in error in granting interest under Section 110 CC of the , where the power of the Court of the Tribunal was discretionary, and that the grant of damages on account of mental agony, pain and suffering etc.
was arbitrary and ought to have been taken to be covered by the compensation granted on account of loss of earning.
The claimant also filed an appeal, by special leave praying for more compensa tion, interest etc.
on each account.
Dismissing the appeals, this Court, 2 HELD: 1.1 The question of award of interest is dependent on the claim being allowed.
Should the claim be not allowed.
the question of grant of interest would not arise.
and if awardable, it is in addition to the amount of compensation.
The Court of Tribunal, in these circumstances, should deter mine, in the first instance, claim for compensation and in the event of its being allowed can further exercise the discretion to grant simple interest in terms thereof, but as an additive to the amount of compensation.
So, the addition of interest to the compensation, by judicial discretion, is sequential in the eye of law and no claim in that regard, specifically need be laid in so many words in the claim petition.
The grant of interest, is not dependent on any pleading in that regard and can even be orally asked if the contingency arises.
[5B D] In these circumstances, there is no substance in the attack to the grant of interest.
[5D] 1.2 The incapacity or disability to earn a livelihood would have to be viewed not only in presenti but in futuro on reasonable expectancies and taking into account deprival of earnings of a conceivable period.
This head being totally different cannot overlap the grant of compensation under the head of pain, suffering and loss of enjoyment of life.
One head relates to the impairment of a person 's capacity to earn, the other relates to the pain and suffering and loss of enjoyment of life by the person himself.
[5F G] In the instant case, the pain and suffering and loss of enjoyment of life is a resultant and permanent fact occa sioned by the nature of injuries received by the claimant and the ordeal he had to undergo.
This, on the face of it is a distinct head, quite apart from the inability to earn livelihood on the basis of incapacity or disability which is quite different.
If money be any solace, the grant of Rs.20,000 to the claimant represents that solace.
Money solace is the answer discovered by the Law of Torts.
No substitute has yet been found to replace the element of money.
[5E F] 1.3 In the facts and circumstances of this case, there is no scope for further enhancement of compensation and further enhancement of interest.
|
N: Criminal Appeal No. 261 of 1976.
Appeal by Special Leave from the Judgment and order dated 2 12 1975 of the Andhra Pradesh High Court in Criminal Misc.
Petition No. 2064/75.
D. V. Patel, Naunitlal and Miss Kiran Singh for the Appellants.
P. P. Rao, K. Narayan Rao and G. N. Rao for the Respondent.
93 The Judgment of the Court was delivered by JASWANT SINGH, J.
The appellants who are Directors of Tandur and Navandgi Stone Quarries Private Limited and holders of a mining lease for extraction of lime stones (Shahabad Stones) are being prosecuted in the Court of Munsif, Judicial Magistrate, First Class, Tandur, for the alleged violation of Rule 21 (1)(ii) of the Mineral Conservation and Development Rules, 1958 which is made punishable under Rule 27 of the said Rules in that they failed to employ a qualified geologist or a mining engineer.
they made an application before the trial Magistrate urging by way of preliminary objection that the complaint against them was not maintainable in view of the fact that the 'Shahabad Stones ' Which were being extracted by them were used fol.
building and construction purposes and as such were minor minerals which were specifically excluded from the purview of the Rules.
The Magistrate dismissed the application holding that what was being operated by the appellants was 'a mine for the purpose of the provisions of Rule 21 of the Mineral Conservation and Development Rules, D, 1958 '.
The appellants thereupon moved the High Court for quashing the aforesaid criminal proceedings pending against them reiterating that as the Shahabad Stones which they were extracting were used for building purposes and were described as minor minerals in Item 15 of Schedule I to the Andhra Pradesh Minor Mineral Concession Rules, 1966 (hereinafter referred to as M.M.C. Rules, 1966), the complaint against them was not tenable. 'The High Court dismissed the application holding that the inherent powers possessed by it under Section 482 of the Code of Criminal Procedure 1973 could be invoked and exercised only when the facts alleged in the complaint if they are accepted to be correct at their face value, do not make out an offence with which the accused is charged.
The High Court further held that merely because the 'Shahabad Stones ' were included in Schedule I to Rule 10 of the M.M.C. Rules, it could not be said straightway that the Stones which were being extracted by the appellants were minor minerals and that some evidence regarding their user was necessary for determination of the question as to whether the appellants were entitled to the benefit of the provision of Rule 2 of the M.M.C. & D. Rules which Provided that the M.M.C. Rules do not apply to the minor minerals.
It is this refusal of the High Court to quash the proceedings which has given rise to the present appeal.
It is now well settled that the High Court does not ordinarily interfere at an interlocutory stage of a criminal proceedings pending in a subordinate Court.
Bearing in mind the well recognised principles of law governing the matter and taking into consideration the nature of 94 the impugned order, we think the High Court was right in declining to grant relief to the appellants.
It is also not a matter in which we may legitimately interfere in exercise of our extraordinary powers under Article 136 of the Constitution specially when the case is at its threshold and evidence has still to be adduced as to whether the minerals extracted could or could not be used as a major mineral for certain purposes.
It must be realised that it is not possible to determine difficult question of the kind involved in the instant case purely in abstract without relevant evidence bearing on the matter in issue.
Accordingly, we dismiss the appeal.
Our order will not, however, be interpreted as barring the appellants from raising any defence or contention that may be open to them before the trial court which will dispose of the same in accordance with law uninhibited by any observations made by it earlier or by the High Court in the course of its Order dismissing the application under section 482 of the Code of Criminal Procedure, 1973.
S.R. Appeal dismissed.
| "Shahabad Stones" are included under Item 15 in Schedule I to Rule 10 of the Andhra Pradesh Minor Mineral Concession Rules 1966.
The appellants, who are directors of Tandur and Navandgi Stone Quarries (Pvt.) Ltd. and holders of mining lease for extraction of lime stones (Shahabad Stones when being prosecuted, for the alleged violation of Rule 21(1)(ii) of the Mineral Conservation and Development Rules, 1958 which is made punishable under Rules 27 of the said rules in that they failed to employ a qualified geologist or a mining engineer, raised a preliminary objection as to the maintainability of the complaint in view of the specific exclusion of the "Shahabad Stones" from the purview of the 1958 Rules, being a minor mineral being used for building and construction purposes.
The trial magistrate dismissed the application and the High Court declined to interfere under Section 48 of the Criminal Procedure Code, 1973.
Dismissing the appeal by special leave the Court, ^ HELD: As the High Court does not ordinarily interfere at an interlocutory stage of a criminal proceedings pending in a subordinate Court, the A.P. High Court was right in declining to grant relief to the appellants, bearing in mind the well recognised principles of law governing the matter and taking into consideration the nature of the impugned order.
It is also not a matter in which Supreme Court may legitimately interfere in exercise of their extra ordinary powers under article 136 of the Constitution especially when the case at its threshold and evidence has still to be adduced as to whether the minerals extracted could or could not be used as a major mineral for certain purposes.
It is not possible to determine difficult question of the kind involved in the instant case, purely in abstract without relevant evidence bearing on the matter in issue.
[93G H, 94A B]
|
minal Appeals Nos.
36 to 38 of 1955.
Appeals from the judgment and order dated the 14th February, 1955, of the Punjab High Court (Circuit Bench), Delhi, in Criminal Writs Nos. 36 D, 37 D and 52 D of 1954.
C. K. Daphtary, Solicitor General of India, N. section Bindra and R. H. Dhebar, for the appellants.
N. C. Chatterjee, A. N. Sinha and N. H. Hingorani, for the respondents.
December 16.
The judgment of Sinha, C. J., Gajendragadkar, Das Gupta and Shah, JJ., was delivered by Gajendragadkar, J. Subba Rao, J., delivered a separate judgment.
GAJENDRAGADKAR J.
These three appeals which have been filed in this Court with certificates issued by the Punjab High Court under article 132(1) of the Constitution are directed against the orders passed by the said High Court by which cl.
11B of Iron and Steel (Control of Production & Distribution) Order, 1941 (hereinafter called the Order) has been declared unconstitutional and inoperative, and the criminal proceedings commenced against M/s. Bhana Mal Gulzari Mal and others under the said clause 11B read with section 7 of the Essential Supplies (Temporary Powers) Act, 1946 (Act XXIV of 1946) (hereinafter called the Act) have been quashed.
M/s. Bhana Mal Gulzari Mal Ltd., is a private limited company having its registered office at Chawri Bazar, Delhi.
Since 1948, it has been registered as a stockholder by the Iron and Steel Controller (hereinafter called the Controller) under cl. 2(d) of the Order.
It appears that 630 under cl.
11B of the Order notifications had been issued from time to time giving a schedule of base prices in respect of iron and steel.
On December 10, 1949, the Controller issued a, notification under cl.
11B decreasing by Rs. 30 per ton the prices already fixed for all categories of steel.
Several criminal cases, were instituted (Nos. 385 410 of 1954) against the said company, its three directors, its general manager and two salesmen (hereinafter called respondents 1 to 7) on the allegation that they, had sold their old stock of steel for prices higher than those prescribed by the said notification of December 10, 1949.
When the respondents had thus to face several criminal proceedings they filed three writ petitions in the Punjab High Court against the Union of India, the State of Punjab and others (hereinafter called the appellants).
By their Writ petition No. 36 of 1954 (23 3 54) they prayed for a direction, order or writ restraining the appellants from enforcing or giving effect to cl.
11B or the said notification, as well as a writ or order quashing the criminal proceedings commenced against them.
The decision in this writ petition has given rise to Criminal Appeal No. 36 of 1955.
Writ Petition No. 37 of 1954 (23 3 54) prayed for a similar order specifically in respect of the criminal cases Nos. 385410 of 1954 then pending against the respondents, and asked for an interim stay of the said proceedings.
The order passed on this writ petition has given rise to Criminal Appeal No. 37 of 1955.
It appears that under some of the criminal proceedings filed against the respondents orders for search had been passed by the trial Magistrate on May 12, 1953.
These orders ,were challenged by the respondents by their Writ Petition No. 52 D of 1954 (7 4 54).
An appropriate writ was asked for quashing the warrants issued under the said orders.
From the orders passed on this writ petition, Criminal Appeal No. 38 of 1955 arises.
In all 'these writ petitions the respondents ' contention was that cl.
11B was invalid and unconstitutional as it violated articles 19(1)(f) and (g) as well as article 31 of the Constitution.
They also urged that the said clause was ultra vires the powers 631 conferred on the Central Government by section 3 of the Act.
The notification issued by the Controller on December 10, 1949, was challenged by the respondents on the ground that it was issued under a clause which was invalid and was otherwise unreasonable and void.
In substance the High Court has upheld the respondents ' plea that cl.
11B is ultra vires as it is violative of the fundamental rights guaranteed under articles 19 (1)(f) and (g) of the Constitution.
In the present appeals the appellants seek to challenge the correctness of this conclusion.
Thus the main point which calls for our decision in this group of appeals is whether cl.
11B of the Order is valid or not.
The impugned clause forms part of the Order which has been issued by the Central Government in exercise of its powers conferred by sub r.
(2) of r. 81 of the Defence of India Rules.
Before considering the appellant 's contention that cl.
11B is valid it would be necessary to refer briefly to the parent Act, and to trace the vicissitudes through which it has passed, to examine its material provisions and their effect on the controversy in the present appeals.
It is well known that on September 29, 1939, the Defence of India Act was passed to provide for special measures to ensure the public safety and interest and the defence of British India and the trial of certain offences.
The Act and the Rules framed thereunder were enacted to meet the emergency which had arisen as a result of the Second World War.
Rule 81(2)(b) of the Rules authorised the Central Government inter alia, so far as appears to it necessary or expedient for securing the defence of British India or the efficient prosecution of war or for maintaining supplies and services essential to the life of the community, to provide by order for controlling the prices or rates at which articles or things of any description whatsoever may be sold or hired and for relaxing any maximum or minimum limits otherwise imposed on such prices or rates.
This Act was followed by Ordinance No. XVIII of 1946, which was promulgated on September 25, 1946.
Clauses 3 and 4 of this Ordinance are relevant for our 632 purpose.
Clause 3(1) provides inter alia that the Central Government, so far as it appears to it necessary or expedient for maintaining or increasing supplies of any essential commodity, or for securing their equitable distribution and availability at fair prices, may by notified order provide for regulating or prohibiting the production, supply and distribution thereof, and trade and commerce therein; sub cl. 2(c) adds inter alia that without prejudice to the generality of the powers conferred by sub section (1), an order made thereunder may provide for controlling the prices at which any essential commodity may be bought or sold.
This Ordinance was issued to provide for the continuance during a limited period of powers to control the production, supply and distribution of, and trade and commerce in, certain commodities which were treated as essential for national economy.
The essential commodities which were covered by the Ordinance were defined by cl. 2(a) as meaning any of the classes of commodities specified; they included iron, steel and coal.
Having provided for the delegation of the specified powers to the Central Government under cl. 3 the Ordinance provided for sub delegation by cl. 4.
Under this clause the Central Government was authorised to direct by a notified order that the power to make orders under cl. 3 shall, in relation to such matters and subject to such conditions, if any, as may be specified in the direction, be exerciseable by (a) such officer or authority subordinate to the Central Government, or (b) such Provincial Government or such officer or authority subordinate to a Provincial Government, as may be specified in the direction.
This Ordinance was later followed by the Act (Act XXIV of 1946) which was passed on November 19, 1946.
The preamble to the Act, the definition of essential commodity and the provisions for delegation and sub delegation which were included in the Ordinance have been re enacted by the Act.
The life of the Act thus passed was continued from time to time until the Essential Commodities Act No. 10 of 1955 was put on the statute book as a permanent measure.
The provisions of the ]Defence of India Act and the 633 Rules framed thereunder came into force to meet the emergency created by the war; but even after the war came to an end and hostilities ceased the emergency created by the war continued and the economic problems facing the country needed the assistance of similar emergency provisions.
That explains why those provisions have continued ever since 1939.
The Order of which cl.
11B is a part was issued on July 26, 1941, by the Central Government in exercise of the powers conferred on it by r. 81(2) of the Defence of India Rules which correspond to the provisions of section 3 of the Act.
It may be pointed out that as a result of the combined operation of cl. 5 of Ordinance XVIII of 1946 and section 7 of the Act, the Order must now be deemed to have been issued under section 3 of the Act.
It is necessary to examine briefly the broad features of the scheme of this Order.
The Controller specified in the Order is the person appointed as Iron and Steel Controller by the Central Government and includes any person described by cl. 2(a) of the Order.
The Order applies to all iron and steel of the categories specified in its Second Schedule.
Clauses 4 and 5 regulate the acquisition and disposal of iron or steel, and cl. 8 requires that the use of iron and steel must conform to the conditions governing the acquisition.
This clause shows that, in exercise of the powers conferred on the Controller by the proviso to it, the Controller has to take into account the requirements of persons holding stocks, the requirements of persons needing such stocks, the transport facilities available and any other factor including a strike or lock out affecting the production or fabrication.
Clauses 10B and 10C empower the Controller to direct sale of iron and steel in cases specified in the said clauses.
Clause 11A authorises the Controller, where he is satisfied that such action is necessary in order to co ordinate the production of iron and steel with the demands of iron or steel which have arisen or are likely to arise, to prohibit or require production of the said commodities in the manner indicated by sub cls.
(a), (b) and (c) therein.
That takes us to cl.
11 B the validity of which 81 634 falls to be considered in the present appeals.
It reads thus: "11B. Power to fix prices (1) The Controller may from time to time by notification in the Gazette of India fix the maximum prices at which any iron or steel may be sold (a) by a producer, (b) by Stockholder including a Controller Stockholder and (c) by any other person or class of persons.
Such price or prices may differ from iron and steel obtainable from different sources and may include allowances for contribution to and payment from any Equalisation Fund established by the Controller for equalising freight, the concession rates payable to each producer or class of producers under agreements entered into by the Controller with the producers from time to time, and any other disadvantages.
The Controller, may also, by a general or special order in writing, require any person or, class of persons enumerated above to pay such amount on account of allowances for contribution to any Equalisation Fund, within such period and in such manner as the Controller may direct in this behalf.
(2) For the purpose of applying the prices notified under sub clause (1) the Controller may himself classify any iron and steel and may, if no appropriate price has been so notified, fix such price as he considers appropriate: Provided that the Controller may direct that the maximum prices fixed under sub clause (1) or (2) shall not apply to any specified stocks of iron or steel and may, in respect of such stocks specify the maximum prices at which such iron or steel may be sold and communicate the same in writing to the persons concerned and any person or persons holding such stocks of iron and steel for which prices have been so specified shall, at the time of the sale of such iron or steel or part thereof, mention the number and date of the order of the Controller in every Cash Memo, Bill or other document evidencing the sale or disposal out of the respective stocks to which the order of the Controller applies.
635 (3) No producer or stockholder or other person shall sell or offer to sell, and no person shall acquire any iron or steel at a price exceeding the maximum prices fixed under sub clause (1) or (2).
" Clause 12 gives power to the Central Government to give directions to the Controller or other authorities in respect of the procedure to be followed by them in exercising their powers and generally for the purpose of giving effect to the provisions of the Order.
It would thus be seen that in issuing this Order the Central Government have prescribed a self sufficient scheme for regulating the production, supply and distribution of steel and iron at fair prices.
The Controller is required to take an over all view of the needs of national economy in respect of steel and iron and to issue appropriate directions in order to effectuate the policy of the Act.
The appellants ' contention is that if cl. 11 B is considered in the light of the scheme which the Order has in view it cannot be said that the said clause is violative of articles 19(1)(f) and (g) of the Constitution.
Before we address ourselves to the question about the vires of cl.
11B it is necessary to make it clear that the validity of sections 3 and 4 of the Act has not been disputed before us, and indeed it cannot be disputed, in view of the decision of the Court in Harishankar Bagla & Anr.
vs The State of Madhya Pradesh (1).
The challenge to the vires of cl.
11B has, therefore, to be examined on the basis that sections 3 and 4 of the Act are valid.
It is relevant to set out the implications of this position.
When it is assumed that sections 3 and 4 are valid it necessarily means that they do not suffer from the vice of excessive delegation.
When the Legislature delegated its authority to the Central Government to provide by order for regulating or prohibiting the production, supply and distribution of steel and iron, it had not surrendered its essential legislative function in favour of the Central Government.
The preamble to the Act and the material words used in section 3(1) itself embody the decision of the Legislature in the matter of the legislative policy, and their effect is to lay (1) 636 down a binding rule of conduct in the light of which the Central Government had to exercise its powers conferred on it by section 3.
The Legislature has declared its decision that the commodities in question are essential for the maintenance and pi ogress of national economy, and it has also expressed its determination that in the interest of national economy it is expedient that the supply of the said commodities should be maintained or increased as circumstances may require and the commodities should be made available for equitable distribution at fair prices.
The concept of fair prices which has been deliberately introduced by the Legislature in section 3 gives sufficient guidance to the Central Government in prescribing the price structure for the commodities from time to time.
With the rise and fall of national demand for the said commodities or fluctuations in the supplies thereof, the chart of prices may, in the absence of well planned regulation, prove erratic and prejudicial to national economy, and without rational and well planned regulation equitable distribution may be difficult to achieve; and so the Legislature has empowered the Central Government to achieve the object of equitable distribution of the commodities in question by fixing fair prices for them.
Thus, when it is said that the delegation to the Central Government by section 3 is valid, it means that the Central Government has been given sufficient and proper guidance for exercising its powers in effectuating the policy of the statute.
Similarly the validity of section 4 postulates that the powers conferred on the sub delegate do not suffer from the vice of excessive delegation.
Sub delegation authorised by section 4 is also justified because, like the delegate under section 3, the sub delegate under section 4 has been given ample guidance to exercise his powers when he is authorised by the Central Government in that behalf.
If the Central Government chooses to exercise its powers under section 3 itself it may pass appropriate orders to give effect to the policy of the Act in respect of matters covered by section 3(1) and (2).
When it adopts such a course the Central Government would have exercised its own authority under section 3; and the exercise 637 of its power cannot be challenged on ' the ground that it suffers from the vice of excessive delegation.
Similarly where by a notified order passed by the Central Government tinder section 3 the Controller is authorised to pass appropriate orders, the notified order cannot be challenged on the ground that it suffers from the vice of excessive delegation.
In our opinion, this position implicit in the assumption that sections 3 and 4 are valid.
What does the Order purport to do ? It purports to prescribe a scheme for the guidance of the Controller or other authorities specified in it when they exercise their powers and attempt to effectuate the policy of the Act.
There can be no doubt that in exercising its powers under section 3 the Central Government could itself have prescribed a price structure for steel and iron from time to time.
Similarly, if by a notified order issued under section 3 the Central Government bad authorised the Controller to do so, he could have himself prescribed a price structure in respect of steel and iron from time to time.
Instead of passing a bare notified order authorising the Controller to take appropriate steps to effectuate the policy of the Act, the Order purports to give him additional guidance by making several relevant provisions in regard to the production, supply and sale of steel and iron.
The several clauses of the Order constitute an integrated scheme which would enable the Controller to take steps to give effect to the policy laid down by section 3 of the Act.
Clause 11B itself provides for the fixation of maximum prices for iron and steel.
First of all the Controller has to classify iron and steel into different categories according as they are tested or untested; an Equalisation Fund has to be established by him for equalising freight, and he has to take into account the concession which is payable to each producer or class of producers under existing valid agreements and any other disadvantages.
He is empowered to require the parties concerned to make a contribution to the Equalisation Fund, and the maximum prices which he has to fix have to be fixed separately for the producers, the stockholders including the controlled stockholders and other persons or class of persons.
Having fixed 638 maximum prices as prescribed by cl. 12 the proviso confers power on the Controller to grant exemptions to specified stocks of iron and steel falling under the said proviso.
After thus prescribing the procedure for fixing the maximum prices and after indicating some of the factors which have to be considered in fixing the maximum prices, sub cl.
(3) of cl.
11B imposes a statutory prohibition against the specified persons from selling or offering to sell iron and steel at a price exceeding the maximum price fixed under sub cl.
It is obvious that by prescribing the maximum prices for the different categories of iron and steel cl.
11B directly carries out the legislative object prescribed in section 3 because the fixation of maximum prices would make stocks of iron and steel available for equitable distribution at fair prices.
It is not difficult to appreciate how and why the Legislature must have thought that it would be inexpedient either to define or describe in detail all the relevant factors which have to be considered in fixing the fair price of an essential commodity from time to time.
In prescribing a schedule of maximum prices the Controller has to take into account the position in respect of production of the commodities in question, the demand for the said commodities, the availability of the said commodities from foreign sources and the anticipated increase or decrease in the said supply or demand.
Foreign prices for the said commodities may also be not irrelevant.
Having regard to the fact that the decision about the maximum prices in respect of iron and steel would depend on a rational evaluation from time to time of all these varied factors the Legislature may well have thought that this problem should be left to be tackled by the delegate with enough freedom, the policy of the Legislature having been clearly indicated by section 3 in that behalf.
The object is equitable distribution of the commodity, and for achieving the object the delegate has to see that the said commodity is available in sufficient quantities to meet the demand from time to time at fair prices.
In our opinion, therefore, if cl. 11B is considered as a part of the composite scheme evidenced 639 by the whole of the Order and its validity is examined in the light of the provisions of sections 3 and 4 of the Act, it would be difficult to sustain the plea that it confers on the delegate uncanalised or unbridled power.
We are inclined to hold that the power conferred on the Central Government by section 3 and on the authority specified by section 4 is canalised by the clear enunciation of the legislative policy in section 3 and that cl.
11B seeks further to canalise the exercise of the said power ; and so it is not a case where the validity of the clause can be successfully challenged on the ground of excessive delegation.
We have referred to this aspect of the matter at some length because it appears to have influenced the final conclusion in the judgment under appeal.
As we will presently indicate the argument before us has, however, centred on the question as to whether the clause has violated article 19 of the Constitution.
It was faintly argued that cl. 11B should have referred to the prices of some specified year as basic prices of the commodities and should have directed the Controller to prescribe the maximum prices in respect thereof by reference to the said basic prices.
In support of this contention reliance is placed on the provisions of section 3 of the English Prices of Goods Act, 1939.
It appears that section 1 of the said Act prohibits sale of price regulated goods at more than permitted price, and section 3 defines the expression " basic price " as the price at which in the ordinary course of business in the case of which those goods were to be sold, agreed to be sold or offered for sale at the 21,st day of August, 1939.
Section 4 defines the permitted increases.
It is in the light of the operation of sections 3 and 4 that the prohibition enacted by section 1 becomes effective under the act.
Reference is also made to the American Emergency Price Control Act 1942, under which the administrator is directed, in fixing prices, to give due consideration so far as practicable to prices prevailing during a designated base period and to make adjustments for relevant factors of general applicability (Vide: Yakus vs United States (1)).
In our (1) 640 opinion, the analogy of the two statutes cannot effectively sustain the argument that in the absence of a corresponding provision in cl.
11B it must necessarily be held to be unconstitutional.
In deciding the nature and extent of the guidance which should be given to the delegate Legislature must inevitably take into account the special features of the object which it intends to achieve by a particular statute.
As we have already indicated the object which was intended to be achieved and the means which were required to be adopted in the achievement of the said object have been clearly enumerated by the Legislature as a matter of legislative decision.
Whether or not some other matters also should have been included in the legislative decision must be left to the Legislature itself.
The question which we have to consider is whether the power conferred on the delegate is uncanalised or unguided.
The answer to this question must, we think, be in favour of the appellants.
Having regard to the nature of the problem which the Legislature wanted to attack it may have come to the conclusion that it would be inexpedient to limit the discretion of the delegate in fixing the maximum prices by reference to any basic price.
Therefore, we must hold that cl.
11B is not unconstitutional on the ground of excessive delegation.
It is of course true that though cl. 11B may not be unconstitutional on the ground of excessive delegation its validity can still be attacked on the ground that it violates articles 19(1)(f) and (g) of the Constitution.
Mr. Chatterjee realised that failure to appreciate the effect of this Court 's decision in Bagla 's case (1) constituted the main infirmity in the judgment under appeal; and so he did not press the argument about excessive delegation.
He contended that cl.
11B was void because it violated articles 19 (1)(f) and (g) inasmuch as the power conferred on the Controller by the said clause puts an unreasonable restriction on the respondents ' fundamental rights guaranteed under article 19.
In support of this argument he has relied on the decisions of this Court in M/s. Dwarka Prasad Laxmi Narain vs The State of Uttar Pradesh & Two Ors.
(1) (2) ; 641 and The State of Rajasthan vs Nath Mal and Mitha Mal (1).
On the other hand, the learned Solicitor General has contended that the decision of this Court in the case of Harishankar Bagla (2) in effect concludes the controversy between the parties in the present appeals.
We will presently refer to these decisions; but before we do so we may mention the material facts on which the contention is raised.
The challenge to the validity of the criminal proceedings pending against the respondents can be made on three alternative grounds; it can be urged that sections 3 and 4 of the Act are ultra vires, and if that is so neither the Order subsequently issued nor cl.
11B nor the fixation of prices would be valid.
We have already shown that this form of challenge has not been adopted by the respondents.
It can also be urged that either the whole of the Order issued by the Central Government or cl.
11B in particular is invalid as offending articles 19(1)(f) and (i) of the Constitution.
It is with this argument that we are at present concerned: or, alternatively it can be urged that the actual fixation of prices by which a flat reduction of Rs. 30 per ton was directed is itself unreasonable and violative of articles 19(1)(f) and (g).
Now in regard to the challenge to cl.
11B on the ground that it violates article 19 it is difficult to see how this clause by itself can be said to violate article 19.
In so far as the argument proceeds on the assumption that the authority conferred on the Controller by cl. 11B is uncanalised or unbridled or unguided, we have already held that the clause does not suffer from any such infirmity.
Therefore reading cl.
11B by itself we do not see bow it would be possible to hold that the said clause is violative of article 19.
In fact, if sections 3 and 4 are valid and cl.
11B do es nothing more than prescribe conditions for the exercise of the delegate 's authority which are consistent with section 3 it is only the actual price structure fixed by the Controller which in a given case can be successfully challenged as violative of article 19.
Let us therefore consider whether it is open to the respondents to challenge the said price structure in the present appeals.
(1) ; (2) 82 642 In their writ petition the respondents had challenged the validity of the notification issued by the Controller on December 10, 1949, mainly, if not wholly, on the ground that it was issued under cl. 11B which itself was void.
It is true that in the course of the argu ments it appears to have been urged before the High Court that the flat deduction of Rs. 30 per ton directed by the impugned notification is unreasonable, and in its judgment the High Court has characterised the said deduction as being confiscatory.
It also appears that the price for sale by registered producers of untested articles was Rs. 333 per ton whereas the price for sale by controlled stock holders is Rs. 363 and the price at which the respondents could sell was Rs. 378 per ton.
As a result of the deduction of Rs. 30 directed by the impugned notification the respondents were required to sell at Rs. 348 per ton.
It is alleged on their behalf that they had purchased the commodity from the controlled stockholders at the rate of Rs. 363 per ton and in consequence compelling them to sell the comm.
odity at the reduced price means a loss of Rs. 15 per ton.
This part of the respondents ' case has not been tried by the High Court and since it was a matter in dispute between the parties it could not be tried in writ proceedings; but apart from it the petitions do not show that the respondents seriously challenged the validity of the notification on this aspect of the matter.
Besides in considering the validity of the notification it would not be enough to show that a particular registered stockholder suffered loss in respect of particular transactions.
What will have to be proved in such a case is the general effect of the impugned notification on all the classes of dealers taken as a whole.
If it is shown that in a large majority of cases, if not all, the impugned notification would adversely affect the fundamental right of the dealers guaranteed under articles 19(1)(f) and (g) that may constitute a serious infirmity in the validity of the notification.
In the present proceedings no case has been made out on this ground and so we cannot embark upon an enquiry of that type in appeal.
643 It still re mains to consider the decisions of this Court on which Mr. Chatterjee has relied.
In the case of M/s. Dwarka Prasad Laxmi Narain (1) the provision of cl.
4(3) of the Uttar Pradesh Coal Control Order, 1953, was held to be void as imposing an unreasonable restriction upon the freedom of trade and business guaranteed under article 19(1)(g) of the Constitution, and not coming within the protection afforded by cl.
(6) of the article.
It is significant that in dealing with the validity of the impugned clause the court has expressly stated that the vires of sections 3 and 4 of the Act were not challenged.
The impugned clause, it was, however, held, had conferred on the licensing authority unrestricted power without framing any rules or issuing any directions to regulate or guide his discretion.
Besides the power could be exercised not only by the State Coal Controller but by any person to whom he may choose to delegate the same and it was observed that the choice can be made in favour of any and every person.
It is because of these features of the impugned clause that this Court held that the clause cannot be held to be reasonable.
It is difficult to see how this decision can help the respondents in attacking cl.
11B. We have already indicated that the powers exerciseable by the Controller under cl.
11B are in terms made subject to the general power of the Central Government to give directions prescribed by cl. 12.
Incidentally we may point out that though cl.
4(3) was struck down by this Court cls. 7 and 8 which empower the Coal Controller to prescribe the terms and prices on which the commodity in question could be sold were upheld as valid.
Mr. Chatterjee contends that in upholding these two clauses this Court has taken into account the formula prescribed by Schedule III and it appeared to the Court that the application of the formula did not on the whole lead to any unreasonable result.
Besides the explanation to cl. 8 also provided some guidance to the authority fixing the price structure and that guidance was also taken into account by this Court in upholding the validity of the two impugned clauses.
That no doubt is true; but, in our opinion, it would be unreasonable (1) ; 644 to suggest, as Mr. Chatterjee sought to do, that in the absence of provisions like the explanation to cl. 8 or the formula to Schedule 111 cl.
11B in the present ease should be struck down as void.
Such a contention finds no support in the decision in the case of M/s. Dwarka Prasad Laxmi Narain (1).
In the case of Nath Mal (2), this Court struck down the latter part of cl. 25 of the Rajasthan Foodgrains Control Order, 1949.
In this case again it is significant that the challenge to the impugned clause proceeded on the specific and express assumption that section 3 of the Act was valid.
Now it appears that the impugned clause empowered the Government to requisition the stock at a price lower than the selling price thus causing loss to the persons whose stocks are freezed while at the same time the Government was free to sell the same stocks at a higher price and make a profit.
The case of the respondent which illustrated this vicious tendency of the impugned clause was treated as a typical case which showed how business of grain dealers would be paralysed by the operation of the clause.
It was on this view about the effect of the clause in general that the offending portion was struck down under article 19(1)(g) of the Constitution.
It was held also to contravene article 31(2).
This decision again does not assist the respondents ' case because, as we have already pointed out, the validity of the impugned notification has not been challenged on any such ground in the present proceedings.
That takes us to the decision of this Court in the case of Harishankar Bagla (3) on which the appellants strongly rely.
In that case this Court has held that sections 3 and 4 of the Act are not ultra vires.
It appears that section 6 of the Act was held to be ultra vires by, the Nagpur High Court from whose decision the appeal arose.
This Court reversed that conclusion and held that section 6 of the Act also was valid.
The appellant had challenged not only sections 3, 4 and 6 of the Act but also the impugned Control Order.
This order was the Cotton Textile (Control of Movement) Order, 1948.
Section 3 of the Control Order in particular was (1) ; (2) ; (3) 645 challenged as infringing the rights of a citizen guaranteed under articles 19(1)(f) and Broadly stated this section of the Control Order prohibited transport except under and in accordance with a general permit or special transport, permit as prescribed by it.
The argument was that the power conferred by section 3 constituted an unreasonable restriction on the fundamental rights of the citizen under articles 19(1)(f) and (g) and that in substance it suffered from the same vice as cl.
4(3) of the Uttar Pradesh Coal Control Order which had been struck down by this Court in the case of M/s. Dwarka Prasad Laxmi Narain (1).
This argument was rejected and it was observed that the impugned clause was not at all similar to cl.
4(3) with which this Court was concerned in the case of M/ section Dwarka Prasad Laxmi Narain (1).
The appellants contend that the reasons given by this Court in upholding section 3 of the Order applied with equal force to cl.
11B in the present appeals.
It cannot be said that there is no force in this contention.
In the result we hold that neither cl. 11B of the Order nor the impugned notification issued by the Controller on December 10, 1949, violate the respondents ' fundamental rights under articles 19(1)(f) and (g), and so their validity cannot be successfully challenged.
The orders passed by the High Court on the writ petitions filed by the respondents before it would, therefore, be set aside and the said petitions dismissed.
SUBBA RAO J. I have had the advantage of perusing the judgment of my learned brother, Gajendragadkar, J.
I agree with his conclusion.
The question raised in this case is whether cl.
11B of Iron and Steel (Control of Production And Distribution) Order, 1941, violates the fundamental rights enshrined in article 19(1)(f) and (g) of the Constitution.
In view of the decision of this Court in Harishankar Bagla vs The State of Madhya Pradesh (2) which is binding on us, I agree with my learned brother that cl.
11B of the said Order is valid.
I do not propose to express my view on any other question raised in this appeal.
Appeals allowed.
| The appellants were prosecuted for having committed offences under section 120B read with Ss. 302 and 436 of the Indian Penal Code and their case was taken up for trial before the Third Tribunal constituted under the West Bengal Tribunals of Criminal jurisdiction Act, 1952 (W.B. Act XIV of 1952).
By a notification dated September 12, 1952, and issued under section 2(b) of the Act the Government of West Bengal declared the whole area within the jurisdiction of Kakdwip and Sagar Police Stations to be a disturbed area and specified the period from January 1, 1948, to March 31, 1950, to be the period during which the notification was to be effective.
The case against the appellants was that between the dates mentioned in the notification, they took leading part in a violent movement called the Tebhaga movement in Kakdwip and incited the Bhagehasis, i.e., the cultivators who actually cultivated the land, to claim the entire crop instead of 2/3 share of it and that they preached murder and arson amongst the cultivators and such preaching was followed by arson and murder on a large scale.
The appellants moved the High Court for an order quashing the proceedings against them on the ground that section 2(b) of the Act, which allowed the Government to declare an area in which " there was " disturbance in the past to be a disturbed area, offended article 14 Of the Constitution as discriminating between persons who had committed the same offences and whose trials had already concluded before the notification under the normal and more advantageous procedure and others whose trials had not concluded and who had to be tried by a less advantageous and special procedure prescribed by the Act.
The application of the appellants was first heard by a bench of two judges but as there was difference of opinion between them the matter was referred to a third judge, and the High Court by a majority held that the provisions of the impugned Act were intra vires and did not offend article 14 of the Constitution.
On appeal by special leave challenging the vires Of section 2(b) and the proviso to section 4(1) Of the Act, Held (per Sinha, C.J., Gajendragadkar and Shah, jj.), that the equality before law, guaranteed by article 14, no doubt prohibits class legislation but it does not prohibit the Legislature to legislate 647 on the basis of a reasonable classification.
If any state off acts can reasonably be conceived to sustain a classification, the existence of that state of facts must be assumed.
Chiranjitlal Choudhuri vs The Union of India and Others, ; and Kedar Nath Bajoria vs The State of West Bengal, ; , followed.
Where the classification is reasonable and is founded on an intelligible differentia and that differentia has a rational relation to the object sought to be achieved by the statute, the validity of the statute cannot be successfully challenged under article 14.
Since the classification made by the impugned Act is rational and the differentia by which offenders are classified has a rational relation with the object of the Act to provide for the speedy trial of the offences specified in the Schedule, section 2(b) and the proviso to section 4(1) of the Act cannot be said to contravene article 1 Of the Constitution even though the procedure prescribed by the Act may amount to discrimination.
The State of West Bengal vs Anwar Ali Sarkar, [1952] S.C.R. 284, distinguished.
Kathi Raning Rawat vs The State of Saurashtra, [1952] S.C.R. 435, Lachmandas Kewalram Ahuja and Another vs The State Of Bombay, ; and Gopi Chand vs Delhi Administration, ; , considered.
Per Sarkar and Subba Rao, jj.
(dissenting).
Whether a law offends article 14 or not does not depend upon whether it is prospective or retrospective for both prospective and retrospective ' statutes may contravene the provisions of that Article.
Although the general rule is that a law must apply to all persons, it is permissible to validly legislate for a class within certain well recognised limits.
The true test of a valid classification is that it must be capable of being reasonably regarded as being based upon a differentia which distinguishes that class from others, and the differentia itself must have a reasonable relation with the object the statute has in view.
Shri Ram Krishna Dalmia vs Shri justice S.R. Tendolkar; , , followed.
The object of the Act in question being to secure a speedy trial of certain offences committed in a specified area during a specified period of time in the interest of the security of the State and the maintenance of public peace and tranquillity in a disturbed area, a distinction made between the cases where the trials had been concluded and the cases where the trials had not yet been concluded, is not a distinction which has any rational relation to the object.
In order to secure that object it is necessary to place both classes of persons in the same situation.
Gopi Chand vs Delhi Administration, ; , distinguished.
648 The Act in so far as it permits an area which was a disturbed area in the past to be declared a disturbed area for the purposes of the Act offends article 14 of the Constitution and is, therefore, unconstitutional and void.
That portion Of section 2(b) which declares an area to be a disturbed area in the past and the notification in question must therefore be held to be void.
|
Appeal No. 75 of 1962.
Appeal by special leave from the judgment and decree dated October 19, 1959, of the Bombay High Court in Appeal No. 152 of 1959.
N. C. Chatterjee, J.B. Dadachanji, O. C. Mathur and Ravinder Narain, for the appellants.
A. V. Viswanatha Sastri and D. D. Sharma, for respondents.
April 22.
The judgment of S.K. Das and Hidayatullah, JJ. was delivered by Das J. Sarkar J., delivered separate, judgment.
S.K. DAS J.
The only question which arises in this appeal is, whether on a proper interpretation of section 28 of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 (Bombay Act LVII of 1947) the Court of Small Causes Bombay had exclusive jurisdiction to deal with the suit out of which this appeal has arisen.
The respondent before us is a partnership firm.
It was in possession as a tenant of a shop No. 582/638, at Mulji Jetha Market, Bombay.
It instituted a suit in the Bombay City Civil Court (to be distinguished from the Court of Small Causes, Bombay) in which it asked for (1) a declaration that it was in lawful possession of shop No. 582/638 at Mulji Jetha Market, Bombay and that the present appellants (who were the defendants in the suit) or their family members, servants or agents had no right to enter into or remain in possession of the said shop ; (2) for an injunction restraining the present appellants, their family members, servants and agents from entering into the said shop ; and (3) for an amount of commission payable to it under an agreement 218 dated June 23, 1955.
The main averments in the plaint were that by the aforesaid agreement defendant No. 1, appellant No. 1 before us, appointed the respondent as his commission agent for the sale of the appellants ' cloth in the shop in question.
The agreement was to remain in force for a period of four years expiring on June 30, 1959.
Pursuant to the agreement, the appellants, their family members, servants and agents were allowed by the respondent to visit the shop only for the purpose of looking after the business of commission agency.
On the expiry of the agreement the appellants had no further right to enter into the shop and in paragraphs 10 and 11 of the plaint the respondent firm alleged that some commission was due to it and further it asked the appellants not to disturb the possession and peaceful enjoyment of the shop by the respondent ; but the appellants, their servants and agents were visiting the shop daily and preventing the respondent from having access to its various articles such as stock in trade, books of account, furniture, fixtures etc.
On these averments the respondent firm asked for the reliefs to which we have earlier referred.
The plaint proceeded on the footing that during the period of the agreement the appellants were mere licensees, and after the expiry of the agreement they were trespassers and had no right to be in the shop.
The plaint in terms negatives any relationship of landlord and tenant as between the parties to the suit.
The substantial defence of the appellants was that the respondent firm had sublet the shop to the appellants at a monthly rent of Rs. 500/ ; but as no sub tenancy could be legally created at the time, without the consent of the landlord, by reason of the provisions of the Act, the respondent firm with a view to safeguard its position in regard to the penal provisions of the Act required the appellants to enter into a sham agreement in the shape of a letter dated June 30, 1952.
The agreement was never acted 219 upon and was intended to be a cloak to conceal the true nature of the transaction.
The appellants further alleged that the agreement dated June 23, 1955, was also not operative between the parties, and the true relation between the parties was that of landlord and tenant.
On these averments in the written statement the appellants took the plea that as the question involved in the suit related to the possession of premises as between a landlord and his tenant, the Court of Small Causes, Bombay, alone had jurisdiction to try the suit.
On these pleadings a preliminary issue as to jurisdiction was framed by the City Civil Court, Bombay and this issue was in these terms: "Whether this court has jurisdiction to entertain and try this suit ?" The learned judge of the City Civil Court relying on a decision of this court in Babulal Bhuramal vs Nandram Shivram (1), decided the preliminary issue in favour of the present appellants.
He held that in view of the observations of the Supreme Court in the aforesaid decision, an earlier decision of the Bombay High Court in Govindram Salamatrai vs Dharampal (2), which had taken a different view was of no assistance to the present respondent, and must be deemed to have been over ruled by the Supreme Court decision.
We may state here that the decision in Govindram Salamatrai (2) , had itself over ruled an earlier decision of the same court in Ebraham Saleji vs Abdulla Ali Raza (3), where Gajendragadkar J. (as he then was) had taken the view that section 28 of the Act included within its jurisdiction all suits and proceedings where the trial court has to consider all claims or questions arising out of the Act., and it makes no difference whether such claim or question arises from the allegations made in the plaint or those made in the (1) ; (2)(1951) , (3) , 220 written statement.
The learned judge of the City Civil Court accordingly made an order that the plaint be returned to the present respondent for presentation to tile proper court.
An appeal was taken by the present respondent to the High Court of Bombay from the decision of the learned City Civil judge.
The High Court pointed out in its judgment dated October 19, 1959, that the ratio of the decision of this court in Babulal Bhuramal 's case (1), was correctly explained in a later decision of the Bombay High Court in Jaswantlal vs "Western Company, India" (2) and on a correct interpretation of section 28 of the Bombay Rents, Hotel and Lodging Houses Rates Control Act, the suit out of which this appeal has arisen was not a suit within the exclusive jurisdiction of the Court of Small Causes, Bombay.
The High Court said that the decision in Babulal Bhuramal (1), did not in effect hold, nor did it justify any interpretation to the effect, that section 28 of the Act made a departure from the general principle that governs the question of jurisdiction, which is that jurisdiction at the inception of, the suit depends on the averments made in the plaint and is not ousted by the defendant saying something in his defence.
In this respect, the High Court accepted as correct the view expressed by Chagla C. J. in Govindram Salamatrai (3), rather than the view of Gajendragadkar, J. in Ebrahim Saleji (4).
In this view of the matter the High Court held that the City Civil Court has jurisdiction to try the suit out of which the appeal has arisen.
It, therefore, set aside the order of the learned City Civil judge and directed that it should now dispose of the suit in accordance with law.
The appellants then asked for special leave to appeal to this court from the judgment and decree of the High Court, and having obtained special leave have preferred the present appeal.
(1) ; (2) (1959) 61 Bom.
I.h. 1087, (3) (1951) 53 Bom, L.R (4) , 221 The Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 was enacted, to amend and consolidate the law relating to the control of rents and repairs of certain premises, of.
rates of hotels and lodging houses and of evictions, In Part II of the Act there are provisions which make rent in excess of standard rent illegal, provisions relating to increase of rent, provisions as to when a landlord may recover possession, when a sub tenant becomes a tenant, unlawful charges by landlord etc.
All these proceed on the footing that there is or was, at the inception, a relation of landlord and tenant between the parties.
In the same Part occur sections 28.
29 and 29 A. Section 28 which we shall presently read deals with jurisdiction of courts ; section 29 deals with appeals, and section 29 A is a section which saves suits involving title.
The particular section the interpretation of which is in question before us is section 28 and we shall read only sub section
(1) thereof in so far as it is relevant for our purpose.
This subsection reads. "28.
(1) Notwithstanding anything contained in any law and notwithstanding that by reason of the amount of the claim or for any other re ason, the suit or proceeding would not, but for this provision, be within its jurisdiction.
(a) in Greater Bombay, the Court of Small Causes, Bombay, (aa) xx xx xx (b) xx xx xx. . shall have jurisdiction to entertain and try any suit or proceeding between a land.
lord and a tenant relating to the recovery of rent or possession of any premises to which any of the provisions of this Part apply and to 222 decide any application made under this Act and to deal with any claim or question arising out of this Act or any of its provisions and subject to the provisions of sub section (2), no other court shall have jurisdiction to entertain any suit, proceeding or application or to deal with such claim or question. " S.29 A also has some relevancy and may be set out here. "Nothing contained in section 28 or 29 shall be deemed to bar a party to a suit, proceeding or appeal mentioned therein in which a question of title to premises arises and is determined, from suing in a competent court to establish his title to such premises.
" Leaving out what is unnecessary for our purpose s.28(1) states that notwithstanding anything contained in any law and notwithstanding that by reason of the amount of the claim or for any other reason, the suit or proceeding would not, but for this provision, be within its jurisdiction, the Court of Small Causes in Greater Bombay shall have jurisdiction to entertain and try any suit or proceeding between a landlord and a tenant relating to the recovery of rent or possession of any premises to which any of the provisions of this Part (meaning thereby Part II apply and to decide any application made under the Act and to deal with any claim or question arising out of the Act or any of its provisions and no other court shall have jurisdiction to entertain any such suit, proceeding or application or to deal with any such claim or question.
It is to be noticed that the operative part of the subsection refers to two matters: (a) any suit or proceeding between a landlord and a tenant reletting to the recovery of rent or possession of any premises to which any of the provisions of Part II apply and (b) any application made under the Act or any claim or 223 question arising out of this Act or any of its provisions.
What is the true effect of sub s.(I) of s.28 with regard to the aforesaid two matters? Does it mean that if the defendant raises a claim or question as to the existence of a relationship of landlord and tenant between him and the plaintiff, the jurisdiction of the City Civil Court is ousted even though the plaintiff pleads that there is no such relationship, and the only court which has exclusive jurisdiction to try the suit is the Court of Small Causes, Bombay ? That is the question before us.
In answering this question it is perhaps necessary to refer to the general principle which admittedly governs the question of jurisdiction at the inception of suits.
This general principle has been well explained in the Full Bench decision of the Allahabad High Court, Ananti vs Chhannu (1), and bag not been disputed before us.
It was observed there: The plaintiff chooses his forum and files his suit.
If he establishes the correctness of his facts he will get his relief from the forum chosen: If . he frames his suit in a manner not warranted by the facts, and goes for his relief to a court which cannot grant him relief on the true facts, he will have his suit dismissed.
Then there will be no question of returning the plaint for presentation to the proper court, for the plaint, as framed, would not justify the other kind of court to grant him the relief. . .
If it is found, on a trial on the merits so far as this issue of jurisdiction goes, that the facts alleged by the plaintiff are not true and the facts alleged by the defendants are true, and that the case is not cognizable by the court, there will be two kinds of orders to be passed.
If the jurisdiction is only one relating to territorial limits or pecuniary limits, the plaint will be ordered to be returned for presentation to the (1) All, 501.
224 proper court.
If, on the other hand, it is found that, having regard to the nature of the suit, it not Cognizable by the class of court to which the court belongs, the plaintiff 's suit will have to be dismissed in its entirety." Having regard to the general principle stated above, we think that the view taken by the High Court in this case is correct.
section 28 no doubt gives exclusive jurisdiction to the Court of Small Causes to entertain and try a suit or proceeding between a landlord and a tenant relating to recovery of rent or possession of any premises to which any of the provisions of Part II apply; it also gives exclusive jurisdiction to decide any application under the Act and any claim or question arising out of the Act or any of its 'provisions all this notwithstanding anything contained in any other law.
The argument of learned counsel for the appellants is that the section in effect states that notwithstanding any general principle, all claims or questions under the Act shall be tried exclusively by the courts mentioned in the section, e.g. the Court of Small Causes in Greater Bombay, and it does not matter whether the claim or question is raised by the plaintiff or the defendant. 'The argument is plausible, but appears to us to be untenable on a careful scrutiny.
We do not think that the section says or intends to say that the plea of the defendant will determine or change the forum.
It proceeds on the basis that exclusive jurisdiction is conferred on certain courts to decide all questions or claims under the Act as to parties between whom there is or was a relationship of landlord and tenant.
It does not invest those courts with exclusive power to try questions of title, such as questions as between the rightful owner and a trespasser or a licensee, for such questions do not arise under the Act.
If, therefore, the plaintiff in his plaint does not admit a relation which would attract any of the provisions of the Act on which the exclusive jurisdiction 225 given under section 28 depends, we do not think that the defendant by his plea can force the plaintiff to go to a forum where on his averments he cannot go.
The interpretation canvassed for by the appellants will give rise to anomalous results; for example, the defendant may in every case force the plaintiff to go to the Court of Small Causes and secondly, if the Court of Small Causes finds against the defendant 's plea , the plaint may have to be returned for presentation to the proper court for a second time.
Learned counsel for the appellants has argued in the alternative that the Court of Small Causes need not return the plaint a second time, for his contention is that Court has "exclusive" jurisdiction to decide the case whenever a claim is made under the Act even though the claim is found to be false on trial.
We do not think that this contention can be accepted as correct, for to do so would be to hold that the Court of Small Causes has exclusive jurisdiction to decide question of title, which is clearly negatived by section 29 A. Anomalous results may not be a conclusive arguments but when one has regard to the provisions in Part 11 it seems reasonably clear that the exclusive jurisdiction conferred by s.28 is really dependent on an existing or previous relationship of landlord and tenant and on claims arising under the Act as between such parties.
Dealing with a similar argument in Govindram Salamatrai (1) Chagla, C.J. said : "There can be no doubt that when a plaintiff files a suit against a defendant alleging that he is his licensee, it is a suit which cannot be entertained and tried by the Small Causes Court because it is not a suit between a landlord and a tenant, and judging by the plaint no question arises out of the Rent Control Act or any of its provisions which would have to be determined on the plaint as it stands. . . . (1) 226 It cannot be suggested that the plaintiff should anticipate any defence that might be taken up by the defendant that he is a tenant or that the initial jurisdiction which the Court had or which the Court lacked should be controlled or affected by any subsequent contention that might be taken up by the defendant.
The jurisdiction of a Court is normally and ordinarily to be determined at the time of the inception of a suit.
Therefore when a party puts a plaint on file, it is at that time that the Court has to consider whether the Court had jurisdiction to entertain and try that suit or not.
But it is argued that although the Court might have had jurisdiction when the suit was filed, as soon as the defendant raised the contention that he was a tenant the Court ceases to have jurisdiction to try that suit and that contention could only be disposed of by the Small Causes Court by virtue of the pr ovisions of section 28.
Therefore, the question that I have to address myself to is whether the question as to whether the defendant is a tenant or a licensee is a question which arises out of the Act or any of its provisions.
Really, this question is not a question that has anything to do with the Act or any of its provisions.
It is a question which is collateral and which has got to be decided before it could be said that the Act has any application at all.
" We are in agreement with these observations, and we do not think that section 28 in its true scope and effect makes a departure from the general principle referred to earlier by us.
Nor do we think that the right of appeal given by s.29 affects the position in any way.
In respect of a decision given by a Court exercising jurisdiction under section 28, an appeal is provided for in certain circumstances 227 under s.29.
This does not mean that s 28 has the effect contended for on behalf of the appellants.
As to the decision of this Court in Babulal Bhuramal (1), we do not think that it assists the appellants.
We consider that the Bombay High Court correctly understood it in Jaswantlal vs "Western Company, India" (2).
In Babulal Bhuramal 's case the facts were these.
A landlord after giving a notice to quit to his tenant on December 6, 1947, filed a suit against him in the Court of Small Causes, Bombay, joining to the suit two other persons who were alleged to be sub tenants of the tenant.
The landlord 's case was that the tenancy of his tenant was validly terminated and he was entitled to evict his tenant; that the alleged sub tenants of the tenant were trespassers who had no right to be on the premises.
The suit succeeded in the Small Causes Court, the Court holding that the subtenants were not lawful sub tenants, the sub letting by the tenant to them being contrary to law.
The Small Causes Court, therefore, passed a decree against the plaintiff and the alleged sub tenants.
Thereafter, the tenant as plaintiff No. I and the alleged sub tenants as plaintiffs Nos. 2 and 3 filed a suit against the landlord in the City Civil Court for a declaration that plaintiff No. I was a tenant of the defendant and was entitled to protection under the Rent Act and that plaintiffs Nos. 2 and 3 were lawful sub tenants of plaintiffs No, I and were entitled to possession and occupation of the premises as sub tenants thereof.
A question was raised in the City Civil Court as to whether the City Civil Court had jurisdiction to entertain the suit.
The City Civil Court held that it had jurisdiction to entertain the suit, but dismissed it on merits.
In the appeal which was filed in the High Court, the High Court dismissed the appeal holding that the City Civil Court had no jurisdiction to entertain the suit and therefore, the suit filed by the plaintiffs in the City (1) [1959] 367, (2) 228 Civil Court was not maintainable.
It was from this decision of the High Court that an appeal was filed in the Supreme Court and the question which the Supreme Court had to consider was whether the second suit filed by the plaintiffs was within the jurisdiction of the City Civil Court.
It was urged before the Supreme Court that the suit was main tainable under section 29 A of the Bombay Rent Act which provided that nothing contained in sections 28 or 29 should be deemed to bar a party to a suit, proceeding or appeal mentioned there in which a question of title to premises arises and is determined, from suing in a competent Court to establish his title to such premises.
The Supreme Court held that a suit which was competent to establish title under section 29 A was a suit to establish title de hors the Bombay Rent Act and not a suit which sought to establish title which required to be established under the Rent Act itself.
It is obvious that in the suit before the Court of Small Causes, it was open to the tenant to claim protection under the Act and by reason of section 28 no other Court had jurisdiction to try that claim; therefore, the Supreme Court held that section 28 barred the second suit and section 29 A did not save it, because it only saved a suit to establish title de hors the Act.
The observations made in that decision on which the present appellants rely were these "Do the provisions of section 28 cover %case where in a suit one party alleges that he is the landlord and denies that the other is his tenant or vice versa and the relief asked for in the suit is in the nature of a claim which arises out of the Act or any of the provisions? The answer must be in the affirmative on a reasonable interpretation of section 28.
" We agree with the High Court that these observation merely show this that in order to decide whether a suit comes within the purview of section 28 what must 229 be considered is what the suit as framed in substance is and what the relief claimed therein is.
If the suit as framed is by a landlord or a tenant and the relief asked for is in the nature of a claim which arises out of the Act or any of its provisions, then only and not otherwise will it be covered by section 28.
The High Court has rightly said : "A suit which is essentially one between the landlord and tenant does not cease to be such a suit merely because the defendant denies the claim of the plaintiff.
In the same way, a suit which is not between the landlord and tenant and in which judging by the plaint no claim or question arises out of tile Rent Act or any of its provisions does not become a suit covered by the provisions of section 28 of the Act as soon as the defendant raises a contention that he is a tenant.
" For the reasons given above we hold that the City Civil Court had jurisdiction to entertain the suit and the High Court correctly came to that conclusion.
Therefore, the appeal fails and is dismissed with costs.
SARKAR J.
I agree that this appeal fails.
The City Civil Court, Bombay held that in view of section 28 of the Bombay Rents Hotel and Lodging Rates Control Act, 1947 it had no jurisdiction to entertain and try the Suit which the respondent had filed against the appellants in that Court and directed the plaint to be returned to the respondent for being filed in the proper Court indicated by that section, namely) the Court of Small Causes, Bombay.
The City Civil Court had tried the question as a preliminary issue in the suit.
There was an appeal to the High Court of Bombay from this decision and the High Court took a contrary view holding that 230 the City Civil Court 's jurisdiction to entertain and try the suit had not been taken away by section 28 of the Act.
The matter is now before this Court in further appeal.
The suit asked for a declaration that the appellants were not entitled to enter into or remain in possession of a certain shop in Greater Bombay and for a permanent injunction restraining them from entering the shop ' The allegations on which the claim to these reliefs was based were that the appellants had been granted a licence to use the shop of which the respondent was the tenant under the owner and that the appellants were wrongfully continuing there in spite of the termination of the licence and were thereby preventing the , respondent from carrying on its business in the shop.
The suit, therefore, was by a licenser against a licensee for certain reliefs based on the termination of the licence.
The defence of the appellants to this suit was that the relationship between the parties was not that of licenser and licensee but that the shop had in fact been sub let to the first appellant and that the agreement between the parties had been given the form of a licence only as a cloak to protect the respondent from ejectment under the Act by its landlord on the ground of unlawful sub letting.
The appellants contended that as they were really tenants, their landlord, the respondent, was not entitled to remove them from possession in view of the provisions of the Act.
The question is, how far the suit is affected by section 28 of the Act.
I proceed now to set out the terms of that section omitting the unnecessary portions.
section 28 (I) "Notwithstanding anything contained in any law 231 (a) in Greater Bombay, the Court of Small Causes, Bombay, shall have jurisdiction to entertain and try any suit or proceeding between a landlord and a tenant relating to the recovery of rent or possession of any premises to which any of the provisions of this Part apply and to decide any application made under this Act and to deal with any claim or question arising out of this Act or any of its provisions and. . . . no other court shall have jurisdiction to entertain any such suit, proceeding or application or to deal with such claim or question.
" The section deals with three different kinds of matters, namely, (1) suits or proceedings between a landlord and a tenant relating to the recovery of rent or recovery of possession of premises, (2) an application made under the Act and (3) a claim or question arising out of the Act or any of its provisions.
It provides that no court except the Court of Small Causes, so far as properties in Greater Bombay are concerned, shall have jurisdiction to entertain and try any suit or proceeding or to decide any application or lastly to deal with any claim or question of any of the said three kinds mentioned in it.
I think it is fairly clear that the suit of the respondent does not fall within the first two kinds of matters contemplated by the section mentioned in.
the preceding paragraph and I did not understand learned counsel for the appellants to contend to the contrary.
The suit obviously does not come within the second kind for that consists of applications under the Act only and a suit is, of course, not an "application".
Turning now to the first kind, it has to be 232 observed that it deals with two varieties of suits between landlord and tenant, namely, a suit for rent and a suit for possession of premises.
Obviously the respondent 's suit is not a suit for rent for no rent is claimed at all.
Nor do I think it possible to say that the suit is one between a landlord and a tenant for recovery of possession of premises.
I suppose whether a suit is of this kind or not will have to be decided by the frame of the suit, that is, by reference to the plaint for the suit is by the plaintiff and it must be as lie has decided it shall be.
Admittedly the plaint that the respondent filed does not show that the suit filed by it is between landlord and tenant nor does it contain any claim for recovery of possession of premises.
That brings me to the third class of matters mentioned in the section namely, claims and questions arising out of the Act.
The section provides that no court other than a Court of Small Causes shall have jurisdiction to deal with any claim or question arising under the Act concerning properties in Greater Bombay.
It is important to note here that this part of the section does not purport to affect any court 's jurisdiction to entertain and try a suit but it only prevents a court from dealing with certain claims or questions.
Therefore, a court may try a suit in so far as it does not thereby have to deal with a claim or question arising out of the Act.
If the other claims and questions arising in the suit cannot be tried without dealing with a claim or question arising out of the Act, then of course the practical result would be to prevent the court from trying the suit at all.
Therefore, it seems to me that the real question in this case is whether the City Civil Court had no jurisdiction to try the respondent 's suit as a whole or in part because it would thereby be dealing with a claim or question arising under the Act.
Does the 233 decision of the suit then require any claim or question arising out of the Act to be dealt with ? If it does not, the City Civil Court would be absolutely free to try the suit.
Now, if one considers the plaint only, then of course it is clear that the present suit raises no claim or question arising out of the Act.
But it is said by the appellants that the defence raises such a claim or question.
The respondent answers that the section contemplates claims or questions raised by the plaint only, for the section determines the jurisdiction of a court to entertain and try a suit and this must be done when the suit is instituted and, therefore, it is irrelevant to consider what questions the defence raises.
I think it unnecessary to decide the dispute whether it is permissible under the section to look at the defence for ascertaining whether a claim or question under the Act arises in the suit.
As at present advised, I do not want to be understood as assenting to the proposition that a reference to the written statement is not at all permissible for deciding whether a court has jurisdiction under the section to deal with claims or questions of a certain kind.
It is important to remember that the question now is whether a court has jurisdiction to deal with a claim or question and not whether a court has jurisdiction to entertain a suit.
I think it unnecessary to decide the dispute because in my view even the defence in the present case does not raise any claim or question tinder the Act.
The defence really is that the appellants are not licensees.
No doubt the appellants have gone on to say that they are sub tenants but they say that only to show why they are not licensees; apart from that it is irrelevant to enquire whether they are sub tenants or not.
I think the defence is only one of 234 a traverse ; it is that the appellants are not licensees as the plaint alleges.
That being so, the only question that the suit involves is whether the appellants are licensees of the shop.
If they are not licensees, then the suit must fail.
No other question would fall for decision.
Quite clearly, a question whether a defendant is a licensee or not, is not a question nor is it a claim arising out of the Act.
Assume however that the defence by contending that the appellants are not licensees as they are subtenants, also raises the question whether the appellants are sub tenants.
Even so, it does not seem to me that is a question or claim arising out of the Act.
The Act does not create any tenancy.
That has to be created by a contract.
The question whether the appellants are sub tenants, that is to say, tenants of a certain kind, is really a question whether a contract of tenancy was made between the appellants and the respondent.
That question is not one arising out of the Act for the Act says nothing as to the creation of a tenancy and is only concerned with the regulation of the relations between a landlord and tenant in a tenancy the existence of which is otherwise brought about.
The appellants no doubt say that the respondent cannot evict them because they are tenants whose right to possession is protected by the Act.
They say that, therefore, a question arises whether they are entitled to remain in possession as subtenants by virtue of the provisions of the Act and without the decision of that question the respondent 's suit cannot be decided.
I am entirely unable to see 'that such a question arises in the suit or that it cannot be decided without a decision of that question.
As soon as it is held that the appellants are licensees, the suit has to be decreed.
When it is so held it has also been necessarily held 235 that the appellants are not tenants, and, therefore, no further question as to rights of tenants under the Act falls to be decided.
If however it is held that the appellants are not licensees but tenants, then on that ground alone the suit has to be dismissed for the claim is not based on any ground other than that the appellants are licensees whose licence has expired.
It would not in such an eventuality be necessary further to consider whether the appellants who have been found to be tenants, are entitled to protection from eviction under the Act for the suit involves no claim whatever for ejectment of the appellants considered as tenants.
No question, therefore, can possibly arise in the suit as to whether the appellants are entitled to be in possession as tenants by virtue of rights created by the Act.
Looking at the matter from whatever point of view I do, I am wholly unable to think that the decision of any question or claim arising out of the Act is necessary for deciding the suit.
Learned counsel for the appellants referred to Babulal Bhuramal vs Nandram Shivram (1), in support of the proposition that the claim or question arising out of the Act mentioned in the section may be one where only the defence gives rise to it.
I find it wholly unnecessary to discuss whether this case supports that proposition for, as I have said in the case in hand, even the defence of the appellants does not raise any such claim or question.
I think it right before concluding to refer to section 51 of the Act under which reference to suits and proceedings in the Act are to include reference to proceedings under Chapter VII of the .
Chapter VII of the contemplates proceedings for the recovery of possession of premises from licensees after the termination of licences in certain cases.
Whether the present case is of that (1) ; 236 type or not is not known.
If it is of that type, then it may be that the City Civil Court would have no jurisdiction to deal with it and only the Court of Small Causes would have jurisdiction to do so in view of section 28.
As however no argument was advanced by counsel for the appellants on the basis of section 51 nor the facts necessary for its application appear on the record, I do not feel called upon to express any opinion on the matter.
I only draw attention to it to show that if the question does arise that has not been argued nor decided in this case.
I think it also right to point out that it may be a moot question whether the appellants, having on their own statement entered into an agreement to defraud, in a manner of speaking, the superior landlord of his rights arising under the Act from an unlawful sub letting, can be permitted to say that the real transaction between them and the respondent was a sub tenancy.
For these reasons I concur n i the order ' proposed by my brother Das.
Appeal dismissed.
| The respondent Is a partnership firm.
It instituted a suit in the Bombay City Civil Court against the appellant.
It was alleged in the plaint that by virtue of an agreement appellant No. I appointed the respondent as his commission agent for the sale of his cloth in the shop which was in the possession of the respondent.
The agreement was to remain in force for four years.
Persuant to the agreement the appellants, their family members, servants and agents were allowed by the respondent to visit the shop only for the purpose of looking after the business of commission agency.
On the expiry of the agreement the appellants had no further rights to enter into the shop.
The respondent prayed for a declaration that it was in lawful possession of the shop, for an injunction restraining the appellants, their family members, servants and agents from entering into the shop and for an amount of commission payable to it under the agreement.
The plaint proceeded on the footing that 215 during the period of agreement the appellants were mere licensees and after the expiry of the agreement they were mere trespassers.
The plaint in terms negatives any relationship of landlord and tenant as between the parties to the suit.
The defence of the appellants was that the respondent had sublet the shop to them at a certain monthly rent.
But since no subletting is possible under the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947, without the consent of the land lord the parties entered into a sham agreement which was never acted upon and which was only a cloak to conceal the true relationship.
The relationship was that of a land lord and tenant.
On these averments in the written statement the appellants took the plea that the Court of Small Causes Bombay alone had jurisdiction to try the suit.
The City Civil Court relying on a decision of this Court upheld the contention of the appellants and made an order that the plaint be returned for presentation to the proper court.
The respondent thereupon appealed to the High Court.
The High Court held that on a correct interpretation of s.28 of the Act the suit out of which the appeal had arisen was not a suit within the exclusive jurisdiction of the Court of Small Causes Bombay and setting aside the order of the City Civil judge directed that it should dispose of the suit in accordance with law.
The present appeal is by way of special leave.
In the appeal the same question as to the jurisdiction of the City Civil Court was raised.
Held (per S.K. Das and M. Hidayatullah, JJ.) that section 28 no doubt gives exclusive jurisdiction to the Court of Small Causes to entertain and try a suit or proceeding between a landlord and a tenant relating to recovery of rent or possession of any premises to which any of the provisions of Part II of the Act apply; it also gives exclusive jurisdiction to decide any application under the Act and any claim or question arising out of the Act or any of its provisions.
Section 28 does not invest the Court of Small Causes with exclusive power to try questions of title as between the rightful owner and a trespasser or a licensee, for such questions do not arise under the Act.
If therefore the plaintiff in his plaint does not admit a relation which would attract any of the provisions of the Act on which the exclusive jurisdiction given under section 28 depends, the defendant by his plea cannot force the plaintiff to go to a forum where on his own averments he cannot go.
If the suit as framed is by a land lord or a tenant and the relief asked for is in the nature of a claim which arises 216 out of the Act or any of its provisions then only and not otherwise will it be covered by section 28.
The City Civil Court had jurisdiction to entertain the suit and the High Court correctly came to that conclusion.
Ananti vs Ghhannu, All.
501 Govindram Salamatrai vs Dharampal, , and Jaswantlal vs Western Company, India (1959), 61 Bom.
L R. 1087, approved.
Babulal Bhuramal vs Nandram Shivram ; , explained.
Per Sarkar, J. The suit is not one between a land lord and a tenant for recovery of possession of premises and there.
fore it does not come under the first kind of matters mentioned in section 28(1).
The suit does not come under the second kind mentioned in that section as that deals with certain applications only.
Section 28 thirdly provides that no court other than a Court of Small Causes shall have jurisdiction to deal with any claim or question arising under the Act concerning properties in Greater Bombay.
This part of the section does not purport to affect any court 's jurisdiction to entertain and try a suit but it only prevents a court from dealing with certain claims and questions.
Therefore a court may try a suit in so far as it does not thereby have to deal with a claim or question arising out of the Act.
It is unnecessary to decide the dispute whether it is per missible under the section to look at the defence for ascertaining whether a claim or question under the Act, arises in the suit because even the defence in the present case does not raise any claim or question under the Act.
The defence really is that the appellants arc not licensees.
That being so, the only question that the suit involves is whether the appellants are licensees of the shop.
Quite clearly, such a question is neither a question nor a claim arising out of the Act.
Neither is a question whether the appellants are sub tenants one arising out of the Act for the Act says nothing as to the creation of a tenancy.
No discussion of any question or claim arising out of the Act is necessary for deciding the suit.
|
Appeal No. 2467 of 1966.
Appeal from the judgment and decree dated March 27, 1963 the Kerala High Court in Appeal Suit No. 848 of 1960 '.
Sarjoo Prasad, P.K. Pillai and M.R.K. Pillai, for the: appellants.
V.K. Krishna Menon, R. Thiagarajan and K. Jayaram, for respondents Nos. 1 to 3.
Judgment of the Court was delivered by Ramaswami, J.
This appeal is brought by certificate from the judgment of the High Court of Kerala in A.S. No. 848 of 1962 dated March 27, 1963 reversing the decree of the principal Subordinate Judge, Trivandrum in O.S. No. 182 of 1957 dated May 23, 1960.
The father of the plaintiffs who are appellants herein was a Hindu Nadar namely Raman Nadar.
He had an eider brother named Krishanan Nadar.
On May 9, 1946 the said Krishanan Nadar and Raman Nadar jointly executed a deed of will exhibit P 2 in respect of the assets of Krishanan Nadar.
On the date of the will, Raman Nadar had only three daughters and no sons.
Krishnan Nadar died on December 5, 1947.
After the death of Krishnan Nadar the appellant 's mother ' was married to Raman Nadar, who is the father of the appellants.
It is specifically provided in the will exhibit p 2 that in the event of Raman Nadar begetting a son or sons in future those male issues will succeed to the assets of Krishnan Nadar to the exclusion of the daughters.
The material portion of the will, exhibit p 2, reads as follows: "Deed of will executed by Krishnan aged 51, Nadar, son of Kaliyambi, merchant, Makkavazhi, Kuzhiamvilakathu Veettil, Melkaladi, Airanimuttan, Pakuthy, Nellamn Adhikaram and his brother Raman son of the said Kaliyambi of do.
, aged 39, merchant, on 26th Madam, 1111 M.E. with their own consultation and to their entire satisfaction.
Some properties have been acquired in the name of the 1st named and in the name of the 2nd named out of love and affection towards him and his children, with the self acquired money of the 1st named 'and without the income of the Tarwad properties of the 1st named and without the help of the other members of the Tarwad or the 2nd named.
They are held 473 by the 1st named in his possession and enjoyed by him till this date.
The 1st named has, till the end of his life; absolute freedom, authority and right to alienate (the properties) in whatever manner he likes and to execute deeds.
The first named is unmarried and the second named has married Parvathy alias Snahappoo daughter of Sarah, Maraikkamuttath Veettil, Vazhuthoor Desom, Neyyattinkara Taluk, through whom he has three daughters Ammukutty aged 14, Chellamma aged 10 and Rajammal aged 5 but no son.
As the first named felt himself desirous of making during his life provision for the devolution after his life of the movable and immovable properties belonging to him in absolute rights as aforesaid, the following provisions regarding them are made: The first named till the end of his life will have the right to pay the land revenue to enjoy and dispose in any manner whatsoever all the movable and immovable properties that belong or may belong to himself.
After the life of the first named, all the properties above said will be taken and enjoyed by the second named maintaining his children named above and those born to him later and without alienating or westing the properties.
After the life of the second named, if he leaves behind no sons, the three daughters named above and the daughters, if any, born hereafter may enjoy all the movable and immovable properties that may be found to belong to the first named and the second named, either in common or in equal shares, effecting mutation, taking pattahs and paying the revenue in their own names, but without making any alienation thereof.
If there be sons born to the second named, they will take after the life of the second named all the movable and immovable properties of the first named and the 2nd named and enjoy them for ever, effecting mutation, taking pattahs and paying revenue, and with all powers of disposal; and in that event, the daughters of the 2nd named will not have and should not claim any right and they will not get any right.
" Soon after the death of Krishnan Nadar defendants 3 and 4 and the mother of the 5th defendant as plaintiffs filed O.S. No. 37 of 1124 M.E. for the administration of the estate of the deceased Krishnan Nadar.
The mother of appellants was made one of the defendants in that suit and the allegation was that Raman Nadar had contracted an illicit relationship with her and that he had executed a gift deed exhibit D 1 in her favour in respect of some of the plaint items.
O.S. No. 37 of 1124 was dismissed on the ' ground that the plaintiffs of that suit had lost their rights under the will on the birth of a son to Raman Nadar through his second 474 wife on February 7, 1951 during the pendency of the suit.
The plaintiffs in O.S. No. 37 of 1124 filed A.S. No. 98 of 1955 against the aforesaid decree and that was disposed of by a Division Bench of the Kerala High Court on February 2, 1957.
The High Court observed as follows: "We do not consider it proper to decide this question 'of 'the legitimacy of the son born to the 1st defendant in his second marriage) in this suit.
This can be gone into in 'a suit, if any, instituted by or on behalf of the son.
The 1st defendant had no right to revoke the will after Krishnan Nadar 's death .
The plaintiffs do not and cannot get the right to possession of the properties until after the 1st defendant 's death but a right to maintenance from the income of the properties has been provided for the plaintiffs by exhibit A (the will) and this they are entitled to get.
The 1st defendant is not entitled to do any act which affects this right of the plaintiffs.
" The High Court remanded the suit for fresh disposal to the Additional Subordinate Judge, Trivandrum.
After the suit went back on remand the Additional Subordinate Judge, Trivandrum held that the plaintiffs were not entitled to any relief and dismissed the suit.
The daughters of defendant no.1 preferred an appeal, A.S. No. 340 of 1959 to.
the High Court.
Meanwhile the appellants instituted O.S. No. 182 of 1957 for a declaration that the first defendant had only a life estate in the properties of Krishnan.
Nadar with the remainder vested in them under the will referred to above.
The suit was decreed by the Principal Subordinate Judge, Trivandrum who held that the second marriage of the 1st defendant was legal and the sons born out of that marriage were entitled to Krishnan Nadar 's property subject to the life estate of the 1st defendant.
It was further held that the daughters of the 1st defendant (plaintiffs in O.S. No 37 of 1124) were not entitled to any right over the properties.
The daughters of the 1st defendant preferred an appeal against the.
decree of the Principal Subordinate Judge being A.S. No. 848 of 1960.
The High Court decided this.
appeal and A.S. No. 340 of 1957 by a common judgment on March 27, 1963.
Appeal A.S. No. 848 of 1960 was allowed in whole and suit O.S. No. 182 of 1957 filed by the appellant was dismissed.
A.S. No. 34 of 1959 was partly allowed and appellants 1 and 2 (being the first two plaintiffs in O.S. No. 37 of 1124) were held entitled to maintenance of Rs. 50/ per head per menses from February 18, 1957.
The alienations, Exs.
C, D and E were held not binding upon the plaintiffs in that suit nor to have any force beyond the life of the 1st defendant.
The other prayer sought by the plaintiffs in the appeal was disallowed.
475 In dismissing O.S. No. 182 of 1957 the High Court took the view that the legal validity of the bequests in exhibit P 2 had to be ascertained as on the date of Krishnan Nadar 's death which was December 5, 1947.
The marriage of the first defendant took place on 14 1 1124 (corresponding to August 29, 1948) and the first child of that marriage was born on February 7, 1951.
The sons of the 1st defendant born of his second wife were, therefore, not in existence at the time of the death of the testator Krishnan Nadar.
Krishnan Nadar belonged to the State of Travancore and all his properties were located in that State where the doctrine of pure Hindu Law reigned supreme unaffected by any legislation.
The High Court held that according to pure Hindu Law a gift cannot be made in favour of a person who was not in existence at the date of the gift.
A person capable of taking under a will must either in fact or in contemplation of law be in existence at the death of the testator.
The devise in favour of plaintiffs in O.S. No. 182 of 1957 was void as they were not born at the time of death of Krishnan Nadar.
After the life estate of the 1st defendant, the daughter:rs became entitled to the properties for their life time.
The question involved in this appeal is whether the High Court was right in holding that plaintiffs have not established their title to the disputed properties.
Although there is no authority in Hindu Law to justify the doctrine that a Hindu cannot make a gift or bequest for the benefit of an unborn person yet that doctrine has been engrafted on Hindu Law by the decision of the Judicial Committee.
This doctrine was laid down for the first time in Tagore 's case(1), in which it was held by the Judicial Committee that a Hindu cannot make a gift in favour of a person who is not in existence either in fact or in contemplation of law at the time the gift was to take effect.
The Judicial Committee purported to base its decision on a passage in Dayabhaga, Ch. 1, verse 21 as.
appears from the following passage in the judgment: "This makes it necessary to consider the Hindu Law of Gifts during.
life and wills, and the extent of the testator 's power, whether in respect of the property he deals with of the person upon whom he confers it.
The Law of Gifts during life is of the simplest character.
As to ancestral estate it is said to be improper that it should be aliened by the holder, without the concurrence of those who are interested in the succession, but by the law as prevailing in Bengal at least (1) the impropriety of the alienation does not affect the legal character of the act (factum valet), and it has long been recognised as.
law (1) I.A. (1872) Supp.
476 in Bengal that the legal power of transfer is the same as to all property, whether ancestral or acquired.
It applies to all persons in existence and capable of taking from the donor at the time when the gift is to take effect so as to fall within the principle expressed in the Dayabhaga, cup.
iv. 21, by the phrase 'relinquishment in favour of the donee who is a sentient person ' By a rule now generally adopted in jurisprudence this class would include children in embryo, who afterwards come into separate existence." (pp. 66 67).
But the Judicial Committee was apparently under some misconception with respect to the meaning of the words of Dayabhaga.
The whole sentence in the original is as follows: of which the following is the: correct translation: "Since in a gift the done 's ownership in the thing (given) arises from the very act of the donor, consisting of the relinquishment of his ownership with the intention of passing the same to a sentient being.
" The sentence neither expresses nor implies that the "sentient being" must be in existence.
or be present at the time and place of the relinquishment.
On the contrary the whole argument contained in paragraphs 21 to 24 of Ch.
1 of Dayabhaga shows that a gift is completed by the donor 's act alone, the acceptance of the donee being not necessary.
Indeed, in the very next passage, Dayabhaga speaks of gifts to God as showing that the validity of the gifts does not depend upon acceptance.
Mr. Sarjoo Prasad suggested that the matter required reconsideration.
But it is manifest that the decision of the Judicial Committee in Tagore 's case(1) has stood a great length of time and on the basis of that decision rights have been regulated, arrangements as to property have been made and titles to property have passed.
We are hence of the opinion that this is a proper case in which the maxim communis error facit jus may be applied.
The principle underlying the maxim is that "the law so favours the public good, that it will in some cases permit a common error to pass for right"; as an example of which may be mentioned the case of common recoveries in English law, which were fictitious proceedings introduced by a kind of pea fraus to elude the statute de Donis, and which were at length allowed by the Courts to be a bar to an estate tail, so that these recoveries however clandestinely introduced, became by long use and acquiescence a legal mode (1) I.A. (1872) Supp.
477 of conveyance whereby a tenant in tail might dispose of his lands.
There is a reference made to this principle by Lord Blackburn in his speech in Charles Dalton vs Henry Angus & Co.(1) as follows: "I quite agree with what is said by the late Chief Justice Cookburn (3 Q.B.D. at page 105) that where the evidence proved an adverse enjoyment as of right for twenty years, or little more, and nothing else, 'no one had the faintest belief that any grant had ever existed, and the presumption was known to be a mere fiction '.
He thinks.
that thus to shorten the period of prescription without the authority of the Legislature was a great judicial usurpation.
Perhaps it was The same thing may be said of a11 legal fictions, and was often said (with, 1 think more reason) of recoveries.
But I take it that when a long series of cases have settled the law, it would produce intolerable confusion if it were to be reversed because the: mode in which it was introduced was not approved of even where it was originally a blunder, and inconvenient, communis error facit ]us.
" The doctrine in Tagore 's case(:) has been altered by three Acts, namely, the Hindu Transfers and Bequests Act, 1 of 1914, the Hindu Disposition of property Act of 1916 and the Hindu Transfers and Bequests (City of Madras) Act, 1921.
The legal position under these Acts is that no bequest shall be invalid by reason only that any person for whose benefit it may have been made was not born at the date of the testator 'section death.
This rule, however, is subject to the limitations and provisions contained in sections 113, 114, 115 and 116 of the .
It is, however, not disputed in the present case that on the relevant date none of the three Act was operative and the doctrine or pure Hindu Law was applicable to the Travancore State.
It follows that the principle laid down in Tagore 's case(2) applied and the bequests in favour of the sons of the 1st defendant are void and of no legal consequence.
On behalf of the appellants it was contended that the bequest in favour of the sons of the 1st defendant was in the nature of a family provision and, therefore, fell outside the principle laid down in Tagore 's case(2).
In our opinion, there is no justification in this argument.
Assuming without deciding that a family provision is an exception to the rule of pure Hindu Law stated above a provision in a will whereby the testor directs that his properties after his death shall be taken by his nephews or in their absence (2) 1. A. (1872) Supp.
(1) [1881] 6A.C. 740,812.
478 by his nieces cannot be characterised as a family provision.
The object of such a disposition is obviously not to make a family provision but to chart a course for future devolution of the testators properties.
The argument was stressed on behalf of the appellants that the will exhibit P 2 was a joint will executed by Krishnan Nadar and Raman Nadar and it was designed to take effect only after the death of both the testators.
As the sons of the 1st defendant must necessarily be born before that event the principle in Tagore 's case(1) was not attracted.
Reference was made to the following passage from Jarman on wills 8th edn. "Two or more: persons may make a joint will, which, if properly executed by each, is, so far as his own property is concerned, as much his will, and is as well entitled to probate upon his death, as if he had made a separate will.
But a joint will made by two persons, to take effect after the death of both, will not be admitted to probate during the life of either.
Joint wills are revocable at any time by either of the testators during their joint lives, or, after the death of one of them, by the survivor.
" In our opinion there is no warrant for this argument.
The 'will exhibit P 2 contains separate provisions regarding the devolution of the properties of each of the testators.
In regard to the properties of Krishnan Nadar it devises a life estate to let defendant and the remainder to his sons or in their absence to his daughters.
In regard to the properties of Raman Nadar the devise is to his sons and in their absence to his daughters.
It is therefore, not possible to accept the argument that the will was intended to operate or to come into effect after the death of both the testators.
In regard to the Krishnan Nadar 's properties the life estate devised in favour of the 1 st defendant must necessarily take effect 'and remain in force during the life of the 1st defendant and not after that.
It is true that at the end of the will there is a clause that both the testators have the right to revoke the will during the lives and that the will will take effect only subsequent to their death.
But the true intention o,f the testator has to be gathered not by attaching importance to isolated expressions but by reading the will as a whole with all its provisions and ignoring none of the has redundant or contradictory.
It must, therefore, be held that as the express devise to the: 1st defendant for his life is a disposition intended to take effect after the death of Krishnan Nadar and before the death of 1st defendant, the last clause in the will cannot be literally correct.
It was then contended on behalf of the appellants that in any event the High Court was in error in holding that the title of the (1) I. A. (1872) Supp.
479 plaint properties vested in the daughters of the 1st defendant under the terms of the will, exhibit P 2.
It appears that during the pendency of the appeal defendant No. 1 Raman Nadar died on May 20 1969 and the question, therefore, arises whether the daughters are entitled to a life interest in the plaint properties after the death of defendant No. 1.
It is manifest from the will that the bequest to the daughters is subject to the prior condition that the defendant No. 1 leaves behind no sons at the date of his death.
The relevant portion of exhibit P 2 states: "After the life of the second named, if he leaves behind no sons, the three daughters named above and the daughters, if any, born hereafter may enjoy all the movable and immovable properties that may be found to belong to the.
first named and the second named, either in common or in equal sharps . . " The bequest to the daughters was, therefore, defensible on the sons being born to defendant No. 1.
Hence upon the death of defendant not 1 on May 13, 1969 there was no valid bequest to the daughters.
In other words there was an intestacy and the provisions of the (Act No. 30 of 1956) would be applicable.
The sons of defendant No. 1 cannot take under the will because they were unborn on the date of the death of the testator Krishnan Nadar.
The daughters also cannot take under the will as the bequest in their favour was subject to the defeatisms clause.
It is evident that the appellants would, be entitled to, their lawful share of the properties of Krishnan Nadar under the provisions of the and they are entitled to a declaration to that effect and other consequential reliefs.
But it is not possible for us to finally dispose of this appeal because there was an issue in the trial court as to whether the appellants were the legitimate sons of defendant No. 1.
The case of the defendants 3 to 5 was that there was No. legal marriage between the 1st defendant and the mother of the plaintiffs.
But the assertion of the plaintiffs, was that their mother married the 1st defendant after getting herself converted into Hinduism and such marriage was legally valid and the plaintiffs are the legitimate children of the 1st defendant.
The trial court decided the issue in favour of the plaintiffs but the High Court has not gone into the question nor recorded a finding as to, whether the plaintiffs are the legitimate sons of defendant No. 1.
For these reasons we hold that this appeal must be allowed, the judgment of the Kerala High Court dated March 27, 1963 in A.S. No. 848 of 1960 should be set aside and the appeal should be remanded to the High Court for determining the issue whether 480 the plaintiffs were the legitimate sons of defendant No. 1 and thereafter dispose of the appeal in accordance with law.
The parties will bear their own costs upto this stage.
The application made by the plaintiffs for the appointment of a Receiver will be dealt with by the High Court.
Appeal allowed.
| K, a Hindu had no issue, but had a brother R who had 3 daughters.
K, and R jointly executed a will bequeting the assets of K to son or sons born in future to R, to the exclusion of the daughters, after the death of K and R. K died in 1947.
The appellants claiming to be the sons of R by his subsequent marriage, filed a suit for a declaration that R had only life interest in K 's properties with the remainder vested in them under the will.
The trial court decreed the suit holding that the second marriage of R was legal and the appellants were entitled to the properties subject to R 's life estate and that R 's daughter had no right in the properties.
R 's daughters filed an appeal to the High Court.
Soon after K 's death, another suit was filed by R 's daughters 'for administration of K 's estate in which the: appellants mother was a party.
This suit was dismissed on the ground that the plaintiffs had lost their right on the birth of appellants.
An appeal to the High Court was pending in this suit also.
The High Court by a common judgment held that the appellants, sons of R, were born after K 's death, so the devise in their favour was void, and that after the life estate of R, his daughters became entitled to the properties for their life time.
HELD: Although there is no authority in Hindu Law to justify the doctrine that a Hindu cannot make a gift or 'bequest for the benefit of an unborn person yet that doctrine has been engraved in Hindu Law by the decision of the Judicial Committee in Tagore vs Tagore.
I.A. (1872) Supp.
This doctrine was laid down for the first time in the case of Tagore.
This decision of the Judicial Committee has stood a great length of time and on the basis of that decision rights have been regulated, arrangements as to property have passed.
Therefore this was a proper case in which maxim communis error facit jus be applied.
The principle underlying the maxim is that "the law so favours the public good, that it will in some cases permit a common error to pass for right".
The bequests in favour of R 's sons were void and of no legal consequence.
[477 A; 478 F G] It is, therefore, not possible to accept the argument that the will was intended to operate or to come into effect after the death of both the testators.
In 'regard to K 's properties the life estate devised in favour of R must necessarily take effect and remain in force during the life of R and not after that; it is true that at the end of the will there is a clause that both the testators have the right to revoke the will during their lives and that the will take effect only sub:sequent to their death.
But the true intention of the testator has to be gathered not by attaching importance to isolated expressions but by reading the will as a whole with all its provisions and ignoring none of them as redundant or contradictory.
It must, therefore, be held that as the express devise to R for his life is a disposition intended to take effect after the death of K and before the death of R the last clause in the will could not be literally correct.
The daughters also could not take under the will as the bequest in their favour was subject to the defeasance clause.
[480 E H] 472 Tagore 's case, I.A. (1872) Supp.
47 and Charles Dalton vs Henry Angus & Co., , 812, referred to.
|
ecial Leave Petition (C) No. 1252 of 1988.
From the Judgment and Order dated 10.8.87 of the Andhra Pradesh High Court in W.P. 10800187.
P.A. Choudhary, TVSN Chari, C. Badrinath and Mrs. Sunitha Rao for the Petitioner.
K.Parasaran, Attorney General G. Chandra and A. Sub hashini for the Respondents.
The Judgment of the Court was delivered by Dutt, J.
The only question that is involved in this petition relates to the validity of rule 498 A of Andhra Pradesh Motor Vehicles Rules, 1964 and a notification dated July 8, 1986 issued by the respondent No. 3, the Commissioner of Police, Hyderabad and Secunderabad, In exercise of his Powers under section 21(1.) of the Hyderabad City Police Act, inter alia, directing that in order to ensure adequate safety of two wheeler riders, wearing of protective helmets is made compulsory for riders of motor cycles and scooters, as envisaged by rule 498 A, with effect from August 1, 1986.
Rule 498 A provides as follows: "Rule 4983 A. Crash helmets to be worn No person shall drive a motor cycle or a scooter in a public place unless such driver wears a crash helmet: Provided that nothing in this rule shall apply to a person professing Sikh religion and wears a turban. ' ' The petitioner, who is a student and has a permanent drivined licence for a two wheeler vehicle, filed a writ petition in the Andhra Pradesh High Court challenging the validity of the said notification as also of rule 498 A on the ground that the same was violative of the rights of the petitioner as guaranteed under Article 19(l)(d) and Article PG NO 636 21 of the Constitution of India.
It was contended by the petitioner before the High Court that as section 85 A of the was yet to be enforced, rule 498 A was illegal and ultra vires the .
It was also contended that the wearing of helmets preventing the free flow of breeze to the head would result in giddiness and affect sight and hearing.
The petitioner filed an affidavit of one Dr. Prabhakar Korada wherein it has been stated inter alia that continuous wearing of helmets can raise the pressure leading to irritation, confusion, headaches, giddiness, falling of hair etc.
The High Court has overruled the contentions of the petitioner that the said notification or the provision of rule 498 A of the Andhra Pradesh Motor Vehicles rules is violative of Article 19(1)(d) or Article 21 of the Constitution or that it is illegal or ultra vires the provisions of the Motor Vehicles Act,1939.
The High Court also relied upon medical opinions of some Neuro Surgeons of repute and came to the finding that wearing of helmets would not cause any ailment whatsoever as contended by the petitioner.
In that view of the matter, the High Court dismissed the writ petition upholding the validity of the notification and the provision of rule 498 A of Andhra Pradesh Motor Vehicle Rules.
Hence this petition for special leave.
At this stage, it may be noticed that by motor Vehicles (Amendment) Act XXVII of 1977 a new section 85 A was inserted in the , hereinafter referred to as 'the Act ' Section 85 A provides as follow: "section 85 A Every person driving or riding (otherwise than in a side car) on a motor cycle of any class shall, while in a public place.
wear a protective headgear of such description as may be specified by the Central Government by rules made by it in this behalf, and different descriptions of headgears may be specified in such rules in relation to deferent circumstances or different class of motor cycles: Provided that the provisions of this section shall not apply to a person who is a Sikh, if he is,while driving or riding on the motor cycle, in a public place, wearing a turban: Provided further that the Central Government may, by such rules, provide for such exceptions as it may think fit.
" Sub section (2) of section 1 of Act XXVII of 1977 provides that the Amendment Act shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint and different dates may be appointed for different provisions of the Amendment Act.
In view of sub section (2) of section 1 of Act XXVll of 1977, the Central Government by a notification dated May 14, 1980 fixed November 1 1980 as the date on which the provision of section 85 A would come into force.
But, by another notification dated October 3 1, 1980, the earlier notification dated May 14, 1480 fixing the date of enforcement of section 85 A as November 1, 1980 was cancelled.
It is contended by Mr. Ghatate, learned Counsel appearing on behalf of the petitioner, that in view of the cancellation of the notification dated May 14, 1980, section 85 A has not come into force and, as such, there is no provision in the providing for wearing of protective headgear or helmet by the driver of a motor cycle of any class while driving the same.
It is submitted that in the absence of any specific provision in the Act, rule 498 A is ultra vires the Act itself and, consequently, the impugned notification issued under section 21(1) of the Hyderabad City Police Act is illegal and should be struck down.
As there was some doubt as to whether section 85 A had come into force by virtue of the notification date May14 1980 and whether the Central Government had the power to cancel l the said notification by the subsequent notification dated October31,1980, we thought it expedient to request the learned Attorney General to appear and assist the Court.
In compliance with our request, the learned Attorney General has appeared before us, but we are of the view that no assistance will by necessary on the point, as we do not think that we are for the reasons state called upon to adjudicate upon the question hereafter.
The learned Attorney General has, however, assisted us in disposing of this petition, and we are thankful to him.
We shall proceed on the assumption that section 85 A has not yet been enforced by the Central Government.
We may now deal with the question as to the legality or otherwise of rule 498 A.
The said rule has been framed by the State Government by virtue of its rule making power under clause (i) of sub section (2) of section 91 of the Act.
PG NO 637 Sub section ( 1) of section 91 and clause (i) of sub section (2) provide as follows: "91(1) The State Government may make rules for the purpose of carrying into effect the provisions of this Chapter.
(2) Without prejudice to the generality of the foregoing power, such rules may provide for (i) generally, the prevention of danger, injury or annoyance to the public or any person, or of danger or injury to property or of obstruction to traffic;" It is urged on behalf of the petitioner that rule 498 A does not and cannot come within the rule making power of the State under clause (i) of sub section (2) of section 19 of the Act, for it does not refer to the driver of a motor cycle or scooter.
It is true that clause (i) does not refer to the driver of a motor cycle or a scooter, but it is much wider inasmuch as it provides, inter alia, for the prevention of danger, injury or annoyance to the public or any person.
It is not disputed that rule 498 A has been framed for the purpose of protecting the head from being injured in cast of an accident.
It is common knowledge that head of the driver of a two wheeler vehicle is the main target of an accident and often it is fatal to the driver.
By insisting on the wearing of a helmet by the driver driving a two wheeler vehicle rule 498 A intends to protect the head from being fatally injured in case of an accident.
Clause (i) is wide enough to include the driver of a motor cycle or a scooter.
The expression "any person"in clause (i) also inlucdes within it a driver of a two wheeler vehicle.
We are unable to accept the contention of the learned Counsel for the petitioner that the words "any person" do not include the driver of a two wheeler vehicle and the rule is intended to prevent the danger, injury or annoyance to the public or any person other than the driver of a two wheeler vehicle.
In our view, clause (i) is also intended for the prevention ot danger, injury or annoyance to the public or any person including the driver of a two wheeler vehicle.
In our view.
clause (i) is also in Tended for the prevention of danger, injury or annoyance to the public or any person including the driver of a two wheeler vehicle.
rule 498 A is, therefore, quite legal and valid, in spite of the absence of any provision like section 85 A. PG NO 638 It is submitted by the learned Attorney General that even assuming that rule 498 A does not come within the purview of clause (i) of sub section (2) of section 91, still the State Government could frame such a rule under sub section ( 1) of section 9 1.
The learned Attorney General submits that the clauses under sub section (2) of section 91 are only illustrative and not exhaustive and the power is real under sub section (1).
In support of his contention, he has referred to a decision of this Court in Om Prakash and others vs Union oflndia and others, AIR 1971 SC 77 1 where it has been observed by this Court that it is a well established proposition of law that where specific power is conferred without prejudice to the generally of the general power already specified, the particular power is only illustrative and does not in any way restrict the general power.
In the instant case also, the general power is in sub section (1) and sub section (Z) contains illust rations and does not, in any way, restrict the general power under sub section (1).
Thus, even assuming that rule 498 A is not covered by clause (i) of sub section (2), it is quite immateriaI inasmuch as such a rule can be framed in exercise of the general power under sub section (1) for the purpose ot carrying into effect Chapter V1 relating to con trol of traffic.
There is, therefor, no substance in the contention of the petitioner that rule 498 A is ultra vires the provision of the Act.
The next attack to rule 498 A and to the impugned notification is based on the fundamental right of a Citizen.
It is submitted that the compulsion for the wearing of a helmet by the driver of two wheeler vehicle is an infringement of the freedom of movement of such a driver,as guaranteed by Article 19(1)(d) do the Constitution, and that such compulsion be rule 498 A interfering with the freedom of movement, not having made in accordance with the procedure established by law, is also violative of Article 21 of the Constitution.
The contention does not at all commend to us.
Rule 498 A ensures protection and safety to the head of the driver of a two wheeler vehicle in case of an accident.
There can be no doubt that rule 498 A is framed for the benefit, welfare and the safe journey by a person in a two wheeler vehicle.
It aims at prevention of any accident being fatal to the driver of a two wheeler vehicle causing annoyance to the public and obstruction to the flow of traffic for the time being.
It is difficult to accept the contention of the petitioner that the compulsion for putting on a headgear or helmet by the driver, as provided by rule 498 A,restricts or curtails the freedom of movement.
On the contrary, in our opinion, it helps the driver of a two wheeler vehicle to drive the vehicle in exercise of his freedom of movement without being subjected to a constant apprehension of a fatal head injury, if any accident takes PG NO 640 place.
We do not think that there is any fundamental right against any act aimed at doing some public good.
Even assuming that the impugned rule has put a restriction on the exercise of a fundamental right under Article 19(1)(d) such restriction being in the interest of the general public, is a reasonable restriction protected by Article 19(5) of the Constitution.
As rule 498 A has been framed in accordance with the procedure established by law, that is, in exercise of the rule making power conferred on the State Government under section 91 of the Act, as discussed above, the question of infringement of Article 21 of the Constitution does not arise.
The contention of the petitioner that rule 498 A and the impugned notification dated July 8,1986 issued by the Commissioner of Police in exercise of his powers under section 21(1) of the Hyderabad City Police Act, infringe the fundamental right of the petitioner under Article 19(l)(d) and Article 21 of the Constitution, is devoid of merit and is rejected.
As to the contention of the petitioner that the wearing of the helmet causes some ailments, we do not think that there is any merit in the contention, particularly in view of the medical opinions of some Neuro Surgeons of repute, as referred to by the High Court in its judgment.
The contention has not also been seriously pressed before us.
The High Court was, therefore, perfectly justified in rejecting the contention.
For the reasons aforesaid, the special leave petition is dismissed.
As no notice has been served on the respondent, there will be no order as to costs.
N.V.K. Petition dismissed.
| The petitioner had filed a Writ Petition (Criminal) No. 1951 of 1985 in the Supreme Court praying that the respondents States be directed: (a) to release all children detained in the jails in the respondent States ; (b) to furnish 'complete information respecting all children detained in the States and the circumstances and the legal facts of such detention and the number of available juvenile courts and children homes; (c) to appoint district judges of the districts to visit jails, sub jails and lock ups to identify and release children in such illegal detention; (d) to requisition immediately necessary buildings and provide infrastructure and make immediate interim arrangements for `places of housing ' of children sought directions to the respective States, Legal.
Aid Boards, District Legal Aid Committees through the appointment of ` duty_counsel ' to ensure protection of the right of the children etc.
The said petition was treated as a public interest litigation and in regard to most of the areas covered by the aforesaid prayers, orders were made from time to time by this Court.
However, being dissatisfied with the progress of the case, the petitioner preferred a Misc.
Petition for leave to withdraw the main public interest litigation on the PG NO 643 PG NO 644 grounds: (1) that the Supreme Court has become "dysfunctional" in relation to, and in the context of the gravity of the violations of the rights of children and the urgency of the requisite remedial steps and that though the proceedings were listed for final disposal in the month of November, 1986 however, owing to unjustified adjournments obtained by the respondents and owing further, to the functional deficiencies of the procedure of this court the proceedings have not yet been finally disposed of; (2) that the Court has not been able to exact prompt compliance with its own orders and directions, issued from time to time, from the respondents; (3) that the applicant is disabled from conducting proceedings with "dignity" as certain happenings in Court had the effect of casting and tended to cast a slur on her integrity and dignity: and (4) that the proceedings were brought as a "voluntary action" and that applicant is entitled to sustain her right to be the "petitioner in person" in a public interest litigation and that the proceedings cannot be proceeded with after delinking her from the proceedings.
Dismissing the criminal miscellaneous petition, HELD: (1) The permission to withdraw the main petition is refused and it is directed that the applicant be deleted from the array of parties in this proceeding.
The proceedings shall now be proceeded with a direction to the Supreme Court Legal Aid Committee to prosecute the petition together with the aid and assistance of such persons or agencies as the Court may permit or direct from time to time.
[667B C] 1(ii) The order dated 5.8.1986 and I3.8.1986 forbidding the applicant from using the information collected by her during her visits to jails and other custodial institutions cannot he modified during the pendency of the proceedings as the information was gathered for purposes of the case and pursuant to the directions of this Court.
[667D] 2(i) The "rights" of those who bring the action on behalf of the others must necessarily be subordinate to the "interests" of those for whose benefit the action is brought.
[652C] 2(ii) In a public interest litigation, unlike traditional disputeresolution mechanism, there is no determination or adjudication of individual rights.
While in the ordinary conventional adjudications the party structure is merely bi polar and the controversy pertains to the determination of the legal consequences of past events and the remedy is essentially linked to and limited by the logic of the array of the parties, in a public interest action the PG NO 645 proceedings cut across and transcend these traditional forms and inhibitions.
The compulsions for the judicial innovation of the technique of a public interest action is the constitutional promise of a social and economic transformation to usher in an egalitarian social order and a welfare State; Effective solutions to the problems peculiar to this transformation are not available in the traditional judicial system.
The proceedings in a public interest litigation are, therefore, intended to vindicate and effectuate the public interest by prevention ot violation of the rights, constitutional or statutory, of sizeable segments of the society, which owing to poverty, ignorance, social and economic disadvantages cannot themselves assert and quite often not even aware of those rights.
The technique of public interest litigation serves to provide an effective remedy to enforce these group rights and interests.
In order that these public causes are brought before the courts, the procedural techniques judicially innovated specially for the public interest action recognises the concomitant need to lower the locus standi threshoIds so as to enable public minded citizens or social action groups to act as conduits between these classes of persons of inherence and the forum for the assertion and enforcement of their rights.
The dispute is not comparable to one between private parties with the result there is no recognition of the status of a Dominus Litis for any individual or group of individuals to determine the course of destination of the proceedings, except to the extent recognised and permitted by the court.
[651E H; 652A C] 2(iii) What corresponds to the stage of final disposal in an ordinary litigation is only a stage in the proceedings.
There is no formal, declared termination of the proceedings.
The lowering of locus standi threshold does not involve the recognition or creation of any vested rights on the part of those who initiate the proceeding, analogus to Dominus Litis.[652H;653A] 3.
Unduly harsh and coercive measures against the states and the authorities might themselves become counter productive.
In the matter of affirmative action the willing cooperation of the authorities must, as far as possible, be explored.
If the proceedings are allowed to be diverted at every stage into punitive proceedings for non compliance,the main concern and purposes of the proceedings might tend to be over shadowed by its incidental ramifications.
The coercive action would, of course, have to be initiated if persuasion fails.
[660C D] In the instant case, the Court 's orders dated 15.4.86, 12.7.86.
5.9.96, 13.8.86 and 21.11.86, show that certain PG NO 646 important and far reaching actions were initiated and appropriate directions were issued to the States and authorities concerned.
The first ground, therefore, does not justify the withdrawal of this public interest Litigation.
If the Court acknowledges any such status of a Dominus Litis to a person who brings a public interest litigation, it will render the proceedings in public interest litigations vulnerable to and susceptible of a new dimension which might, in conceivable cases, be used by persons for personal ends resulting in prejudice to the public weal.
[653F G;662H; 663A B] 4(i) The concept of public accountability of the judicial system is, indeed, a matter of vital public concern for debate and evaluation at a different plane.
But, for that reason courts of law, in their actual day to day judicial work, cannot allow the incantations and professions of these principles to enable parties to judicial adjudications to constitute themselves the overseers of the judicial performance and accountability in the individual case in which they are immediately concerned and permit themselves comments and criticism of the judicial work in the particular case.
[661F,G H;662A] 4(ii) While comments and criticisms of judicial functioning, on matters of principle, are healthy aids for interspersion and improvement, the criticism of the functioning of the Court in the course of and in relation to a particular proceeding by the parties to it borders on a conduct intended or tending to impair the dignity, authority and the functional disposition of the court.
It is, therefore thought important to maintain respect and dignity ot the courts and its officers whose task is to uphold and enforce the law because without such respect, public faith in the administration of justice would be undermined and the law itself would fall into disrespect.
[662B C] 4(iii) This is not to deny the broader right to criticise the systemic inadequacies in the larger public interest.
It is the privileged right of the Indian citizen to believe what he considers to be true and to speak out his mind, though not, perhaps, always with the best of testes; and speak perhaps, 'with greater courage then care for exactitude.
Judiciary is not exempt from such criticism.
Judicial institutions are.
and should be made, of stronger stuff ' intended to endure and thrive even in such hardy climate.
[662F G] In the instant case, there is no justification to the resort to this freedom and privilege to criticise the proceedings during their pendency by persons who are parties and participants therein.
[662G H] PG NO 647 5(i) Even the humblest citizen of the land, irrespective of his station in life, is entitled to present his case with dignity and is entitled to be heard with courtesy and sympathy, Courts are meant for, and are sustained by, the people and no litigant can be allowed to be looked upon as a supplicant or an importuner.
[663C D] 5(ii) The parties who seek justice at the hands of the court are neither its subordinates or subsidiaries.
But the notion of an equal participation, in its practical applications, presents difficulties and cannot be stretched to the point where the court could share the responsibility, and the powers that go with it, of regulating the proceedings of the court with any of the parties before it.
In the existing system.
the parties who seek recourse to courts have to submit themselves to the jurisdiction and discipline of the court.
Their conduct, in relation to the proceedings.
is liable to be regulated by the court.
This is not a matter of expression or assertion of any superiority but is merely a necessity and a functional imperative [666B C] In the instant case, keeping in view the facts and circumstances or the case, the second ground of withdrawal is wholly insubstantial and proceeds on what appear to be certain subjective susceptibilities of the applicant which, to the extent they are irreconcilable with the discipline of the court, cannot be countenanced.
[666D] 6(i) The contention, that applicant is entitled to sustain her right to be the "petitioner in person" in a public interest litigation and that the proceedings cannot be proceeded with after de linking her from the proceedings cannot be accepted.
Any recognition of any such vested right in the persons who initiate such proceedings is to introduce a new and potentially harmful element in the judicial administration of this form of public law remedy.
That apart, what is implicit in the assertion of the applicant is the appropriation to herself of the right and wisdom to determine the course the proceedings are to or should take and its pattern.
This cannot be recognised.
[666E G] 6(ii) No litigant can be permitted to stipulate conditions with the court for the continuance of his or her participation.
[667A] 7.
The initiation of a public interest litigation or proceedings for issue of a writ of Habeas Corpus on the basis of letters reflects and symbolises the Court 's anxiety to relax the rigour of formal pleadings.
However, in proceedings which are already initiated and are pending it world be inappropriate for a party to the proceedings to address letters directly to the Judges.
What is sought to be PG NO 648 brought to the notice of the Court should,as far as possible, be filed in the Registry for being placed before the appropriate bench or submitted in the open court.
There might be extra ordinary circumstances when a party is compelled to resort to the expedience of a letter or a telegram.
Even in such a case, it would be appropriate to address them to the Registry to be placed before the appropriate bench.
The difficulties arising out of such direct communications are too obvious to require any elaborate discussion, [664E G]
|
145 and 149 to 158 of 1959.
Writ Petition under article 32 of the Constitution of India for enforcement of Fundamental Rights.
Sardar Bahadur, for the petitioners.
C. K. Daphtary, Solicitor General of India, R. Ganapathy Iyer and T. M. Sen, for the respondents.
March 30.
The Judgment of the Court was delivered by WANCHOO, J.
These eleven petitions raise a common point and will be disposed of together.
The brief facts necessary for present purposes are these.
The petitioners are dealers in motor spirit in Hyderabad.
In 1949 the Hyderabad Sales of Motor Spirit Taxation Regulation, No. XXIV of 1358 Fasli (hereinafter called the Regulation) was passed and the petitioners were registered as retail dealers of petroleum products under the Regulation.
In 1957 the petitioners and others filed writ petitions in the High Court of Andhra Pradesh questioning the validity of the Regulation.
There was also a prayer for stay of the levy and collection of the tax and the High Court ordered that all further proceedings in the matter of levy, demand and collection of tax including cancellation of registration certificate and threatened attachment of property and the launching of criminal proceedings in pursuance of the Regulation be stayed.
The petitioners allege that on this stay being granted by the High Court, they thought that section 3 of the Regulation was suspended during the period of stay and therefore they stopped collecting the tax from consumers.
While these petitions were pending in the High Court, the Madras Sales of Motor Spirit Taxation (Andhra Pradesh Extension and Amendment) Act, No. V of 1958 (hereinafter called the Act), was passed by which 696 the Madras Sales of Motor Spirit Taxation Act, No. VI of 1939 was applied to Andhra Pradesh with some modifications and the Regulation was repealed.
This Act, like the Regulation, had provisions for registration of dealers and in consequence fresh registration certificates were issued to the petitioners as well as to all other dealers in the State.
In August 1958 the petitions challenging the validity of the Regulation were dismissed.
In September 1958 notice& were issued to the petitioners informing them that they had failed to submit returns showing sales of motor spirit from March 1957 to March 1958 and they were required to submit returns within seven days, failing which best judgment assessments would be made under the relevant provision of the Regulation.
The petitioners made repre sentations against this order and their main case was that they had not collected any tax from consumers during this period and it would therefore be harsh to demand tax from them in the circumstances.
Thereupon it is said that best judgment ' assessments were made against the petitioners and they were required to pay the tax, though liberty to pay in installments was granted to them for this purpose.
As however the petitioners failed to deposit the tax even in installments, the registration certificate of one of the petitioners was cancelled and other petitioners were threatened with cancellation of their registration certificates about October 1959.
Consequently, the present petitions were filed soon after challenging the provisions of the Act relating to cancellation of registration certificates on the ground that such cancellation was not a reasonable restriction on the fundamental rights of the petitioners to carry on business under article 19 (1) (g) of the Constitution.
The petitioners therefore pray for a declaration that sub sections
(1) and (6) of section 4 of the Act and r. 14 purported to be framed thereunder are ultra vires as being violative of article 19 (1) (g) of the Constitution and for consequential orders against the respondents, namely, the State of Andhra Pradesh and its officers, from enforcing the said provisions.
The petitions have been opposed by the respondents 697 and their case is that the provisions in question are reasonable restrictions on the right guaranteed under article 19 (1) (g) and are therefore perfectly valid and constitutional.
The respondents also say that the allegation of the petitioners that they did not collect the tax during the period of the stay orders from consumers is false.
In order to decide the constitutionality of the provisions which have been challenged it is necessary to look into the purpose and object of the Act in which those provisions appear.
The Act was passed in order to levy and collect tax on retail sales of motor spirit in the interest of the general revenues of the State.
Section 2 of the Act is the definition section.
Section 3 is the charging section and provides the rates at which the tax is to be levied on all retail sales of motor spirit.
Section 4 (1) which is being challenged is in these terms: "No person shall, after the commencement of this Act, carry on business in motor spirit as an importer or as a wholesale or retail dealer at any place in the State unless he has been registered as such under this Act.
" Sub sections (2) and (3) make certain ancillary provisions and sub section
(4) is in these terms: "Registration may be made subject to such conditions, if any, as may be prescribed including in the case of an applicant for registration as a retail dealer, the making of such deposit or the furnishing of such security as the registering authority may consider necessary to ensure the due payment of the tax which may from time to time be payable by him." Sub section (5) is unnecessary for our purpose, and sub section
(6) is in these terms: "Any registration under sub section (1) may be suspended or cancelled by such authority, for such reasons, and in such manner, as may be prescribed.
" It is not necessary to refer to other sections which make various provisions necessary for the enforcement of the Act till we come to section 26 which gives power to 88 698 the State Government to make rules to carry out the purposes of the Act.
Rule 14 which has been attacked has been made under the power conferred under section 26 and it is not being disputed that if the main provisions contained in section 4 are constitutional, the rule is within the ambit of the Act and the rule making power of the State Government.
It will be clear from this analysis of the impugned provisions of the Act that the purpose and object of the Act is to levy and collect tax for purposes of the general revenues of the State and the liability for payment is placed under section 3 upon the person effecting the sale.
He is required by section 5 of the Act to keep books of account in the prescribed form and to submit to the Commercial Officer and to such other officers as may be prescribed, a I return in such form, 'containing such particulars and at such intervals, as may be prescribed.
Along with the return, under section 6 he is required to pay the amount of tax due in respect of the motor spirit sold by him in retail during the preceding month according to the return.
In order therefore that the State may have a check on the person from whom the tax is due section 4(l) provides for registration of dealers who carry on the business in motor spirit.
Without such registration it would be impossible for the State to know the persons who are selling motor spirit and from whom the tax is due.
The provision therefore under section 4(l) for registration of dealers is an eminently reasonable provision in order to carry out the object of the Act, namely, the levy and collection of this tax for purposes of the State.
It is really no restriction on carrying on business in motor spirit; any one who carries on such business is free to do so and all that he has to do is to ask for registration, which he will get subject to the provisions of sub section
That sub section has not been challenged in these petitions and therefore we proceed on the assumption that it is constitutional.
It follows therefore that all that anyone who wants to carry on business in motor spirit has to do is to ask for registration which he will get under the rules, and the purpose behind registration is that those on whom the liability to pay tax 699 that it may realise the tax from them.
The challenge therefore to the constitutionality of section 4(1) must fail.
Then we turn to sub section
(6), which provides that any registration under sub section
(1) may be suspended or cancelled by such authority, for such reasons, and in such manner, as may be prescribed.
The main attack of the petitioners is on this sub section.
They contend that this sub section authorises the State to cancel a registration.
The effect of such cancellation read with sub section
(1) is that a person whose registration is cancelled cannot carry on business in motor spirit as he was doing before the cancellation.
It is said that cancellation results in the total extinction of the business of the person whose registration is cancelled and thus the provision as to cancellation is an unreasonable restriction on the fundamental right to carry on business.
There is no doubt that if a registration is cancelled under sub section
(6) it will not be possible for the person whose registration is so cancelled to carry on his business in motor spirit.
Rule 14 provides conditions under which the registration may be cancelled and we are in the present case concerned with two of them, namely, where the holder of at.
registration certificate (a) fails to pay the tax or any other amount payable under the Act and (b) fraudulently evades the payment of the tax.
The reasonableness of this provision as to cancellation of registration certificate has to be judged in the background of what we have already said about the purpose of the levy and its liability on the seller.
It is true that there are other provisions in the law for realisation of public dues from those who default in making payments; but generally speaking cancellation of registration in cases like these is one more method of compelling payment of tax which is due to the State.
Collection of revenue is necessary in order that the administration of the State may go on smoothly in the interest of the general public.
The State has therefore armed itself with one more coercive method in order to realise the tax in such cases.
It is true 700 that cancellation of registration may result in a dealer being unable to carry on the business, but the same result may even follow from the application of other coercive processes for realisation of dues from a trader, for his assets may be sold off to pay the arrears of tax and lie may thereafter be not in a position to carry on the business at all.
Therefore the provision for cancellation of registration for failure to pay the tax or for fraudulently evading the payment of it is an additional coercive process which is expected to be immediately effective and enables the State to realise its revenues which are necessary for carrying on the administration in the interest of the general public.
The fact that in some cases restrictions may result in the extinction of the business of a dealer would not by itself make the provision as to cancellation of registration an unreasonable restriction on the fundamental right guaranteed by article 19(1)(g).
We may in this connection refer to Narendra Kumar vs The Union of India (1), where it was held that: "the word 'restriction ' in articles 19(5) and 19(6) of the Constitution includes cases of 'prohibition ' also; that where a restriction reaches the stage of total restraint of rights special care has to be taken by the Court to see that the test of reasonableness is satisfied by considering the question in the background of the facts and circumstances under which the order was made, taking into account the nature of the evil that was sought to be remedied by such law, the ratio of the harm caused to individual citizens by the proposed remedy, the beneficial effect reasonably expected to result to the general public, and whether the restraint caused by the law was more than was necessary in the interests of the general public.
" Applying these tests we are of opinion that the cancellation of registration will be justified even though it results in the extinction of business as such cancellation is in respect of a tax meant for the general revenues of the State to carry on the administration in the interest of the general public.
(1) ; 701 Besides, there is another consideration to which we may advert in the end, though even otherwise the cancellation is justified.
Though there is no provision in the Act or the Rules specifically authorising the seller to pass on the tax to the consumer, what actually happens is that the seller includes the tax in the price and thus passes it oil to the consumer.
Then in his turn the seller pays the tax to the State.
In effect by thus passing on the tax to the consumer through the price, the dealer has already collected the tax.
Therefore the compulsion of payment which arises because of the provision for cancellation of registration is under the circumstances justified and there is no reason why he should fail to pay it to the State or evade payment thereof fraudulently.
The fault for failure to pay the tax or fraudulent evasion in payment thereof lies in the circumstances entirely on the dealer and he cannot be heard to complain that cancellation of registration in such a case is a disproportionate restriction on the right to carry on business which cannot be justified in the interests of the general public.
Under the circumstances we are of opinion that the ratio of Narendra Kumar 's case (1) applies fully to the present case and the provision contained in sub section
(6) of section 4 is a reasonable restriction within the meaning of article 19(6) of the Constitution.
The petitions therefore fail and are hereby dismissed with costs; there will be one set of hearing costs only.
Petitions dismissed.
| Six seats are allotted to the State of Jammu and Kashmir in the House of People (Lok Sabha) and election to those seats should ordinarily have been by direct election under article 81(1) of the Constitution but the President modified that Article under article 370(1) by Para.
5(c) of the Constitution (Application to Jammu and Kashmir) Order, 1954, to the effect that "the representatives of the State in the House of People shall be appointed by the President on the recommendations of the Legislature of the State".
The petitioner who claimed to be a registered elector and as such eligible for election from any Parliamentary constituency in India contended that the President had exceeded his powers when he made this modification for he thereby substituted direct election to the House of People by nomination which he could not do, and that the said modi fication amounted to radical alteration in article 81 and was not justified under article 370(1).
Held, that the word "modification" used in article 370(I) must be given the widest meaning in the context of the Consti tution and in that sense it includes an amendment and it cannot be limited to such modifications as do not make any "radical transformation".
The modification lays down that the President will make the nomination on the recommendation of the State Legislature which can do so only by voting, and in effect it provides that the seats will be filled by indirect election and not direct election.
The element of election being thus still present there was no radical alteration in article 81 and the President had the power to make the modification which he did.
In re ; , , distinguished.
|
ivil Appeal No. 3003 of 1988.
From the Judgment and Order dated 8/9th April, 1986 of the Central Administrative Tribunal, New Delhi in R.A. No. 2 of 1986 in TA No. T 564 of 1985.
AND Civil Appeal No. 889 of 1988.
From the Judgment and Order dated 29.10.86 and 5.11.1986 in the Central Administrative Tribunal, Ahmedabad in O.A. No. 103 of 1986.
J.S. Bali and L.R. Singh for the Appellant in C.A. No. 3003 of 1988.
K.M.K. Nair for the Appellant in C.A. No. 889 of 1988.
Kuldip Singh, Additional Solicitor General, A. Subba Rao, C.V.S. Rao and Hemant Sharma for the Respondents.
The judgment of the Court was delivered by VENKATACHALIAH, J.
The special leave petition and the appeal by two Central Government servants raise an interesting point of construction of a service Rule whether a Disciplinary Authority can, under Sub Rule (vi) of Rule 11 of the Central Civil Service (Classification, Control and Appeal) Rules, 1965, (Rules for short), impose the penalty of reduction on a Government Servant, recruited directly to a particular post, to a post lower than that to which he was so recruited; and if such a reduction is permissible, whether the reduction could only be to a post from which under the relevant Recruitment Rules promotion to the one to which the Government servant was directly recruited.
PG NO 549 The petition and appeal are directed against the orders dated 8/9 4 1986 of the Central Administrative Tribunal, Delhi, and the order dated 29.10.1986 of the Central Administrative Tribunal, Gujarat, respectively, affirming the orders of the Disciplinary Authorities imposing on the petitioner and the appellant the penalty of reduction in rank to post lower than the one to which both of them were initially recruited.
There is a divergence of judicial opinion amongst the High Courts on the point: The Division Benches of the Orissa and Karnataka High Courts have held that such a reduction in rank is not possible at all.
[See: Babaji Charan Rout vs State of Orissa and Ors., [1982] 1 SLJ 496; Shivalingaswamy vs State of Karnataka, [1985] ILR Kar.
1453].
However, the Madras, Andhra Pradesh and Allahabad High Courts have held that there is no limitation on the power to impose such a penalty.
[See: Gopal Rao vs C.l.T., ; Mahendra Kumar vs Union of India, [1984] 1 All India Ser.
Law Jour.
34; S.N. Dey vs Union of India & Ors., [1983] 2 SLJ All. 114].
The Central Administrative Tribunal, Madras, in C.S. Balakumar vs The lnspecting Asstt.
Commissioner of Income Tax, [1987] 1 All India SLJ 18 has also subscribed to this view.
There is yet a third view, as typified in P.V. Srinivasa Sastry vs Comptroller & Auditor General of India, and the one taken by the Central Administrative Tribunal in the case from which the Special Leave Petition arises, that such a reduction in rank is permissible provided that promotion from the post to which the Government servant is reduced to the post from which he was so reduced is permissible, or, as it has been put, the post to which the Government servant is reduced is "in the line of promotion" and is a "feeder service".
Special leave is granted in SLP (C) 9509 of 1986.
Both the cases are taken up for final hearing, heard and disposed of by this common Judgment.
A brief advertance to the facts of the cases is necessary.
SLP (C) 9506 of 1986 is by a certain Nyadar Singh, the unsuccessful petitioner before the Central Administrative Tribunal, New Delhi, and is directed against that the Tribunal 's order No. T 564/85 (SBCWP No. 1747/80) dated PG NO 550 28th February, 1986, rejecting his challenge to the order dated 4th Sept., 1976, of the disciplinary authority imposing a penalty of `reduction in rank ' reducing the petitioner from the post of Assistant Locust Warning Officer to which he was recruited directly on 31.10.1960 and confirmed on 27.12.1971 to that of Junior Technical Assistant pursuant to certain disciplinary proceedings held against him.
In 1974, he was working as an Assistant Locust Warning Officer at Nohar.
On 4.11.1975 in respect of certain acts alleged to constitute misconduct on his part certain disciplinary proceedings were initiated against him which culminated in the order dated 4.9.1976 imposing the aforesaid penalty.
The statutory appeal before the appellate authority was, dismissed on 24.4.1979.
Thereafter he filed a writ petition before the Delhi High Court which, after the coming into force of the Central Administrative Tribunal Act, 1985, stood transferred to and was disposed of by the Central Administrative Tribunal, New Delhi, by its order dated 28.2.1986, now under appeal.
It is relevant to mention that in the year 1981, after the period of penalty of five years had spent itself out, the appellant was re promoted to the post of Assistant Locust Warning Officer.
Civil Appeal No. 889 of 1988 is by M.J. Ninama, an Upper Division Clerk in the Post & Telegraph Circle Office, Ahmedabad, preferred against the order No. OA 103 of 1986 dated 29.10.1986 of the Central Administrative Tribunal, Ahmedabad, rejecting appellant 's challenge to the legality and correctness of the order dated 15.5.1988 of the Post Master General who in modification of the earlier orders imposing a penalty of compulsory retirement on him, substituted in its place the order imposing the penalty of `reduction in rank ' to the post of Lower Division Clerk pursuant to the findings recorded against the appellant on the charge of accepting illegal gratification.
Appellant had been directly recruited as an Upper Division Clerk in the Office of the Post Master General, Gujarat Circle, Ahmedabad.
He was reduced to the lower post of Lower Division Clerk until he was found fit after a period of five years from 15.5.1986.
However, the appellant 's seniority on re promotion was directed to be fixed at what it would have been, without the reduction.
We have heard Shri J.S. Bali, learned counse] for the appellant Nyadar Singh and Shri K.M.K. Nair, learned counsel for the appellant Ninama; and Shri Kuldip Singh, learned Additional Solicitor General for the respondents in both the appeals.
Rule 11 of the `Rules ' enumerates the penalties which may for good and sufficient reasons be imposed on a PG NO 551 Government servant.
Sub rule (vi) of Rule 11 provides: "11.
The following penalties may, for good and sufficient reasons and as hereinafter provided, be imposed on a Government servant namely: Minor penalties: Omitted as irrelevant here.
Major penalties: (v) . . (vi) reduction to a lower time scale of pay, grade, post or Service which shall ordinarily be a bar to the promotion of the Government servant to the time scale of pay, grade, post or Service from which he was reduced, with or without further directions regarding conditions of the restoration to that grade, or post or Service from which the Government servant was reduced and his seniority and pay on such restoration to that grade, post or Service;" According to the contention of the appellants ' learned counsel, the appellants were, as a result of the imposition of the penalty, reduced in rank to a post lower than the one to which they were initially recruited, which on a proper construction of the Rule, is not permissible.
Learned counsel relied upon the decision of this Court in Hussain Sasan Sahed Kaldgi vs State of Maharashtra, Shri Kuldip Singh, Additional Solicitor General, however, contended that this limitation which may be appropriate in the case of a `reversion ' which, as the very concept implies, could not be to a post which the Government servant did not earlier hold, is inappropriate in a case of reduction in rank imposed as a penalty.
Reduction in rank, according to learned Additional Solicitor General, has a wider import than `reversion ' and there is no reason why the power to impose this penalty which is permissible on the plain language of the Rule be whittled down by any other consideration.
The learned Additional Solicitor General sought to rely upon certain pronouncements of the High Courts.
The import of the expression `Reduction in rank ' has been examined in the context of the constitutional PG NO 552 protection afforded to Government servants under Article 311(2) in relation to the three major penalties of 'dismissal ', 'removal ' and 'reduction in rank ' and the constitutional safeguards to be satisfied before the imposition of these three major penalties.
In Article 311(2) the penalty of "reduction in rank" is classed along with 'dismissal ' and 'removal ' for the reason that the penalty of reduction in rank has the effect of removing a Government servant from a class or grade or category of post to a lessor class or grade or category.
Though the Government servant is retained in service, however, as a result of the penalty he is removed from the post held by him either temporarily or permanently and retained in service in a lesser post.
The expression 'rank ', in 'reduction in rank ' has, for purposes of Article 311(2), an obvious reference to the stratification of the posts or grades or categories in the official hierarchy.
It does not refer to the mere seniority of the Government servant in the same class or grade or category.
Though reduction in rank, in one sense, might connote the idea of reversion from a higher post to a lower post, all reversions from a higher post are not necessarily reductions in rank.
A person working in a higher post, not substantively, but purely on an officiating basis may, for valid reasons, be reverted to his substantive post.
That would not, by itself, be reduction in rank unless circumstances of the reversion disclose a punitiveelement.
The submission of the learned Additional Solicitor General in substance, is that while 'reversion ' envisages that the lower post to which the Government servant is reverted should necessarily to amongst those earlier held by him and from which he had come on promotion, the idea of reversion being a mere antonym of promotion the importing of such a limitation into a case of "reduction in rank" imposed as a penalty would be doing, violence of the express statutory language and an unwarranted fettering of the power of the disciplinary authority.
The idea of reduction in rank, says the learned Additional Solicitor General, is much wider than the ambit of the reversion and there is no justification to whittle down the ambit of this expression consciously employed by the rule making authority.
Such a construction would create more difficulties than It might appear to solve and become counter productive in the sense that even where the disciplinary authority, desires to retain a Government servant in service, though not in the same post but in a lower one, the Authority would be rendered helpless by such a construction being place of in the Rule.
PG NO 553 The argument in favour of this construction of the Rule is stated by by a learned Single Judge in Gopal Rao 's case (supra) thus: ". .
ln effect, what the learned counsel says is that there is no difference between the order of reversion and an order of reduction in rank, that it is well established that reversion can be only to a post which a person held earlier and that reduction also can only be to a post or class of service which the person occupied at any time before. ." " '. .
In my view, the expression "reduction in rank" covers a wider field than reversion to a lower post.
It is true, the word "reversion" always connotes "a return to the original post or place.
" But the word "reduction" has no such limitation and therefore, reduction in rank extends even to a rank which the officer concerned never held. ." Similar view has been taken by a learned Single Judge of the the Andhra Pradesh High Court in Mahendra Kumar vs Union of India and Anr., [1985] 1 SLR [8] : ". .
The Central Civil Service (Classification, Control and Appeal) Rules provide for several penalties which can be imposed for good and sufficient reasons.
One of the major penalties contemplated by Rule II is "reduction to a lower . .
grade, post or service . .
", and I see m, reason why this penalty cannot be imposed upon a person who, on the date of imposition of penalty, is continuing in the same post to which he was appointed by direct recruitment.
This is not a case of reversion of a Government servant to his substantive post for want of vacancy or otherwise, but this is a case of reduction by way of punishment.
I am unable to read any limitation upon the power of the disciplinary authority to impose this punishment on the petitioner, as suggested.
No decision has also been brought to my notice supporting this contention It must, however, be observed that in the above case the High Court upheld the challenge of the appellant that there was no misconduct at all.
The other observations as to the scope of the Rude were, therefore, unnecessary for the decision of the case.
PG NO 554 7.
The opposite view is taken by the Orissa High Court in Babaji Charan Rout vs State of Orissa and Ors., [1982] 1 All India SLJ 496 and by a Division Bench of the Karnataka High Court in Shivalingaswamy v: State ot Karnataka, [l985] ILR Kar. 1453.
In the first case, there is no discussion of the matter as the Division Bench merely followed an earlier unreported decision of another Division Bench of the same High Court.
In the Karnataka case, a person who had been directly recruited as "Village Accountant had been reduced by the Disciplinary Authority to the post of "daftarband".
The Division Bench interpreting an analogous rule in the State 's Service Rules, held the reduction impermissible, observing: ".
Rule 8 [v] of the Karnataka Civil Services (Classification, Control and Appeal) Rules, 1957, as amended, in our opinion, does not justify such an action.
It will lead to most unreasonable results if a person directly recruited to a post is reduced to a post which he never came to hold in service.
That is not the scheme of the CCA Rules and therefore we have no hesitation in holding that the Deputy Commissioner had no competence to impose the penalty of reducing the appellant to the post of Daftar band Attender when in fact he entered service only as Village Accountant.
If the disciplinary authority felt that the gravity of the charges proved warrants that the appellant should be removed from service it was open to the authorities to make an order either dismissing or removing him from service . .
The third view of the matter which while holding such a reduction is permissible, but subject to the post to which the Government servant is reduced being one from which promotion to the post from which reduction is effected is permissible, is to be found in Srinivasa Sastry 's, case (supra) where Rama Jois, J. of the Karnataka High Court held: ".
It is no doubt true that normally penalty of 'reduction in rank ' is imposed only so as to bring down a civil servant to a lower time scale, grade, service or post, held earlier by him before promotion and not below the post, grade, service, or time scale to which a civil servant was directly recruited, and it appears, that it is also PG NO 555 reasonable to do so.
The learned counsel, however, could not substantiate the point with reference to the rule which empowered the disciplinary authority to impose the penalty of reduction in rank as it does not make any such differentiation . ." [See at 515, para 91.
This is also the view taken by the Tribunal in the first of the appeals now before us.
The Tribunal held : "12.
In the light of the aforesaid discussion we find that rule 11 (vi) of the Central Civil Services (Classification, Control and Appeal) Rules, 1965, on its true construction permits reduction in rank in the case of a direct recruit if the post to which he is reduced is in the line of promotion i.e. is a feeder service . .
" But as against this judicial opinion in Srinivasa Sastry 's case, the learned Judge, as auther, [See 'Services under the State ': Indian Law Institute, page 220] expressed the view: "Therefore, it is reasonable to take the view that a civil servant earns promotion by exhibiting his merit and ability and suffers reduction in rank instead of removal or dismissal for misconduct or inefficiency during his service in the higher post unless he is unworthy of being retained in the service and that the word 'reduction in rank ' is used in Article 311 in this sense.
It appears that the punishment by way of reduction in rank can be inflicted only against a civil servant who held a lower post and who has been promoted to the higher post; . ." 9.
The contention of the learned Additional Solicitor General that when a legislative authority uses the expression "reduction in rank" without imposing any limitations there is no justification to fetter or otherwise limit the plenitude of the idea of 'reduction ', looks, at the first blush, seemingly plausible and even somewhat attractive.
The view has commended itself for acceptance to some of the High Courts and Tribunals.
The meaning to be given to a particular statutory language depends on the evaluation of a number of interpretative criteria.
Shorn of the context, the words by themselves are "slippery customers".
The general presumption PG NO 556 is that these criteria do not detract or stand apart from, but are to be harmonised with, the well accepted legal principles.
In a difficult case, the number of relevant interpretative criteria may be so high that the task of the court in assessing their effect is, correspondingly, difficult.
Even the statutory language apparently free from the sins of semantic ambiguity might not, in the context of the purpose, connote or convey its lexicographic thrust; but would acquire a different shade or colour imparted to it by the variations of the interpretation criteria.
The ambiguity need not necessarily be a grammatical ambiguity, but one of appropriateness of the meaning in a particular context.
Francis Bennion in his "Statutory lnterpretation" refers to the nature of the task in weighing the factors: ". it is necessary for the interpreter to assess the respective weights of the relevant interpretative factors and determine which of the opposing constructions they favour on balance . .
" "We may speak of the factors tending in a certain direction as a bundle of factors.
This is figurative, but then so is the idea of factors being 'weighed '.
The court is unlikely even to consider the factors one by one, and certainly will not proceed in any mechanistic way . .
" "We find that one bundle of factors favours one of the opposing constructions of the enactment.
while the other bundle favours the other construction.
[As to opposing constructions see section 84 of this Code. ] .
There may be factors drawn from a single interpretative criterion in both bundles .
. " [See `Statutory lnterpretation ' by Francis Bennion.
1984 End. page 390] It is true that where statutory language should be given its most obvious meaning to accord with how a man in the street might answer the problems posed by the words ' the Statute must be taken as one finds it.
Consideration relevant to interpretation are not whether a differently conceived or worded statute would have yielded results more consonant with fairness and reasonableness.
Consequences do not alter the statutory Ianguage, but may only help to fix its meaning.
PG NO 557 10.
As to whether a person initially recruited to a higher time scale, grade or service or post can be reduced by way of punishment, to a post in a lower time scale, grade, service or post which he never held before, the statutory language authorises the imposition of penalty does not, it is true, by itself impose any limitations.
The question is whether the interpretative factors, relevant to the provision, impart aNy such limitation.
On a consideration of the relevant factors to which we will presently refer we must hold that they do.
Though the idea of reduction may not be fully equivalent with 'reversion ', there are certain assumptions basic to service law which bring in the limitations of the latter on the former.
The penalty of reduction in rank of a Government servant initially recruited to a higher time scale, grade, service or post to a lower time scale, grade, service or post virtually amounts to his removal from the higher post and the substitution of his recruitment to lower post, affecting the policy of recruitment itself.
In Worthington vs Robin, [l896] 75 Law Times Reports 446 where a supervisor of Inland Revenue was reduced in rank by statutory authority, referring to the effect of reduction in rank.
though in a different context, brought about by the order of the statutory authority, the Court of appeals understood the process as a dismissal from the higher post and reappointment to the Iower post.
Rigby.
L.J observed: " . .
1 treat what has happened as a dismissal, because, though in effect he has been reduced to a lower position, his new appointment is in fact a re appointment.
If we could see any point in this action upon which there might be a possibility of his succeeding, we should be most anxious to give him the opportunity . .
" But action was dismissed because the civil servant was holding the office at the pleasure of the Commissioners under the Inland Revenue Regulation Act governing the situation.
There are, therefore, certain considerations of policy that might militate against such a wide meaning to be given to the power.
In conceivable cases, the Government servant may not have the qualifications requisite for the post which may require and involve different, though not necessarily higher, skills and attainments.
Here enter considerations of the recruitment policy.
The rule must be read in consonance PG NO 558 with the general principles and so construed the expression `reduction ' in it would not admit of a wider connotation.
The power should, of course, be available to reduce a civil servant to any lower time scale, grade, service or post from which he had subsequently earned his promotion.
The Second, and perhaps equally relevant, consideration, is the anomaly that a pushing to its logical limits of such power might produce.
In Srinivasa Sastry 's case, (supra), the learned Judge of the Karnataka High Court visualised these anomalies thus. ". .
Acceptance of the contentions urged for the respondents would lead to incongruous and absurd results.
To illustrate, could a Doctor be reduced in rank to the post of a Compounder, or an Engineer to the post of a Fitter, or a Teacher in a High School to the post of a Peon, or a Scientific Officer to the post of a ministerial officer, in the absence of any provision in the rules for the consideration of the case of the civil servant concerned, for promotion from the latter category to the former category? It appears to me that on a fair and proper construction of rule II (vi) of the Rules, the condition precedent for the exercise of power under that rule by way of imposing penalty of reduction in rank to a lower post is, that the higher post from which the concerned civil servant is sought to be reduced must be a promotional post in relation to the lower post to which he is sought to be reduced . .
[See at 516].
" The argument that the rule enables a reduction in rank to a post lower than the one to which the civil servant was initially recruited for a specified period and also enables restoration of the Government servant to the original post, with the restoration of seniority as well, and that, therefore, there is nothing anomalous about the matter, does not, in our opinion, wholly answer the problem.
It is at best one of the criteria supporting a plausible view of the matter.
The rule also enables an order without the stipulation of such restoration.
The other implications of the effect of the reduction as a fresh induction into a lower grade, service or post not at any time earlier held by the Government servant remain unanswered.
Then again, there is an inherent anomaly of a person recruited to the higher grade or class of post being asked to work in a lower grade which in certain conceivable cases might require different qualifications.
It might be contended that these anomalies PG NO 559 Could well be avoided by a judicious choice of the penalty in a given fact situation and that these considerations are more matters to be taken into account in tailoring out the penalty than those limiting the scope of the punitive power itself.
But, an over all view of the balance of the relevant criteria indicates that it is reasonable, to assume that the rule making authority did not intend to chothe the disciplinary authority with the power which would produce such anomaious and unreasonable situations.
The contrary view taken by the High Courts in the several decisions referred to earlier cannot be taken to laid down the principle correctly.
The pronouncement of this Court in Hussain Sasan Saheb Kaldgi vs State of Maharashtra, [l987[ AIR (SC) 1627 relied upon by the appellant is one which deals with a case of 'reversion '.
Appellant in that case who, while working as a primary teacher in the services of the District Local Board, offered himself for and was selected by direct recruitment to the post of the Asst.
Deputy Educational Inspector.
But after four years he was sought to be reverted to the post of primary teacher.
His suit for the declaration that the purported reversion was illegal and void was decreed by the trial court, but was dismissed by the High Court in appeal.
This court restored the decree of the trial court.
As rightly pointed out by the learned Additional Solicitor General, the case dealt with the scope and limitations of the process of 'reversion ' and is of no assistance in deciding the point under consideration.
But this does not make any difference to the conclusion we have reached.
The point now is as to what orders are to be made in these appeals.
Appellants in the two appeals have been reduced to posts lower than these to which they were initially directly recruited.
As these penalties cannot be sustained in the view we take of the rule, in the normal course the penalties imposed would require to be set aside and the disciplinary authority directed to re consider which other penalty which it would now choose to impose.
But, we are of the opinion that it would be somewhat unfair that at this distance of time the matters are re opened.
We think, having regard to all the circumstances of the cases the orders that commend themselves appropriate in the two cases are in terms following: (i) In the first of the appeals, appellant Nyadar Singh, has, after the period of the reduction in rank has spent itself out, been restored to the original position.
It would, therefore, be sufficient to set aside the penalty imposed on him and direct that the period of service in the PG NO 560 reduced post be treated as service in the post held by him prior to imposition of the penalty, subject to the condition, however, that the appellant shall not be entitled to any difference of salary for and during the period of reduction.
In view of this, we think that the proceedings taken against him should come to an end and there is no need to remit the matter to the Disciplinary Authority for selection and imposition of a fresh penalty.
(ii) In the case of M.J. Ninama the penalty of reduction in rank is set aside and he shall be restored to the post which he held before the imposition of the penalty.
However, for the period, if any, served by him in the lower post pursuant to the penalty imposed on him, he shall not be entitled to the difference of salary.
It will also not be necessary to remit his case for fresh consideration of the choice of the penalty having regard to the lapse of time.
It is ordered and the appeals disposed of accordingly.
No costs.
R.S.S. Appeals disposed of.
| Pursuant to separate disciplinary proceedings the penalty of `reduction in rank ' was imposed on the appellants, Nyadar Singh and M.J. Ninama, reducing each of them to a post lower than the one to which they were directly recruited.
The Central Administrative Tribunals rejected the appellants ' challenge to the orders imposing the penalty.
Before this Court, the appellants ' contention was that as a result of the imposition of the penalty, they were reduced in rank to posts lower than the one to which they were initially recruited, which on a proper construction of Rule 11 of the Central Civil Services (Classification, Control and Appeal) Rules 1965 was not permissible.
The Additional Solicitor General, on the other hand, contended that this limitation which might be appropriate in the case of a `reversion ', was inappropriate in a case of `reduction in rank ' imposed as a penalty.
The argument was that `reduction in rank ' had a wider import than `reversion ' and there was no reason why the power to impose this penalty which was permissible on the plain language of the Rule, be whittled down by any other consideration.
PG NO 547 PG NO 548 Disposing of the appeals, it was, HELD: (1) The meaning to be given to a particular statutory language depends on the evaluation of a number of interpretative criteria.
Shorn of the context, the words by themselves are `slippery customers '.
The general presumption is that these criteria do not detract or stand apart from, but are to be harmonised with, the well accepted legal principles.
Considerations relevant to interpretation are not whether a differently conceived or worded statute would have yielded results more consonant with fairness and reasonableness.
Consequences do not alter the statutory language, but might only help to fix its meaning.
[555H; 556A B, G H] (2) The expression `rank ', in `reduction in rank ' has, for purposes of Article 311(2), an obvious reference to the stratification of the posts or grades or categories in the official hierarchy.
It does not refer to the mere seniority of the Government Servant in the same class or grade or category.
[552B C] (3) The penalty of `reduction in rank ' of a Government servant initially recruited to a higher time scale, grade, service or post to a lower time scale, grade, service or post virtually amounted to his removal from the higher post and the substitution of his recruitment to lower post, affecting the policy of recruitment itself.
ln conceivable cases, the Government servant might not have the qualification requisite for the post which might require and involve different, though not necessarily higher, skills and attainment.
[551B C, 557G] [Worthington vs Robin, [1896] 75 Law Times Reports 446, referred to.] (4) Rule 11 must be read in consonance with general principles and so construed the expression `reduction ' in it would not admit of a wider meaning.
[557H; 558A] Babaji Charan Rout vs State of Orissa, [1982] 1 SLJ 496; Shivalingaswamy vs State of Karnataka, [1985] ILR Kar.
1453; approved.
Gopal Rao vs C.I.T., ; Mahendra Kumar vs Union of India, [1984] 1 All India Ser.
Law Journal 34; ; S.N. Dey vs Union of India, [1983] 2 SLJ All. 114; C.S. Balakumar vs The lnspecting Asstt.
Commissioner of Income Tax, [1987] 1 All India SLJ 18, over ruled.
PG NO 548 P. V. Srinivasa Sastry vs Comptroller & Auditor General of India, and Hussain Sasan Saheb Kaldgi vs State of Maharashtra, , referred to.
|
ivil Appeal No. 88 of 1953.
Appeal under article 132(1) of the Constitution of India from the Judgment and Order dated the II th September, 1951, of the High Court of, Judicature for the State of Rajasthan at Jodhpur in D. B. Civil Appeal,(Ijlas i Kbas) No. 6 of 1950.
H. J. Umrigar, Narain Andley and Rajinder Narain for the appellants.
Radhey Lal Aggarwal and B. P. Maheswari, for the respondent.
May 12.
The Judgment of the Court was delivered by MUKHERJEA J.
This appeal is on behalf of the plaintiffs and has come before us on a certificate granted by the High Court of Rajasthan, under article 132(1) of the Constitution, on the ground that the case involves a substantial question of law as to the interpretation of the Constitution.
The appellant has also put in a petition praying for leave to urge other, grounds on the merits of the case.
The suit, out of which this appeal arises, was brought by the appellants, as plaintiffs, on the 16th August, 1946, in the District Court I at Jodhpur in Rajasthan against the defendant respondent, claiming to recover from the latter a sum of Rs. 10,342 annas odd together with interest and costs.
The plaintiffs, at all material times, carried on the business of commission agents both at Indore and Jodhpur under the name and style 441 of " Kanmal Kishenmal " and I" Kanmal Surajmal " respectively and their case is that between September and December, 1945, the defendant entered into several forward contracts for the purchase and sale of bullion through the plaintiffs ' firm at Indore.
These transactions proved unprofitable to the defendant and except a small profit of Rs. 103 annas odd which one of these transactions fetched, every one of the rest ended in loss and the loss aggregated to a sum of Rs. 21,423 1 6 pies.
It is averred in the plaint that this entire amount was paid to third parties at Indore by the plaintiffs on behalf of the defendant and that the plaintiffs received, in all, a sum of Rs. 11,457 8 0, which the defendant paid from time to time, towards these losses, to the plaintiffs ' firm at Jodhpur.
The plaintiffs were therefore entitled to the balance of Rs. 9,861 which together with interest came up to Rs. 10,342 and this was the claim laid in the plaint.
The suit was transferred from the District Court to the Original Side of the High Court of jodhpur and the defendant filed his written statement in the High Court on the 27th October, 1947.
The defence was a complete denial of the plaintiffs ' claim and it was contended inter alia that the transactions in suit amounted to wagering contracts and according to the law prevalent in Marwar, as contained in the notification of the Marwar Government dated the 3rd June, 1943, all forward business contracts in bullion, in which the date fixed for delivery exceeded 12 days, were illegal and were punishable as criminal offences.
No suit was therefore maintainable on the basis of these transactions.
On these pleadings a number of issues were raised of which issue No. 5 stood thus: " Are the transactions in dispute in the suit illegal and the present suit in respect of these transactions is not maintainable on account of the notification dated 3rd June, 1943 ? " The suit came up for hearing before a single Judge of the Jodhpur High Court sitting on the Original Side.
No evidence was adduced by the parties and the case 57 442 was heard only on issue No. 5 which was treated as an issue on a pure question of law.
It was held by the learned Judge that, as it was admitted by the plaintiffs that the contracts to which the suit related covered a period exceeding 12 days, they came within the prohibition of the notification referred to above and a suit based upon them was not maintainable in law.
The judgment shows that a contention was raised on behalf of the plaintiffs that the notification was confined only to contracts made in Marwar or intended to be performed in that place, and as the contracts in suit were all entered into at Indore, they could not be hit by the notification.
This argument was repelled by the learned trial judge on a two fold ground.
It was said in the first place that as the suit was actually brought in the Jodhpur Court, the plaintiffs could not avoid facing the notification and the Jodhpur Court could not give them a relief in violation of its own laws.
The other reason assigned was based upon section 13 of the Civil Pro cedure Code and it was said that if the plaintiffs could and did get a decree on the basis of these transactions in the Indore Court and wanted to enforce the same as a foreign judgment in the Court of Jodhpur, the latter would be justified in refusing to give effect to such judgment under section 13 of the Marwar Civil Procedure Code, on the ground that such judgment was founded on a breach of law in force in Marwar.
In this view the learned Judge, by his judgment dated the 2nd March, 1948, dismissed the plaintiffs ' suit.
The plaintiffs thereupon took an appeal, against this judgment, to the Appeal Bench of the Jodhpur High Court and the appeal was heard by a Division Bench consisting of Nawal Kishore C. J. and Kanwar Amar Singh J.
The learned Judges accepted the legal position taken up by the plaintiffs, that the contracts could be void only if they were entered into at Marwar or were intended to be performed, either wholly or partly, at Marwar.
Admittedly they were entered into at Indore outside Marwar, but the learned Judges held that from the fact that certain payments were made by the defendant and accepted by the plaintiffs towards these contracts at Marwar, it could be inferred that it 443 was a term of the contracts that they would be performed at Marwar.
Another point raised on behalf of the plaintiffs, that as the notification of 3rd June, 1943, itself came to an end by efflux of time on the 30th September, 1946, there, was no obstacle in the way of the plaintiffs ' obtaining a decree at any time after that, was repelled by the learned Judges on the ground that as the contracts themselves were illegal, at the time when they were entered into, by reason of their violating the provisions of the notification, the fact that the notification subsequently ceased to be operative could not make the illegal contracts lawful.
The result was that by its judgment dated the 24th September, 1948, the appellate bench of the High Court dismissed the appeal.
The plaintiffs thereupon with the leave of the Court took an appeal against this decision to the Ijlas i Khas of the State of Jodhpur as it then existed.
While the appeal of the plaintiffs was pending before the Ijlas i Khas of the Jodhpur State, the integration of the various States of Rajasthan took place and the United States of Rajasthan was formed on the 7th of April, 1949.
The Rajasthan High Court Ordinance was promulgated by the Rajpramukh of Rajasthan on the 21st June, 1949, and on the 29th of August following, the High Court of Rajasthan was constituted.
Another Ordinance known as the 'Rajasthan Appeals and Petitions (Discontinuance) Ordinance, 1949 ' provided, by section 4, that pending appeals before the Ijlas i Khas of any of the covenanting States if they related to judicial matters were to be heard by a special Court to be constituted by the Rajpramukh.
This section was amended by an amending Ordinance dated the 24th of January, 1950, and all these pending appeals were directed to be heard and disposed of by the Rajasthan High Court established under ' the Rajasthan High Court Ordinance of 1949.
In accordance with this provision the appeal of the plaintiffs was transferred to the High Court of Rajasthan for disposal.
The Constitution of India came into force on the 26th of January, 1950, and when the appeal came up for hearing before the Rajasthan High Court a preliminary point was raised as to whether the 444 appeal should not be transferred to the Supreme Court for disposal under article 374(4) of the Constitution.
The matter was referred for consideration by a Full Bench, and the Full Bench decided that article 374(4) of the Constitution had no application to the present case and the appeal was to be heard by the High Court of Rajasthan.
The appeal was then placed for hearing before a Division Bench of the Rajasthan High Court and by their judgment dated the 11th of September, 1951, the learned Judges dismissed the appeal and affirmed the decision of the Courts below.
Against this judgment the plaintiffs got leave to file an appeal to this Court under article 132(1) of the Constitution and that is how the matter has come before us.
The only constitutional point involved in the appeal is whether article 374(4) of the Constitution is attracted to the facts of the present case and whether the appeal should therefore have been transferred to this Court for disposal instead of being heard and disposed of by the Rajasthan High Court.
In view of the fact that we have ' acceded to the prayer of the appellants and have granted them leave to urge other grounds relating to the merits of the case in support of the appeal, this constitutional point has nothing but an academic importance and is not pressed by the appellants.
We would therefore proceed to consider the points upon which the learned counsel for the appellants has attempted to assail the propriety of the decision of Rajasthan High Court on its merits.
The learned Judges of the Rajasthan High Court took the view, and it seems to us quite properly, that the Courts below were not right in treating issue No. 5 as raising a pure question of law where no investigation of facts was necessary.
The High Court has pointed out that the defendant while raising the plea of illegality of the contracts in his written statement, nowhere alleged that the contracts were entered into at Marwar or were intended to be performed there.
On the other hand the plaintiffs expressly averred that the contracts were made at Indore.
The one fact from which the appeal bench of the Jodhpur High Court drew the conclusion that the contracts were intended to be 445 performed, partly at least, at Marwar, was that certain payments towards the losses resulting from the transactions were made by the defendant to the plaintiffs ' firm at Marwar.
This, as the Rajasthan High Court points out, does not necessarily lead to the inference that it was a ' part of the original agreement entered into by the parties, that the performance was to be made at Marwar.
The payments might have been made, as a matter of convenience, upon express instructions from the Indore firm.
It is also pointed out that if the general principle of law is that it is the debtor who has to seek the creditor, as the defendant ranked here as a debtor by reason of the losses suffered in the business, it was for him to seek the plaintiffs at Indore and not for the plaintiffs to seek him at Jodhpur.
The ,suit, it is to be further noted, was brought at Jodhpur only on the allegation that the defendant resided within its jurisdiction.
There was no averment in the plaint that any part of the cause of action arose within its jurisdiction.
On all these grounds the Rajasthan High Court was of opinion that the Courts below should have either framed a specific issue on facts or if they thought that issue No. 5 was sufficiently wide to cover the question of fact as well, they should have given an opportunity to the parties to lead evidence for arriving at a finding whether the contracts were to be performed in whole or in part in Marwar.
The learned Judges themselves were inclined to send the case back, on remand, in order that evidence might be adduced on this point.
But they did not take this step as they were told that the contracts were entered into by telegrams and no terms of any sort were settled between the parties, it being understood that the business was to be conducted according to the custom and usage of the market.
The learned Judges further discussed a question of Private International Law, apparently raised on behalf of the defendant, that even if the contract was made outside Marwar and not intended to be performed there.
, still the Court of Marwar should refuse to enforce the contract as it was illegal according to the lex fori, that is to say the law of the place where the suit was brought.
446 This contention of the defendant was not accepted and it was held that if the contract was enforceable by the law of the place where it was made or where it was to be performed, it could not be held unenforceable in Jodhpur on the ground of its being opposed to public policy as the prohibition in the notification was not general in its nature and the contract in question cannot be said to be opposed to any basic ideas of morality or public policy.
After saying all these however, the learned Judges of the Rajasthan High Court dismissed the suit on the short point that even if the sale or purchase under the contracts might have taken place outside Marwar Yet the notification not only hit the contracts of sale and purchase but the contract of agency itself relating to such transactions.
It is said then that in the case of Pakki Adat, primarily the place of payment of profit is the place where the constituent resides and in the present case the plaintiffs had alleged themselves to be Pakka Adatias.
Consequently the agency contract would be hit by the notification as it was to be performed at Jodhpur where the defendant lives.
We do not think that the learned Judges ' approach to the case has been a proper one or that the reasoning adopted by them can be accepted as sound.
By the notice of 3rd June, 1943, an additional rule, namely, rule No. 90(c) was added to the Defence of India Rules as applied to Marwar.
Sub rule (2) of rule 90(c) laid down that no person shall enter into forward contract or option in bullion.
In sub rule (1) " forward contract " was defined to mean 'a contract for delivery of bullion.
at a future date, such date being later than 12 days from the date of the contract '; and a " contract " was defined to mean ' a contract made or to be made or to be performed in whole or in part in Marwar relating to the sale or purchase of bullion. ' The present suit is really not one to enforce any contract relating to purchase or sale of bullion which comes within the prohibition of this notification.
It is a suit by an agent claiming indemnity against the principal, for the loss, which the agent had suffered, in carrying out the directions of the principal.
The right to such indemnity is founded on the statutory provision 447 contained in section 222 of the Indian Contract Act which stands as follows: The employer of an agent is bound to indemnify him against the consequences of all lawful acts done by such agent in exercise of the authority conferred upon him." Here the plaintiffs paid the losses resulting from the transactions to third parties, on behalf of the defend.
ant, in exercise of the authority conferred upon them by the latter.
These acts of payment were certainly lawful acts if we assume, as indeed we must, that all these transactions took place and the payments were made outside Marwar.
It is the statutory right which flows from the contract of agency that the plaintiffs are seeking to enforce against the defendant and the suit has been brought in the Jodhpur Court as the defendant resides within that jurisdiction.
The fact that in case of Pakki Adat the place of payment is normally where the constituent resides is immaterial for our present purpose.
A contract for sale or purchase of bullion may be entered into by and between the parties directly or it may be made through agents.
In either case if such contract is not entered into at Marwar, nor is it agreed to be performed wholly or in part in Marwar, it would be outside the notification and cannot be held to be illegal.
The fallacy in the reasoning of the learned Judges lies in the fact that the contract between principal and agent, which is entirely collateral to the contract of purchase and sale, has been held by them as coming within the prohibition of the notification merely on the ground that payment, by the agent to the principal, of the profits of the transaction could be made or demanded at the place where the principal resides.
In our opinion the right to indemnity, which is an incident of the contract of agency, is not hit by the notification at all and is a matter which is entirely collateral to a forward contract of purchase and sale of bullion which the notification aims at prohibiting.
We hold therefore that the Courts were not right in dismissing the plaintiffs ' suit on the ground that the contracts upon which the suit was based were illegal by reason of their contravening the provisions 448 of the notification.
The result is that we set aside the judgments of the Courts below and send the case back to the Original Court of Jodhpur in order that it may be tried 'on all the other issues raised in the suit after giving opportunity to the parties to adduce such evidence as they want to adduce.
The plaintiffs appellants will have their costs up to this stage.
Further costs will abide the result.
Order accordingly.
| The respondent as principal entered into several forward contracts for the purchase and sale of bullion through the appellant 's firm at Indore who worked as commission agents for the respondent.
The transactions resulted in a loss and the appellants who had to pay the amount of loss to third parties on behalf of the respondent as the agents brought the suit for recovery of the amount in the Court in Jodhpur where the respondent resided.
It was pleaded by the respondent that according to.
the law prevalent there as contained in the notification of the Marwar Government dated the 3rd June, 1943, all forward business contract in bullion in which the date fixed for delivery exceeded 12 days were 440 illegal and therefore a suit on the basis of these transactions was not maintainable.
Held, that, the suit was really not one to enforce any contract relating to the purchase or sale of bullion which comes within the prohibition of the notification but was one by an agent claiming indemnity against the principal for the loss which the agent had suffered in carrying out the directions of the principal.
The right to such indemnity was founded on the statutory provision contained in section 222 of the Indian Contract Act and the acts of payment made by the plaintiffs on behalf of the defendant were lawful acts as all the transactions took place and the payments were made outside Marwar and therefore the suit was not hit by the notification.
|
tition (Criminal) Nos. 920 and 934 of 1984.
(Under article 32 of the Constitution of India) P.R. Mridul, R.D. Agarwala and R.N. Poddar for the Applicant/Respondent.
Miss Rani Jethmalani, G.S. Cheema and Shailendra Bhardwaj for the opp.
side/ petitioners.
The order of the Court was delivered by VENKATARAMIAH, J. These cases are just two in number.
There may be many other cases of this nature which have not yet reached this Court but may be filed shortly.
These are not ordinary criminal cases involving a few individuals coming from a small locality.
These are extraordinary cases involving serious questions of great public importance touching the security of the nation as well as personal liberty of a sizeable section of the community, many of whom may have been made to believe by a dominant section of society, may be wrongly, that what they were doing was right and for that reason may not have been free agents.
Hence these cases have to be dealt with differently from the usual cases which come up before this Court.
First a word of caution.
In the course of these proceedings every word uttered on either side of the Bar should be an weighed before it is used.
There is no room for heat and passion; logic and reason alone should rule the debates.
There should be an all round sympathy in dealing with the complex issues which may arise for determination.
In handling these cases the highest judicial talent and statesmanship are needed and hence these cases cannot just be rejected reserving liberty to the applicants to approach a Judicial Magistrate, a Sessions Judge or even the High Court.
Every step taken in these cases should serve as a healing touch bringing solace to all concerned and lessening by some degree the pain and suffering through which the country and its peace loving people have passed and are passing.
These proceedings should have the effect of assuaging the outraged feelings of many who till now may not be aware of what has actually happened.
Any amount of time spent by the highest Court of this land on these cases would not go in vain.
There is no duty more sacred than this.
however, feel that the questions involved are too large and complex for the shoulders of a Single Judge to bear.
It is my humble view that these and other cases of like nature should be heard by at least seven learned Judges of this Court whose unquestioned judicial authority, erudition and acumen would be of great 928 assistance in the restoration of peace in one of our great States known for the valour, the devotion, the spirit of sacrifice and the sense of duty towards the country of the people residing in it.
May I say that there can be no compromise on the following matters, namely, unity and integrity of India, the secular and democratic form of the Indian Government and the supremacy of the Indian Constitution ? They must be upheld in any event.
There cannot be any doubt about the right of the established Government to run the administration of the country.
We should remember, that India is no doubt a Union of States, but the boundary, of the States are not unalterable.
There is only one citizenship in India and that all of us Indian citizens belong to the whole of India and the whole of India belongs to all of us.
Man made boundaries cannot divide us.
Language, religion, caste and other factors cannot be allowed to drive a wedge between one section and another.
It is good to remember here what Abraham Lincoln said though in another context in 1858, 'A house divided against itself cannot stand '.
The issue now before the Court involves more than the future of India.
Again to quote Lincoln from what he said in the American context: "It presents to the whole family of man, the question whether a constitutional republic or a democracy a government of the people, by the same people can or cannot maintain its territorial integrity, against its own domestic foes".
The above words appear to be relevant in the present Indian context too.
The unfolding of facts in these cases may make those who may have erred to realise where they have erred and how they have erred.
It may help the Court to suggest solutions for rectifying the undesirable effects of such errors.
Even if allegations of serious offences against the State may be forthcoming against the arrested persons, the Court may still consider whether it is not possible to enlarge at least some of them, who may be in a repentant mood, on bail to facilitate early restoration of normalcy in the State.
The Court may at some stage have occasion to consider whether it 929 should recommend to Parliament to pass an Act of Indemnity which may be an act of great sagacity, thus drawing the curtain on this unhappy page of the history of the Indian Republic.
These may be many other things which may be done and they are within the domain of my learned Brothers who may hear these cases.
If this Court in the end can succeed in establishing peace and harmony in the country, it would be its finest hour.
I, therefore, refer these cases to a larger Bench with the fond hope that our country would have no occasion in the future to face a similar situation.
These papers may be placed before the Hon 'ble the Chief Justice of India for appropriate directions.
N.V.K. Cases referred to larger bench.
| In the election to the Assembly constituency No 31 Jullundur Cantt., which was held on 31.5.1980, the total votes polled from the constituency were 47650, out of Which the appellant polled 19710, whereas the respondent Yash secured 418 votes more i.e. 20128 votes; Therefore, the appellant sought to challenge the election of Respondent No. 1 on various grounds consisting of corrupt practises committed by respondent No. 1 which materially affected the result of the election.
According to the appellant, Respondent No. 1 through speeches either made by him or his friend carried out a vilifying campaign to show that the appellant was directly connected with the murder of one Asa Ram a harijan and one of Supporters of Congress (l) party, so as to wean away the votes of the harijans of the locality and members of the Congress (l) party.
The Punjab and Haryana High Court disbelieved the oral evidence and found no nexus with the news items etc.
and dismissed the election petition.
Hence the appeal by special leave.
^ HELD 1.1 It is well settled that where the doctrine of inuendo is applied, it must be clearly proved that the defamatory allegation was made in respect of a person though not named yet so fully described that the allegation would refer to that person and that person alone.
Inuendo cannot be proved merely by inferential evidence which may be capable of two possibilities.[386F G] 1.2 In the instant case, the evidence statement of witnesses and the documents produced, do not call for any inference of any close connection or direct link between the imputations made against the appellant in 1978 and those made in 1980.
In none of the documents produced by the appellant which refer to the activities of the first respondent, there is the slightest possible hint that the appellant had anything to do with the murder of Asa Ram.
Further more, the allegations made in 1978 being far too remote and there being no continuous link between those allegations and the allegations made in 1980, the first category of the charge against the respondent cannot be sustained, more particularly because in 384 1978 a fresh election was not in the offing because the Janata Government came into power in 1977 and in normal course would have completed its full term in 1982.
Thus, at that time no body could have predicted that the election would be held only two years later which happened by a sudden spurt of events.
[386E F; G H] N. Vimala Devi vs K. Madhusudhana Reddy [1975] 3.
S.C.R. 128 followed.
2.1 It is now well settled by several authorities of the Supreme Court that an allegation of corrupt practice must be proved as a strictly as a criminal charge and the principle of preponderance of probabilities would not apply to corrupt practices envisaged by the Act because if this test is not applied a very serious prejudice would be caused to the elected candidate who may be disqualified for a period of six years from fighting any election, which will adversely affect the electoral process.[387F G] 2.2 In the instant case, the evidence both oral and documentary led by the appellant falls short of the standard of proof required to bring his case within the four corners of section 123(4) of the Representation of the People Act 1951(1).
About the speech made on May 18, 1980, the deposition of PW8 cannot be relied on inasmuch as it is impossible to conceive of contradictions made by him.
If the witness apart from being interested and partisan, had been present in the meeting throughout, he would not forget who spoke first.
Even P.W 13 cannot be believed since, while admitting in his cross examination that he did not make a noted of what Yash had spoken, yet he was able to give full and grotesque details of the speech, that too, when he was examined in the court after more than a year and half.
[390C D, 388B D] 3.
It is very difficult for a Court to rely on news items published in any newspaper on the basis of information gives by correspondents because that may not represent the true state of affairs.
It is at best a second hand secondary evidence.
[388F G] Samant N. Balakrishna vs George Fernandez & Ors. ; , reiterated.
|
it Petition (Civil) Nos. 455, 597, 635, 636, 777/1986, 1518, 1686/1987, 77, 78 and 395 of 1988.
(Under Article 32 of the Constitution of India).
Govinda Mukhoty and Mrs. Rekha Pandey for the Petitioners.
Madhusudan Rao, Mahabir Singh, M. Satya Narayan Rao and C.V.S. Rao for the Respondents.
The Judgment of the Court was delivered by 415 SINGH, J.
The petitioners in all these ten writ petitions filed under Article 32 of the Constitution of India have raised grievance of discrimination against the State of Haryana in not following the doctrine of "equal work equal pay".
The petitioners are working as instructors under the Adult and Non formal Education Scheme under the Education Department of Haryana.
The object of the Non formal Education and Adult Education Scheme is to impart literacy (functional and awareness) to the adult illiterates in age group of 15 35 years and to provide literacy to the children in the age group of 5 15 years who are drop outs from the primary and middle school level or who never joined any regular school.
A number of Adult Education Centres have been opened in the State of Haryana, which are maintained under the Rural Functional Literacy Programme/Project (RELP) of the Central Government, administered by the State of Haryana although expenditure in respect of the project is borne by the Central Government.
The petitioners were appointed instructors to impart literacy to adult illiterates at these Centres on different dates.
The students who are taught by the petitioners are permitted to appear at the Vth standard (primary examinations) conducted by the Education Department of the State.
On passing the examination the students are issued a certificate of having passed primary examination.
On the basis of that certificate students are eligible for admission to 6th class in the regular schools maintained by the State Government.
The petitioners were appointed instructors by the District Adult Education officers of each district between 1978 to 1985 on the basis of selection held by a Selection Committee.
Initially the petitioners were paid a fixed salary of Rs. 150 per month but since April 1983 it has been increased to Rs.200 per month.
Minimum qualifications for being appointed an instructor is matric, many of the instructors are graduates while some of them also hold junior basic training certificates.
The petitioners are given a deliberate break of one day after the lapse of every six months and have thus been treated temporary in service notwithstanding the fact that they have been continuously working ever since the date of their appointment.
There is another scheme known as Social Education scheme in the State of Haryana for imparting education to illiterates in the villages, the scheme is known as State Adult Education Programme also.
Under that scheme a number of social education centres have been opened.
The teachers employed under that scheme were known as squad teachers who run the centres.
In 1981 the head squad teachers and squad teachers were regularised as head teachers and teachers, and granted the benefit of pay scale applicable to regular 416 head masters and teachers of primary schools maintained by the State A Government.
The petitioners ' grievance is that although they are performing the same nature of functions and duties as performed by the squad teachers but they are denied the same scale of pay instead they are being paid a fixed salary of Rs.200 per month.
The relief claimed by the petitioners in all these petitions is identical in the following terms (a) Issue a writ in the nature of mandamus or any appropriate writ, order or direction that the petitioners continue to be in the service of the respondents from the date of their initial appointment irrespective of their being a deliberate break in their services during the vacation period.
(b) Issue an appropriate writ, order or direction to the respondents to put the petitioners on regular pay scales to that of primary school teachers in the Education Department of Haryana plus other consequential benefits from the date of their initial appointment and further direct the respondents to pay the petitioners the difference in arrears of salary accrued to them from the date of their initial appointment.
(c) Issue by appropriate writ, order or direction that the Department of Adult Education and Non formal Education is a permanent department of the State and the petitioners are regularised teachers in the Department appointed against sanctioned posts of instructors.
There is no dispute that the State of Haryana has framed its own scheme for imparting education to Adult illiterates in the villages, this scheme is known as the State Social Education Scheme.
Under this scheme the State of Haryana has opened social education centres in various Districts.
These centres have been functioning under the Department of Education where teachers known as squad teachers have been imparting literacy, functional and awareness among the illiterates.
The State of Haryana by its order dated 20.1.1981 regularised the services of the squad teachers working on ad hoc basis with effect from 1.1.1980 and sanctioned them pay scale of Rs.420 700, the scale applicable to primary school teachers in the State of Haryana.
The petitioners claim that the job and functions of the instructors are similar to squad teachers for running the social educa 417 tion centres, therefore they are also entitled to the same pay scale as granted to squad teachers.
At this stage it is necessary to note that supervisors are appointed to supervise the various centres at which instructors have been working under the Adult Education and Nonformal Education Scheme.
A number of supervisors filed a writ petition in this Court under Article 32 of the Constitution claiming same scale of pay as granted to head squad teachers of the Social Education Scheme.
Their claim was upheld by this Court in Bhagwan Dass vs State of Haryana, [1987] 4 SCC 634 and direction was issued sanctioning the same scale of pay to them as has been sanctioned to the head squad teachers of the Social Education Scheme.
The petitioners ' claim that as the supervisors who supervise their work have been granted pay scale applicable to head squad teachers the petitioners are also entitled to the pay scale applicable to squad teachers of the Social Education Scheme .
The main controversy raised on behalf of the respondents is that the instructors do not perform similar duties as performed by the squad teachers.
It was urged that the nature of duties of instructors are quite different than those performed by the squad teachers.
The petitioners have stated that the instructors are full time employees they take regular classes of students in the age group of S 15 years for two and a half hours and they further take classes for adult illiterates in the age group of 15 35 years for one and a half hours.
This is not disputed.
The petitioners further contended that in addition to four hours teaching work they have to motivate the children and the adults to join the centres for getting free education.
They are required to submit survey reports to the department every six months giving details as to how many children in the age group of 5 15 years are not going to the schools and how many adult persons are illiterate in their villages.
The petitioners further assert that adult education and nonformal education programme which is implemented by the instructors is similar to social education programme.
The instructors as well as squad teachers of social education scheme are appointed by the District Adult Education officer and both these class of persons function under the control and supervision of the Joint Director, Adult Education under the Directorate of Education of the State of Haryana.
The duties of instructors as contained in Chapter II of the Informal Education Instructors Guide published by the Haryana Government, Directorate of Education, are specified, a copy of the same has been annexed to the affidavit of Prem Chand one of the petitioners.
The duties of the instructors as prescribed therein are as under: 418 "DUTIES OF THE INSTRUCTOR (A) AS ORGANISER OF THE CENTRE 1.
To contact the villagers and their children who can be given education at the centre; 2.
To survey the villages to know who are the children who can be brought to the centre for teaching; 3.
To tell the villages about the aims and objects of education programme; and (4) To form local co ordinating bodies.
(B) AS A TEACHER 1.
To complete the syllabus in time and to create interest in the children by his teaching; 2.
The instructor must be aware of multiple class and group teaching systems; 3.
He should give examples of village life and to link it with education; and 4.
To make cultural activities a part of education.
(C) AS ADMISTRATOR OF THE CENTRE 1.
To contact such students who are irregular or late comers to the centre and to encourage them/their parents to send their children regularly to the centre; 2.
To keep records of the following: (i) personal details of children and their progress charts; (ii) Their timely evaluation; (iii) The details of admission of children from Informal Education Centre (3rd, 4th and 5th class) to formal school; 419 (iv) Copy of the monthly progress and copies of reports sent to the Supervising and Planning offices and copies of other reports.
" The aforesaid publication issued by the Government further states that Haryana is the first State which has integrated the two schemes, namely, Informal Education Programme and Adult Education Programme.
In the counter affidavit of J.K. Tandon, Assistant Director, Adult Education, it is stated that the instructors who are seeking equality with the squad teachers of Social Education Scheme are quite different.
The social education squad teachers are mobile in nature and they move from one village to another, after completing their job in a village whereas in the case of instructors they are employed from the same village and are from the nearby villages, the squad teachers are full time employees and teaching work is carried out by them for full day.
However, in his affidavit Shri Tandon could not dispute the duties as mentioned in the Informal Education Instructors Guide (extracted above).
Another counter affidavit has been filed by Sabira Khosla, Deputy Director, Adult Education, in that affidavit it is stated that the squad teachers are full time employees they work for 6 7 hours and besides working at night during 6 p.m. to 10 p.m. they do social work also.
Another additional affidavit has been filed on behalf of the respondents by S.R. Kaushal, Assistant Director of School Education.
In his affidavit he has stated that social education squad teachers perform various duties under the Social Education Programme which is divided into various divisions as under: 1.
Education division.
Debate and discussion division.
Sports division.
Cultural activity division.
Social service division.
It is stated that the squad teachers undertake various functions to supplement the programme under the aforesaid divisions.
He has pointed out the difference in the working of the instructors and the squad teachers.
The main point of distinction relied upon by him is 420 that the instructors are appointed part time while squad teachers and JBT teachers are in full time employment.
Social education squad teachers are transferable while instructors are not transferable.
A social squad teacher is required to teach 7 hours daily while an instructor is required to teach for four hours.
The social education scheme is permanent and squad teachers are working under a permanent scheme while the instructors are working under a temporary scheme.
We have given our anxious consideration to the material placed before us.
On a careful analysis of the same we find that the nature of duties and functions performed by instructors are similar to those performed by squad teachers.
The functions and duties of both classes of persons are primarily directed to advance the cause of education to bring social awareness among the people in the rural areas and to create interest in various social economic and educational activities.
Bringing adults to centre for educating them is a difficult task and to impart education to drop outs children is not an easy job.
One of the main duties of the instructors is to motivate the adults and drop out children to participate in the activities and to motivate them for taking education.
The instructors teach four hours a day and thereafter they have to do survey work and motivation work in addition to that the instructors are required to carry out additional duties which are assigned to them by the Department.
This is evident from the circular letter dated 4.3.1987 issued by the Joint Director, Adult Education (Annexure B) to the affidavit of Rajinder Singh petitioner.
The letter was circulated to all the instructors of adult and informal education, it reads as under: "Dear To bring adults in centres is a very difficult task.
This is possible only when our centres are attractive and adults feel happy to come to the centres and forget all their worries after coming to the Centre.
Instructors should behave with the adults in such a way that they think him their friend and guide.
The adults should be told that by hearing, reading the writing, they can know about the Government Scheme made for their benefit and progress.
Every Instructor is supposed to know about all such schemes so that they can guide their students.
The Adults should get the guidance from the instructors as to how they can get loans from various banks and cooperative Societies.
In the com 421 ing year we must equip the instructors with training so that they can fulfil the responsibility given to them.
In a meeting held at Karnal you were told about the facilities being given to widows and old persons.
You have to properly propagate the same.
I will be very grateful to you for circulating this letter to all the instructors and supervisors.
Office Dist.
Adult Education officer Karnal.
Page No. A d 4/3480 659, Karnal dated 13.3.1981.
One copy of the letter to be circulated to all instructors and supervisors of Adult and Informal Education for necessary action.
Dist Adult Education officer Karnal 13.2.1987.
" The aforesaid duties which are required to be performed by the instructors are in addition to their four hour teaching duty.
Further the instructors are required to organise sports like kho kho, kabadi and athletics, and to participate in the local functions and to motivate affluent villagers to give donations for the adult education scheme.
This is evident from a circular letter issued by the District Adult Education officer, Ambala on 12.11.1986 (Annexure to the affidavit of Rajender Singh).
Having regard to these facts and circumstances we are of the view that there is no difference in the nature of duties of the instructors and squad teachers and both of them carry out similar work under the same employer.
The doctrine of equal work equal pay would apply on the premise of similar work, but it does not mean that there should be complete identity in all respects.
If the two class of persons do same work under the same employer, with similar responsibility.
under similar working conditions the doctrine of 'equal work equal pay ' would apply and it would not be open to the State to discriminate one class with the other in paying salary.
The State is under a Constitutional obligation to ensure that equal pay is paid for equal work.
The respondents ' contention that the adult education scheme is temporary, as the posts are sanctioned on year to year basis and as such the instructors are not entitled to claim equality with the squad teachers as the scheme under which they work of a permanent nature is misconceived.
This contention was rejected by this Court in the case 422 of Bhagwan Dass (supra) while considering the case of supervisors.
A There is no doubt that instructors and squad teachers are employees of the same employer doing work of similar nature in the same department therefore the appointment on a temporary basis or on regular basis does not affect the doctrine of equal pay for equal work.
Article 39(d) contained in Part IV of the Constitution ordains the State to direct its policy towards securing equal pay for equal work for both men and women.
Though Article 39 is included in the Chapter of Directive Principles of State Policy, but it is fundamental in nature.
The purpose of the Article is to fix certain social and economic goals for avoiding any discrimination amongst the people doing similar work in matters relating to pay.
The doctrine of equal pay for equal work has been implemented by this Court in Ranjit Singh vs Union of India & Ors., ; ; Dhiren Chamoli and ors.
vs State of U.P., and Surinder Singh & Anr.
vs Engineer in Chief, CPWD & Ors.
, In view of these authorities it is too late in the day to disregard the doctrine of equal pay for equal work on the ground of the employment being temporary and the other being permanent in nature.
A temporary or casual employee performing the same duties and functions is entitled to the same pay as paid to a permanent employee.
The respondents ' contention that the mode of recruitment of petitioners is different from the mode of recruitment of squad teachers inasmuch as the petitioners are appointed locally while squad teachers were selected by the subordinate Service Selection Board after competing with candidates from any part of the country.
Emphasis was laid during argument that if a regular selection was held many of the petitioners may not have been appointed they got the employment because outsiders did not compete.
In our opinion, this submission has no merit.
Admittedly the petitioners were appointed on the recommendation of a Selection Committee appointed by the Adult Education Department.
It is true that the petitioners belong to the locality where they have been posted, but they were appointed only after selection, true that they have not been appointed after selection made by the Subordinate Service Selection Board but that is hardly relevant for the purposes of application of doctrine of "equal pay for equal work".
The difference in mode of selection will not affect the application of the doctrine of "equal pay for equal work" if both the class of persons perform similar functions and duties under the same employer.
Similar plea raised by the State of Haryana in opposing the case of supervisors in the case of Bhagwan Dass (supra) was rejected, where it was observed that if the State deliberately chose 423 to limit the selection of candidates from a cluster of a few villages it will not absolve the State for treating such candidates in a discriminatory manner to the disadvantage of the selectees once they are appointed provided the work done by the candidates so selected is similar in nature.
The recruitment was confined to the locality as it was considered advantageous to make recruitment from the cluster of villages for the purposes of implementing the Adult Education Scheme because the instructors appointed from that area would know the people of that area more intimately and would be in a better position to persuade them to take advantage of the Adult Education Scheme in order to make it a success.
The respondents ' plea that instructors are not transferable does not affect the doctrine of equal pay for equal work.
The instructors are appointed locally to implement the Adult and Non formal Education Scheme because they are in a better position to motivate the adults and drop outs children for participating in the scheme.
An outsider may be handicapped in motivating the local residents for participating in the scheme.
As regards the difference in qualification is concerned it is true that the squad teachers possess JBT certificates and many of them are graduates but minimum qualification for squad teachers is also matric.
Similarly minimum qualification for instructors is matric but many of the petitioners are graduates and some of them are trained teachers possessing JBT certificates.
Great emphasis was laid on behalf of the respondent State that instructors are part time employees while squad teachers are full time employees.
Similar arguments were raised on behalf of the State in the case of Bhagwan Dass (supra) in resisting the claim of supervisor but the submission was rejected by this Court on the ground that having regard to the duties and functions which the supervisors are required to perform it was difficult to uphold the plea that he was a part time employee.
In the instant cases also we have already noticed the details of the duties and functions assigned to an instructor which normally say that the petitioners are required to teach at the centre for four hours and in addition to that they are required to motivate adults and drop outs children of the locality and to prepare survey reports, in addition to that they are further required to implement various schemes initiated by the Government, they are further required to organise sports, athletics programme and to persuade local affluent people for making donations.
They are required to educate the local residents with regard to the various welfare schemes initiated by the Government for the welfare of the residents of the rural areas.
Having regard to their duties and functions it is difficult to uphold the respondent 's plea that the instructors are 424 part time employees as they work only for four hours.
In view of the above discussion, we hold that the instructors are entitled to the same pay scale as sanctioned to squad teachers.
We, accordingly, direct that the petitioners ' salary shall be fixed in the same pay scale as that of squad teachers.
The pay of each of the petitioners shall be fixed having regard to the length of service with effect from the date of his initial appointment by ignoring the break in service on account of six months fresh appointments.
The petitioners will be entitled to increments in the pay scale in accordance with law notwithstanding the break in service that might have taken place.
We further direct that these directions shall be implemented with effect from September 1, 1985 as directed by this Court in the case of Bhagwan Das (supra).
The petitioners ' claim for regularising their services In the department cannot be accepted as admittedlly the project of Adult and Non formal Education is temporary which is likely to last till 1990.
We accordingly allow the writ petitions partly with costs which we quantify at Rs.5,000.
R.S.S. Petitions allowed.
| The Superintendents of the Delhi High Court by writ petition claimed better rights of promotion, objected to their being treated as on par with the Private Secretaries to Judges and Court Masters, and being included in a joint seniority list alongwith them, particularly as far as the promotion to the next higher post of Assistant Registrar was concerned.
The petitioners contended inter alia that there was a violation of Article 14 of the Constitution in treating the posts of Superintendents, Court Masters or readers and Private Secretaries to Judges as equal status posts; that the sources of recruitment to these posts were not identical and so also the qualifications required for appointments to these posts; that the duties of the incumbents of these posts were different; that in treating these posts as equal status posts, unequals had been treated equally and the rule of equality had been violated.
Dismissing the petition, the Court, HELD: Where an employer has a large number of employees, performing diverse duties, he must enjoy some discretion in treating different categories of his employees as holding equal status posts or equated posts, as questions of promotion or transfer of employees inter se will necessarily arise for the purpose of maintaining the efficiency of the organisation.
[781C D) PG NO 772 PG NO 773 There is nothing inherently wrong in an employer treating certain posts as equal posts or equal status posts, provided that in doing so he exercises his discretion reasonably and does not violate the principles of equality enshrined in Articles 14 and 16 of the Constitution.
[781D E] For treating certain posts as equated posts or equal status posts, it is not necessary that the holders of these posts must perform the identical functions or that the sources of recruitment to the posts must be the same, nor is it essential that the qualifications for appointments to the posts must be identical.
But, there must not be such difference in the pay scales or qualifications of the incumbents of the posts or in their duties or responsibilities or regarding any other relevant factor that it would be unjust to treat the posts alike and posts having substantially higher pay scales or status in service or carrying substantially heavier responsibilities and duties or otherwise distinctly superior, cannot be equated with the posts carrying much lower pay scales or substantially lower responsibilities and duties or enjoying much lower status in service.
[781E G] The petitioners could not challenge the aforesaid posts being treated as equal status posts as that had been done in accordance with the Seniority Rules of 1971 the vires of which had not been challenged.
[782B] Neither the combined seniority list nor the treating of the said posts as equal status posts could be said to be arbitrary in the absence of any material, particularly in view of the fact that the Chief justice and the Judges of the High Court had taken the view that it was necessary in order to provide adequate promotional opportunities to the various sections of the employees.
[784D] The challenge to the said posts being treated as equal status posts had come too late in 1970 to be entertained in a writ petition, after the seniority Rules of 1971 became effective.
This challenge could be negatived on the ground of delay or latches apart from other considerations.
[784E G] There was nothing unreasonable in the restriction that out of the total number of candidates who satisfied the eligibility requirement, the zone of consideration would be limited to a multiple of 3 to 5 times the number of vacancies or in determining the persons to be considered on the basis of their seniority in the combined seniority list.
It was open to the High Court to restrict the zone of consideration in any reasonable manner, and limiting the PG NO 774 zone of consideration to a multiple of the number of vacancies and basing it on seniority according to the combined seniority list cannot be regarded as arbitrary or capricious or mala fide, nor can it be said that such a restriction violates the, principle of selection on because even experience in service is a relevant consideration in assessing merit.
[791C E] It is not as if either Rule 7 of the Establishment Rules of 1972 or Rule 5 of the seniority Rules of 1971 which provides for a combined seniority list negatives the chance of promotion to the posts of Assistant Registrars being granted to the Superintendents.
[794A B] So far as the zone of consideration is Limited by the competent authority in a manner not inconsistent with the Rules or in a manner not arbitrary or capricious or mala fide, the validity of the decision to limit the zone of consideration cannot be called in question on the ground that the manner in which the zone was limited was not uniform.
[795D E] V. T. Khanzode and Ors.
vs Reserve Bank of India and Anr., ; Guman Singh vs State of Rajasthan und Ors., ; Sant Ram Sharma vs State of Rajasthan and Anr., [19688] 1 S.C.R. III; Reserve Bank of India vs N.C. Paliwal and Ors., ; ; Ashok Kumur Yadav and Ors., etc.
vs State of Haryana and Ors., etc., [1985] Suppl.
1 .S.C.R. 657; V.J. Thomas and Ors.
vs Union of India and Ors.
, l1985] Suppl.
S.C.C. 7; Madan Mohan Saran and Anr.
vs Hon 'ble the Chief Justice and Ors., and Mahesh Prasad Srivastava vs Abdul Khair, , referred to.
|
Civil Appeal No. 1653 of 1979.
Appeal by special leave from the Judgment and Order dated 23.5.1979 of the Delhi High Court in E.F.A. No. 8/76.
Madan Bhatia and Sushil Kumar for the Appellant.
S N. Kacker, S.K.Mehta, P.N. Puri, E.M.S. Anam and M.K. Dua for the Respondents.
The Judgment of the Court was delivered by A.N. SEN J.
The principal question which falls for determination in this appeal by Special Leave granted by this Court, is whether Gyan Chand Jain, the Respondent No. 1 in this appeal, who purchased a two and half storeyed Bungalow at No. 5 C/96, W.E.A. Karol Bagh, New Delhi, at an auction sale held pursuant to the terms of the compromise decree between the morgagor and the morgagee, is entitled to recover actual physical possession of the portions in the occupation of the appellants as lessees, the leases in respect of which were created after the decree in the mortgage suit by consent between the parties had been passed, in an application made by the auction purchaser Gyan Chand Jain under O.XXI, rules 95 & 96 of the Code of Civil Procedure.
There is no serious dispute with regard to the facts material for the purpose of appeal.
Des Raj Agarwal, the sole proprietor of M/s. 178 Raj Kumar & Co., mortgaged the 2/1/2 storeyed bungalow No.5 C/96, WEA.
Karol Bagh, New Delhi (herein after referred to as the premises) along with various other properties with Oriental Bank of Commerce (hereinafter referred as the Bank) on 28.6.1960 by deposit of title deeds.
The Bank filed a suit to recover its dues on the mortgage on 6.11.1962.
On 3.9.1963, a decree was passed by consent of the parties in favour of the plaintiff mortgagee for the sum of Rs. 479177.49 with costs and future interest at 6% till realisation of the decretal amount.
The other relevant terms of the consent decree which are contained in clauses 8 and 9 of the compromise are to the following effects: "8.
If the judgment debtor pay Rs. 479177.49 less costs and interest as after March, 1961 within two years of the decree, then whole of the decree shall stand satisfied.
If full amount of the decree with costs and interest is not paid as agreed above, within two years of the decree, then the decree holder shall be free to enforce the decree against the property mortgaged which shall be sold in execution of the same and the decree holder shall be entitled to proceed against other property and person of the judgment debtor in the case of the proceeds of the property not being sufficient to satisfy the decree".
After the decree had been passed on 3.9.1963, it appears that the judgement debtor leased out different portions of the premises to Dev Raj Dogra, Ish Kumar Khosla and Balwant Singh, the appellants herein, 1966, 1967 and 1970 respectively.
The judgment debtor failed to make payment of the decreetal dues in terms of the provisions contained in the consent decree and the premises in question resold by public auction on 28.10.1971.
Gyan Chand Jain whose bid was the highest, was declared to be the purchaser of the premises and the sale in his favour was confirmed on 6.8.1973.
On 25.10.76 an application was made on behalf on Gyan Chand Jain, the auction purchaser, in the Delhi High Court under O. XXI rules 95 and 96 and also S.151 of the Code of Civil Procedure for the following reliefs: (i) Warrants of possession with the direction that vacant physical possession of the entire property be delivered to the applicant, be issued and vacant physical possession of the entire property be got delivered to the applicant; 179 (ii) in case the Hon 'ble Court comes to a conclusion that the applicant is not entitled to vacate physical possession of any part of the property symbolic possession of that part of the property be granted to him; (iii) notices be issued to the persons mentioned in para 9 above to show cause why vacant physical possession of the portion of the property in their occupation be not delivered to the applicant.
The three tenant who were in possession of the respective portions leased out to them and on whom notices had been served, contested the said application.
A learned Single Judge of the Delhi High Court passed an order of physical possession of the said portions in the respective occupation of the tenants, the appellants before us, to be made over to the auction purchaser Gyan Chand Jain.
The Learned Judge held that the tenancies in favour of the tenants had been created after institution of the suit by the Bank and after the passing of the compromise decree in the said suit; and, the said tenancies would have no effect on the rights acquired by the auction purchaser, in view of the provisions contained in section 52 of the Transfer of property Act.
The Learned Judge had relied on the judgment of a Division Bench of the Bombay High Court in the case of Ramdas Popat Patil vs Fakira Pandu Patil and Ors.(1) and also on decision of Division Bench of the Gujarat High Court in case Jagjiwandas a Firm vs Lakhiram Haridasmal and Ors.(2) The tenants preferred an appeal against the said order of the learned Judge.
Before the Division Bench of the Delhi High Court, it was urged on behalf of the tenants that the decision of the Division Bench relied on by the learned Single Judge had been subsequently over ruled by a decision of the Full Bench of the Bombay High Court in case of Anaji Thamaji Patil vs Ragho Bhivraj Patil and Anr.(3) and the correctness of the decision of the Gujarat High Court had also been questioned in this Full Bench judgment.
Various other arguments were also advanced before the Division Bench on behalf of the tenants and the said arguments have been noted in the judgment of the Division Bench.
The Division Bench however, dismissed the appeal, accepting the contention put forward on behalf of the respondent auction purchaser that the decision of this Court in the case of M/s Supreme General Films Exchange Ltd. vs His Highness Maharaja Sir Brijnath Singhji.
180 Deo of Maihar and Ors., concludes the controversy.
The Division Bench also referred to the decision of this Court in case Jayaram Mudaliar vs Avva Swami and Ors.(2) Against the judgment and decision of the Delhi High Court the tenants have preferred this appeal after obtaining special leave from this Court.
Mr. Bhatia, learned counsel appearing on behalf of the tenants the appellants before us, has urged that section 52 of the has no application to the facts and circumstances of this case, as the conditions laid down in the said Section for the applicability of the said section are not satisfied.
It is the argument of Mr. Bhatia that the requirements of the said Section are (1) there must be a suit or proceeding which is not a collusive one and any right to immovable property must be directly and specifically in question in the said suit or proceeding and (2) transfer or otherwise dealing with the property by any party to the suit or proceeding must affect the right of any other party thereto under any decree or order which may be passed therein.
Mr. Bhatia has contended that in the instant case the right that the mortgagee had was only to put the property to sale in the event of the mortgagor failing to pay the decreetal amount in terms of the provisions of the compromise decree.
It is his contention that the right to put the property to sale cannot be said to be a right to immovable property directly and specifically in question in the suit.
He also referred to section 65A of the which empowers the mortgagor while lawfully in possession of the mortgaged property to grant lease in terms of the provisions contained in the said Section.
He has submitted that section 65A should be read along with section 52 and both these sections have been incorporated with the object of preserving the interest of the mortgagee by making suitable provisions so that the security of the mortgagee might not in any way be affected by any act done by the mortgagor after the creation of the mortgage and also after the institution of any suit for enforcement of the mortgage.
It is his submission that in section 65A of the the Legislature has made it manifestly clear that the mortgagor will be entitled to grant a lease of the property in conformity with the provisions of the said Section and he submits that when a mortgagor grants a lease of the mortgaged property in terms of the provisions of Section 65 A of the , it cannot be said that the granting of any such lease affects the right of the mortgagee.
Mr. Bhatia has next contended that in any event S.52 makes provisions for the 181 parties to the suit or proceeding and can have no application to any outside auction purchaser who is not a party to the suit or proceeding and who only acquires his right after the sale in execution of the decree has been confirmed.
Mr. Bhatia argues that the judgment of the learned Single Judge of the Delhi High Court must be held to be wrong, as the learned Single Judge came to his decision relying on the decision of the Division Bench of the Bombay High Court in the case of Ramdas Popat Patil vs Fakira Pandu Patil and Ors.
(supra) and the decision of the Gujarat High Court in the case of Jagjiwandas a Firm vs Lakhiram Haridasmal and Ors.
(supra) and the decision of the Division Bench of the Bombay High Court in Ramdas Popat Patil 's case has been over ruled by the Ful Bench decision of the Bombay High Court in Anaji Thamaji Patil vs Ragho Bhivraj Patil and Anr.
(supra) in which the correctness of the decision of the Gujarat High Court has also been questioned.
Mr. Bhatia has commented that the decisions of this Court in the case of M/s. Supreme General Films Exchange Ltd. vs His Highness Maharaja Sir Brijnath Singhji Deo of Maihar and Ors.
(supra) and in the case of Jayaram Mudaliar vs Ayya Swami and Ors.
(supra) do not conclude the question involved in the instant case.
He has submitted that the rights of a third party auction purchaser to get physical possession of the property purchased at the auction sale was not considered by the Supreme Court in any of these two decisions; and he has further submitted that in these two cases the Supreme Court had indeed proceeded on the assumption that section 52 of the was applicable without considering whether the requirements of the said Section had been complied with or not, as these aspects were not argued before the Supreme Court in these two cases.
Mr. Bhatia has drawn our attention to O.XXI, rule 95 and also to rule 96 of the Code of Civil Procedure and has submitted that the rights of an auction purchaser are governed by the provisions contained therein.
It is the argument of Mr. Bhatia that in view of the provisions contained therein, the auction purchaser cannot claim physical possession of the portions in the occupation of the appellants, even though the appellants might have been inducted as tenants after the compromise decree in the suit had been passed.
Mr. Kakkar, learned counsel appearing on behalf of the auction purchaser, has submitted that as the tenants in the instant case were inducted not only after the institution of the suit for enforcement of the mortgage but also after the compromise decree had been passed, therein section 52 of the must be held to be applicable and it must be held that the tenancies were illegal and were created in breach of the provisions contained in section 52 of the 182 .
Mr. Kakkar has argued that section 65 A of the does not, in any way, control section 52 of the said Act.
It is his argument that section 65 A makes provisions with regard to the powers of the mortgagor to grant leases of the mortgaged property after the creation of the mortgage but before the institution of suit, while, on the other hand section 52 makes provisions for cases of transfer or otherwise dealing with any property after the institution of a suit or proceeding and section 52 imposes a complete ban on the transfer of any kind or dealing with immovable property except with the authority of the Court during the pendency of the suit or proceeding in which any right to immovable property is directly or specifically in question so that the rights of any party may not be affected when any decree or order is passed in the suit or in the proceeding.
Mr. Kakkar has referred to S.58 of the in support of his contention that in case of a mortgage, there is a transfer of an interest in specific immovable property for the purpose of securing of the payment of money advanced or to be advanced by way of loan.
He has argued that in a suit for the enforcement of mortgage it must, therefore, be held that the right to immovable property is directly and specifically in question; and he has further argued that after the decree for sale is passed in a mortgage suit the mortgagor loses even his right to redeem the property.
He has submitted that in the instant case tenancies have been created long after the compromise decree in which provision for sale of the mortgaged property had been made and the right of the mortgagee decree holder to put up the mortgaged property to sale had also arisen for failure on the part of the mortgagor judgment debtor to pay the decretal dues in terms of the compromise decree and the tenancies created by the mortgagor must be held to be illegal and void as they are clearly in contravention of the provisions contained in section 52 of the .
He submits that there cannot be any manner of doubt, that the creation of a tenancy affects the value of the property and to that extent affects the security, even though it may be said that the Legislature in its wisdom has thought it fit to permit the mortgagor to grant leases of the mortgaged property in terms of the provisions contained in section 65 A of the .
It is his argument that the Legislature has thought it fit not to impose any kind of absolute prohibition in respect of the dealing with any property by the mortgagor after the creation of a mortgage and has imposed only such restrictions which the Legislature thought would not prejudicially effect the security of the mortgagee; but the Legislature, however, in section 52 of the Act has thought fit to impose complete ban on the transfer 183 of or otherwise dealing with any property after the institution of a suit or proceeding in which the right to property is directly or specifically in question, so that the rights of any party thereto may not be affected under a decree or order which may be made in the suit or proceeding.
Mr. Kakkar has next submitted that the auction purchaser at the Court sale acquires all the right, title and interest of the mortgagor and also of the mortagee as a result of the purchase and the auction purchaser, therefore, steps into the shoes of the mortgagee and becomes entitled to obtain physical possession of the property purchased in the same manner as the mortgagee himself would have been able to do.
Mr. Kakkar in this connection has referred to the decision of this Court in the case Mangru Mahto and Ors.
vs Shri Thakur Taraknath Tarakeshwar Math and Ors.(1); and also to the decision of the Supreme Court in M/s. Supreme General Films Exchange Ltd. vs His Highness Maharaja Sir Brijnath Singhji Deo of Maihar and Ors.
(supra) It is the submission of Mr. Kakkar that the decisions of this Court in the case of M/s. Supreme General Films Exchange Ltd. (supra) and also in the case of Jayaram Mudaliar (supra) conclude the question involved in the present appeal and the Division Bench rightly dismissed the appeal relying on the said decisions.
Before we proceed to deal with the respective contentions of the parties, it will be convenient to consider the material provisions of the relevant statutes to which we were referred in the course of submissions made from the bar.
Section 52 of the reads as follows: "During the pendency in any Court having authority within the limits of India excluding the State of Jammu and Kashmir or established beyond such limits by the Central Government of any suit or proceeding which is not collusive and in which any right to immovable property is directly and specifically in question, the property cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the rights of any other party thereto under any decree or order which may be made therein, except under the authority of the Court and on such terms as it may impose.
[Explanation For the purposes of this section, the pendency of a suit or proceeding shall be deemed to commence from the date of the presentation of the plaint or the institu 184 tion of the proceeding in a Court of competent jurisdiction, and to continue until the suit or proceeding has been disposed of by a final decree or order, and complete satisfaction or discharge of such decree or order has been obtained, or has be come unobtainable by reason of the expiration of any period of limitation prescribed for the execution thereof by any law for the time being in force.]" Material provisions of section 58 (a) and (b) of the said Act are in the following terms: "(a) A Mortgage is the transfer of an interest in specific immovable property for the purpose of securing the payment of money advanced or to be advanced by way of loan, an existing or future debt, or the performance of an engagement which may give rise to a pecuniary liability.
The transferor is called a mortgagor, the transferee a mortgagee; the principal money and interest of which payment is secured for the time being are called the mortgage money, and the instrument (if any) by which the transfer is effected is called a mortgage deed.
(b) Where, without delivering possession of the mortgaged property, the mortgagor binds himself personally to pay the mortgage money, and agrees, expressly or impliedly, that, in the event of his failing to pay according to his contract, the mortgagee shall have a right to cause the mortgaged property to be sold and the proceeds of sale to be applied so far as may be necessary, in payment of the mortgage money, the transaction is called a simple mortgage and the mortgagee a simple mortgagee." section 65A which was subsequently introduced into the Act by section 30 of the Transfer of Property (Amendment) Act, 1929 provides: "(1) Subject to the provisions of sub section (2), a mortgagor, while lawfully in possession of the mortgaged property, shall have power to make leases thereof which shall be binding on the mortgagee.
(2) (a) Every such lease shall be such as would be made in the ordinary course of management of the property concerned, and in accordance with any local law, custom or usage.
185 (b) Every such lease shall reserve the best rent that can reasonably be obtained, and no premium shall be paid or promised and no rent shall be payable in advance.
(c) No such lease shall contain a covenant for renewal.
(d) Every such lease shall take effect from a date not later than six months from the date on which it is made.
(e) In the case of a lease of buildings, whether leased with or without the land on which they stand, the duration of the lease shall in no case exceed three years.
and the lease shall contain a covenant for payment of the rent and a condition of re entry on the rent not being paid within a time therein specified.
(3) The provisions of sub section (1) apply only if and as far as a contrary intention is not expressed in the mortgagedeed; and the provision of sub section (2) may be varied or extended by the mortgage deed and, as so varied and extended shall, as far as may be, operate in like manner and with all like incidents, effects and consequences, as if such variations or extensions were contained in that sub section.
Rules 95 and 96 of O.XXI of the Code of Civil Procedure under which the auction purchaser in the instant case had made the application for possession are in the following effect: "95.
Where the immovable property sold is in the occupancy of the judgment debtor or of some person on his behalf or of some person claiming under a title created by the judgment debtor subsequently to the attachment of such property and a certificate in respect thereof has been granted under rule 94, the Court shall, on the application of the purchaser, order delivery to be made by putting such purchaser or any person whom he may appoint to receive delivery on his behalf in possession of the property, and, if need be, by removing any person who refuses to vacate the same.
Where the property sold is in the occupancy of a tenant or other person entitled to occupy the same and a certificate in respect thereof has been granted under rule 94, the Court shall, on the application of the purchaser, order delivery to be made by affixing a copy of the certificate of sale in 186 some conspicuous place on the property and proclaiming to the occupant by beat of drum or other customary mode, at some convenient place, that the interest of the judgment debtor has been transferred to the purchaser.
An analysis of section 52 of the indicates that for application of the said section the following conditions have be satisfied: 1.
A suit or a proceeding in which any right to immovable property must be directly and specifically in question, must be pending; 2.
The suit or the proceeding shall not be a collusive one; 3.
Such property during the pendency of such a suit or proceeding cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the right of any other party thereto under any decree or order which may be passed therein except under the authority of Court.
In other words, any transfer of such property or any dealing with such property during the pendency of the suit is prohibited except under the authority of Court, if such transfer or otherwise dealing with the property by any party to the suit or proceeding affects the right of any other party to the suit or proceeding under any order or decree which may be passed in the said suit or proceeding.
It has to be noted that this section imposes a prohibition on transfer or otherwise dealing with any property during the pendency of a suit provided the conditions laid down in the section are satisfied.
section 58 makes it clear that in case of a mortgage there is a transfer of an interest in the specific immovable property mortgaged for the purpose of securing the payment of money advanced or to be advanced by way of a loan, an existing or future debt, or the performance of an engagement which may gives rise to pecuniary liability.
It further confers, in case of a simple mortgage where, without delivering the possession of the mortgaged property, the mortgagor binds himself personally to pay the mortgage money, a right on the mortgagee to cause the mortgaged property to be sold and the proceeds of sale to be applied, so far as may be necessary in payment of the mortgage debt, 187 section 65A which as we noticed earlier, was introduced by the Amending Act, 1929 in recognition of the mortgagor 's powers exercised bona fide to grant lease of the mortgage property in the usual course of management, makes provision with regard to the exercise of such powers by the mortgagor, while the mortgage subsists and the mortgagor is in lawful possession of the mortgaged property.
This section further makes it clear that any lease granted by the mortgagor in accordance with the provisions of this section would be binding on the mortgagee.
Rules 95 and 96 of O.XXI of the Code of Civil Procedure makes provisions for enabling a purchaser of immovable property in a Court sale after obtaining the necessary certificate from the Court in terms of the provisions contained in rule 94 of the Code to apply for delivery of possession of the immovable property purchased by him at the Court sale.
Rule 95 provides for actual physical possession and rule 96 provides for symbolic possession.
A plain reading of rule 95 which we have earlier set out, clearly establishes, that the purchaser will be entitled to physical possession of property purchased and the Court will direct delivery of actual possession of the property sold to him by removing any person who refuses to vacate the same, if need be, if the following conditions are satisfied: 1.
The property sold must be in the occupation of the judgment debtor; 2.
The property sold must be in the occupancy of some person on behalf of the judgement debtor: 3.
The property sold must be in the occupation of some person claiming under a title created by the judgment debtor subsequently to the attachment of the property.
Rule 96 on the other hand makes it clear that where the property sold is in the occupancy of a tenant or other person entitled to occupy the same, symbolic possession of the property in the manner provided in the said rule is to be made over to the purchaser after the purchaser has obtained the necessary certificate under rule 94 of the Code.
We shall now proceed to consider the decision of this Court in the case of M/s. Supreme General Films Exchange Ltd. vs His Highness Maharaja Sir Brijnath Singh Deo of Maihar and Ors.
(supra) and also the decision of this Court in Jayaram Mudaliar vs Ayya Swami and Ors (supra).
In the case of M/s. Supreme General Films Exchange 188 Ltd., the plaintiff respondent who were the mortgagee of a cinema theatre of which the appellant Supreme General Films Exchange Ltd. claimed to be a lessee in occupation, had filed a suit against the mortgagor and a decree by compromise had been passed in the said suit on 7th May, 1960.
By the said compromise decree it was agreed that the amounts due to the mortgagee decree holder would be realised by the sale of the theatre.
The Central Bank of India, another creditor of the mortgagor, assigned its rights under the decree to the plaintiff decree holder.
The theatre was attached in the course of execution of the decree.
The original lease of 1940 on the basis of which the appellant, the Supreme General Films Exchange Ltd. had entered into possession, expired in 1946 but thereafter the Company had continued in possession as a tenant holding over until the impugned lease deed of 1946 in favour of the company was executed.
The company filed a suit in 1954 for specific performance of the agreement to lease and the lease deed of 1956 was executed in compliance with the terms of the compromise decree passed in the said suit filed by the appellant company.
In the said suit for specific performance by the appellant company, the plaintiff mortgagee was not impleaded as a party.
The plaintiff mortgagee thereafter filed a suit claiming that the lease of 1956 was void as the same came within the mischief of Ss. 52 and 65A of the and also section 64 of the Code of Civil Procedure.
The appellant company contested the said suit contending inter alia that the suit of this nature filed by the plaintiff mortgagee did not lie as it fell outside the purview of section 42 of the Specific Relief Act.
The trial Court decreed the said suit of the plaintiff mortgagee and granted the declaration asked for.
The appellant company preferred an appeal against the decree of the trial Court to the High Court which dismissed the said appeal.
Thereafter the appellant company filed a further appeal to this Court by special leave granted by this Court.
This Court for reasons recorded in the judgment held that the plaintiff was entitled to the declaration asked for on proper construction of section 42 of the Specific Relief Act.
One of the contentions which was raised on behalf of the appellant in this Court was that section 52 of the was not attracted to the lease in question.
Dealing with contention this Court observed at pp.
243 244 as follows: "The contention that the case fell outside the purview of section 52 of the as the lease was executed in purported satisfaction of an antecedent claim rests upon the terms of an agreement of 1948, embodied in a letter, on the strength of which the defendant appellant had 189 filed his suit for specific performance.
We find that the terms of the compromise decree in that suit and lease deed of 1956 purported to confer upon the defendant appellant new rights.
Indeed, there are good grounds for suspecting that the compromise in the suit for specific performance was adopted as a device to get round legal difficulties in the execution of the lease of 1956 in favour of the defendant company.
We are unable to accept the argument, sought to be supported by the citation of Bishan Singh and Ors.
vs Khazan Singh and Anr.
(AIR that the lease was merely an enforcement of an antecedent or pre existing right.
We think that it purported to create entirely new rights pendent lite.
It was, therefore struck by the doctrine of lis pendens, as explained by this Court in Jayaram Mudaliar vs Ayyaswami and ors.
[1973 SCR. 139] embodied in Section 52 of the .
An alternative argument of the appellant was that a case falling within section 65A (2) (a) of the , confining the duration of a lease by a mortgagor to three years, being a special provision, displaces the provisions of section 52 of the .
This argument overlooks the special object of the doctrine of lis pendens which applies to a case in which litigation relating to property in which rights are sought to be created pendente lite by acts of parties, is peening.
Moreover, for the purposes of this argument, the defendant appellant assumes that the provisions of Section 65A(2) (e) are applicable.
If that was so, it would make no substantial difference to the rights of the defendant appellant, which would vanish before the suit was filed if Section 65A applies.
We, however, think that, as the special doctrine of lis pendens, is applicable here, the purported lease of 1956 was invalid from the outset.
In this view of the matter, it is not necessary to consider the applicability of Section 65A (2) (e), which the defendant appellant denies, to the facts of this case." This Court further held agreeing with the concurrent findings of the Trial Court and the High Court that the lease of 1956 was also struck by the provisions of section 64 of the Civil Procedure Code, as the property continued to remain under attachment at the time of the grant of the lease in 1956.
190 It may be noted that in the case the validity of the lease had been questioned by the mortgagee decree holder in a suit for appropriate declaration.
The claim was not for possession by a third party auction purchaser in a proceeding under rr. 95 and 96 of O.XXI of the Code of Civil Procedure and the merits of an application under the said provisions of the Code and the scope and effect thereof did not come up for consideration, In the case of Mangru Mahto and Ors.
vs Shri Thakur Taraknath Tarakeshwar Math and Ors.
(supra), the mortgagor had granted lease of the mortgaged property to certain persons.
In execution of the mortgage decree, the mortgagee himself purchased the property at the auction.
The lessees of the mortgaged property had allowed the property to be sold and had not applied for being added as a party.
The mortgagee had also obtained the money decree against one of the lessees and in execution of the decree had attached the mortgaged land.
The lessees filed claim petitions objecting to the attachment under O.XXI, rule 58 of the Code of Civil Procedure.
The claim petitions filed by the lessees were allowed and the executing court held that the leases were genuine.
The mortgagee auction purchaser did not file any suit under Order XXI, rule 63 but latter filed a suit against the mortgagor and the lessees for recovery of possession of the lands, alleging that the leases were collusive transactions and were otherwise not binding on him.
The Trial Court dismissed the suit holding that the leases were genuine; but the High Court decreed the suit holding that the leases were sham transactions and were made in contravention of section 65A of the .
The lessees thereafter preferred and appeal to this Court under certificate granted by the High Court.
One of the contentions raised before this Court was that as the mortgagee did not file a suit under o. XXI, rule 63 of the Code of Civil Procedure after the claim petitions of the lessees under O.XXI rule 58 of the Code of Civil Procedure had been allowed and the mortgagee was not entitled to maintain the suit for recovery of possession of the mortgaged land and for mense profits on the allegation that the leases were collusive transactions and were otherwise not binding on him.
This contention was negatived by this Court for reasons recorded in the judgment.
This Court further held that the validity of the leases granted by the mortgagor was not affected by section 65A of the as the leases were granted before the enactment of section 65 A.
As these aspects do not have any material bearing on the question involved in the present appeal, it does not become necessary for us to pursue these two aspects any further.
This Court, however, held that the leases in question were not granted by the mortgagor in the ordinary 191 course of management as the agent or bailiff of the mortgagee and were not binding on the mortgagee and in that view of the matter this Court dismissed the appeal.
This Court observed at p. 132 as follows: "A lease granted by the mortgagor, out of the ordinary course of management, though not binding on the mortgagee is binding as between the mortgagor and the lessee.
Such a lessee acquires an interest in the right of redemption and is entitled to redeem.
If such a lease is created before the institution of a suit relating to the mortgage, the lessee must be joined as a party to the suit under O. 34, r. 1, C.P.C.; otherwise he will not be bound by the decree passed in the suit and will continue to retain his right of redemption.
But in view of section 52 of the , if the mortgagor grants such a lease during the pendency of a suit for sale by the mortgagee, the lessee is bound by the result of the litigation.
If the property is sold in execution of the decree passed in the suit, the lessee cannot resist a claim for possession by the auction purchaser.
The lessee could apply for being joined as a party to the suit and ask for an opportunity to redeem the property.
But if he allows the property to be sold in execution of the mortgage decree and they have now lost the present case, the lessees allowed the suit lands to be sold in execution of the mortgage decree and they have now lost the right of redemption.
They cannot resist the claim of the auction purchaser of recovery of possession of the lands.
" It may be noted that the Court immediately after the aforesaid observations has further observed as follows: "If a mortgagor in possession of the mortgaged property executes a lease of the property in the ordinary course of management as the agent or bailiff of the mortgagee during the pendency of a suit by the mortgagee to enforce the mortgage, a question may arise whether such a lease is in the eye of the law a lease granted by the mortgagee through his agent and therefore binding on him.
But in the present case, that question does not arise as the leases were not granted by the mortgagor in the ordinary course of management as the bailiff or agent of the mortgagor.
" It is to be noticed that this decision arose out of the suit instituted by the mortgagee auction purchaser for recovery of possession of 192 mortgaged property sold in execution of the mortgage decree and purchased by the mortgagee himself and the decision in the case rested mainly on the basis that the lease was not granted by the mortgagor in the usual course of business.
This case was also not concerned with an application by an outside auction purchaser for physical possession of the property purchased by him in an application made under O.XXI, rr. 95 and 96 of the Code of Civil Procedure, and the Court did not have to consider this scope and effect of a proceeding under O.XXI, rr. 95 and 96 of the Code of Civil procedure.
In our opinion, it cannot, therefore, be said that these two decisions of this Court conclude the question involved in the present appeal before us.
It may be true that section 52 and section 65 A of the operate in different spheres.
S.65 A, as we have earlier noticed deals with the powers of the mortgagor to grant a lease of the mortgaged property., while the mortgagor remains in lawful possession of the same.
section 52 deals with cases of transfer of or otherwise dealing with any immovable property after any suit or proceeding in which any right to the said immovable property is directly and specifically in question, has been filed.
It is also to be noted that section 65 A which came to be inserted by the Amending Act 1929, is neither made 'subject to ' nor 'not withstanding the provisions ' contained in section 52 of the Act.
section 52 will, however, be only applicable, if the requirements of the said section are satisfied.
We have earlier noticed what the requirements of the said section are.
In the instant case, it does not become necessary for us to consider whether the grant of any lease by a mortgagor in conformity with the provisions of section 65 A of the during the pendency of a suit by the mortgagee to enforce the mortgage will attract the provisions of section 52 of the Act or will be outside the mischief of the provisions of the said section on the ground that the creation of such a lease may not affect the rights of the mortgagee under any decree or order which may be passed in the suit.
We have earlier quoted the observations of this Court in the case of Mangru Mahto (supra) and it will be noticed that the Supreme Court in the said case did not decide this question and left this question open.
In the instant case an outside auction purchaser is seeking recovery of the physical possession of the property purchased by him at the auction from the appellants who are in possession of different portions of the said premises as tenants of the said por 193 tions.
The auction purchaser in the instant case was not the mortgagee and he was no party to the suit in which the compromise decree was passed.
section 52 in clear terms speaks of the rights of the parties to the suit or proceeding.
In this connection it may be noted that this Court in the case of Jayaram Mudaliar (supra) held at p. 153 as follows: "It is evident that the doctrine, as stated in section 52, applies not merely to actual transfers of rights which are subject matter of litigation but to other dealings with it by any party to the suit or proceeding, so as to affect the right of any other party thereto.
Hence it could be urged that where it is not a party to the litigation but an outside agency such as the tax collecting authorities of the Government, which proceeds against the subject matter of litigation, without anything done by a litigating party, the resulting transaction will not be hit by section 52.
Again, where all the parties which could be affected by a pending litigation are themselves parties to a transfer or dealings with property in such a way that they cannot resile from or disown the transaction impugned before the Court dealing with the litigation the Court may bind them to their own acts.
All these are matters which the Court could have properly considered.
The purpose of Section 52 of the is not to defeat any just and equitable claim but only to subject them to the authority of the Court which is dealing with the property to which claims are put forward.
" The auction purchaser derives his right to obtain possession only after the sale in his favour has become absolute and sale certificate has been obtained by him.
The mode and manner of obtaining such possession are regulated by rr. 95 and 96 of the Code of Civil Procedure.
It is of interest to note that in the instant case, the auction purchaser had applied for obtaining possession under r. 95 which provides for actual possession and also under r. 96 which provides for symbolic possession.
We have earlier set out the provisions of these two rules.
In the facts and circumstances of this case, the auction purchaser, in view of the provisions contained in rule 95 which regulates the rights of the auction purchaser to obtain physical possession of the property purchased, is not entitled to recover the physical possession of the portions in the occupation of the appellants as tenants.
The appellants are not the judgment debtors.
They are not in occupation of the property on behalf of the judgment debtor.
They are also not claiming to be in occupation under 194 a title created by the judgment debtor subsequently to any attachment of the property.
There has been no question of any attachment in the instant case.
The appellants are in the occupation of the respective portions as tenants and they claim to occupy the same as such.
The question of validity or otherwise of the tenancy may have to be considered and determined in an appropriate proceeding.
In the present proceeding, the auction purchaser who is an outsider and was not a party to the suit resulting in the compromise decree in execution of which the property was put up for sale, is not entitled to recover physical possession from the appellants in view of the provisions contained in O. XXI, rule 95, and the auction purchaser must be held to be entitled to symbolic possession in terms of the provisions contained in O.XXI, rule 96 in respect of the portions in occupation of the appellants.
We, accordingly, allow this appeal.
We set aside the judgment and order passed by the High Court directing physical possession of the portions in the occupation of the appellants to be made over to the auction purchaser Gian Chand Jain, We direct that symbolic possession of the portions in occupation of the appellants is to be made over to the auction purchaser Gian Chand Jain.
In the facts and circumstances of this case, we make no order as to costs.
N.V.K. Appeal allowed.
| Order XXI Rules 95 and 96 of the Code of Civil Procedure enable a purchaser of immovable property in a Court sale, to apply for delivery of possession.
Rule 95 provides for actual physical possession and rule 96 provides for symbolic possession.
A purchaser will be entitled to physical possession of the property purchased if the property sold is in the occupation of the judgment debtor, of some person on behalf of the judgment debtor or some person claiming under a title created by the judgment debtor subsequent to the attachment of the property.
If the property sold is in the possession of a tenant or other person entitled to occupy the same, symbolic possession is to be made over to the purchaser under Rule 96.
The first respondent was an auction purchaser of property, of which the three appellants were tenants occupying different portions.
The property was mortgaged by its owner with a Bank.
As the amount due was not paid, the Bank instituted a suit for its recovery.
A decree was passed by consent of the parties which provided that if the amount was not paid within two years, the Bank could enforce the decree by sale of the property.
After the compromise decree was passed, the owner leased out different portions of the property to the appellants.
As the owner failed to make payment of the decreetal dues, the property was sold by Court auction and the first respondent, whose bid was the highest, was declared to be the purchaser of the premises, and the sale in his favour was confirmed.
The first respondent/auction purchaser filed an application under Order XXI, Rules 95 and 96 read with Section 151 of the Code of Civil Procedure in the High Court, for delivery of vacant physical possession of the entire property and prayed that if it was not possible to grant vacant physical possession of any part of the property, symbolic possession of that part may be granted.
This application was contested by the three appellants/tenants.
A Single Judge of the High Court holding that the tenancies in favour of the appellants having been created after the institution of the suit by the Bank and after the passing of the compromise decree in the said suit, and the said tenancies would have no effect on the rights acquired by the auction purchaser in view of Section 52 of the , and relying on the Division Bench Judgments of the Bombay High Court in Ramdas Popat Patil vs Fakira Patil and Ors.
AIR 1959 Bom 19 and of the Gujarat High Court in Jagjiwandas a Firm vs 175 Lakhiram Haridasmal and Ors.
AIR 1968 Guj 193 passed an order for delivery of physical possession of the portions in the respective occupation of the appellants.
In appeal it was contended that the Full Bench decision of the Bombay High Court in Anaji Thamaji Patil vs Ragho Bhivraj Patil and Anr.
AIR 1973 Bom 75, over ruled the Bombay Division Bench decision and doubted the correctness of the Gujarat decision, but the Division Bench of the High Court dismissed the appeal accepting the contention put forward on behalf of the respondent purchaser that the decision of this Court in M/s Supreme General Films Exchange Ltd. vs His Highness Maharaja Sir Brijnath ; concluded the controversy.
In the appeal to this Court, it was contend on behalf of the appellants that: (1) Section 52 of the has no application to the facts and circumstances of this case as the conditions laid down therein for its applicability are not satisfied.
(ii) The right that the mortgagee had was only to put the property to sale in the event of the mortgagor failing to pay the decreetal amount in terms of the provisions of the compromise decree, and this right cannot be said to be a right to immovable property directly and specifically in question in the suit.
(iii) Section 65A of the should be read alongwith Section 52 and both these sections have been incorporated with the object of preserving the interest of the mortgagee by making suitable provisions so that the security of the mortgagee might not in any way be affected by any act done by the mortgagor after the creation of the mortgage and also after the institution of any suit for enforcement of the mortgage.
(iv) Section 52 makes provisions for the parties to the suit or proceeding and can have no application to any auction purchaser who is not a party to the suit or proceeding and who only acquires his right after the sale in execution of the decree has been confirmed.
(v) The right of the third party auction purchaser to get physical possession of the property purchased at the auction sale was not considered by the Supreme Court in M/s Supreme General Films Exchange Ltd. vs His Highness Maharaja Sir Brijnath Singhji Deo of Maihar and Ors.
and Jayaram Mudaliar vs Ayya Swami and Ors.
AIR (vi) Order XXI, Rule 95 and Rule 96 of the Code of Civil Procedure provides that the rights of an auction purchaser are governed by the provisions contained therein and that the auction purchaser cannot claim physical possession of the portions in the occupation of the appellants even though they might have been inducted as tenants after the compromise decree in the suit had been passed.
On behalf of the first respondent auction purchaser it was submitted that (1) as the tenants were inducted not only after the institution of the suit for enforcement of the mortgage but also after the compromise decree that has been passed therein, Section 52 of the must be held to be applicable 176 and it must be held that the tenancies were illegal and were created in breach of these provisions.
S.(2) 65A the does not in any way control section 52.
S 65A makes provisions with regard to the powers of the mortgagor to grant leases of the mortgaged property after the creation of the mortgage but before the institution of suit, while section 32 makes provisions for cases of transfer or otherwise dealing with any property after the institution of a suit or proceeding and section 52 imposes a complete ban on the transfer of any kind or dealing with immovable property except with the authority of the Court during the pendency of the suit or proceeding so that the rights of any part may not be affected when any decree or order is passed.
Section 58 of the provides that a mortgage is a transfer of an interest in specific immovable property for the purpose of securing the payment of money advanced or to be advanced by way of loan.
In a suit for the enforcement of a mortgage, the right to immovable property is directly and specifically in question and after the decree for sale is passed, the mortgagor loses even his right to redeem the property.
The tenancies in the instant case having been created long after the compromise decree, are illegal and void and in contravention of section 52 of the Act.
The decisions of this Court in M/s Supreme General Films Exchange Ltd. Manager Mahto and Ors.
and Jayaram Mudaliar conclude the question involved in the appeal.
On the question whether the 1st Respondent as auction purchaser in an application under Or.
XXI, rules 95 and 96, of the Code of Civil Procedure is entitled to recover actual physical possession of the portions in the occupation of the appellants as lessees, the lease in respect of which were created after the decree in the mortgage suit by consent between the parties had been passed.
Allowing the appeal ^ HELD 1.
The Judgment and Order passed by the High Court directing physical possession of the portions in the occupation of the appellants to be made over to the auction purchaser Respondent No. 1 is set aside.
Symbolic possession of the portions in occupation of the appellants to be made over to the auction purchaser respondent.
[194 D] 2.
In the case of M/s Supreme General Films Exchange Ltd., the validity of the lease had been questioned by the mortgagee decree holder in a suit for declaration.
The claim was not for possession by a third party auction purchaser in a proceeding, under rules 95 and 96 of order XXI of the Code of Civil Procedure and the merits of such an application and the scope and effect of the said provisions of the Code did not come up for consideration.
In Mangru Matho and Ors.
vs Shri Thakur Taraknath Tarakeshwar Math and Ors.
a suit was instituted by the mortgagee auction purchaser for recovery of possession of mortgaged property sold in execution of the mortgage decree and purchased by the mortgagee himself and the decision rested mainly on the basis that the lease was not granted by the mortgagor in the usual course of business.
This case was also not concerned with an application by an outsider auction purchaser for physical possession of the property purchased by him in an application made under order XXI Rules 95 and 96 of the Code of Civil Procedure.
These two decisions do not therefore conclude the question involved in the present appeal.[190 A B, 191 H 192 C] 177 3.
The auction purchaser derives his right to obtain possession only after the sale in his favour has become absolute and sale certificate has been obtained by him.
The mode and manner of obtaining such possession are regulated by Rules 95 and 96 of the Code of Civil Procedure.[193 F] In the instant case a third party auction purchaser is seeking recovery of the physical possession of the property purchased by him at the auction from the appellants who are in possession of different portions of the said premises as tenants of the said portions.
The auction purchaser was not the mortgagee and he was no party to the suit in which the compromise decree was passed.
The auction purchaser in view of the provisions contained in Rule 95 which regulate the rights of the auction purchaser to obtain physical possession of the property, is not entitled to the recover the physical possession of the portions in the occupation of the appellants as tenants.
The appellants are not the judgment debtors.
They are not in occupation of the property on behalf of the judgment debt or.
They are also not claiming to be in occupation under a title created by the judgment debtors subsequent to any attachment of the property.
There is no question of any attachment in the case.
The appellants are in the occupation of their respective portions as tenants and they claim to occupy the same as such.
The auction purchaser must therefore be held to be entitled to only symbolic possession in terms of the provisions contained in Or XXI rule 96 in respect of the portions in occupation of the appellants.
[192 H 193 A, 193 H 194 A, C]
|
Appeal No. 409 of 1966.
Appeal by special leave from the judgment and order dated July 5, 1963, of the Gujarat High Court in Special Civil Application No. 827 of 1961.
R. Gopalakrishnan, for the appellant.
G. L. Sanghi, section K. Dholakia and R. N. Sachthey, for the respondent.
This is an appeal by special leave from a judgment of the Gujarat High Court dismissing a petition under L83Sup.
CI/69 2 246 article 226 of the Constitution by which the order, retiring the appellant from service before he had attained the age, of 55 years, had been challenged.
The appellant had joined the service of the erstwhile State of Junagadh on August 1, 1934.
That State merged into the State of Saurashtra on January 20, 1949.
The appellant continued to remain in the service of that State having been confirmed as an Executive Engineer on September 24, 1956.
On the merger of Saurashtra in the new billingual State of Bombay on November 1, 1956, the appellant was absorbed in the service of the said State.
On the bifurcation of the State of Bombay on May 1, 1960, he was assigned to, the State of Gujarat and was absorbed as a permanent Executive Engineer there.
On October 12, 1961 the State of Gujarat made an order retiring the appellant from the service with effect from January 12, 1962.
On that date he had not attained the age of 55 years but he was about 53 years old.
This, order was made 'in exercise of the powers conferred by Rule 161 of the Bombay Civil Service Rules, 1959.
The order of retirement was challenged by the appellant by means of a writ petition which was dismissed.
It is common ground that when the appellant was in the ,service of the erstwhile State of Junagadh his conditions of :service were governed by the Junagadh State Pension and Parwashi Rules which had been made by the ruler of the State who exercised sovereign legislative powers.
According to those rules the age of superannuation was 60 years.
Before the inclusion of the Junagadh State in the State of Saurashtra the Rajpramukh had promulgated an Ordinance called the Saurashtra State Regulation of Government Ordinance 1948.
By section 4 of that Ordinance all the laws in force in the covenanting States prior to their integration were continued in force in the State of Saurashtra until repealed or amended under section 5.
Notwithstanding this the Saurashtra Government adopted and applied the Bombay Civil Service Rules which were then in force in the State of Bombay by an order dated September 23, 1948.
This Court in Bholanath ,J. Thaker vs The State of Saurashtra(1) held that the Rules as regards the age of superannuation which prevailed in the covenanting State which in that case was the State of Wadhwan continued to govern those government servants who had come from that State and had been absorbed in the services of the State of Saurashtra.
In view of that decision the State of Saurashtra made the Saurashtra Covenanting State Servants (Superannuation age).
Rules, 1955, hereainafter called the "Saurashtra Rules", in exercise of the power conferred by article 309 of the Consti tution.
Rule 3(i) provided (1) A.I.R. 1954 S.C. 680.
247 "A Govt.
servant shall, unless for special reasons otherwise directed by Govt.
retire from service on his completing 55 years of age.
" After the integration of the Saurashtra State into the State of Bombay a resolution was passed by the Government on Janu ary 7, 1957 applying the old Bombay Civil Service Rules to Saurashtra area.
On July 1, 1959 the Bombay Civil Service, Rules 1959, hereinafter called the "Bombay Rules" were pro mulgated under article 309 of the Constitution.
Clause (c)(2) (ii) (1) of Rule 161 is as follows "Except as otherwise provided in this Sub clause Government servants in the Bombay Service of Engineers, Class 1, must retire on reaching the age of 55 years, and may be required by the Government to retire on reaching the age of 50 years, if they have attained to the rank of Superintending Engineer.
" It was under this rule that the order retiring the appellant was made.
In the High Court the writ petition filed by the appellant was heard and disposed of with two other similar petitions in which identical questions had been raised.
A number of points were raised in the High Court but it is unnecessary to refer to them because the questions on which the present appeal can be disposed of are only two : (1) Whether the appellant was governed by the Saurashtra Rules or the Bombay Rules and (2) even if the Saurashtra Rules were applicable could the retirement of the appellant be ordered before he, had attained the age of 55 years.
The High Court rightly looked at the provisions of section 115(7) of the .
It is provided thereby that nothing in the section shall be deemed to affect after the appointed.
day the operation of the provisions of Chapter 1 of of the Constitution in relation to 'the determination of the conditions of service of persons serving in connection with the affairs of the Union or any State.
The proviso is important and lays down that the conditions of service applicable immediately before the appointed day to the case of any person referred to in sub section (1) or sub section (2) (of section 115) shall not be varied to his disadvantage except with the previous approval in the Central Government.
The case of the appellant fell within the proviso and it had, therefore, to be, determined whether the conditions of service applicable to the appellant immediately before the appointed day which admittedly were contained in the Saurashtra Rules had been varied to his disadvantage, and if so, whether the approval of the Central Government had been obtained.
It was conceded before the High Court by the, learned 248 Advocate General, who appeared for the State, that no previous approval of the Central Government had been obtained to vary the conditions of service of those public servants who were serving in the State of Saurashtra until November 1, 1956.
The High Court in this situation proceeded to decide whether by the application of Rule 161 of the Bombay Rules the conditions of service of the appellant contained in the Saurashtra Rules had been varied to his disadvantage.
It was argued on behalf of the appellant that the expression "unless for special reasons otherwise directed by Government" in Rule 3 (i) of the Saurashtra Rules provided for extension of the age of superannuation beyond 55 years and not for reduction thereof.
The Advocate General had argued that what was meant by the aforesaid words was that Government could, for special reasons, retire a Government servant before he had attained the age of 55 years which was the normal superannuation age.
If that was so Rule 161 (c) (2) (ii) (1) of the Bombay Rules could not be regarded as having varied the conditions of service contained in the Saurashtra Rules to the disadvantage of the Government servants.
The High Court was of the view that while framing the Saurashtra Rules the draftsmen who must have been well aware of the then Bombay Civil Service Rules which were in the same terms as Rule 161 of the Bombay Rules could not have framed the clause in such manner as to introduce an element of discrimination between Executive Engineers who had been absorbed from a Covenanting State and those who had been appointed or recruited directly by the State Government.
In the opinion of the High Court even under the Saurashtra Rules retirement could be ordered before a person had attained the age of 55 years.
It was, therefore, held that the conditions in Rule 161 (c) (2) (ii) of the Bombay Rules had not been shown to be less advantageous or disadvantageous to the appellant than the conditions in Rule 3 (i) of the Saurashtra Rules by which the appellant was governed until November 1, 1956.
In this manner the proviso to section 115(7) of the did not stand in the way of the applicability of the Bombay Rules.
We find it difficult to concur with the view of the High Court.
Rule 3 (i) of the Saurashtra Rules, if construed or interpreted in the manner in which it has been done by the High Court, would bring it into direct conflict with the law laid down by this Court in Moti Ram Deka etc.
vs General Manager, N.E.F. Railways Maligaon, Pandu etc.(1), which is a _judgment of a bench of seven judges of this court.
One of the matters which came up for consideration was the effect of a service rule which permitted compulsory retirement without fixing the minimum period of service after which the rule could be invoked.
According to the (1) ; 249 observations of Venkatarama Ayyar, J., in The State of Bombay vs Saubhagchand M. Doshi(1) the application of such a rule would be tantamount to dismissal or removal under article 311(2) of the Constitution.
There were certain other decisions of this Court which were relevant on this point, viz. P. Balakotaiah vs The Union of India & Ors.(2) and Dalip Singh vs The State of Punjab(3).
All these decisions were considered in Moti Ram Deka 's case(4) and the true legal position was stated in the majority judgment at page 726 thus : "We think that if any Rule permits the appro priate authority to retire compulsorily a civil servant without imposing a limitation in that behalf that such civil servant should have put in a minimum period of service, that Rule would be invalid and the so called retirement ordered under the said Rule would amount to removal of the civil servant within the meaning of article 311(2).
" In Gurdev Singh Sidhu vs State of Punjab & Anr.(5), it was pointed out that the only two exceptions to the, protection afforded by article 311(2) were, (1) where a permanent public servant was asked to retire on the ground that he had reached the age of superannuation which was reasonably fixed; (2) that he was compulsorily retired under the Rules which prescribed the normal age of superannuation and provided a reasonably long period of qualified service after which alone compulsory retirement could be valid.
The basis on which this view has proceeded is that for efficient administration it is necessary that public servants should enjoy a sense of security of tenure and that the termination of service of a public servant under a rule which does ,not lay down a reasonably long period of qualified service is in substance removal under article 311(2).
The principle is that the rule relating to compulsory retirement of a Government servant must not only contain the outside limit of superannuation but there must also be a provision for a reasonably long period of qualified service which must be indicated with sufficient clarity.
To give an example, if 55 years have been specified as the age of superannuation and if it is sought to retire the servant even before that period it should be provided in the rule that he could be retired after he has attained the age of 50 years or he has put in service for a period of 25 years.
Now Rule 3 (i) of the Saurashtra Rules will have to be dec lared invalid if the expression "unless for special reasons other (1) ; (2) [1958] S.C.R. 1052.
(3) (4) ; (5) ; 250 wise directed by Government" is so construed as to give a power to order compulsory retirement even before attaining the age of 55 years.
It is well known that a law or a statutory rule should be so interpreted as to make it valid and not invalid.
If this expression is confined to what was argued before the High Court, namely, that it gives power to the Government to allow a Government servant to remain in service even beyond the age of 55 years for special reasons the rule will not be rendered invalid and its validity will not be put in jeopardy.
So construed it is apparent that the appellant could not have been retired compulsorily under the Saurashtra Rules before he had attained the age of 55 years.
By applying the Bombay rule his conditions of service were varied to his disadvantage because he could then be compulsorily retired as soon as he attained the age of 50 years.
As the previous approval of the Central Government was not obtained in accordance with the proviso to section 115(7) of the , the Bombay rule could not be made applicable to the appellant.
Counsel for the State pressed us to look into certain docu ments for the purpose of finding out whether prior approval of the Central Government was obtained in the matter of varying the conditions of service of the appellant by applying the Bombay rules.
But none of these documents were referred to before the High Court and in the presence of a clear concession by the learned Advocate General we see no justification for acceding to such a request.
In this view of the matter this appeal must succeed and it is hereby allowed with costs in this Court.
It is declared that the appellant was entitled to remain in service until he attained the age of 55 years and that the impugned order directing his retirement was invalid and ineffective.
G.C. Appeal allowed.
| The sixth respondent granted various Pattas of his lands to his wife, to the appellant and others in November, 1944.
After the coming into force of the Andhra Pradesh (Andhra Area) Estates Communal, Forest and Private Lands (Prohibition of Alienation) Act, 1947, section 4(1) of which declared alienation of Communal or Forest Lands after October, 1939, to be void, a petition was filed in the District Court by two ryots for a declaration that the alienations in the present case were void and did not confer any rights on the alienees.
The District Judge allowed the petition holding that the lands in question were forest lands and the alienations were void.
Revision petitions filed before a Single Judge of the High Court were dismissed but in a Letters Patent Appeal it was held that the petitioners as ryots had no right to maintain the petition, and a reasonable opportunity had to be given to the State to get itself transposed as the petitioner.
The State Government was then transposed as the petitioner but thereafter the District Judge held that the petition was not maintainable by reason of the repeal of the Act of 1947 upon the passing of a subsequent Act namely the Madras Estates (Abolition and Conversion into Ryotwari) Act, 1948.
However, a revision petition against this order was allowed by the High Court which remitted the matter to the District Judge.
By a judgement in November, 1960 the District Judge allowed the were forest lands and there transfers were void.
Further revision petitions filed by the appellant and others were dismissed by the High Court.
In appeal to this Court it was contended inter alia on behalf of the appellant that (1) the Act of 1947 was a temporary Act and all proceedings thereunder came to an end with the implied repeal of the Act by Act XXVI of 1948; (2) a notification by the State Government describing the land as forest land was an essential pre requisite to the application of the Act; and (3) the Act applied only to lands which were admittedly forest lands and the operation thereof could not be extended to lands in respect of which there was a dispute as to the nature thereof.
It was argued that any such dispute could only be decided by the Settlement Officer and not by the District Judge.
HELD: Dismissing the appeal, (1) The purpose of the Act of 1947 was to prohibit the alienation of communal, forest and private lands in estates in the Province of Madras and the preamble to the Act shows that it was enacted to prevent indiscriminate alienation of such lands pending the enactment of legislation for acquiring the interest of landholders in such estates and introducing ryotwari settlement therein.
No fixed duration of the Act was specified 330 and it was impossible to hold that merely because of the contents of the preamble, the Act became a temporary Act or that it stood repealed by the enactment of the later Act of 1948 unless there were express words to that effect or unless there was a necessary implication.
It is not reason able to hold that the alienation of large blocks of land which were rendered void under the Act of 1947 became good by reason of the passing of the later Act.
[332 B] (2) The definition of "forest lands" in section 2(b) of the Act is an inclusive one and shows that 'forest land ' would include not only waste land containing trees, shrubs and pasture lands but also any other class of lands declared by Government to be forest land.
This does not mean that before a piece of land could be said to be forest land there would have to be a notification by the Government and that otherwise the application of the Act would be excluded.
[334 C] (3) Section 20(1) of the Act of 1948 as originally enacted was substituted for another by section 9 of the Madras Estates (Abolition and Conversion into Ryotwari) (Amendment) Act, 1956, which was to.
be deemed to have come into force on April 19, 1949 being the date on which the Act of 1948 originally came into force.
The section as it now stands did not confer any jurisdiction on the Settlement Officer to determine any question as to whether any land was forest within the meaning of the Act and consequently the adjudication by the District Judge under sub.
section (4) of
|
ivil Appeal No. 4479 of 1990.
357 From the Judgment and Order dated 19.4.
1989 of the Madhya Pradesh High Court in M.P. No. 1378 of 1989.
S.K. Dholakia and D. Bhandari for the Appellant.
Kapil Sibal.
Additional Solicitor General, G.L. Sanghi, B.R. Agarwala.
Ms. Sushma Manchanda, S.K. Agnihotri, Mahen der Singh, Ms. Sushma Suri, Ujjwal A. Rana and Ashok Singh for the Respondent.
The Judgment of the Court was delivered by SHARMA, J.
Special leave is granted.
The appellant and the respondent No. 5 along with others were candidates for admission to the Post graduate Course in Obstetrics and Gynaecology in the G.R. Medical College, Gwalior.
They had duly passed the M.B.B.S. examina tion and satisfied the other essential conditions for admis sion.
The selection of the candidates was made on the basis of their relative merit and the respondent No. 5 was select ed as the last candidate in the list of the successful applicants.
The appellant was placed on the top of the waiting list and was admitted for the Diploma Course.
She challenged the admission of the respondent No. 5 on the ground that the latter was a foreign national, and was not entitled to be considered for admission in absence of prior clearance certificate by the Ministry of Health and Family Welfare, Central Government; which she could not file along with her application nor could she produce it before she was finally selected.
A writ application under Article 226 of the Constitution filed by the appellant was heard by a Full Bench of the Madhya Pradesh High Court and was dismissed by the judgment under appeal.
The learned counsel for the appellant has relied upon the Instruction dated the 6th August, 1983 issued by the Government of India, Ministry of Health and Family Welfare, to the Deans and the Principals of all Medical Colleges regarding procedure for admission of foreign students in medical institutions in the country.
By a subsequent order the Instruction which in terms had been issued for a partic ular year was kept alive.
The learned counsel for the re spondents have not disputed the binding nature of the In struction.
But there is a serious dispute about its inter pretation.
After the receipt of the applications for admission the matter was scrutinised by a committee described as the College and Hospital 358 Council and it prepared a merit 'list in which the respondent No. 5 ranked higher than the appellant.
Objections were invited latest by the 23.10.1989 and the appellant filed her application within time alleging that the respondent No. 5 was not eligible for admission at all as she had not pro duced the necessary certificate from the Ministry of Health and Family Welfare.
It appears that the respondent No. 5 had produced a letter from the Ministry of External Affairs stating that the said Ministry had no objection to the admission of the respondent.
The objection was considered by the College and Hospital Council of which besides others the Dean Dr. A.K. Govila as also the mother inlaw of the re spondent No. 5.
Dr. (Mrs.) P. Oliyai, a former Professor and Head of the Department of Obstetrics and Gynaecology of the College were members.
The objection raised by the appellant was rejected by the following decision: "(b) Dr. Roza Oliyai, since married to an Indian Doctor and obtained the permission of Ministry of External Affairs (Letter No. 1703/Dir.
(GMS)/89 dated 31.3.1989), the objec tions raised were rejected and her merit stands as status quo.
Accordingly the final list was published on 8.11.
The respondent No. 5 was, however, able to obtain the necessary certificate from the Ministry of Health and Family Welfare later and the same was filed in the College.
The respondent No. 5 was formally admitted in the first week of December, 1989.
The learned counsel for the appellant has pressed the following two points in support of the appeal: (a) The selection of the respondent No. 5 by the College and Hospital Council was vitiated on account of participation of the respondent 's mother in law as a member; and (b) Under the Government of India Instruction it was neces sary for the respondent No. 5 to have produced before the College and Hospital Council the necessary certificate from the Ministry of Health and Family Welfare before her final selection.
The crucial date was when the respondent No. 5 was finally selected and her formal admission later in December, 1989 was not material.
Also the certificate issued by the Ministry of External Affairs could not be a substi tute for the Ministry of Health and Family Welfare.
359 6.
The first argument of the learned counsel for the appellant is well founded.
Dr. (Mrs.) P. Oliyai was, without any doubt.
vitally interested in the admission of her daugh ter in law and her presence in the meeting of the Council must be held to have vitiated the selection of the respond ent No. 5 for admission.
As was observed in A.K. Kraipak and Other vs Union of India, and Others, there was a conflict between her interest and duty and taking into consideration human probabilities in the ordinary course of human conduct, there was reasonable ground for pleading that she was likely to have been biased.
In the Kraipak 's case the person concerned was the Acting Chief Conservator of Forests who did not participate in some of the deleberations of the selection Board, but the fact that he was a member of the Board and that he participated in the deleberations where the claims of his rivals were considered and in the preparation of list were held to have necessarily caused an impact on the selection, as the Board must have given weight to his opinion.
In that case the other members of the Board had filed affidavits stating that the Acting Chief Conserva tor had in no manner influenced their decision, but this was not considered sufficient to save the selection.
The princi ple has been followed in numerous cases including in Ashok Kumar Yadav and Others vs State of Haryana and Others, 17, where it was emphasised that it was not necessary to establish bias and that it was sufficient to invalidate the selection process if it could be shown that there was reasonable likelihood of bias.
It is regrettable that in spite of repeated reminders by the courts of law, the College and Hospital Council constituted by a number of highly educated persons and headed by the Dean himself did not pay any need.
It was expected of Dr. (Mrs.) Oliyai to dissociate from the Council instead of espousing the case of her daughter in law and in any event it was the bounden duty of the Dean to have seen that Dr. Oliyai did so before proceeding with the selection process.
We, accordingly hold that the selection of the respondent No. 5 for admission to the Post graduate Course was vitiated in law.
Ordinarily as a result of our above finding the matter would have been sent for reconsideration by a proper ly constituted selection committee, but having regard to the nature of the dispute between the rival doctors for the right of admission to the course of study for the present session which is fast progressing necessitating expeditious disposal of the issue, we asked the learned counsel for the parties to place the merits of their respective cases.
Accordingly, arguments were addressed, and we have consid ered the same at some length, and we proceed to decide the controversy finally here.
360 8.
Although during the hearing the learned advocates for the parties made submissions dealing with several other facets of the disputed issue, but ultimately they agreed, and in our view rightly, that the final outcome of the present litigation is dependent on the interpretation of the direction as contained in the Instruction issued by the Ministry of Health and Family Welfare, referred to above.
At one stage it was suggested on behalf of the respondent that since she has now acquired Indian nationality, she cannot be thrown out of the College.
There is no merit in this argu ment, as admittedly the respondent was not a citizen of this country when she was actually admitted in the College in the first week of December, 1989.
Mr. G.L. Sanghi also relied upon the letter dated 31.8.
1989 issued by the Ministry of External Affairs in favour of the respondent which was relied upon by the College and Hospital Council for reject ing the objection of the appellant.
This again cannot be of any help.
The role of the Ministry of External Affairs is distinctly different from that of the Ministry of Health and Family Welfare, and a certificate of no objection by one Department cannot be a substitute for the clearance by the other.
Scrutiny by the Ministry of External Affairs is made with a view to screen the person concerned to find out whether he is desirable person at all to enjoy the hospital ity of the country in the background of various relevant factors in this regard.
So far the Ministry of Health and Family Welfare is concerned, it has to take into account the question whether a seat for the medical course either upto the Degree standard or the Post graduate stage can be spared for a foreign national.
The State has to spend a large sum of money in running institutions of higher technical educa tion and the seats are limited.
In such a situation a seat can be allotted to a foreign national only at the cost of a citizen of this country.
The College and Hospital Council was, therefore, not right in deciding to admit the respond ent No. 5 on the strength of no objection certificate by the Ministry of External Affairs.
Now remains the question as to meaning of the afore said Instruction which contains two provisions as mentioned in clauses (a) and (b).
Undisputedly clause (a) is not attracted in the present case as the seat in question has not been made available by the Ministry of Health and Family Welfare and consequently there is no question of a foreign student to be sponsored by the said Ministry.
The second part of the Instruction as contained in clause (b) reads as follows: "(b) No foreign student, who is seeking admission directly for such course, shall be admitted unless Ministry of Health and Family Welfare gives its clearance.
361 According to the appellant the stage at which the condition mentioned above has to be satisfied is when the final selec tion for.admission is made.
Mr. Sanghi contends that the direction has to be construed in the light of the expression "admitted" used therein, which indicates that if the neces sary certificate is produced before the actual admission takes place, the same cannot be held to be illegal.
The learned counsel pointed out that the purpose of the Instruc tion is to ensure that no foreign national is allowed to occupy a seat ordinarily meant for the citizen of the coun try without the permission of the Ministry of Health and Family Welfare, Government of India, and once that hurdle is cleared, the purpose is fully satisfied.
After the produc tion of the necessary clearance, there does not remain any reason for rejecting the claim of a more meritorious candi date.
He emphasised the fact that the respondent No. 5 having secured higher percentage of marks than the appellant in the M.B.B.S. examination was adjudged a better candidate on merits.
We agree.
Accordingly, we find that the admission of the respondent No. 5 cannot be ignored or cancelled on the ground of any illegality.
The appeal is, therefore, dismissed but, in the circumstances, without costs.
R.S.S. Appeal dismissed.
| The appellant and respondent No. 5 along with others were candidates for admission to the post graduate course in Obstetrics and Gynecology in the G.M. Medical College, Gwalior.
Respondent No. 5 was selected as the last candidate in the list of the successful applicants.
The appellant was placed on the top of the waiting list.
The appellant challenged the admission Of respondent No. 5 on the ground that the latter was a foreign national and was not entitled to be considered for admission in absence of prior clearance certificate by the Ministry of Health and Family Welfare, Central Government, which she could not file along with her application nor could she produce it before she was finally selected.
The respondent had however produced a no objection letter from the Ministry of External Affairs.
Later, she was also able to obtain the necessary certificate from the Ministry of Health and Family welfare.
The writ application under Article 226 of the Constitu tion filed by the appellant was dismissed by a Full Bench of the Madhya Pradesh High Court.
Before this Court it was contended on behalf of the appellant that (i) the selection of respondent No. 5 was vitiated on account of participation of the respondent 's mother in law (a former Professor and Head of Department) as a member of the College and Hospital Council; and (ii) under the Government of India Instructions it was necessary for respondent No. 5 to have produced before the College and Hospital 356 Council the necessary certificate from the Ministry of Health and Family Welfare before her final selection, and the certificate issued by the Ministry of External Affairs could not be a substitute.
Dismissing the appeal on merits, this Court, HELD: (1) The mother in law of respondent No. 5 was, without any doubt, vitally interested in the admission of her daughter in law and her presence in the meeting of the Council must be held to have vitiated the selection of respondent No. 5 for admission.
A.K. Kraipak vs Union of India, ; Ashok Kumar Yadav vs State of Haryana, ; , referred to.
(2) It is regrettable that in spite of repeated remind ers by the Courts of law, the College and Hospital Council constituted by a number of highly educated persons and headed by the Dean himself did not pay any heed to the principles of natural justice.
(3) The State has to spend a large sum of money in running institutions of higher technical education and the seats are limited.
In such a situation a seat can be allot ted to a foreign national only at the cost of a citizen of this Country.
The College and Hospital Council was, there fore, not right in deciding to admit the respondent No. 5 on the strength of no objection certificate by the Ministry of External Affairs.
(4) A certificate of no objection by one Department cannot be a substitute for the clearance by the other.
(5) The purpose of the Instructions is to ensure that no foreign national is allowed to occupy a seat ordinarily meant for the citizen of the country without the permission of the Ministry of Health and Family Welfare, Government of India, and once that hurdle is cleared, the purpose is fully satisfied.
After the production of the necessary clearance, there does not remain any reason for rejecting the claim of respondent No. 5 who was a more meritorious candidate, who had secured higher percentage of marks than the appellant in the M.B.B.S. examination.
|
Appeal Nos. 164 of 1965 and 1105 of 1964.
865 Appeals by special leave from the orders dated the June 29, 1963 and August 31, 1963 of the Industrial Tribunal (II) Uttar Pradesh and Industrial Tribunal (H), Uttar Pradesh (Appellate authority) in Appeals Nos. 1 of 1963 and 4 of 1963 respectively.
M. C. Setalvad, B. L. Khanna and K. K. Jain, for the appellant (in C.A. No. 164/65).
B. L. Khanna and K. K. Jain, for the appellant (in C.A. No. 1105/65).
C. B. Agarwala and O. P. Rana, for respondents 1 and 2.
The Judgment of the Court was delivered by Gajendragadkar, C.J.
This appeal has been brought to this Court by special leave and it challenges the validity of certain orders passed by the Certifying Authorities in respect of the draft Standing Orders which the appellant, The Rohtak Hissar District Electric Supply Co. Ltd., had submitted to them for certification.
Five respondents have been impleaded to this appeal; they are the State of U.P., Certifying Officer for Standing Orders and Labour Commissioner, U.P., Kanpur, and three representatives of the employees respectively.
At the hearing before us, the employees ' representatives have not appeared and the appeal has been contested by respondent No. I alone.
The appellant is a Joint Stock Company incorporated under the Companies Act, and it has its registered office at Allahabad.
The principal object for which this Company has been incorporated is to carry on the business of generation and distribution of electricity.
In accordance with the provisions of the (No. 20 of 1946) (hereinafter called 'the Act '), the appellant prepared draft Standing Orders in consultation with its employees and submitted the same to the Certifying Officer on the 24th December, 1950, for certification.
At that time, the workmen employed by the appellant had not formed any Union, and so, the Labour Department held proceedings for the election of the three representatives from the said workmen.
Normally, a Union representing the workmen would have been competent and qualified to represent the workmen in the certification proceedings; but since there was no Union in existence, the Labour Department had to adopt, the expedient of asking the workmen to elect three representatives.
That is how respondents 3 to 5 came to be elected as the representatives of workmen.
In the certification proceedings, these representatives took no objection to the draft Standing Orders submitted by the 866 appellant.
In fact, the said draft Standing Orders were submitted to the Certifying Officer on the basis that they had been agreed to by the appellant and its workmen.
The Certifying Officer, however, examined the fairness and reasonableness of the provisions contained in the said draft Standing Orders and made several changes in them.
The draft Standing Orders with the changes made by the Certifying Officer were accordingly certified on the 21st November, 1962.
Against the said order passed by the Certifying Officer, the appellant filed an appeal before the Industrial Tribunal, U.P., Allahabad, which had been appointed the Appellate Authority under the Act.
It was urged by the appellant before the Appellate Authority that the Certifying Officer was in error in making modifications in the draft Standing Orders submitted to him for his certification, but the Appellate Authority did not accept the appellant 's contention and, in substance, confirmed the order passed by the Certifying Officer.
In the result, the appeal preferred by the appellant was dismissed by the Appellate Authority on the 29th June, 1963.
It is against this appellate order that the appellant has come to this Court by special leave.
Along with this appeal, Civil Appeal No. 1105 of 1964 has been placed before us for hearing and final disposal.
This appeal arises between the appellant M/s Amitabh Textile Mills Ltd., and its workmen and it raises substantially the same points as arise in 'Civil Appeal No. 164 of 1965.
Mr. K. K. Jain, who appeared for the appellant in this appeal, has stated before us that the decision in this appeal will follow our decision in Civil Appeal No. 164 of 1965.
That is why we do not propose to refer to the facts in this appeal nor deal with it separately.
The first point which Mr. Setalvad has raised before us in Civil Appeal No. 164 of 1965 is of a general character.
He contends that the Model Standing Orders which have been followed as a pattern by the certifying authorities in the present certification proceedings, are themselves invalid in some material particulars.
His argument is that the Model Standing Orders permissible under the Act should be confined to matters which do not fall within the purview of the provisions of the (No. 14 of 1947) (hereinafter called 'the Central Act ') ,or of the U.P. (No. 28 of 1947) (hereinafter called 'the U.P. Act ').
Before dealing with this point, it is necessary to indicate the broad features of the Act.
The Act was passed on the 23rd 867 April, 1946, and the Standing Orders framed by the U.P. Gov ernment under section 15 of the Act were published on the 14th May, 1947.
The Central Act came into force on the 1st April, 1947, whereas the U.P. Act came into force on the 1st February, 1948.
It will thus be seen that the Act came into force before either the Central Act or the U.P. Act was passed.
The scheme of the Act originally was 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 the workmen employed by them.
The Legislature thought that in many industrial establishments, the conditions of employment were not always uniform, and sometimes, were not even reduced to writing, and that led to considerable confusion which ultimately resulted in industrial disputes.
That is why the Legislature passed the Act making it compulsory for the establishments to which the Act applied to reduce to writing conditions of employment and get them certified as provided by the Act.
The matters in respect of which conditions of employment had to be certified were specified in the Schedule appended to the Act.
This Schedule contains 11 matters in respect of which Standing Orders had to be, made.
In fact, the words "Standing Orders" are defined by section 2(g) as meaning rules relating to matters set out in the Sche dule.
The "Certifying Officer" appointed under the Act is defined by section 2(c), whereas "Appellate Authority" is defined by section 2(a).
Originally, the jurisdiction of the Certifying Officer and the.
Appellate Authority was very limited; they were called upon to consider whether the Standing Orders submitted for certification conformed to the Model Standing Orders or not.
Section 3(2) provides that these Standing Orders shall be, as far as practicable, in conformity with such Model Standing Orders.
Section 15 which deals with the powers of the appropriate Government to make rules, authorises, by cl.
(2) (b), the appropriate Government to set out Model Standing Orders for the purposes of this Act.
That is how the original jurisdiction of the certifying authorities was limited to examine the draft Standing Orders submitted for certification and compare them with the Model Standing Orders.
In 1956, however, a radical change was made in the provisions of the Act.
Section 4 as amended by Act 36 of 1956 has imposed upon the Certifying Officer or the Appellate Authority the duty to adjudicate upon the fairness or the reasonableness of the provisions of any Standing Orders.
In other words, after the amendment was made in 1956, the jurisdiction of the certifying authorities has become very much wider and the scope of the 868 enquiry also has become correspondingly wider.
When draft Standing Orders are submitted for certification, the enquiry now has to be twofold; are the said Standing Orders in conformity with Model Standing Orders; and are, they reasonable or fair ? In dealing with this latter question, the Certifying Officer and the Appellate Authority have been given powers of a Civil Court by section 11(1).
The decision of the Certifying Officer is made appealable to the Appellate Authority under section 6 at the instance of either party.
Similarly, by an amendment made in 1956 in section 10(2) both the employer and the workmen are permitted to apply for the modification of the said Standing Orders after the expiration of 6 months from the date of their coming into operation.
It will thus be seen that when certification proceedings are held before the certifying authorities, the reasonableness or the fairness of the provisions contained in the draft Standing Orders falls to be examined.
That is one aspect of the matter which has to be borne in mind in dealing with Mr. Setalvad 's contention.
The second aspect of the matter which is relevant on this point is that the Standing Orders have to cover the matters specified in the Schedule attached to the Act.
Item 1 1 in the said Schedule refers to any other matter which may be prescribed.
We have already mentioned the fact that section 15 confers power on the appropriate Government to make rules.
Section 15 (2) (a) provides that the appropriate Government may, by rules, prescribe additional matters to be included in the Schedule, and the procedure to be followed in modifying Standing Orders certified under this Act in accordance with any such addition.
Thus there can be no doubt that the Act contemplates that the Standing Orders must cover matters initially included in the Schedule as well as matters which may be added to the Schedule by the appropriate Government in exercise of the authority conferred on it by section 1 5.
In fact, by virtue of this power, the U.P. Government has added several items to the list contained in the Schedule; they are 8A issue of service certificate; 9A censure and warning notice; 11 A issue of wage slips; II B introduction of welfare schemes such as provident fund, gratuity etc.; and 11C age of superannuation or retirement, rate of pension or any other facility which the employers may like to extend, or may be agreed upon between the parties.
We will have occasion to deal with item 11C later.
The position, therefore, is that in the State of U.P. Standing Orders have to cover the items originally included in the Schedule as well as the items which have been subsequently added thereto.
Mr. Setalvad 's argument is that in determining the scope of the Standing Orders and the character and extent of the jurisdic 869 tion conferred on the certifying authorities under the Act, we should not overlook the fact that when the Act was passed, the Central Act and the U.P. Act had not come into operation; and as it was originally passed, the Act required certification of Standing Orders which were in conformity with the Model Standing Orders without examining their reasonableness or fairness.
The position under the original Act, according to Mr. Setalvad, therefore was that the conditions of employment which had to be included in the Standing Orders were no better than, or different from, similar conditions which would otherwise have been included in contracts of service between the employers and their employees.
After the Central Act and the U.P. Act were passed, a different situation has arisen.
The U.P. Act, following the pattern of the Central Act, has provided for the settlement of industrial disputes and other incidental matters in accordance with its own scheme.
Sections 4(A) and 4(B) of the U.P. Act deal with the establishment of Labour Courts and Industrial Tribunals, and section 4K gives power to the State Government to refer disputes for adjudication to Labour Courts or Industrial Tribunals.
The First Schedule to the U.P. Act sets out 6 items of industrial disputes which can be referred to the Labour Courts, whereas the Second Schedule refers to 11 items of industrial disputes which can be referred for adjudication to the Industrial Tribunals.
Thus, an elaborate machinery has now been established by the U.P. Act for the purpose of dealing with industrial disputes concerning the matters specified in the First and the Second Schedules to the U.P. Act.
That is why any attempt which the certifying authorities may purport to make in devising elaborate provisions in respect of matters covered by the First or the Second Schedule of the U.P. Act, would trespass upon the provisions of the said Act, and in that sense, would be invalid.
Let the operation of the Act be confined to its original form and no further; that, in substance, is the general point raised by Mr. Setalvad before us.
We are not inclined to accept this contention.
In substance, the argument proceeds on the assumption that there is a conflict between the Act and the U.P. Act.
Since we are not satisfied that there is any such conflict, it is not necessary for us to consider what would have been the result if we had taken the view that there was any such conflict between the said two Acts.
The schemes of the two Acts are in essence different in character.
The Act purports to secure to industrial employees clear and unambi guous conditions of their employment.
The obvious object of the Act is to avoid any confusion in the minds of the employers or the employees in respect of their rights and obligations concerning the 870 terms and conditions of employment and thereby avoid unnecessary industrial disputes.
The result of the Standing Orders which are certified under the Act is to make it clear to both the parties on what terms and conditions the workmen are offering to work and the employer is offering to engage them.
The scheme of the U.P. Act, on the other hand, is to deal with the problem posed by industrial disputes which have actually arisen or are apprehended, and naturally the nature of the industrial disputes which may arise or which may be apprehended, relates to items larger in number than the items covered by the Act.
It is true that some of the items are common to both the Acts, but as we have just indi cated, the scopes of the provisions of the two respective Acts and the fields covered by them from that point of view are not the same.
After the Act was amended in 1956, the Legislature has pro vided a speedy and cheap remedy available to individual employees to have their conditions of employment determined in the manner prescribed by the Act.
If employees or employers desire any modification in the said Standing Orders, that remedy is also provided.
The decision of the Certifying Officer is made subject to an appeal, and so, after its amendment in 1956, the Act provides for a self contained Code for the fixation of conditions of employment in establishments to which the Act applies.
It is true that the original scope of the Act was rather narrow and limited; but even after the scope of the Act has been made wider, we cannot see how it can be said to conflict with the provisions of the U.P. Act or the Central Act.
Therefore, we are not impressed by the argument that the procedure adopted by the certifying authorities in the present case in dealing with the question of the fairness or reasonableness of the draft Standing Orders submitted for certification is invalid, and for that reason alone, some of the draft Standing Orders certified by them should be set aside.
The next contention which Mr. Setalvad has raised is that the appropriate authorities under the Act were in error in insisting upon conformity with the Model Standing Orders under section 3(4).
His argument is that in certifying the Standing Orders the appropriate authorities may, no doubt, compare them with the Model Standing Orders, but they need not insist upon strict compliance with them.
He also suggested that it would be open to the employers to include matters in the Standing Orders which may not strictly be included in the Schedule.
In this connection, he relied on the fact that the draft Standing Orders which the appellant had submitted for certification, had been assented to by the 871 employees.
In our opinion, this contention is misconceived and, must be rejected.
The consent of the employees is, no doubt, a relevant factor which the certifying authorities may bear in mind in dealing with the question as to the fairness or reasonableness of the said Orders.
If both the parties agree that certain Standing Orders submitted for certification are fair and reasonable, that, no doubt, is a consideration which the appropriate authority must take into account; but clearly, the appropriate authority cannot be denied the jurisdiction to deal with the matter according to its own judgment.
It is for the appropriate authority to decide whether a particular Standing Order is fair or reasonable, or not.
Sometimes, the employees may not be organised enough to resist the pressure of the employer or may not be articulate; and where the employees are not organised or strong enough to put forward their point of view vigorously, the fact that the employer has persuaded his employees to agree to the draft Standing Orders, will not preclude the appropriate authority from discharging its obligation by considering the fairness or reasonableness of the draft.
The present case itself is an illustration in point.
When the Standing Orders were drafted by the appellant and submitted for certification, it was found that the employees of the appellant had no Union of their own; and so, three representatives were elected by the employees at the instance of the Labour Department.
The fact that the employees ' representatives have not appeared before this Court also shows that they are either not organised enough, or have not the financial capacity to take steps to engage lawyers to appear before this Court.
Therefore, we do not think that the consent of the employees can have a decisive significance in certification proceedings.
Then in regard to the matters which may be covered by the Standing Orders, it is not possible to accept the argument that the draft Standing Orders can relate to matters outside the Schedule.
Take, for instance, the case of some of the draft Standing Orders which the appellant wanted to introduce; these had reference to the liability of the employees for transfer from one branch to another and from one job to another at the discretion of the management.
These two Standing Orders were included in the draft of the appellant as Nos.
IO and II.
These two provisions do not appear to fall under any of the items in the Schedule; and so, the certifying authorities were quite justified in not including them in the certified Standing Orders.
In this connection, we may incidentally add that if the appropriate Government adds to the list of items in the Schedule, it may, 3Sup.
CI/66 9 872 in some cases, be permissible to the certifying authorities to say that having regard to the relevant factors, no provision need be made for some of the items thus added.
The U.P. Government has, by adding clause II B to the Schedule, referred to items of welfare schemes such as provident fund, gratuities, etc.
It would, we think, be unreasonable to hold that the Standing Order must necessarily refer both to provident fund and gratuities, and other welfare schemes.
It is well known that the introduction of these amenities in industrial establishments involves financial liabilities for the employers, and the decision as to whether these amenities should be introduced or not, depends upon a consideration of several relevant factors; and so, if the additional items are included in the Schedule, and they appear to overlap or cover the same or similar ground, the appropriate authorities may, for good reasons, take the view that the provision need not be made for each one of those items.
This position has not been seriously disputed before us by Mr. Agarwal for respondent No. 1.
He has fairly conceded that it is not obligatory on the employer to have a scheme ,for provident fund as well as gratuity in every case.
Thus, the true position appears to be that under section 3 (2) of the Act the employers have to frame draft Standing Orders and they must normally cover the items in the Schedule to the Act.
If, however, it appears to the appropriate authorities that having regard to 'the relevant facts and circumstances, it would be unfair and unreasonable to make a provision for a particular item, it would be competent for them to do so; but the employer cannot insist upon adding a condition to the Standing Order which relates to a matter which is not included in the Schedule.
Then in regard to the conformity with the Model Standing Orders, the position is clear.
Section 3 (2) of the Act specifically requires that the Standing Orders shall be, as far as practicable, in conformity with the model.
These words indicate that the appropriate authority may permit departure from the Model Standing Orders if it is satisfied that insistence upon such conformity may be impracticable.
This fact also shows that in a given case, the appropriate authority may permit departure from the Model Standing Orders and may come to the conclusion that one or the other of the conditions included in the Model Standing Orders may not, for the time being, be included in the Standing Orders of any particular establishment vide Associated Cement Company Ltd.v.
P. D. Vyas, and Others(1).
(1) ; [1960) 873 The next point raised by Mr. Setalvad is in relation to the addition of two items to the Schedule by respondent No. 1.
We have already mentioned these items.
Mr. Setalvad objects to the addition of item II B which has reference to welfare schemes, such as provident fund, gratuities, etc., as well as item 11C which has reference to the age of superannuation or retirement, rate of pension or any other facility which the employers may like to extend or may be agreed upon between the parties.
We do not think that this argument is well founded.
We have already emphasised the fact that the Act, even in its original form, was intended to require the employers to define with sufficient precision the conditions of employment under them.
In pursuance of the said object, the Schedule enumerated 10 items in respect of which Standing Orders had to be drafted by the employers and submitted for certification.
Item 1 1 in the Schedule refers to any other matter which may be prescribed.
When the appropriate Government adds any item to the Schedule, the relevant question to ask would be whether it refers to the conditions of employment or not.
If it does, it would be within the competence of the appropriate Government to add such an item.
Section 15(1) confers wide powers on the appropriate Government to make rules to carry out the purposes of the Act; and section 15(2) specifies some of the matters enumerated by clauses (a) to (e), in respect of which rules may be framed.
It is well settled that the enumeration of the particular matters by sub section
(2) will not control or limit the width of the power conferred on the appropriate Government by sub section
(1) of section 15; and so, if it appears that the item added by the appropriate Government has relation to conditions of employment, its addition cannot be challenged as being invalid in law.
Whether or not such addition should be made, is, a matter for the appropriate Government to, decide in its discretion.
The reasonableness of such addition cannot be questioned, because the power to decide which additions should be made has been left by the Legislature to the appropriate Government.
Having regard to the development of industrial law in this country during recent years, it cannot be said that gratuity or provident fund is not a term of conditions of employment in industrial establishments.
Similarly, it would be difficult to sustain the argument that the age of superannuation or retirement is not a matter relating to the conditions of employment.
Therefore, we are satisfied that the contention raised by Mr. Setalvad that the addition of items 11B and 11C to the Schedule is invalid, must fail.
That takes us to the points raised by Mr. Setalvad on the merits of the Standing Orders.
Lot us begin with the Standing 874 Order in relation to the age of superannuation.
The appellant had made a provision about the age of superannuation in its draft Standing Orders and it was numbered as 59.
The Certifying Officer had dropped this draft Standing Order, because the appellant did not agree to provide for any retirement benefits.
On appeal, however, the appellate authority has made substantial alterations in the said draft provisions and has numbered it as Standing Order 54.
Under Standing Order NO. 54 as certified, it is provided that " a workman shall retire from service after attaining the age of 55 years, or after putting in 30 years service whichever is earlier.
If he has put in more than seven years ' service, he shall get a pension at the rate specified by the said Standing Order.
" Mr. Setalvad contends that even if the addition of item 11C is valid, the relevant certified Standing Order is not justified by item 11C. In our opinion, this argument is sound and must be upheld.
We have already noticed that item 11C provides for the fixation of the age of superannuation or retirement, and in that connection, it incidentally refers to the rate of pension or any other facility which the employer may like to extend or may be agreed upon between the parties.
This item consists of two parts; the first relates to the age of superannuation or retirement; and the second refers to the rate of pension or any other facility.
In regard to this latter part of item 11C, the important provision is that this rate of pension or any other facility should be such as the employer may like to extend, or as may be agreed upon between the parties.
It is plain that the provision for pension which the certified Standing Order 54 purports to make was neither extended by the employer, nor agreed upon between the parties.
On this narrow ground alone, the said provision.
in certifying S.O. No. 54 must be regarded as invalid.
That raises the question as to whether it would be fair or reasonable to retain the other part of certified S.O. 54 without the provision as to payment of pension.
It appears to us that it would not be fair or reasonable to introduce a term of retirement in the conditions of service without making any provision for a suitable retiral benefit; but such a provision cannot be made suo Moto by the appropriate authority under item 11C; it has to be made either at the initiative of the employer, or by consent of parties.
Mr. Setalvad did not dispute the position that it would be equitable to make some suitable provision for retiral benefit to the employees, particularly the existing employees, if an age of superannuation or retirement is going to be fixed for the first time in this establishment.
He was, therefore, prepared that the whole of certified S.O. No. 54 should be deleted and the matter of retire 875 ment of the employees should be left to be determined under the existing practice.
It is common ground that under the existing practice, there is no age of superannuation or retirement.
The next certified Standing Orders which are challenged by Mr. Setalvad are in regard to the payment of compensation for "lay off"; they are Nos. 29 and 30.
Clause (a) of the certified S.O. 29 reads thus: "The employer may at any time or times, in the event of a fire, catastrophe, break down of machinery or stoppage of power supply, epidemic, civil commotion or other causes, whether of a like nature or not, beyond the control of the employer, stop any machine or machines or department or departments, wholly or partly for any period or periods, by giving two days ' notice, if possible.
If two days ' notice of closure has not been given, the employer shall pay wages in lieu of such notice, i.e., two days ' wages.
Provided that no compensation in lieu of notice in excess of wages for the actual period of closure shall be payable when the period of closure is less than two days".
Mr. Setalvad argues that it is wholly unreasonable to expect that where work is stopped for any of the reasons mentioned in this clause, it would be possible for the employer to give two days ' notice before such stoppage of work.
All the causes mentioned in this clause are causes over which the employer has no control and which would overtake the establishment suddenly and unexpectedly.
We have no difficulty in accepting this argument.
We would, therefore, modify the last sentence in the first paragraph of certified S.O. No. 29(a) by providing that if in cases where it would have been possible to give two days ' notice of closure, but the employer has not given such a notice.
he shall pay wages in lieu of such notice, i.e., two days ' wages.
Plainly stated,.
having regard to the nature of the causes mentioned in this clause, such a case can rarely arise.
Then as regards Standing Order No. 30, Mr. Setalvad 's con tention is that this Standing Order conflicts with section 6K of the U.P. Act.
This section deals with the right of workmen laid off for compensation.
It is not necessary to refer in detail to the provisions of this section for the purpose of dealing with Mr. Setalvad 's argument.
It would be enough to state that this section refers to cases in which workmen laid off are entitled to compen 876 sation, and it provides for the scales at which 'such compensation should be computed.
Mr. Setalvad suggests that the matter of payment of compensation for Jay off having thus been covered by section 6K, it would not be legitimate for the Standing Orders to make a separate provision in that behalf.
The field in question is covered by a specific provision of the U.P. Act and matters relating to that field must be dealt with by section 6K and no other provision.
in this connection, Mr. Setalvad referred us to section 6K of the U.P. Act.
Section 6 R(1) provides that the provisions from section 6 J to 6 Q shall have effect notwithstanding anything inconsistent therewith contained in any other law (including Standing Orders) made under the .
There is a proviso to this sub section which is also relevant.
It says that nothing contained in this Act shall have effect to derogate from any right which a workmen has under the , or any notification or order issued thereunder or any award for the time being in operation or any contract with the employer.
It is clear that the proviso cannot cover the cases of Standing Orders which are expressly included in section 6 R(1).
It is true that the Standing Orders, when certified, in substance embody statutory conditions of employment, but they cannot be treated as a contract within the meaning of the proviso.
The context obviously negatives such a construction; and so, if the point raised by Mr. Setalvad had to be decided solely by reference to the provisions of section 6 K and 6 R, there would have been considerable force in his argument.
But the difficulty in accepting Mr. Setalvad 's argument is created by the provisions of section 25 J of the Central Act.
Section 25 J corresponds to section 6 R of the U.P. Act, except this that the proviso to section 25 J(1) and sub section
(2) of section 25 J which have been recently added by Act 36 of 1964, make a substantial departure from the pre existing position of the law even under the Central Act.
Section 25 J(2) is more important for our purpose.
It reads thus : "For the removal of doubts, it is hereby declared that nothing contained in this Chapter shall be deemed to affect the provisions of any other law for the time being in force in any State in so far as that law provides for the settlement of industrial disputes, but the rights and liabilities of employers and workmen in so far as they relate to Jay off and retrenchment shall be determined in accordance with the provisions of this Chapter".
877 It is thus clear that the last part of section 25 J(2) categorically provides that the rights and liabilities of the employers and workmen in relation to lay off shall be determined in accordance with the provisions of Chapter V A of the Central Act.
This clearly means that in regard to the question about the payment of compensation for lay off and retrenchment, the relevant provisions of the Central Act will apply and not those of the U.P. Act.
This position cannot be, and is not, disputed by Mr. Setalvad.
Once we reach this stage, we have to go to the proviso to section 25.J(1), because it is one of the provisions contained in Chapter V A which is made applicable by section 25 J (2); and this proviso clearly and unambiguously lays down, inter alia, that where under any Standing Orders, a workman is entitled to benefits in respect of any matter covered by Chapter V A which are more favourable to him than those to which he would be entitled under this Act, he shall continue to be entitled to the more favourable benefits in respect of that matter, notwithstanding that he receives benefits in respect of other matters under this Act.
The position, therefore, is that section 25 J(2) makes Chapter V A of the Central Act applicable to disputes in relation to compensation for lay off, notwithstanding section 6 K and 6 R of the U.P. Act; and amongst the provisions thus made applicable by section 25 J(2) is the proviso to section 25 J(1) under which the Standing Orders which give more favourable benefits to the employees in respect of compensation for lay off, will prevail over the provisions of the Central Act.
We ought to add in fairness that as soon as this aspect of the matter was brought out in the course of arguments, Mr. Setalvad conceded that his contention against the validity of certified Standing Order 30(a) could not be pressed.
A somewhat similar question was raised before this Court and has been considered in Workers of Dewan Tea Estate and Others vs Their Management(1).
There is one more point which still remains to be considered.
In this connection, the controversy centres round certified Standing Orders 47, 48 and 49.
These Standing Orders purport to have been made under item 10 of the Schedule to the Act.
Item 10 refers to the means of redress for workmen against unfair treatment or wrongful exactions by the employer or his agents or servants.
Standing Order 47 deals with the procedure for enquiring into complaints.
The substantive part of this Standing Order is not in dispute; what is challenged is the validity of the two provisos to the said Standing Order, and the whole of Standing Orders 48 (1) 878 and 49.
The first proviso to S.O. 47 gives a right to the complainant workman to appeal to the Labour Commissioner or to a Conciliation Officer of the U.P. Government, or to the machinery provided by collective agreements, if any, against the decision of the investigating officer or the employer, without prejudice to any right of the workmen aggrieved by the decision of the investigating officer or the employer to resort to proceedings in a court of law.
The second proviso authorises a workman or a registered Union of which he is a member to submit a complaint of dismissal for the decision to the Labour Commissioner or to a State Conciliation Officer direct without first referring it to the Labour Officer of the industrial establishment or if there is none, any other officer appointed by the employer in this behalf or the employer.
Standing Order 48(a) purports to provide that the decision of the employer upon any question arising out of, in connection with, or incidental to, these orders shall be final, subject to the appeals indicated by clauses (1) and (2) thereto.
Standing Order 48 (b) seems to lay down that as soon as a workman or an employer sends a notice through a legal practitioner or resorts to any legal process whatsoever, or indicates in any other manner his intention of having recourse to legal process, no appeal shall be heard by the Labour Commissioner.
Standing Order 49 empowers the employer at its discretion to refer any matter for decision to the Labour Commissioner, without giving any prior decision of his own; and it prescribes that the decision of the Labour Commissioner in such matters shall be final and binding on the workmen and the employer, subject to the provisions of the Act or the Rules.
Mr. Setalvad argues that this elaborate provision for appeals contemplated by certified Standing Order 48 (a) ( 1 ) & (2) as well as the finality assigned to the decision of the Labour Commissioner under S.O. 49, are entirely outside the purview of the Act, and as such invalid.
Similarly, he argues that the two provisos to S.O. 47 are invalid, because appeals of the kind contemplated by the said provisos do not fall within the scope of the Act.
We are inclined to uphold this contention.
Though the scheme of the Act, as modified in 1956, has widened the scope of the enquiry before the appropriate authorities, we do not think that the Act authorises the introduction of Standing Orders which would result in appeals to outside authorities either by the workmen or the employer.
The Standing Orders which fall within the contemplation of the Act, are intended to regulate the conditions 879 of service of the employees, and in that behalf they may legitimately make provisions concerning the rights and liabilities of the parties and their enforcement by an internal arrangement which can be regarded as a domestic arrangement between the employer and his employees.
It is not permissible under the Act to introduce appeals to outside authorities, and thereby extend the scope of the provisions which can legitimately be made by the Standing Orders.
Besides, on the merits, Standing Order 48(a) (2) seems to be unfair inasmuch as it does not give a right of appeal to the employer in regard to decisions reached by the Joint Disciplinary Committee under S.O. 48 (a) ( 1 ) even though the employer may feel aggrieved by them.
Likewise, the finality assigned to the decision of the Labour Commissioner by S.O. 49 would plainly be inconsistent with the provisions of the U.P. Act inasmuch as disputes arising from matters covered by the decision of the Labour Commissioner are completely taken out of the purview of section 4 K of the said Act; and prima facie, that does not seem to be permissible under the impugned provision of finality.
But quite apart from these considerations, we have no hesitation in holding that the eleborate provisions made by the two provisos to S.O. 47, as well as Standing Orders 48 and 49 are outside the purview of the Act, and therefore, must be held to be bad in law.
Mr. Setalvad attempted to argue that some other Standing Orders certified by the appropriate authorities should not have been so certified; but we have not allowed him to proceed with this part of his case, because we do not think that in an appeal brought to this Court under article 136 of the Constitution, we would be justified in examining the correctness of the conclusion reached by the appropriate authorities in dealing with the reasonableness or fairness of the Standing Orders in question.
That is a matter which is left to the discretion of the Certifying Officer in the first instance, and the Appellate Authority when the matter goes in appeal before it.
These are not matters which can be legitimately raised before this Court under article 136.
The result is, certified Standing Order 29(a) is modified as indicated in this judgment; Standing Order 54 which deals with the age of superannuation or retirement and provides for consequential payment of pension, as well as the two provisos to Standing Order 47, and Standing Orders 48 and 49 are struck down and deleted from the list of certified Standing Orders.
The rest of the 880 order passed by the Appellants Authority is confirmed.
The certified Standing Orders will now have to be renumbered.
As we have already indicated, this order will govern also Civil Appeal No. 1105 of 1964, with the result that the Standing ,Orders in this appeal which correspond to the Standing Orders in C.A. No. 164 of 1965, will be modified or struck down in accordance with this judgment.
There would be no order as to costs in both the appeals.
Appeal allowed in part.
| On 26th January 1950, the United Khasi Jaintia Hills District was formed as one of the Tribal Areas of Assam.
The area along with other Tribal Areas mentioned in Parts A and B of the Table appended to paragraph 20 of the Sixth Schedule to the Constitution, are governed by the provisions prescribed by that Schedule.
Under Paragraph 2(4) of the Schedule, the administration of the United Khasi Jaintia Hills District vested in the District Council inaugurated on 27th June 1952.
The appellant was elected as Chief Executive Member of the District Council in March 1963, and by various notifications the term of the District Council has been extended up to 2nd May 1965.
On 26th August 1963, the Governor of Assam appointed a Commission under paragraph 14(1) to examine and report on the creation of a new autono mous district for the people of Jowai sub division and for excluding it from the United Khasi Jaintia Hills District.
The Commission made its report for such creation and exclusion on 20th January 1964.
The Council of Ministers considered the 'report, decided to accept the recommendation, drew up an explanatory memorandum as required by paragraph 14(2) of the Schedule and sent the entire file to the Governor who noted on it "seen thanks".
The Minister in charge, then laid the report of the Commission and the explanatory memorandum, stating that the Government had decided to accept the recommendation of the Governor on the report, before the Assembly, and the Assembly passed a resolution approving the action proposed.
On 23rd November 1964, the Governor issued a Notification by which the new autonomous district was created and was "eluded from the United Khasi Jaintia Hills District with effect from 1st December 1964.
The appellant challenged the Notification by a petition for the issue of a writ in the High Court., which was dismissed.
In appeal to this Court, it was contended that : (i) Paragraph 1(3) of the Schedule does not confer upon the Governor power to constitute a new autonomous district and that it could be done only by Parliamentary legislation under Paragraph 21 of the Schedule under which powers are granted to Parliament to amend the Schedule and even if be had the Dower, the Governor 's decision must be confirmed by Parliamentary legislation; and (ii) the Notification was invalid because the mandatory provisions of paragraph 14 bad not been complied with.
HELD (Per Chief Justice, Wanchoo, Ramaswami and Satyanarayana Raju, JJ.):(i) When paragraph 1(3)(c) provides that the Governor may, by public notification, create a new autonomous districts; it does not contemplate, that the Constitution requires something more to be done by Parliament, in order to make the notification effective.
[782 A] 771 Paragraph 1(3) confers on the Governor power to issue a notification for the purposes of bringing about any of the results enumerated by cls.
(a) to (g) of the paragraph.
Clause (c) refers to the power of Governor to create a new autonomous district; cl.
(e) refers to the power to diminish the area of any autonomous district, and cl.
(g) refers to the power to define the boundaries of any autonomous district.
The proviso to the paragraph imposes a condition on the exercise of the powers conferred by cls.
(c) to (f) by requiring the Governor before exercising the powers to appoint a Commission under Paragraph 14(1) to report on those matters and then to consider its report Paragraph 1(3) indicates that the Constitution has delegated to the Governor a part of the power conferred on Parliament itself by paragraph 21.
If the Governor has been clothed with the relevant power, the exercise of the power must by itself, be effective to bring about the results intended by cis.
(c) to (i) of paragraph 1(3).
The power must be exercised subject to The condition prescribed by the proviso, but once it is properly exercised it becomes effective and there is no need for parliamentary legislation in that behalf.
[780 H; 781 A B, C D; 782 B, C D] The two Acts, namely Act 18 of 1954 and Act 42 of 1957, one for renaming a District and the other for excluding an item from Part A and including it in Part B, do not show any legislative practice requiring parliamentary legislation with respect to the matters covered by the Notification.
[782 G; 783 D] It is not necessary that for an effective exercise of his power by the Governor there should be confirmation by Parliamentary legislation, because, the power of Parliament under paragraph 21 is very wide and includes the power to take away the Governor 's power, and in the very unlikely event of the Governor attempting to challenge the decision of Parliament in respect of any of the matters mentioned in Paragraph 1(3), Parliament can take away his power altogether by suitable legislation.[783 F] The modification made by the impugned Notification does not affect the contents of paragraph 20(1), because, even after the Notification the paragraph truly and correctly provides that the areas specified in Parts A and B of the table shall be tribal areas within the State.
What the Notification purports to do is to change one item into two.
Since the power to bring about the change is expressly conferred on the Governor by paragraph 1(3)(c) to (g), the exercise of that power, which leads to a consequential change in paragraph 20(2) which just gives a description of the areas, does not require Parliamentary legislation to make the change effective.
Therefore, it would not be reasonable to hold that without Parliamentary legislation the impugned Notification cannot validly effect any change in item 1 of Part A of the table appended to paragraph 20.
[784 C E, H; 786 B, C] (ii) The power conferred on the Governor by paragraph 1(3) had been validly and properly exercised by him.
One of the conditions prescribed by paragraph 14 is that the Governor should consider the report submitted by the Commission and make his recommendations.
Even if the Governor was expected to apply his mind and make a recommendation.
, he is not precluded from receiving the assistance of the Council of Ministers before he makes up his mind, and on the record it must be held that the Commission recommended that a new autonomous district should be created and that the Governor agreed with the recommendation.
B] Though the Commission appointed under paragraph 14 used the words "District Council" on considering its recommendations as a whole 772 there is no doubt that what it recommended was the creation of a new autonomous district.
[787 F G] Per Hidayatullah, J. (dissenting) : No action could be effective without Parliamentary legislation under Paragraph 21 to amend the operative portion of paragraph 20 which Parliament alone can amend, Further, the Governor, far from playing the key role which the policy underlying the Schedule envisages, left the entire matter to the Government.
(i) When the final step is taken to divide a tribal area it amends the Sixth Schedule.
Paragraph 1(3) says nothing about the amendment of paragraph 20, and the Governor has no power under cls.
(c), (d) and (e) to amend the paragraph or the Table appended to it.
A power to amend paragraph 20 and an amendment of the.
paragraph and the table cannot be implied, in view of paragraph 21, under which powers are granted to Parliament to amend the Schedule.
Even if it is not an amendment for purposes of article 368, the amendment cannot be such a simple affair that a Notification of the Governor amends the provisions by implication.
If the Notification alone did that there would be antinomy between the Notification and the Schedule.
Paragraph 20 and the Table will remain unaltered and the Notification will render them obsolete.
Therefore, to complete the chain of steps the power under paragraph 21 must be exercised to alter the autonomous districts. the names and areas of which are laid down by Parliament.
The Governor 's Notification is one of the means of achieving the change but effectiveness can only be given by Parliament as it was done on previous occasions when Act 18 of 1954 and Act 42 of 1957 were passed.
There is no material as to what the practice or procedure was that was followed when changes were made in the tribal areas, except that on previous occasions Parliamentary legislation was undertaken, and while it is not conclusive, it is a circumstance which also points in the direction that Parliamentary legislation must cap all other steps if the Schedule is to read true to the new situation.
[803 C,F H; 804 F H; 813 FIH] (ii) The history of these backward tracts and the scheme of 'he Sixth Schedule show that the Governor is intended to discharge special functions in the administration of the tribal areas in Assam in which a start in democratic institution is being made.
In the present case the Governor was very much in the background and the information and formation of opinion was by the State Government.
He was only informed after everything was over.
E] The functions of the Governor are not made subject to the scrutiny of the Government of Assam, and the Union also has not been given the power to give directions as to the administration of these autonomous districts.
The Governor is expected to act independently and not with the advice of Ministers.
Should difference arise between them the legis lature would decide.
Under paragraph 14(2) there is provision for the appointment of Commissions for various purposes mentioned in that paragraph and paragraph 16.
As regards the changes in autonomous districts contemplated by paragraph 1(3)(c) to (f), if the State Government agreed with the Governor there would be no need to explain what action the Government was going to take; it has only to implement the decision administratively and the Governor would notify the changer.
The need for an explanatory memorandum arises if the Governor 's recommendations are not accepted by the State Government.
Apart from this control by the Legislature in specified matters, there is nothing to ,show that in addition the District and Regional Councils, which are autonomous in almost every way, are to be controlled by the Council of 773 Ministers through the Governor.
The Governor 's note hardly squared with the special responsibilities contemplated by the Schedule.
[805 D E; 810 G; 811 B, D G; 812 A, F] Even in the Commission 's recommendation there was some confusion, though it may be conceded that when reference was made to a council, an autonomous district was meant.
[813 D]
|
Appeal No. 2485 of 1992.
From the Judgment and Order dated 8.10.1991 of the Calcutta High Court in F.M.A.T. No. 2532 of 1991.
P.S. Poti and Rathin Das for the Appellants.
Dr. Shankar Ghosh, Raj Kumar Gupta and P.C. Kapur for the Respondents.
J. Special leave granted.
487 This appeal arises against the judgment dated October 8, '1991 of the ' Division Bench of the Calcutta High Court made in F.M.A.T. No. 2532 of 1991.
The first respondent, a limited Company filed under article 226 of the constitution of India Civil Order No. 16339 (W) of 1988 for a mandamus to refrain the appellants from giving effect to the vesting of the lands in Dag No. 1, Khatian No., 10, Tauzi No. 56, J.L. No. 26, Mouza Chowkgaria within P.S. Kasba, admeasuring 128.40 acres and to take possession of tank fisheries lying therein pursuant to the provisions of West Bengal Estate Acquisition Act, of 1954, for short 'the Act '.
The learned Single Judge directed an action under Sec.
10(2) of the Act after giving an opportunity to the respondents and to take possession of the said lands pursuant thereto.
On appeal the Division Bench in the impugned judgment held that the appellants should take action under the West Bengal Land Reforms Act, 1955 within a period of two months from the date of the said judgment and on its failure, the respondents would be at liberty to deal with and dispose of the lands in its own manner.
Until then the appellants were restrained to take possession of the land.
Feeling aggrieved against the said direction the above appeal under article 136 has been filed.
The Revenue Officer found from finally published record of rights that the lands in question were classified as 'Beel ' (marshy land) and tank fisheries would he classified as 'Beel Mash Khas '.
The learned Single Judge and the Division Bench of the High Court found that when the Revenue Officer initiated proceedings to revise the old Jama Rs. 1230.
9 Anas in three Jamas of Rs. 1,188 and odd in khata No. 102; Rs. 396 and odd in khata No. 128 and Rs. 3024 and odd in khata No. 131.
the respondent succeeded in his appeal under Sec.
44(3) of the Act holding the lands to be 'Tank fisheries ' and that, therefore, old Jama was to be maintained.
So the Division Bench directed to take action under the Land Reforms Act.
Shri P.S. Poti, learned Senior Counsel for the appellants contended that by operation of Secs.
4 and 5 of the Act, fisheries being one of the interests that stood extinguished and vested in the State Govt.
Free of all incumbrances with effect from June 1, 1956, the respondents have lost right, title and interest therein.
Section 6 only enables an intermediary to retain possession of certain enumerated lands which includes "tank fisheries" provided he makes an application in form 'B ' within the specified time expressing his intention to retain the lands.
Since the respondent had failed to do so the entire lands including tank fisheries stood vested in the state.
As per the entries in the record of rights the lands are only Beel (Marshy lands) and not tank fisheries and, therefore, even the exercise of the option to retain possession is not available.
Even assuming that the lands are tank fisheries, what was saved from the operation of the Act is the entitlement of the respondent to hold 488 the land as a tenant without any interest therein except the right to remain in khas (physical) possession subject to such terms and conditions as may be prescribed by the Govt.
and payment of rent.
Since the respondent raised a dispute the learned single Judge rightly directed an enquiry under Sec. 10 (2) in this behalf and to take action pursuant to its result under Sec.
10(1).
The Division Bench committed gravest error in treating that the decision of the Tribunal under Sec.
44(3) relating to Jama to be final and the lands to be tank fisheries and that the respondent is entitled to retain khas possession with all right, title and interest therein as an owner.
The direction given to initiate the action under the Land Reforms Act 1955 within the specified period and on failure thereto liberty given to the respondent to alienate the lands is beyond the relief sought in the writ petition.
Therefore, the Division Bench committed manifest error of law warranting interference.
Dr. Ghosh, learned senior counsel for the respondents, contended that initially Devendra Nath Dey Sarkar purchased the lands from Harkishan Mondal, the original Zamindar in 1911 and from him the respondents had purchased the leasehold rights in 1937 and ever since they have been using the lands as tank fisheries.
When notification under Sec. 4 was issued, the lands were being used as.
tank fisheries.
Despite its vesting, by operation of Sec.
6(2) the respondent has right to retain possession as an owner.
In support thereof he placed reliance on State of U.P. vs Krishna Gopal & Anr.
[1988] Suppl.
2 SCR 391, State of West BengaI vs Atul Krishna Shaw & Anr.
[1990] Supp. 1 SCR 91 and Sasanka Sekhar Maity & Ors.
vs Union of India ; He further contended that the liability of dispossession of the respondent from the lands would arise only if the possession is found to be unlawful.
But by operation of Sees.
6(2) and 10(5) the possession is lawful.
The order of the Appellate Tribunal passed in 1957 under section 44(3) having been allowed to become final and the civil suit for declaration that it is Beel and not tank fisheries having filed by the State and got dismissed, concludes that the lands in question are only "tank fisheries".
By operation of Subsec.
(2) for Sec.
6 of the Act the respondent is entitled to retain possession and the action for dispossession under Sec.
10 (1) is illegal.
The Division Bench therefore, rightly directed to initiate proceedings under the Land Reforms Act and to take action thereunder.
Admittedly the Act came into force on February 12,1954.
Notification under Secs.
4(1) and (3) was published in the prescribed manner specifying the date of vesting of the estate and had come into effect from June 1, 1956.
By operation of sub sec.
(1) of Sec.
5 the estate and all the rights of intermediaries including fisheries in the estate shall stand determined and ceased and stood vested in the State free from all incumbrances.
"Incumbrance" defined under Sec. 2(h) of the Act means 'in relation to estates and rights of intermediaries therein, does not 489 include the rights of a raiyat or of an under raiyat or of a non agricultural tenant, but shall, except in the case of land allowed to be retained by an intermediary under the provisions of sec.
6, include all rights or interests of whatever nature, belonging to intermediaries or other persons, which relates to lands comprised in estates or to the produce thereof.
Therefore, title to, rights or interests in lands which include fisheries held by an intermediary shall stand extinguished and ceased and stood vested in the state free of all incumbrances.
The respondents being purchasers of lease hold interest in tank fisheries, as per their own case, it also stood extin guished.
But, however, since the appellant treated the respondent as an intermediary, we proceed on that footing.
The exceptions engrafted in the incumbrance and exempted from the operation of Sections 4 and 5 are only the rights of a raiyat or of an under raiyat or of a non agricultural tenant and the right of retention of possession allowed to an intermediary under Sec.6 of the Act.
All other rights, interest of whatever nature or little belonging to the intermediaries or other persons who hold the lands under lease from intermediary should also stood extinguished.
All grants and confirmation of title, to estates and rights therein, to which the declaration of vesting applies and which were made in favour of intermediaries shall stand dismissed and ceased by operation of Sec.
5(1) (b) of the Act, Section 6 postulates by a non obstanti clause that notwithstanding anything contained in secs.
4 and 5 an intermediary shall, except in the cases mentioned in the proviso to sub sec.
(2) but subject to the other provisions of that sub sec., be intitled "to retain with effect from the date of vesting", various kinds of lands like homestead etc.
enumerated therein including 'tank fisheries ' covered by clause (e) thereto.
The explanation of 'tank fisheries ' means, "a reservior or place for the storage of the water, whether formed naturally of by excavation or by construction of embankments, which is being used for pisciculture or for fishing, together with the sub soil and the banks of such reservoir or place, except such portion of the banks as are included in a homestead or in a garden or orchard and includes any right or pisciculture or fishing in such reservoir or place".
Therefore, if lands comprised of tank fisheries whether naturally formed or by excavation or by construction of embankments being used for pisciculture or fishing, the intermediaries became entitled to retain possession, despite the intermediaries having been divested of right, title and interest therein.
This is made manifest by Sec.
10(5) of the Act which postulates that 'nothing in this section shall authorise the Collector to take khas possession of any estate or of any right of an intermediary therein, which may be retained under sec.6 '.
Sub sec.
(2) of Sec. 6 declares that, "An intermediary who is entitled to retain possession of any land under sub sec.(1) shall "be deemed to hold such land" directly under the State from the date of vesting as a tenant, subject to such terms and conditions as may be prescribed and subject to payment of such rent as may be determined under the provisions of this 490 Act and as entered in the record of rights finally published under Chapter V except that no rent shall be payable for land referred to in clause (h) or (i), provided that if any tank fishery or any land comprised in a tea garden, orchard, mill, factory or workshop was held immediately before the date of vesting under lease, such lease shall be deemed to have been given by the State Govt.
On the same terms and conditions as immediately before such date, subject to such modification therein as the State Govt.
may think fit to make '.
On the issue of notification under Sec.49, Sec. 52 prescribed procedure to deal with raiyats and under raiyats covered in Chapter 11 etc.
It says that the provisions in Chapter II shall with such modification as may be necessary apply mutatis mutandis to raiyats or under raiyats as if such raiyats or non raiyats were intermediaries and the land held by them were estates and such a person holding under a raiyat or an under raiyat were a raiyat for the purpose of clauses (c) and (d) of Sec.5, provided that, where a raiyat or an under raiyat retains under sec.6 any land comprised in a holding, then notwithstanding anything to the contrary contained in sub sec.
(2) of sec.6, then he shall pay the rent as prescribed in clauses (a) to (d) thereto.
Under Sec.5(c) every raiyat holding any land under an intermediary shall hold the same directly under the state as if the state had been the intermediary and on the same terms and conditions as immediately before the date of vesting.
Thus the right, title and interest of a raiyat or under raiyat in the lands in his possession and enjoyment are saved.
By operation of law they became full owners thereof subject to the terms and conditions that maybe imposed under Sec. 52 and payment of Jama existing on the date of notification or revised from time to time and finally entered in Record of Rights.
The pre existing rights of the intermediaries in the estate to which the declaration applied shall stand vested in the State free from all incumbrances.
Section 6 does not have the effect of divesting the state of the vested right, title and interest of the intermediary.
One of the rights i.e. possession held by the intermediaries is the only interest saved by Sec.6.
from the operation of Secs.
4 and 5.
The fishery rights also stood vested.
The pre existing rights, title and interest therein also shall stand determined as against the state and ceased.
The Collector had symbolic possession under Sec. 10.
But by use of non obstanti clause in Sec.6 (1) the respondent became entitled to retain khas possession of tank fisheries, and he shall hold tank fisheries directly under the state on such prescribed terms and conditions and subject to payment of such rent as may be determined under the Act from time to time as finally entered in Record of Rights.
If any lease by the intermediary of any tank fisheries granted prior to the date of vesting, by operation of the proviso to sub sec.
(2) of Sec. 6, the lease shall be deemed to have been given by the State Govt.
On the same terms and conditions and subject to such modification 491 therein as the State Govt. may think fit.
Such holding of the land by the intermediary of the tank fishery shall be as a tenant.
The word 'retain ' has been defined in Black 's Law Dictionary, 6th Edition, page 1316 to mean 'to continue to hold, have, use, recognise, etc.
and to keep '.
In Collings English Dictionary at page 1244 'retain ' has been defined as 'to keep in one 's possession, to be able to hold or contain, to hold in position, to keep for one 's future use as by paying a retainer or nominal charges '.
In Webster Comprehensive Dictionary International Edition, Volume II, at page 1075, the word 'retain ' has been defined, 'to keep or continue to keep in one 's possession '.
Section 10(2) of the Act empowers the Collector, after his taking charge of the estate and the interest of the intermediaries under Sec.
10(1), to issue a written order serving in the prescribed manner requiring the intermediary or any person in possession (khas or symbolic) of any such estate or any interest to give up such possession by a date to be specified in the order which shall not be earlier than 60 days from the date of service of the order, etc.
Sub section 5 of Sec.
10 prohibits him to take khas possession of any right of intermediary in the estate retained under Sec.6.
The conjoint operational conspectus assists us to conclude that the preexisting right, title and interest in the lands situated in an eatate stood extinguished and ceased to have effect on and from notified date i.e. June 1, 1956 and stood vested in the state free from all incumbrances.
The non obstanti clause under Sec.6 excluded from the operation of sees.
4 and 5 only of the interest of the respondent to retain physical possession of the lands covered by Sec.6, subject to Sec 6 (2).
The intermediary by operation of Sec.
10(2) shall be required to submit in form 'B ' within 60 days from the date of issuing notice under Sec.
10 (1) of his intention to retain possession of the tank fisheries.
On such submission of Form 'B ', the Collector without dispossessing him/it shall be entitled to prescribe such terms and conditions to which the intermediary or the lessee shall be bound and hold the tank fishery and shall remain in possession, using the tank fisheries for pisciculture or for fishing and subject to payment of such rent as may be determined under the Act and finally entered in the Records of Rights.
Under Sec. 39 in Chapter V, the State Govt has to carry out the purpose of the Act.
It shall prepare the Records of Rights in respect of the lands in an estate in any district or a part of a district in the manner prescribed therein.
Section 44 provides the procedure for publication of the draft and final Record of Rights prepared or "revised".
Sub section (1) thereof postulates that when a Record of Rights has been prepared or "revised" the Revenue Officer was enjoined to have it published in the prescribed manner.
On receipt of objections, if any, made 492 regarding any entry therein or any ommission thereof, he shall consider the same and is enjoined to pass an order under Sec.5A of the Act.
By operation of the proviso to sub sec.
(1) of Sec.
44 the order so passed under Sec.
5A shall be final, subject to the order of the appellate Tribunal under Sec. 44 (3) and during the continuance of that order it is not liable to be reopened.
The respondent is not right in its contention, as found favour with the High Court, that entries once made shall be final and can never be revised.
The word 'revised ' under sub sec.
(1) of Sec.
44 indicates that the State Govt.
or its officers shall be entitled to revise from time to time the Record of Rights and to make necessary entries or corrections in the relevant columns of Record of Rights in its settlement operations or as per exigency envisaged under the Act and the rules made there the order under Sec.
44(3) becomes final so long as there is no revision effected.
The question of res judicate therefore, does not arise and the previous appellate order does not preclude the authorities to revise the Record of Rights.
The Division Bench of the High Court, therefore, is not right in its conclusion that the order passed by the appellate authority under Sec.
44(3) is final and the authorities have no jurisdiction to revise the Record of Rights.
After the act was amended by Act 33 of 1973, Sec.
57B was brought on statute which had barred the jurisdiction of the civil courts and exclusive jurisdiction has been conferred on the revenue authorities to deal with the matters arising under the Act.
So the dismissal of the suit as having been abated is of little consequence.
The appellants contend that even on the date of vesting the lands in question are "Beel" lands and that it is not tank fisheries.
The entries in the record of the rights disclose that the lands in question are being used as homestead or for agricultural purpose and that, therefore, it is not tank fishery.
The respondents disputed the Govt.
's stand and so it is a disputed question of fact.
We do not propose to go into, nor decide the same.
It is true, as rightly contended by Dr. Ghosh, that the lands once retained under Sec.6 by the intermediary and accepted by the authorities pursuant to form 'B ' declaration, the intermediary is entitled to retain possession and is not liable to dispossession so long as he complies with the terms and conditions, if any, imposed and the rent imposed is being paid.
The avowed object of Act is to divest the pre existing right, title and interest of the intermediary in the lands situated in an estate in a district or part of the district and shall stand divested from the Zamindar or intermediary except of a raiyat or under raiyat or non agricultural tenant.
Notwithstanding such divestment thereof the intermediary has been empowered to hold and retain possession directly under the state and hold it as a tenant, subject to such terms and conditions and subject to payment of rent as may be determined under the Act.
Therefore, the entitlement to retain possession of the land i.e. tank fisheries in this case is not absolute but hedged with the conditions precedent of expressing his intention to retain 493 possession by filing form 'B ' within 60 days and abiding to comply with such terms and conditions as may be imposed and also payment of rent.
By operation of the explanation to Sec.
6(1) (e) "tank fisheries" not only it must be a tank fishery at the date of vesting, but it must also continue to be used for pisciculture or for fishing.
The emphasis on 'being used ' obviously is that the tank fisheries should be continued to be used for public purpose, namely the fish seedling or fish must be made available for public consumption.
Dr. Ghosh is right that the crucial date is the date of vesting with regard to tank fishery also.
Not only that the intermediary shall hold the tank fishery on the date of vesting as tank fishery but continue to hold and use the same thereafter for pisciculture or fishing as explained in explanation 6(1) (e) of the Act.
Subsequent conversion of the land as tank fisheries is not material.
Whether, as a fact, it was used as a tank fishery on the date of vesting i.e. June 1, 1956 and being continued to be used as such or converted later on is a question of fact to be adjudicated after giving reasonable opportunity to the respondents.
Equally whether the respondents exercised the option to retain possession of tank fishery within 60 days from the date of publication of notification under section 4 or the notice under Sec.
10(1), etc., is also a question of fact to be determined.
In Saroj Kumar Bose vs Kanailal Mondal & Ors.
the facts were that the predecessor in interest of the respondents took permanent lease of fishery right without sub soil rights under a registered lease deed prior to the Act came into force and they continued to remain in possession and was using the lands as tank fishery.
The lassor, filed a suit for recovery of rent together with interest.
The appellant lessee resisted the suit liability contending that the tank fishery stood vested in the State and that, therefore, he was absolved of his liability to pay rent to the lessors.
The trial court decreed the suit.
On appeal, it was confirmed.
Dismissing the appeal, this court held that by operation of sec.6 of the act the right to retain possession of tank fishery by an intermediary was saved and that, therefore, the lessor continued as an intermediary to remain in khas possession.
In spite of the estate vested in the State, the tank fishery continued to remain in possession of the lessor.
In that context it was held, as relied on by Dr. Ghosh, that khas possession is not a necessary condition for retaining the property by intermediary.
State had recognised the plaintiffs as tenant by accepting rent from them.
Therefore, it was held that interest of the plaintiff did not vest in the State either.
In State of West Bengal vs Atul Krishna Shaw & Anr.
[1990] Supp. 1 SCR page 90, by a bench of this court to which one of us (K. Ramaswamy,J.) was a member, the facts were that after the estate vested in the state, the tank fisheries continued to remain in possessions of the respondent intermediaries.
Suo moto 494 proceedings were taken for correction of the classification of lands on the grounds that the plots were wrongly recorded as fishery plots.
The respondents objected to the re classification contending that they were continuing to cultivate pisciculture in the lands.
The claim of the respondents was negatived by the Settlement Officer.
On appeal, the Tribunal reversed the order of the Settlement Officer and confirmed the original classification as tank fishery.
On a writ petition filed in the High Court by the State, it was dismissed in limine.
While allowing the appeal, this court held that the crucial date for consideration whether the lands were being used as tank fishery was the date of the vesting and subsequent conversion was not material and that by operation of Sec 6 (2) of the Act, the tank fishery stood excluded from the operation of Sec. 4 and Sec. 5 of the Act.
Placing reliance on the findings at p. 101A & B, namely, 'Therefore, when by means of reservoir or a place for storage of water whether formed naturally or by excavation or by construction of embankment, is being used for pisciculture or for fishing is obviously a continous process as a source of livelihood, would be 'tank fisheries ' within the meaning of Sec.6 (1) (e) '.
Such tanks stand excluded from the operation of Sections 4 and 5 and the crucial date is the date of vesting.
As seen earlier the effect of the operation of Secs.4 and 5 is divesting the intermediaries of his pre existing right, title and interest in the estate except those which were exempted from the operation of the Act.
One of the exemptions is retention of the possession of the lands covered by Sec 6 of the Act.
See 6(1) (e), tand fisheries is one such.
Sub section (2) amplifies its effect.
Sub section '(2) transposes the pre existing possessory right of the retained lands of an intermediary of tank fisheries into holder of it as a tenant without any interest therein.
By fiction of law the respondent was transposed as "holder" of the possession directly under the State as tenant, subject to such terms and conditions as may be specified and subject to payment of rent as may be determined from time to time.
Therefore, what was saved by non obstenti clause of Sec.6(1) & (2) of the Act is the right of retention.
of the Physical (Khas) Possession of tank fisheries.
What was intended in Atul Kishan Shaw 's case was that Sec.
6(2)saved the retention of possession of tank fisheries and not divesting the state of the vested rights etc.
in the estate.
In South Indian States of A.P. and Tamil Nadu etc.
of the Madras Province, Madras Estate (Abolition and Conversion into Raiyatvari) Act, 26 of 1948 is in operation.
After the states reorganisation, in Tamil Nadu it is called Tamil Nadu Act and in Andhra Pradesh it is called Andhra Pradesh (Andhra Area) Act.
Thereunder Sec.
II provides procedure to grant raiyatvari patta to a raiyat in occupation.
Section 3(2) (d) proviso gives statutory protection to a raiyat from dispossession till raiytavari patta has been granted , Sees.
12 to 14 give right to landholder to obtain patta and see 15.
empowers the settlement officer to grant 495 patta to the landholders.
Section 19 provides that "where any raiyat or non raiyat land has been sold by any landholder for non agricultural purpose before first day of July, 1945, the buyers shall be entitled to keep the land subject to payment by him to the Govt.
of the raiyatvari assessment or ground rent which may be imposed upon the land and under the proviso it was declared that sale was not void or illegal under any law in force at that time.
The object of those provisions is to confer raiyatvari rights on person in occupation be it raiyat or landholder absolutely with no further conditions.
Thereafter he is entitled to use the raiyati land as if he is the owner thereof and the liability is to pay only land assessment or cist.
There is no limitation on the nature of user of the land.
But the language in the Act appears to be different.
As regards the raiyat or under raiyat they are treated differently from intermediary.
As regards the raiyat and non raiyat is concerned his pre existing right, title and interest in the land was not abolished and he is entitled to retain all his boundle of rights as intermediary directly under the state subject to the orders passed as per the procedure prescribed under Sec.52 and the relevant rules and payment of rent.
But in the case of an intermediary, he has been given only right to retain possession under Sec.
6 of the homestead lands or land comprised in or appertaining to buildings and structures, 25 acres of agricultural lands in khas possession, factories, workshops, tank fisheries or other enumerated properties etc.
without any interest therein and subject to the terms and conditions that may be imposed and payment of rent excising or revised as per the provisions relevant thereto.
Sub section (2) of Sec.
6 expressly postulates that if he holds the tank fisheries should be for continued for use as tank fisheries and it would be subject to such terms and conditions and subject to payment of rent as may be fixed.
The holding of the land is as a tenant, the emphasis is that his possession is without any interest in the land.
Under T.P. Act a tenant has leasehold interest in the land.
But in Sec. 6 (2) as a tenant for the purpose of payment of the rent and retention of possession and appears to be nothing more.
As regards tank fishery is concerned, though exemption has been granted, it is subject to the condition of continued user for pisciculture of fishing.
From the scheme of the Act it would appear that the intermediary or the lessee gets no absolute right in the tank fisheries which were already divested but to remain in khas possession and to enjoy the usufruct thereof i.e. for pisciculture or fishing without any interest or sub soil rights and subject to such terms and conditions and subjects to payment of rent as prescribed under the Act, but not as owner thereof.
The direction, therefore, by the High Court that the respondents are entitled to dispose of the land is contrary to and in negation of the scheme of the Act and Rules.
Therefore, it is manifestly illegal.
The appeal is accordingly allowed.
The order of the Division Bench of the High Court is set aside.
The direction of the Single Judge is restored.
The appellant 496 is free to issue notice to the respondent under Sec.
10(2) of the Act and conduct an enquiry into and find: (1) on the date of the vesting whether the lands were being used for pisciculture or fishing i.e. tank fisheries; (2) whether the respondent had submitted form 'B ' within the prescribed time exercising the option to retain possession of the lands in question as tank fisheries; and (3) whether the respondent is continuing to use the lands in question as tank fisheries.
Reasonable opportunities shall be given to the respondents to prove its/their case.
On the enquiry if it is found that the lands are not tank fisheries as on the date of the vesting or that the respondent had not submitted option in Form 'B ' to retain possession of the lands as tank fisheries within the prescribed period, then the lands stood vested in the state free from all incumbrances and authorities are entitled to take possession of the land under Sec.
10(1) read with Sec.
10(3).
In case if it finds that the lands were being used as tank fisheries as on the date of vesting and that the respondents exercised the option within the time to retain possession and is continuing to use the tank fishery for pisciculture or for fishing; and if it has been continuing in possession of tank fishery, it is free to impose, if not already impossed such terms and conditions as may be necessary to ensure continued use of tank fishery for pisciculture or for fishing, subject to payment of such rent as may be fixed or revised and ultimately entered in the Record of Rights.
In case the respondent commits contravention thereof, it is open to the state to resume possession.
In case the respondent is not using the tank fishery for pisciculture or for fishing or alienated the lands it is open to the appellants to take possession of the lands and all sales if made by the respondents do not bind the state.
The appeal is accordingly allowed with the above modification and the rule absolute issued by the learned single Judge of the High Court will stand modified to the above extent and the writ petition is disposed of accordingly.
In the circumstances parties are directed to bear their own costs throughout.
Appeal allowed.
| Respondent Company filed a writ application in the High Court to refrain the appellants from giving effect to the vesting of the lands in question and to take possession of tank fisheries lying therein.
The Single Judge directed an action under section 10(2) of the West Bengal Estate Acquisition Act, 1953 and to take possession of the lands pursuant thereto giving an opportunity to the respondents.
The Division Bench on appeal held that appellants should take action under the West Bengal Land Reforms Act, 1955 within a period of two months of its judgment, failing which the respondents would he at liberty to deal with and dispose of the lands and until then the appellants were restrained to take possession of the lands.
The Single Judge and the Division Bench found that the Revenue Officer initiated proceedings to revise the old Jama of lands as he found from record of rights that lands were classified as 'Beel ' (marshy land) and the appeal of the respondent under Section 44(3) of the Act was allowed holding that the lands being 'tank fisheries ' old Jama was to be maintained.
481 482 ` The present appeal by special leave was filed against the judgment of the Division Bench of the High Court contending that by operation of sections 4 and 5 of the West Bengal Estate Acquisition Act, fisheries being one of the interests that stood extinguished and vested in the State Govt.
free of all incumbrances with effect from 1.6.1956, the respondents lost right, title and interest therein; that since the respondent failed to make an application in form 'B ' within the specified time expressing his intention to retain the lands, the entire lands including tank fisheries stood vested in the State; that as per the entries in the record of rights the lands were only Beel (Marshy lands)and not tank fisheries and, therefore, even the exercise of the option to retain possession was not available; that since the respondent raised a dispute, the Single Judge rightly directed an enquiry under section 10(2) and to take action pursuant to its result under section 10(1); that the Division Bench committed manifest error in treating that the decision of the Tribunal under section 44(3) relating to jama to be final and the lands to be tank fisheries and that the respondent was entitled to retain khas possession with all right, tide and interest therein as an owner; and that the direction given to initiate the action under the West Bengal Land Reforms Act, 1955 within the specified period and on failure thereto liberty given to the respondent to alienate the lands was beyond the relief sought in the writ petition.
The respondents submitted that they purchased the leasehold rights in 1937 from the earliest purchaser of the lands who purchased the same from the original Zamindar and since then the respondents were using the lands as tank fisheries; that when notification under section 4 was issued, the lands were being used as tank fisheries; that despite its vesting, by operation of section 6(2), the respondent had right to retain possession as an owner; and the action for dispossession under section 10(1) was illegal; that the liability of dispossession of the respondent from the lands would arise only if the possession was found to be unlawful; and that the Division Bench, therefore, rightly directed to initiate proceedings under the West Bengal Land Reforms Act and to take action thereunder.
Allowing the appeal, this Court, HELD:1.1.
By operation of sub sec.
(1) of Sec.
5 the estate and all the rights of intermediaries including fisheries in the estate shall stand determined and ceased and stood vested in the State free from all incumbrances.
(488 G) 483 1.2."Incumbrance" defined under Sec.
2(h)of the Act means 'in relation to estates and rights of intermediaries therein, does not include the rights of a raiyat or of an under raiyat or of a non agricultural tenant, but shall, except in the case of land allowed to be retained by an intermediary under the provisions of sec.
6, include all rights or interests of whatever nature, belonging to intermediaries or other persons, which relates to lands com prised in estates or to the produce there of.
Therefore, tide to, rights or interests in lands which include fisheries held by an intermediary shall stand extinguished and ceased and stood vested in the state free of all incumbrances.
(488 H, 489 A) 1.3.The exceptions engrafted in the incumbrance and exempted from the operation of Sections 4 and 5 are only the rights of a raiyat or of an underraiyat or of a non agricultural tenant and the right of retention of possession allowed to an intermediary under Sec.
6 of the Act All other rights, interest of whatever nature or tide belonging to the intermediaries or other persons who hold the lands under lease from intermediary should also stood extinguished.
(489 C) 1.4.All grants and confirmation of title, to estates and rights therein, to which the declaration of vesting applies and which were made in favour of intermediaries shall stand determined and ceased by operation of Sec.
5(1) (b) of the Act.
(489 D) 1.5.The respondents being purchasers of lease hold interest in tank fisheries? it also stood extinguished.
1.6.The pre existing right, tide and interest in the lands situated in an estate stood extinguished and ceased to have effect on and from notified date i.e. June 1, 1956 and stood vested in the State free from all incumbrances.
The non obstanti clause under Sec. 6 excluded from the operation of secs.
4 and 5 only of the interest of the respondent to retain physical possession of the lands covered by Sec. 6, subject to sec.
The intermediary by operation of Sec.
10(2) shall be required to submit in form 'B ' within 60 days from the date of issuing notice under Sec.
10(1) of his intention to retain possession of the tank fisheries.
On such submission of Form 'B ', the Collector without dispossessing him/it shall be entitled to prescribe such terms and conditions to which the intermediary or the leasee shall be bound and hold the tank fishery and shall remain in possession, using the tank fisheries for pisciculture or for fishing and subject to payment of such rent as may be determined under the Act and 484 finally entered in the Records of Rights.
(491 E F) 1.7.
The lands once retained under Sec.
by the intermediary and accepted by the authorities pursuant to form 'B ' declaration, the intermediary is entitled to retain possession and is not liable to dispossession so long as he complies with the terms and conditions, if any, imposed and the rent imposed is being paid.
(492 E) 1.8.
The avowed object of Act is to divest the pre existing right, tide and interest of the intermediary in the lands situated in an estate in a district or part of the district and shall stand divested from the Zamindar or intermediary except of a raiyat or under raiyat or non agricultural tenant.
Notwithstanding such divestment thereof the intermediary has been empowered to hold and retain possession directly under the State and hold it as a tenant, subject to such terms and conditions and subject to payment of rent as may be determined under the Act.
Therefore, the entitlement to retain possession of the land i.e tank fisheries in this case is not absolute but hedged with the conditions precedent of expressing his intention to retain possession by filing form 'B 'within 60 days and abiding to comply with such terms and conditions as may be imposed and also payment of rent.
(492 GH, 443 A) 1.9.
By operation of the explanation to Sec.
6(1) (e) "tank fisheries" not only it must be a tank fishery at the date of vesting, but it must also continue to be used for pisciculture or for fishing.
The emphasis on 'being used ' obviously is that the tank fisheries should be continued to be used for public purpose, namely the fish seedling or fish must be made available for public consumption.
(493 B) 1.10.
The intermediary shall hold the tank fishery on the date of vesting as tank fishery but continue to hold and use the same thereafter for pisciculture or fishing as explained in explanation 6(1) (e) of the Act.
Subsequent conversion of the land as tank fisheries is not material.
(493 D) State of U.P. vs Krishna Gopal & Anr., [1988] Supp.
2SCR 391 and Sasanka Sekhar Maity & Ors.
v Union of India, ; , cited.
Saroj Kumar Bose v Kanailal Mondal & Ors., [1985]2 SCR 393 and State of West Bengal v Atul Krishna Shaw & Anr., [1990] Supp. 1 SCR 901, explained.
485 1.11.
The word 'revised ' under sub sec.
(1) of Sec.
44 indicates that the State Govt.
or its officers shall be entitled to revise from time to time the Record of Rights and to make necessary entries or corrections in the relevant columns of Record of Rights in its settlement operations or as per exigency envisaged under the Act and the rules made therein.
The order under Sec.
44(3) becomes final so long as there is no revision effected.
The question of res judicata, therefore, does not arise and the previous appellate order does not preclude the authorities to revise the Record of Rights.
(492 B) 1.12.
The Division Bench of the High Court is not right in its conclusion that the order passed by the appellate authority under Sec. 44 (3) is final and the authorities have no jurisdiction to revise the Record of Rights.
(492 C) 1.13.
Sub section(2) of Sec. 6 expressly postulates that if he holds the tank fisheries should be for continued for use as tank fisheries and it would be subject to such terms and conditions and subject to payment of rent as may be fixed.
The holding of the land is as a tenant, the emphasis is that his possession is without any interest in the land.
Under T.P Act a tenant has lease hold interest in the land.
But in Sec.6(2) as a tenant for the purpose of payment of the rent and retention of possession and appears to he nothing more.
As regards tank fishery is concerned, though exemption has been granted, it is subject to the condition of continued user for pisciculture or fishing.
(495 E) 1.14.
From the scheme of the Act it would appear that the intermediary or the lessee gets no absolute right in the tank fisheries which were already divested but to remain in khas possession and to enjoy the usufruct thereof i.e. for pisciculture or fishing without any interest or sub soil rights and subject to such terms and conditions and subject to payment of rent as prescribed under the Act, but not as owner thereof.
The direction, therefore,by the High Court that the respondents are entitled to dispose of the land is contrary to and in negation of the scheme of the Act and Rules.
Therefore, it is manifestly illegal.
(495 G) 1.15.
The appellant is free to issue notice to the respondent under Sec.
10 (2) of the Act and conduct an enquiry into and rind: (1) on the date of the vesting whether the lands were being used for pisciculture or fishing i.e. tank fisheries; (2) whether the respondent had submitted form `B ' within the prescribed time exercising the option 486 to retain possession of the lands in question as tank fisheries; and (3) whether the respondent is continuing to use the lands in question as tank fisheries.
Reasonable opportunities shall be given to the respondents to prove its/their case.
(496 A B) 1.16.On the enquiry if it is found that the lands are not tank L1.16.On the enquiry if it is found that the lands are not tank L1.16.On the enquiry if it is found that the lands are not tank fisheries as on the date of vesting or that the respondent had not submitted option in Form `B ' to retain possession of the lands as tank fisheries within the prescribed period, then the lands stood vested in the State free from all incumbrances and authorities are entitled to take possession of the land under Sec.
10(1) read with Sec.
10(3).
In case if it rinds that the lands were being used as tank fisheries as on the date of vesting and that the respondents exercised the option within the time to retain possession and is continuing to use the tank fishery for pisciculture or for fishing; and if it has been continuing in possession of tank fishery, It is free to impose, if not already imposed, such terms and conditions as may be necessary to ensure continued use of tank fishery for pisciculture or for fishing, subject to payment of such rent as may be fixed or revised and ultimately entered in the Record of Rights.
In case, the respondent commits contravention thereof, it is open to the State to resume possession.
In case the respondent is not using the tank fishery for pisciculture or for fishing or alienated the lands it is open to the appellants to take possession of the lands and all sales if made by the respondents do not bind the State.
(496 C E)
|
ON: Civil Appeal No. 340 of 1957.
Appeal from the judgment and order dated November 29, 1954, of the Hyderabad High Court in Reference No. 234/5 of 1953 54.
K. N. Rajagopala Sastri, B. H. Dhebar and D. Gupta, for the appellant.
48 378 A. V. Viswanatha Sastri, P. Rama Reddy and R. Mahalinga Iyer, for the respondents.
March 20.
The Judgment of Bhagwati and Sinha, JJ., was delivered by Bbagwati, J. Kapur, J., delivered a separate Judgment.
BHAGWATI, J.
This appeal with a certificate from the High Court of Judicature at Hyderabad raises the question whether the sum of Rs. 2,19,343 received by the assessee in the year of account relevant for the assessment year 1951 52 was a revenue receipt or a capital receipt.
The facts leading up to this appeal may be shortly stated : The assessee is a registered firm consisting of five brothers and the wife of a deceased brother having equal shares in the profit and loss of the partnership.
The firm was appointed the sole selling agents and sole distributors for the Hyderabad State for the cigarettes manufactured by M/s. Vazir Sultan Tobacco Co., Ltd., under the terms of a resolution of the Board of Directors dated January 6, 1931.
" Mr. Baker reported that an arrangement had been, come to for the time being whereby the firm of Vazir Sultan & Sons, were given the distributorship of " Charminar " Cigarettes within the H. E. H. the Nizam 's Dominions and that they were allowed a discount of 2% on the gross selling price." No written agreement was entered into between the Company and the assessee in respect of the above mentioned arrangement nor was there any correspondence exchanged between them in this behalf.
In 1939 another arrangement was arrived at between the assessee and the company whereby the assessee was given a discount of 2% not only on the goods sold in the Hyderabad State but on all the goods sold in the Hyderabad State and outside Hyderabad State.
It does not appear that the Board of Directors passed any resolution in support of this new arrangement nor was any agreement drawn up between the parties incorporating the said new ar rangement.
379 On June 16, 1950, the Board of Directors passed the following resolution reverting to the old arrangement embodied in the resolution dated January 6,1931: " The Chairman, having referred to resolution No. 24 passed at the board meeting held on 6 1 31 and having reported that Vazir Sultan & Sons had agreed to revert to the arrangement outlined in that resolution with effect from 1 6 50, it was on the proposition of Mr. section N. Bilgrami, seconded by Mr. N. B. Chenoy resolved that payment of the sum of O. section Rs. 2,26,263 be made to Vazir Sultan & Sons by way of compensa tion, Vazir Sultan & Sons, to pay D. B. Akki & Co., out of that amount the sum of O. section Rs. 6,920 also by way of compensation.
Mr. Mohd. Sultan & Mr. Hameed Sultan stated that, as partners in the firm of Vazir Sultan & Sons, they did not take part in this resolution, although they had accepted on behalf of Vazir Sultan & Sons, the terms thereof.
" The sum of Rs. 2,19,343 was accordingly received by the assessee in the year of account 1359 F.
The Income tax Officer included this sum in the assessee 's total income and taxed it as a revenue receipt.
On appeal the Appellate Assistant Commissioner held that the sum of Rs. 2,19,343 was not a revenue receipt but a capital receipt being compensation for the loss of the agency and as such not liable to tax.
The Income tax Officer (C Ward) Hyderabad thereupon preferred an appeal to the Income tax Appellate Tribunal, Bombay, which held that the said sum received by the assessee was a revenue receipt and liable to tax.
The assessee then applied to the Appellate Tribunal for a reference to the High Court under sec.
66(1) of the Income tax Act and the Tribunal accordingly referred the following question of law to the High Court: " Whether the sum of O. section Rs. 2,19,343 received by the assessee Firm from Vazir Sultan Tobacco Co., Ltd., is a revenue receipt or a capital receipt ?" The High Court answered the question in favour of the assessee stating the question in a different form, viz., 380 " Whether the sum of O. section Rs. 2,19,343 received by the assessee firm from Vazir Sultan Tobacco Co., Ltd., is liable to be taxed under the Indian Incometax Act?" The appellant thereafter applied to the High Court for a certificate of fitness which was granted by the High Court on February 21, 1955, and hence this appeal.
The question that falls to be determined is whether the sum which was in express terms of the resolution mentioned by way of " compensation " for the loss of the agency was a revenue receipt (trading receipt or an income receipt) as contended by the Revenue or a capital receipt as contended by the assessee.
It was urged on behalf of the appellant that the sole selling agency which was granted by the Company to the assessee in the year 1931 was merely expanded as regards territory in 1939 and what was done in 1951 was to revert to the old arrangement, and the structure or the profit making, apparatus of the assessee 's business was not affected thereby.
The expansion as well as the restriction of the assessee 's territory were in the ordinary course of the assessee 's business and were mere accidents of the business which the assessee carried on and the sum of Rs. 2,19,343 received by the assessee as and by way of compensation for the restriction of the territory was a trading or an income receipt and was therefore liable to tax.
It was, on the other hand, contended on behalf of the assessee that it did not carry on business of acquiring and working agencies, that the agency acquired in 1931 was a capital asset of the assessee 's business of distributing Charminar cigarettes in the Hyderabad State, that the expansion of territory outside the Hyderabad State in 1939 was an accretion to the capital asset already acquired by the assessee, that the resolution of 1950 was in substance a termination or cancellation of the agency qua territory outside the Hyderabad State and resulted in the sterilisation of the capital asset qua that territory, that the sum of 381 Rs. 2,19,343 received by the assessee in the year of account was by way of compensation for the termination or cancellation of the agency outside Hyderabad State and being therefore compensation for the sterilisation pro tanto of a capital asset of the assessee 's business was a capital receipt and was therefore not liable to tax.
The question whether a particular receipt is a revenue receipt or a capital receipt or a particular expenditure is a capital expenditure or a revenue expenditure is beset with considerable difficulty and one finds the Revenue and the assessee ranged on different sides taking up alternate contentions as it suits their purposes.
As was observed by Lord Macmillan in Van Den Berghs, Limited vs Clark(1) : " The reported cases fall into two categories, those in which the subject is found claiming that an item of receipt ought not to be included in computing his profits and those in which the subject is found claiming that an item of disbursement ought to be included among the admissible deductions in computing his profits.
In the former case the Crown is found maintaining that the item is an item of income; in the latter, that it is a capital item.
Consequently the argumentative position alternates according as it is an item of receipt or an item of disbursement that is in question, and the taxpayer and the Crown are found alternately arguing for the restriction or the expansion of the conception of income.
" The question has therefore to be dealt with irrespective of the one stand or the other which is taken by the Revenue or the assessee and the Court has got to determine what is the true character of the receipt or the expenditure.
In the case of the Commissioner of Income tax and Excess Profits Tax, Madras vs The South India Pictures Ltd., Karaikudi (2) this Court endorsed the following statement of Lord Macmillan in Ven Den Berghs, Ltd. vs Clark (1): " That though in general the distinction between an income and a capital receipt was well recognised (1) ; , 429.
(2) ; , 228.
382 and easily applied, cases did arise where the item lay on the border line and the problem had to be solved on the particular facts of each case.
No infallible criterion or test can be or has been laid down and the decided cases are only helpful in that they indicate the kind of consideration which may relevantly be borne in mind in approaching the problem.
The character of the payment received may vary according to the circumstances.
Thus the amount received as consideration for the sale of a plot of land may ordinarily be a capital receipt but if the business of the recipient is to buy and sell lands, it may well be his income.
" While considering the case law it is necessary to bear in mind that the Indian Income tax Act is not in pari materia with the British Income Tax statutes, it is less elaborate in many ways, subject to fewer refinements and in arrangement and language it differs greatly from the provisions with which the courts in England have had to deal.
Little help can therefore be gained by attempting to construe the Indian Income tax Act in the light of decisions bearing upon the meaning of the Income tax legislation in England.
But on analogous provisions, fundamental concepts and general principles unaffected by the specialities of the English Income tax statutes, English authorities may be useful guides.
(Vide the observations of the Privy Council in the Commissioner of Income tax vs Shaw Wallace & Co. (1); Gopal Saran Narain Singh vs Commissioner of Income tax (2); Commissioner of Income tax, Bombay Presideney and Aden vs Chunnilal B. Mehta (3 ) and Raja Bahadur Kamakshya Narain Singh of Ramgarh vs C. I. T., Bihar & Orissa (4).
Before embarking upon a discussion of the principles emerging from the various decisions bearing upon this question, it is necessary to advert to an argument which was addressed to us by the learned counsel for the appellant in connection with the Privy Council decision in the Commissioner of Income tax vs Shaw Wallace & Co. (1).
That case was relied upon by the (1) (1932) L.R. 59 I.A. 206, 212.
(2) (1935) L.R. 62 I.A. 207, 214.
(3) (1938) L.R. 65 I A. 332, 349.
(4) (1943) L.R. 70 I.A. 180, 188.
383 Appellate Assistant Commissioner and the High Court as determinative of the question in favour of the assessee and it was strenuously urged before us on behalf of the Revenue that the authority of that decision was considerably shaken not only by the later privy Council decision in Raja Bahadur Kamakshya Narain Singh vs C. I. T., Bihar and Orissa (1) but also by a decision of this Court in Raghuvansi Mills Ltd. vs Commissioner of Income tax, Bombay City (2).
It may be remembered that the term " income was understood by their Lordships of the Privy Council in Shaw Wallace 's Case(3) to connote a periodical monetary return coming in with some sort of regularity or expected regularity from definite sources.
The source may not necessarily be one which is expected to be continuously productive, but it must be one whose object is the production of a definite return excluding anything in the nature of a mere windfall.
Income was thus likened pictorially to the fruit of a tree or the crop of a field (lbid p. 212).
This concept of " income " was adopted and in substance repeated by the Privy Council in Gopal Saran Narain Singh 's Case (4) at p. 213, though Lord Russell of Killowen pronouncing the opinion of the Privy Council pithily remarked that anything which can properly be described as income is taxable under the Act unless properly exempted.
The case of Raja Bahadur Kama kshya Narain Singh (1)struck a discordant note and Lord Wright delivering the opinion of the Board observed at p. 192 that it was not in their Lordships ' opinion correct to regard as an essential element in any of these or like definitions a reference to the analogy of fruit or increase or sowing or reaping or periodical harvests and that such picturesque similes cannot be used to limit the true character of income in general.
Lord Wright further observed at p. 194: " Its applicability may in particular cases differ because the circumstances, though similar in some respects, may be different in others.
Thus the profit realised on a sale of shares may be capital if the seller (1) (1943) L.R. 70 I.A. 180, 188.
(2) [1953] S.C.R. 177.
(3) (1932) L.R. 59 I. A. 206, 212.
(4) (1935) L.R. 62 I.A. 207, 2I4.
384 is an ordinary investor changing his securities, but in some instances, at any rate, it may be income if the seller of the shares is an investment or an insurance company.
Income is not necessarily the recurrent return from a definite source, though it is generally of that character.
Income, again may consist of a series of separate receipts, as it generally does in the case of professional earnings.
The multiplicity of forms which " income " may assume is beyond enumeration.
Generally, however, the mere fact that the income flows from some capital assets, of which the simplest illustration is the purchase of an annuity for a lump sum, does not prevent it from being income, though in some analogous cases the true view may be that the payments, though spread over a period, are not income, but instalments payable at specified future dates of a purchase price.
(Vide Secretary of State for India vs Scoble) (1).
This Court in Raghuvansi Mill 's Case (2) also observed that the definition of " income " in Shaw Wallaces Case (3) as a periodical monetary return coming in with some sort of regularity or expected regularity from definite sources must be read with reference to the particular facts of that case.
It was therefore urged on behalf of the Revenue that periodicity or recurring nature of the receipt was not a necessary ingredient of " income " nor was the existence of a material external source capable of producing a recurrent return necessary before a receipt could be treated as income chargeable to tax.
We are not unmindful of this criticism of the definition of " income " adopted by the Privy Council in Shaw Wallace & Co. 's Case (3) and the concept of " income " may have to be thus revised.
But even granting the proposition that is contended for by the Revenue the result is no different in the present case because the head of income under which the assessee before us has been assessed to Income tax is " business " a definite source from which the income in question sought to be assessed is alleged to have been (1) ; (2) ; (3) (1932) L.R. 59 I.A. 206, 212.
385 derived and whether it is of a recurring or non recurring nature therefore does not enter into the picture.
The exemption from liability in regard to that income is claimed by the assessee, not on the ground of the applicability of section 4(3)(vii) of the Income tax Act but on the ground that it is not a revenue receipt but a capital receipt, being compensation paid by the Company to the assessee for the termination or cancellation of the agency qua territory outside Hyderabad State, a capital asset of the assessee 's business.
What then are the considerations which have to be borne in mind in determining these vexed questions ? The distinction between a capital expenditure and a revenue expenditure came up for consideration before this Court in Assam Bengal Cement Co., Ltd. vs The Commissioner of Income tax, West Bengal (1) and this Court laid down certain criteria for the determination as to whether a particular expenditure incurred by the assessee was a capital expenditure or a revenue expenditure.
We need not therefore discuss that problem any further.
As to whether a particular receipt in the hands of an assessee is a capital receipt, or a revenue receipt, we had occasion to consider the same in the Commissioner of Income tax and Excess Profits Tax, Madras vs The South India Pictures Ltd., Karaikudi (2).
The assessee there carried on the business of distribution of films.
In some instances the assessee used to produce or purchase films and then distribute the same for exhibition in different cinema halls and in other cases used to advance monies to producers of films produced with the help of monies so advanced.
In the course of such business it advanced monies to the Jupiter Pictures for the production of these films and acquired the rights of distribution of the three films under three agreements in writing dated September, 1941, July 1942 and May 1943.
In the accounting year ending March 31, 1946, and in the previous years the assessee had exploited its rights of distribution of the three pictures.
On October 31, 1945, the (1) (2) ; , 228. 49 386 assessee and the Jupiter Pictures entered into an agreement cancelling the three agreements relating to the distribution rights in respect of the three films and in consideration of such cancellation the assessee was paid Rs. 26,000 in all by the Jupiter Pictures as compensation.
It was held by the Majority of this Court that the sum received by the assessee was a revenue receipt (and not a capital receipt) assessable under the Indian Income tax Act inasmuch as: (1) the sum paid to the assessee was not truly compensation for not carrying on its business but was a sum paid in the ordinary course of business.
to adjust the relation between the assessee and the producers of the films; (2)the agreements which were cancelled were by no means agreements on which the whole trade of the assessee had for all practical purposes been built and the payment received by the assessee was not for the loss of such a fundamental asset as was the ship managership of the assessee in Barr Crombie & Co., Ltd. vs Commissioners of Inland Revenue (1) and (3)one could not say that the cancelled agreements constituted the framework or whole structure of the assessee 's profit making apparatus in the same sense as the agreement between the two margarine dealers in Van Den Berghs Ltd. vs Clark (2) was.
The criteria laid down by the majority judgment for determining whether the particular payment received by the assessee was income or was to be regarded as a capital receipt were: (i)whether the agreements in question were entered into by the assessee in the course of carrying on its business of distribution of films, and (ii) whether the termination of the agreements in question could be said to have been brought about in the ordinary course of business; so that money received by the assessee as a result of or in connection with such termination of agreements could be regarded as having been received in the ordinary course of its business and therefore a trading receipt.
(1) (2) ; , 429.
387 A similar question arose in Commissioner of Incometax, Nagpur vs Rai Bahadur Jairam Valji(1) where this Court followed the same line of reasoning.
The question there related to a sum of Rs. 2,50,000 received by the assessee as damages or compensation for the premature termination of a contract dated May 9, 1940.
The High Court on a reference under section 66(1) of the Income tax Act had held that the sum was a capital receipt in the hands of the assessee, and as such not liable to be taxed.
It was contended on behalf of the Revenue that the contract dated May 9, 1940, was one entered into by the assessee in the ordinary course of his business, that the sum of Rs. 2,50,000 was paid admittedly as solatium for the cancellation of that contract, and that it was therefore a revenue receipt.
The assessee on the other hand contended that the contract dated May 9, 1940, was for a period of 25 years of which more than 23 years had still to run at the time of the settlement, and it was therefore capital in character.
Moreover, the true character of the agreement was that it brought into existence an arrangement which would enable him to carry on a business and was not itself any business and any payment made for the termination of such an agreement was a capital receipt.
This Court on the facts and circumstances of the case came to the conclusion that the contract in question was entered into by the assessee in the ordinary course of business and was one entered into in the carrying on of that business.
The arrangement ultimately entered into between the parties in regard to the payment of the said sum of Rs. 2,50,000 was accordingly treated as an adjustment made in the ordinary course of business and the receipt was therefore held to be an amount paid as solatium for the cancellation of a contract entered into by a person in the ordinary course of business.
In the course of the discussion reference was made to agency agreements and this Court observed:" In an agency contract, the actual business consists in the dealings between the principal and his (1) [1959] Supp. 1 S.C.R. 110; , 163.
388 customers, and the work of the agent is only to bring about that business.
In other words, what he does is not the business itself but something which is intimately and directly linked up with it.
It is therefore possible to view the agency as the apparatus which leads to business rather than as the business itself on the analogy of the agreements in Van Den Berghs Ltd. vs Clark (1).
Considered in this light, the agency right can be held to be of the nature of a capital asset invested in business.
But this cannot be said of a contract entered into in the ordinary course of business.
Such a contract is part of the business itself, not anything outside it as is the agency, and any receipt on account of such a contract can only be a trading receipt.
" This Court further emphasised the distinction between an agency agreement and a contract made in the usual course of business and pointed out that the agreement could in any event be regarded as a capital asset of the agent which would be saleable.
Such a concept would certainly be out of place with reference to a contract entered into in the course of business and any payment made for the non performance or cancellation of such a contract could only be damages or Compensation and could not, in law or fact, be regarded as an assignment of the rights under the contract.
Once it was found that the contract was entered into in the ordinary course of business, any compensation received for its termination would be a revenue receipt, irrespective of whether its performance was to consist of a single act or a series of acts spread over a period.
While thus indicating that an agency could be treated as a capital asset of the business this Court guarded itself against its being understood as deciding that the compensation paid for cancellation of an agency contract must always and as a matter of law be held to be a capital receipt and it made the following pertinent observations : " Such a conclusion will be directly opposed to the decision in Kelsall 's case (2) and the Commissioner (1) ; ,429.
(2) ; 389 of Income tax and Excess Profits Tax, Madras vs The South India Pictures Ltd., Karaikudi (1).
The fact is that an agency contract which has the character of a capital asset in the hands of one person may assume the character of a trading receipt in the hands of another, as for example, when the agent is found to make a trade of acquiring agencies and dealing with them.
The principle was thus stated by Romer, L. J., in Golden Horse Shoe (New) Ltd. vs Thurgood (2) : The determining factor must be the nature of the trade in which the asset is employed.
The land upon which a manufacturer carries on his business is part of his fixed capital.
The land with which a dealer in real estate carries on his business is part of his circulating capital.
The machinery with which a manufacturer makes the articles that he sells is part of his fixed capital.
The machinery that a dealer in machinery buys and sells is part of his circulating capital, as is the coal that a coal merchant buys and sells in the course of his trade.
So, too, is the coal that a manufacturer of gas buys and from which he extracts his gas.
Therefore when a question arises whether a payment of compensation for termination of an agency is a capital or a revenue receipt, it would have to be considered whether the agency was in the nature of capital asset in the hands of the assessee, or whether it was only part of his stock in trade.
Thus in Barr Crombie & Sons Ltd. vs Commissioners of Inland Revenue (3), the agency was found to be practically the sole business of the assessee, and the receipt of compensation on account of it was accordingly held to be a capital receipt, while in Kelsall 's case the agency which was terminated was one of several agencies held by the assessee and the compensation amount received therefor was held to be a revenue receipt, and that was also the case in the Commissioner of Income tax and Excess Profits Tax, Madras vs The South India Pictures Ltd., Karaikudi (1).
" We may in this context also note the further observations made by this Court: (1) ; 228, (2) , 300.
(3) 390 But apart from these and similar instances, it might, in general, be stated that payments made in settlement of rights under a trading contract are trading receipts and are assessable to revenue.
But where a person who is carrying on business is prevented from doing so by an external authority in the exercise of a paramount power and is awarded compensation therefor, whether that receipt is a capital receipt or a revenue receipt will depend upon whether it is compensation for injury inflicted on a capital asset or on a stock in trade.
The decision in the Glenboig Union Fireclay Co., Ltd. vs The Commissioners of Inland Revenue (1) applies to this category of cases.
There, the assessee was carrying on business in the manufacture of fire clay goods and had, for the performance of that business, acquired a fire clay field on lease.
The Caledonian Railway which passed over the field prohibited the assessee from excavating the field within a certain distance of the rails, and paid compensation therefor in accordance with the provisions of a statute.
It was held by the House of Lords that this was a capital receipt and was not taxable on the ground that the compensation was really the price paid " for sterilising the asset from which otherwise profit might have been obtained.
" That is to say, the fire clay field was a capital asset which was to be utilised for the carrying on of the business of manufacturing fire clay goods and when the assessee was prohibited from exploiting the field, it was an injury inflicted on his capital asset.
Where, however, the compensation is referable to injury inflicted on the stock in trade, it would be a revenue receipt.
(Vide the Commissioners of Inland Revenue vs Newcastle Breweries Ltd. (2).
" It is no doubt true that this Court was not concerned with any agency agreement in the last mentioned case and the observations made by this Court there were by way of obiter dicta.
The obiter dicta of this Court, however, are entitled to considerable weight and we on our part fully endorse the same.
The earlier case of Commissioner of Income tax and Excess Profits Tax, (1) (2) 391 Madras vs The South India Pictures Ltd. (1) was indeed a case where the assessee had entered into agency agreements for the exploitation of the three films in question, but in that case the conclusion was reached that entering into such agency agreements for acquiring the films was a part of the assessee 's business and the agreements in question having been entered into by the assessee in the ordinary course of business the cancellation of those agreements was also a part of the assessee 's business and was resorted to in order to adjust the relation between the assessee and the producer of those films.
It would not be profitable to review the various English decisions bearing on this question as they have been exhaustively reviewed in the above decisions of this Court.
The position as it emerges on a consideration of these authorities may now be summarised.
The first question to consider would be whether the agency agreement in question for cancellation of which the payment was received by the assessee was a capital asset of the assessee 's business, constituted its profit making apparatus and was in the nature of its fixed capital or was a trading asset or circulating capital or stock in trade of his business.
If it was the former the payment received would be undoubtedly a capital receipt; if, however, the same was entered into by the assessee in the ordinary course of business and for the purpose of carrying on that business, it would fall into the latter category and the compensation or payment received for its cancellation would merely be an adjustment made in the ordinary course of business of the relation between the parties and would constitute a trading or a revenue receipt and not a capital receipt.
We may perhaps appropriately refer at this stage to an aspect of this question which was canvassed before us with some force and it was that there was no enforceable agreement as between the assessee and the Company which could be made the subject matter of a legal claim for damages or compensation at his instance in the event of its termination or cancellation by the Company.
The agency agreement was (1) ; , 228.
392 terminable at the will of the Company and if the Company chose to do so the assessee had no remedy at law in regard to the same.
It is, however, to be remembered that in all these cases one has really got to look to the nature of the receipt in the hands of the assessee irrespective of any consideration as to what was actuating the mind of the other party.
As Rowlatt, J., observed in the case of Chibbett vs Joseph Robinson & Sons (1): "As Sir Richard Henn Collins said, you must not look at the point of view of the person who pays and see whether he is compellable to pay or not; you have to look at the point of view of the person who receives, to see whether he receives it in respect of his services, if it is a question of an office and in respect of his trade, if it is a question of trade and so on.
You have to look at his point of view to see whether he receives it in respect of those considerations.
This is perfectly true.
But when you look at that question from what is described as the point of view of the recipient, that sends you back again, looking, for that purpose, to the point of view of the payer; not from the point of view of compellability or liability, but from the point of view of a person inquiring what is this payment for; and you have to see whether the maker of the payment makes it for the services and the receiver receives it for the services.
" The learned Judge further observed at p. 61 " But at any rate it does seem to me that compensation for loss of an employment which need not continue, but which was likely to continue, is not an annual profit within the scope of the Income tax at all." (See also W. A. Guff vs Commissioner of Incometax, Bombay City) (2) where the question whether the amount paid was compensation for which the employer was liable or was a payment made ex gratia was considered immaterial for the purpose of the decision in that case).
It was also urged that the agency in question before us was not an enduring asset of the assessee 's business as in its very nature it was terminable at will, (1) , 60.
(2) 393 there being no agreement or arrangement for a fixed term between the assessee and the Company.
On the analogy of the test laid down by this Court in Assam Bengal Cement Co., Ltd. vs The Commissioner of Income tax, West Bengal (1) while considering the distinction between a capital expenditure and a revenue expenditure, it was argued that the agency agreement in question could not be a capital asset of the assessee 's business in so far as it was not of an enduring character and the compensation paid for its termination could not therefore be a capital receipt in the hands of the assessee.
Whatever be the position, however, in the case of the acquisition of an asset by the assessee by making a disbursement for the purchase of the same, similar considerations would not necessarily operate when the amount is received by the assessee for the termination or cancellation of an asset of his business.
The character of such a receipt would indeed have to be determined having regard to the fact whether the asset in question was a capital asset of the business or a trading asset thereof.
For this purpose it will be immaterial whether that asset was of an enduring character or was one which was terminable at will.
We have therefore got to determine whether the agency in question before us was a capital asset of the assessee 's business.
One of the relevant considerations in the matter of such determination has been whether the asset was in the nature of fixed capital or constituted the circulating capital or stock in trade of the assessee 's business.
This question was thus dealt with by Viscount Haldane in John Smith & Sons vs Moore (2) : " But what was the nature of what the Appellant here had to deal with ? He had bought as part of the capital of the business his father 's contracts.
These enabled him to purchase coal from the colliery owners at what we were told was a very advantageous price, about fourteen shillings per ton.
He was able to buy at this price because the right to do so was part of the (1) (2) , 282.
50 394 assets of the business.
Was it circulating capital ? My Lords, it is not necessary to draw an exact line of demarcation between fixed and circulating capital.
Since Adam Smith drew the distinction in the Second Book of his " Wealth of Nations ", which appears in the chapter on the Division of Stock, a distinction which has since become classical, economists have never been able to define much more precisely what the line of demarcation is.
Adam Smith described fixed capital as what the owner turns to profit by keeping it in his own possession, circulating capital as what he makes profit of by parting with it and letting it change masters.
The latter capital circulates in this sense.
My Lords, in the case before us the Appellant, of course, made profit with circulating capital, by buying coal under the contracts he had acquired from his father 's estate at the stipulated price of fourteen shillings and reselling it for more, but he was able to do this simply because he had acquired, among other assets of his business, including the goodwill, the contracts in question.
It was not by selling these contracts, of limited duration though they were, it was not by parting with them to other masters, but by retaining them, that he was able to employ his cir culating capital in buying under them.
I am accordingly of opinion that though they may have been of short duration, they were none the less part of his fixed capital ".
In the case before us the agency agreement in respect of territory outside the Hyderabad State was as much an asset of the assessee 's business as the agency agreement within the Hyderabad State and though expansion of the territory of the agency in 1939 and the restriction thereof in 1950 could very well be treated as grant of additional territory in 1939 and the withdrawal thereof in 1950, both these agency agreements constituted but one employment of the assessee as the sole selling agents of the Company.
There is nothing on the record to show that the acquisition of such agencies constituted the assessee 's business or that these agency agreements were entered into by the assessee in the carrying on of any such business.
395 The agency agreements in fact formed a capital asset of the assessee 's business worked or exploited by the assessee by entering into contracts for the sale of the " charminar " cigarettes manufactured by the Company to the various customers and dealers in the respective territories.
This asset really formed part of the fixed capital of the assessee 's business It did not constitute the business of the assessee but was the means by which the assessee entered into the business transactions by way of distributing those cigarettes within the respective territories.
It really formed the profit making apparatus of the assessee 's business of distribution of the cigarettes manufactured by the Company.
If it was thus neither circulating capital nor stock in trade of the business carried on by the assessee it could certainly not be anything but a capital asset of its business and any payment made by the Company as and by way of compensation for terminating or cancelling the same would only be a capital receipt in the hands of the assessee.
It would not make the slightest difference for this purpose whether either one or both of the agency agreements were terminated or cancelled by the Company.
The position would be the same in (either event.
As was observed by Lord Wrenbury in the Glenboig Union Fire Clay Co., Ltd. vs The Commissioners of Inland Revenne (1) at p. 465: " The matter may be regarded from another point Of view ; the right to work the area in which the working was to be abandoned was part of the capital asset consisting of the right to work the whole area demised.
Had the abandonment extended to the whole area all subsequent profit by working would, of course have been impossible but it would be impossible to contend that the compensation would be other than capital.
It was the price paid for sterilising the asset from which otherwise profit might have been obtained.
What is true of the whole must be equally true of part.
" If both the agency agreements, viz., one for the territory within the Hyderabad State and the other for the territory outside Hyderabad State had been (1) 396 terminated or cancelled on payment of compensation, the whole profit making structure of the assessee 's business would have been destroyed.
Even if one of these agency agreements was thus terminated, it would result in the destruction of the profit making apparatus or sterilisation of the capital asset pro tanto and if in the former case the receipt in the hands of the assessee would only be a capital receipt, equally would it be a capital receipt if compensation was obtained by the assessee for the termination or cancellation of one of these agency agreements which formed a capital asset of the assessee 's business.
The facts of the present case are closely similar to those which obtained in the Commissioner of Incometax vs Shaw Wallace & Co. (1).
In that case also the assessees had for a number of years prior to 1928 acted as distributing agents in India of the Burma Oil Company, and the Anglo Persian Oil Company, but had no formal agreement with either Company.
In or about the year 1927 the two companies combined and decided to make other arrangements for the distribution of their products.
The assessee 's agency of the Burma Company was accordingly terminated on December 31, 1927, and that of the AngloPersian Company on June 30, following.
Some time in the early part of 1928 the Burma Company paid to the assessee a sum of Rs. 12,00,000 " as full compensation for cessation of the agency " and in August of the same year the Anglo Persian Company paid them another sum of Rs. 3,25,000 as " compensation for the loss of your office as agents to the company " On the facts and circumstances of the case the Privy Council came to the conclusion that the sums could only be taxable if they were the produce, or the result of, carrying on the agencies of the oil companies in the year in which they were received by the assessees.
But when once it was admitted that they were sums received; not for carrying on that business, but as some 'Sort of solatium for its compulsory cessation, the answer seemed fairly plain.
Whatever be the criticism in regard to the concept of income adopted in this case noted (1) (1932) L.R. 59 I. A. 206,212.
397 earlier in this judgment, the decision could just as well be supported on the grounds which we have hereinbefore discussed and was quite correct, the payments having been received by the assessees as and by way of compensation for the termination Or cancellation of the agency agreements in question which were in fact the capital assets of the assessee 's business.
The Appellate Assistant Commissioner as well as the High Court were thus justified in the conclusion to which they came, viz., that the sum of Rs. 2,19,343 received by the assessee from the Company was a capital receipt.
The result, therefore, is that the appeal fails and will stand dismissed with costs throughout.
KAPUR, J. I have had the advantage of perusing the judgment prepared by my learned brother Bhagwati, J., but with great respect I am unable to agree and my reasons are these.
The sole question for determination in this case is as to whether a sum of Rs. 2,26,263 received by the assessees from.
Vazir Sultan Tobacoo Co. Ltd. as compensation for the termination of their agency for the distribution of 'charminar ' cigarettes in areas of India other than Hyderabad State is or is not taxable in the hands of the assessees.
The answer to this question depends on whether the amount has been received by the assessees as a capital or a revenue receipts.
In 1931 the assessees were appointed distributing agents for Hyderabad State only and for the rest of India in 1939, the agency commission in each case being a discount of 2% on the gross selling price.
The agency of 1939 was terminated by a resolution dated June 16, 1950, on payment of the compensation amount already mentioned but the assessees continued to be distributors for Hyderabad State.
It must here be mentioned that the agency in question was terminable at will, and that any compensation paid for it would prima facie be revenue.
During the accounting year the amount of income, profits and gains of the assessees from the cigarette distribution business and from another source, i. e., 398 Acid Factory within the State of Hyderabad was Rs. 4,53,159.
The order of the Income tax Officer or the Appellate Tribunal does not show bow much of this sum was attributable to the Cigarette distribution business and how much to the other source.
There is no finding as to how and to what extent, if any, the business of the assessees was affected by the cesser of distribution business outside that State.
The question now arises did the assessees receive the compensation in lieu of the commission they otherwise might or would have earned if the agreement had continued or did they receive it as compensation for the destruction of a profit making asset.
The answer to this question would again be dependent upon whether the receipt in question is attributable to a fixed capital asset or to circulating capital.
These two terms have been used in a number of cases but as applied to agencies compensation will be a capital receipt if it is received as the value of the agency, i.e., it is a price of the business as if it is brought to sale.
On the other band it is revenue receipt if it is paid in lieu of profits or commission.
In Van Den Berghs Ltd. vs Clark (1) Lord Macmillan described circulating capital as " capital which is turned over and in the process of being turned over yields profit or loss.
Fixed capital is not involved directly in that process and remains unaffected by it ".
As was said by Lord Macmillan in the same case, it is not possible to lay down any single test as infallible or any single criterion as decisive in the determination of the question.
Ultimately it, must depend upon the facts of a particular case.
The assessees rested then case on the decision of the Privy Council in Commissioner of Income tax vs Shaw Wallace & Co. (2) on which the High Court has mainly relied.
In that case the assessees carried on business in India as merchants and agents for various companies.
They were distributing agents for two on companies.
These two agencies were terminated and a sum of Rs. 12,00,000 was paid as compensation for the loss of these agency rights and the question was (1) ; (2) (1932) L.R. 59 I.A. 206. 399 whether this was a capital payment.
It was held to be a capital and not a revenue receipt because the, sum received was not the result of carrying on the ' agencies of the oil companies, in other words, it could 1 not be regarded as profits or gains from carrying on the business but was received in the nature of a solatium for cessation.
The case was decided on the interpretation of the word 'business ' as defined in section 2(4) of the Income tax Act, under which it " includes any trade, commerce or manufacture, or any adventure or concern in the nature of trade, commerce or manufacture ".
These words, it was held, were wide " but underlying each of them is the fundamental idea of the continuous exercise of an activity which was also the idea underlying the relevant words of section 10(1) of the Act, " in respect of the profits or gains of any business carried on by him ", i. e., it is to be the profit earned by a process of production.
The test of income was its periodicity because it connotes a periodical monetary return.
This test of periodicity was not accepted by the Privy Council itself in Raja Bahadur Kamakshya Narain Singh 's case (1).
Lord Wright there said " income is not necessarily the recurrent return from a definite source, though it is generally so ".
The test of periodicity was rejected by this Court in Raghuvanshi Mills Ltd. vs Commissioner of Income tax (2) where Bose, J., said that the remarks of periodical monetary return must be confined to the facts of that case and it was held that money received from an insurance company for insurance against losses was income representing loss of profits as opposed to loss of capital.
In a later case The Commissioner of Income tax vs The South India Pictures Ltd. (3) it was said that if Shaw Wallace & Co. had other agencies similar to those of the two oil companies it would be difficult to reconcile the decision in that case with the later decisions in Kelsall Parsons & Co. vs Commissioners of Inland Revenue (4) and other cases (Per Das, C. J.).
In view of the decision in the South India Pictures ' case and the observations of Bose, J., in the (1) (1943) L.R. 70 I.A. 180.
(2) ; , 183.
(3) ; , 232.
(4) ; 400 case of Raghuvanshi Mills Ltd. (1) the authority of Shaw Wallace & Co. 's case (2) must be taken to be considerably shaken.
We have then to see how the question has to be determined.
Various tests have been laid down in decided cases.
According to Lord Cave, L. C., an expenditure made not only once and for all but with a view to bringing into existence an asset or an advantage for the enduring benefit of a trade has been treated as properly attributable to capital and not to revenue.
(British Insulated Cables (3) ).
According to Lord Atkinson the word " asset " need not be confined to " something material" and Romer, L. J., has added that the advantage paid for need not be ,of a positive character " and may consist in the getting rid of an item of fixed capital that is of an onerous character (Anglo Persian Oil Co. vs Dale (4) ).
If the receipt represents the aggregate of profits which an assesee would otherwise have received over a series of years the lump sum might be regarded as of the same nature as the ingredients of which it was composed ; at p. 431) (5) but it is not necessarily in itself an item of income (per Lord Buckmaster in Glenboig Union Fireclay Co. (6) ).
In Van Den Berghs ' case (7) there were three agreements between a British and a Dutch company operative till 1940 making it possible for them to carry on their business 'in friendly alliance ' and providing for the sharing of profits in certain proportions.
The agreements were terminated in 1927 and the Dutch company paid the English company a sum of pound 450,000 as compensation.
The question was the charac ter of the receipt whether capital or revenue.
It was held by the House of Lords that it was the former because the agreements were not " ordinary commercial contracts in the course of carrying on their trade ; they were not contracts for the disposal of their employees or for the engagement of agents or other employees (1) ; , 183 (2) (1932) L.R. 59 I.A. 206 (3) , 213, 222.
(4) , 146 (5) Van Den Berghs Ltd. v Clark (6) (1922) 12 Tax Cas.
427, 464.
(7) ; 401 for the conduct of their business nor were they merely agreements as to how their trading profits when earned should be distributed as between the contracting parties.
On the contrary the agreements related to the whole structure of the recipient 's profit making apparatus.
They regulated its activities, defined what it might or it might not do and affected the whole conduct of its business ".
According to Lord Macmillan if the agreements formed the fixed framework within which the circulating capital operated, then they are not incidental to the working of its profit making machine but were essential parts of the mechanism itself and therefore they would result in a capital receipt and not revenue receipt.
Thus the agreements were designed to ensure that the business was carried on to the best advantage but they did not themselves form part of the business.
They were not agreements which must be regarded as pertinent to trading activities which yielded profits.
As such the totality of payments on account of those agreements were held to be a capital receipt.
The various decided cases demarcate the areas on the two sides of the line in which a receipt may lie and in every case it has to be determined as to whether it falls on one side or the other.
The simplest case is of income from property or business as distinct from something received in lieu of property or business itself.
One illustration of this is insurance against fire, destruction or damage and insurance against loss of profit, the former would bring in compensation in the nature of a capital.
Another instance is where the whole business is bought over and the receipt is the price of the business itself as opposed to a lump sum payment for the loss of profit calculated on a proper basis.
The test of income, i. e., periodicity or recurrence at fixed intervals has been doubted in this Court.
Raghuvanshi Mills (1).
Another test is afforded by cases of tangible immoveable property.
If an owner of such property is paid compensation for not working a part of his property, (1) ; , 183.
51 402 e. g. a part of the demised premises the compensation is not profit because it is payment for sterilising that part of the asset from which otherwise profit might have been obtained.
(Glenboig Union Fireclay case (1) at p. 464).
There is no difference in cases of this kind whether the abandonment extends to the whole area or is circumscribed to a part because in either case it is sterilising an asset from which otherwise profit might have been obtained.
" It makes no difference whether it may be regarded as a sale of the asset out and out or it be treated merely as a means of preventing the acquisition of profit that would otherwise be gained.
In either case the asset of the company to that extent has been sterilised or destroyed ".
Another test is whether the agreement related to the whole structure of recipient 's profit making apparatus and affected the whole conduct of his business or was the loss of a part of the fixed framework of the business.
If it is, it is capital (Van Den Bergh 's case (2) ).
But compensation for temporary and variable elements of the recipient 's profit making apparatus would be revenue (MacDonald 's case (3) ).
If the agreement affects the whole structure and character of the recipient 's business then it is capital but not if the structure of the business is so designed as to absorb the shocks as by the cancellation of one agency (Kelsall Parson 's case(4)).
In Bush Beach and Gent Ltd. vs Road(5) again the test of how the cancellation of the agreement affected the recipient 's business was applied.
Barr Crombie 's case (6) is a case of capital asset as there the recipient lost his entire business which resulted in reduction of staff, salaries and even in office accom modation.
The result was the cesser of its trading existence.
The transaction took the form of a transfer for a price from one party to another of something that formed part of the enduring asset of one of them.
Compensation for the loss of an agency would be for the loss of a capital asset if the termination of the (1) , 464.
(2) ; (3) (4) (1938) 21 Tax Cas.
(5) (6) (1945) 26 Tax Cas.
406. 403 agency was a damage to the recipient 's business structure such as to destroy or materially cripple the whole structure involving serious dislocation of the normal commercial organisation but if it was merely compensation for the loss of trading profit, i. e., in respect of commissions or it took the place of commission that would have been earned if the engagement had continued then it is revenue (Wiseburg vs Domville) (1).
So that the decision as to whether compensation was capital or revenue would depend upon whether the cessation of the agency destroys or materially cripples the whole structure of the recipient 's profit making apparatus or whether the loss is of the whole or part of the framework of business.
If we apply these tests to the agreement which has been terminated in the present case, it does not fall in any of the class of cases of destruction of a capital asset.
For the appellant reliance was placed on the observations of Venkatarama Aiyar, J., in Commissioner of Income tax vs Rai Bahadur Jairam Valji (2) where it was pointed out that in an agency contract the actual business consists in the dealings between the principal and his customers and the work of the agent is only to bring about that business.
In other words what the agent does is not business itself but something which is intimately and directly linked with it.
But an examination of the context shows that that is not what these observations mean.
The point that was to be decided in that case was whether a payment of compensation for the cancellation of a trading contract was a capital or revenue receipt, and dealing with decisions relating to the cancellation of agency contracts which were quoted in support of the contention that they were capital, the learned Judge_ observed that considerations applicable to agency contracts were inapplicable to trading contracts, because the two classes of contracts, were essentially different, and these differences were there pointed out.
The purpose of these observations was to show that receipts from (1) (2) [1959] SUPP.
1 S.C.R. 110 , 161, 163.
404 trading contracts were revenue and not that receipts from agency contracts are capital.
That that is the true scope of these observations is clear from the following passage: "In holding that compensation paid on the cancellation of a trading contract differs in character from compensation paid for cancellation of an agency contract, we should not be understood as deciding that the latter must always, and as a matter of law be held to be a capital receipt.
Such a conclusion will be directly opposed to the decisions in Kelsall 's case (1) and Commissioner of Income tax vs South India Pictures Ltd (2).
The fact is that an agency contract which has the character of a capital asset in the hands of one person may assume the character of a trading receipt in the hands of another, as, for example, when the agent is found to make a trade of acquiring agencies and dealing with them ".
The Court there observed that when the assessee holds a number of agencies, the compensation paid for cancellation of any of them could be regarded as revenue receipt.
This is inconsistent with the conclusion that an agency contract must always be regarded as a capital asset.
The learned Judges further observed that they were not elaborating this part as they were there concerned with a trading contract and therefore the statement as to when receipts from agency contracts could be regarded as revenue receipts cannot be read as exhausting the circumstances under which they could be held to be revenue.
As a matter of fact there are three kinds of cases of agencies shown by the decided cases: (1) Kelsall Parsons case (1) where the recipient was carrying on several agencies and the test laid down was whether the business structure could absorb a shock of the terminate on of one.
(2) The other is where the compensation is for a temporary and variable element of assessee 's profit making apparatus; MacDonald 's case (3).
(3) The third class of cases is represented by (1) ; (2) ; , 232.
(3) 405 Fleming & Co. 's case(1) where the rights and advantages surrendered were such as to destroy or materially cripple the whole structure of the profit making apparatus.
The agencies themselves are of different kinds:(1) where the agent himself carries on the business and sells the product of the principal and gets commission for it; (2) where the agent 's function is confined to bringing the principal and the customer together and be gets agency commission for the performance of only that service; (3) where the agent is a distributor and distributes the products of the principal through his sub agents and charges commission for the distribution work.
Cases (1) and (3) would not strictly fall within the scope of the ' observations in Commissioner of Income tax vs R. B. Jairam Valji (2) and case (2) would fall within the second class of agreements mentioned in Van Den Bergh 's case (3).
The agreement which is now before us and which was surrendered was terminable at will.
The amount of profit which the assessee made from working the agency contract in Hyderabad State alone was much more than the amount which the assees received for the termination of the whole of their agency outside the State.
Thus it is clear that the termination did not affect the trading activities of the assessees and therefore the termination of the contract viewed against the background of the assessee 's business Organisation and profit making structure appears to be no more than compensation for the loss of future profit and commission.
The true effect of the facts of this case appears to be this that in 1939 the assessee 's area of distribution was increased from the State of Hyderabad to the whole of India and in 1950 it was again reduced to the original area of 1931.
The assessees never lost their agency.
As a result of this contraction of area they at the most have lost some agency commission.
The compensation therefore was in the nature of surrogatum and in this view of the matter it is revenue and not capital.
(1) (2) [1959] Supp. 1 S.C.R. 110 , 161, 163.
(3) ; 406 I would therefore allow this appeal with costs throughout.
By COURT: In accordance with the majority judgment of the Court, the appeal is dismissed with costs throughout.
Appeal dismissed.
| The respondents appeared in the first year D.H.MS (Diploma in Homeopathic Medicine and Surgery) annual examination in june,1988.They had to re appear as they did not get the required percentage of pass marks in two or more subjects.
They were permitted to join the second year class after June, 1988.
Under the interim orders of the High Court, they appeared in the second year annual examination.
Simultaneously, the respondents appeared in the first year D.H.MS.
examination and cleared all the papers.
After re appearing in one or more subjects in the second year Supplementary examination in June, 1990, they were declared passed in the 2nd year D.H.M.S. examination.
The respondents joined the third year D.H.M.S. course and completed the course of study.
When their examination forms were forwarded to the appellant Council, they declined to permit the respondents to appear in the 3rd year D.H.M.S. annual examination, because they did not complete one year course of study between passing the first D.H.M.S. examination and appearing in the second year course.
The respondents preferred a writ petition before the High Court to direct the appellants to permit them to appear in the third year DHMS examination, commencing from 3.9.1991.
Following the view taken in the decision of the Court in C.W.P. No 2307/ 88.
Gurinder pal Singh vs Punjabi University & Ors., which was followed in Harinder Kaur Chandok (Minor) v The Punjab School, Education Board through its Secretary, , the High court allowed the writ petition of the respondents.
Against that order of the High Court, the appeal (C.A.No. 2107/93) was filed by special leave.
The appellants submitted that the High Court was wrong in its construction on regulation 11 of the Homeopathy (Diploma Course) DHMS Regulations, 1983; that if a candidate passed on supplementary examination, he would have to wait till the next academic session; that none of the Regulations indicated carry forward scheme of the subjects, but on the contrary,it was a case of detention every year.
The respondents urged that the interpretation placed by the High Courts on Regulations 8 to 10 was correct; that four chances afforded to the 308 candidate could be rendered nugatory, if the interpretation as stated by the appellants was accepted; that the Regulations did not say that after First D.H.M.S. examination, a student could not study for Second D.H.M.S. course and sit for examination provisionally; that the declaration of result for the Second D.H.M.S. course took place only after a student cleared the First D.H.M.S. examination; that if the Regulations were literally interpreted, that would lead to absurdity and it would run counter to the object of providing a supplementary examination.
As the other appeals (C.A.Nos.
2108 10/93) contained identical issue, all the appeals were heard and decided together.
Allowing, the appeals, this Court, HELD:1.1.
The Regulations 8 10 of the Homeopathy (Diploma Course) DHMS Regulations, 1983 are plain enough and are susceptible only to literary interpretation.
Maxwell:Interpretation of Statutes, 12th Edition, Page 29, referred to.
1.2.For admission to the First D.H.M.S. examination: i)a student must have regularly attended the courses of instruction, theoretical and practical; ii) for a period of not less than 12 months; iii) to the satisfaction of the head of the College.
(317 B) 1.3.
Eligibility for admission to Second D.H.M.S. examination is based on two conditions: i) A student has passed his First D.H.M.S. examination at the end of one year previously.
This means one year must elapse between the passing of the First year examination and taking of Second Year Examination.
ii) Subsequent to the passing the First year 309 a) he must have regularly attended the courses both theoretical and practical; b) for a period of at least one year; c) to the satisfaction of the head of the College.
(317 F G) Thus, unless and until, these two conditions are satisfied, a student is ineligible for admission to the Second D.H.M.S. examination.
(317 H, 318 A) 1.4 The conditions for eligibility for admission to Third D.H.M.S examination are: i) After passing the Second D.H.M.S examination, one and a half years must have elapsed before taking the Third D.H.M.S. examination.
ii) Subsequent to the passing of the Second D.H.M.S. examination: a) he must have regularly attended the courses both theoretical an practical; b) for a period of 11/2 years; c) to the satisfaction of the college.
(318 F G) 1.5.
Mandatory requirements of Regulation 9 are; i) The lapse of one year period between the passing of First D.H.M.S. examination and taking the Second D.H.M.S. examination.
ii) Subsequent to the passing of the First D.H.M.S. examination to undergo the course of study for one year.
(321 G) 1.6.
Therefore, if a candidate passes in the supplementary examination, the requirement of one year cannot be enforced.
Worse still is a case of a student who passes only at the next annual examination.
Could he he allowed to take the Second D.H.M.S. examination without even completing the First? Should he by chance pass the Second D.H.M.S. and not complete the First, since he has still one more chance to take this examination, what is to happen? 310 The situation is absurd.
The same principle should apply to Regulation 10 where the lapse is one and half years.
(321 H, 322 A) 1.7.The pattern of the examination is: 12 months for First D.H.M.S. examination, 12 months for Second D.H.M.S. examination and 18 months for Third D.H.M.S examination.
These put together with six months of compulsory internship, make up the four years prescribed for the Course in Regulation 3.
(318 G) 1.8.When a candidate completes the subjects only in the supplementary examination, then alone, he passes the examination.
It is that pass which is declared.
If the "doctrine of relation back" is applied, it would have the effect of deeming to have passed in the annual examination, held at the end of 12 months, which on the face of it, is untrue.
(321 A) 1.9.Whatever it is, a candidate has to complete all the subjects within four chances.
Should he fail to do so, he will have to undergo the course in all subjects for one year unless of course, he gets the exemption as stated in proviso to Clause (vii).
In Regulation 11 there is no 'system of carry forward '.
On the contrary, it is detention every year.
Harmonious construction violates the mandatory requirements of Regulation 9.
(321 E F) 1.10.If a student were to sit idle at home after passing the supplementary examination that is his own making.
To avoid such a situation, the Regulation cannot be construed causing violence to the language.
(323 H, 324 A) 1.11.The candidates who, as on the day of Judgment of these appeals, have attended all the courses and have passed all the examinations might make an appropriate representation to the Council of Homeopathic System of Medicines (The appellant) to consider their cases.
The representation shall be filed within a period of four weeks.
The Council of Homiopathic System of Medicines (the appellant) will take appropriate decision.
(327 C) 2.
The adjective 'supplementary ' means an examination to make up the deficiencies.
Thus, it stands to reason only when deficiencies are made up, the whole becomes complete.
(322 D) Oxford Dictionary, Seventh Edition, page 1072, referred to.
(322 B)
|
Appeal No. 265 of 1964.
Appeal from the judgment and order dated August 7, 1962 of the Andhra Pradesh High Court in Appeal Suit No. 312 of 57.
F. Babula Reddy, K. Rajendra Chaudhuri and K. R. Chaudhuri, for the appellants.
P. Rama Reddy and A. V. V. Nair, for respondent No. 1.
T.V. R. Tatachari, for respondent No. 2.
In the village of Varagali, in the district of Nellore, there is a temple in which is enshrined the idol of Sri Kodandaramaswami.
The temple was built in the middle of the last century by one Burla Rangareddi who managed the affairs of the temple and its properties during his life time.
After his death his son, Venkata Subbareddi is in management.
By a deed dated August 19 1898 Venkata Subbareddi relinquished his interest in ' the properties in favour of one Vemareddi Rangareddi whose family members are defendants 1 to 5.
The plaintiff filed a petition before the Assistant Commissioner , for Hindu Religious Endowments, Nellore, alleging mismanagement of the temple and its properties by the first defendant.
Notice was issued to the 1st defendant to show cause why the temple properties ghould not be leased out in public auction and the first, defendant contested the application alleging that the properties were not the properties of the temple but they belonged to his family.
After enquiry, the Assistant Commissioner submitted a report to the Hindu Religious Endowments Board, Madras, recommending that a scheme of 'Management may be framed for the administration of the. temple and its properties.
The Board thereafter commenced I proceedings for settling a scheme and issued notice to the 1st defendant to state his objections.
The 1st defendant reiterated his plea that the temple was not a public temple.
The Board held an enquiry and by its order dated October section 1949 held that the temple was a public one.
On January 18, 1950 the 1 st defendant filed O.P. No. 3 of 1950 on the file of the District Judge; Nellore (1) for setting aside the order of the Board 'dated 272 October 5, 1949 declaring the temple of Sri Kodandaramaswamiwari as a temple defined in section 6, cl. 17 of the Act, (2) for a declaration that the temple was a private temple and (3) for a declaration that the properties set out in the schedule annexed to the petition were the personal properties of his family and they did not constitute the temple properties.
Originally, the Commissioner.
Hindu Religious Endowment Board, Madras was impleaded as the sole respondent in the petition.
The present plaintiff later on got himself impleaded as the 2nd respondent therein.
Both the respondent$ contested the petition on the ground that the temple was a public temple and that the properties mentioned in the schedule were the properties of the temple and not the personal properties of the 1st defendant.
For reasons which are not apparent on the record the petition was not disposed of for a number of years.
In the meantime Madras Act II of 1927 was repealed and the Hindu Religious and Charitable Endowments Act of 1951 was enacted.
Then came the formation of the State of Andhra Pradesh.
By reason of these changes the Commissioner of Hindu Religious Endowments in the State of Andhra Pradesh was impleaded as the 1st respondent to the petition.
Thereafter, there was a compromise between the petitioners 1 to 5 on the one, hand and the Commissioner, the 1st respondent on the other.
The District Judge, Nellore recorded the compromise and passed a decree in terms thereof by his order dated October 28, 1954, The material clauses of the compromise decree, exhibit B 11 are as follows '.
That Sri kodandaramaswami temple, Varagali, be and hereby is declared as a temple as defined in section 6.
clause 17 of the Hindu Religious and Charitable Endowments Act; 2.
That petitioners 1 to 4 be and hereby are, declared as the present hereditary trustees of the said temple.
That the properties set out in schedule A filed herewith be and hereby are, declared as the person proper.
ties of the family of the petitioners subject to a charge as slow below; 4.
That petitioners 1 to 4 their heirs, successors administrators and assignees do pay to the said temple for its maintenance 12 1/2 putties of good Mologolukulu paddy 6001 every year by the 31st of March; 5.
That the said 121 putties of good Mologolukulu paddy and Rs. 600/ due every year be a charge on the lands mentioned in Schedule A given hereunder; 6.
That the petitioners 1 to 4 and their heirs and assignees be liable to pay 12 1/2 putties of Molo 273 golukulu paddy and Rs. 600 every year whether the lands yield any income or not.
That the H. R. & C. E. Commissioner be.
entitled to associate non hereditary trustees not exceeding two.
.whenever they consider that such appointment is necessary and in the interests of the management.
That the Managing trustee shall be one of the four hereditary trustees or their successors in title only and not the non hereditary trustees; 15.
That the right of the 2nd respondent to agitate the matter by separate proceedings will be unaffected by the terms of this compromise to which he is not a party.
" It is apparent from the terms of the compromise decree that the temple was declared to be a public temple as defined in section 6, cl,.
17 of the Hindu Religious and Charitable Endowments Act and that the properties set out in Sch.
A annexed to the compromise petition were declared, to, be the personal properties of defendants 1 to.
section The, decree created a liability on their part to deliver to the temple for its maintenance 121 putties of paddy and pay Rs. 600/ cash every year.
The Present suit was instituted on October 3 1. 1955 for a declaration that the provision in the compromise. decree that the lands mentioned in the schedule were the personal properties of defendants 1 to 5 and not the absolute properties of the temple, was not valid.
and binding on the temple.
Defendants 1 to 5 objected, to the suit on the ground that it was not open to the plaintiff to seek a declaration that a Part of the decree was not binding but the plaintiff should have directed his attack against the ,entirety of the decree.
The trial court dismissed the suit on the ground that the suit was defective and that section 93 of.
the Hindu Religious and, Charitable Endowments Act of 1951 was a bar to the institution of the suit.
Against the decree of the trial court the plaintiff preferred an appeal A S, 312 of 1957 to the High Court of Andhra Pradesh.
plaintiff also filed C.M.P. no; 6422 of 1962 praying for amendment of the plaint the effect that the compromise decree in O. P. No. 3 of 1950 was not valid and binding on the temple.
After hearing defendants 1 to.5 the High Court allowed the amendment sought for: by the plaintiff and held that the amendment cured the defect with regard to the prayer for a declaration to have the compromise decree set aside partially.
The High Court further held that section 93 of the Hindu.
Religious and Charitable Endowments Act was not a bar to the suit and ' section 42 of the Specific Relief Act ' was not exhaustive and the suit was therefore maintainable.
In the result, the High Court "owed the appeal and remanded the suit to the trial court for disposing the same on the remaining issues.
274 It was contended, in the first place, on behalf of the appellants that declaratory suits are governed exclusively by section 42 of the and if the requirements of that section are not fulfilled no relief can be granted in a suit for a mere declaration.
It was submitted that the plaintiff must satisfy the court, in such a suit, that he is entitled either to any legal character or to any right in any property.
It was argued for the appellants that the plaintiff has brought the suit as a mere worshiper of the temple and that he has no legal or equitable right to the properties of the temple which constitute the subject matter of the suit.
It was pointed out that the plaintiff has not asked for a declaration of his legal character as a worshiper of the temple but he has asked for the setting aside of the compromise decree in O. P. No. 3 of 1950 with regard to the nature of the temple properties.
It was contended that in a suit of this description the conditions of section 42 of the are not satisfied and the suit is, therefore, not maintainable.
The first question to be considered in this appeal is whether the suit is barred by the provisions of section 42 of the which states: "42.
Any person entitled to any legal character, or to any right as to any property, may institute a suit against any person denying, or interested to deny, his title to such character or right, and the Court may in its discretion 'make therein a declaration that he is so entitled, and the plaintiff need not in such suit ask for any further relief: Provided that no Court shall make any such declaration where the plaintiff, being able to seek further relief than a mere declaration of title, omits to do so.
Explanation A trustee of property is a 'person interested to deny ' a title adverse to the title of some one who is not in existence, and for whom, if in existence, he would be a trustee.
" The legal development of the declaratory action is important.
Formerly it was the practice in the Court of Chancery not to make declaratory orders unaccompanied by any other relief.
But in exceptional cases the Court of Chancery allowed the subject to sue the Crown through the Attorney General and gave declaratory judgments in favour of the subject even in cases where it could not give full effect to its declaration.
In 1852 the Court of Chancery Procedure Act was enacted and it was provided by section 50 of that Act that no suit should be open to objection on the ground that a merely declaratory decree or order was sought thereby, and it would be lawful for the court to make binding declarations of right without granting consequential relief.
By section 19 of Act VI of 1854, section 50 of the Chancery Procedure Act was transplanted to India and made applicable to the Supreme Courts.
With regard to courts other than the courts established by Charters the procedure was codified in India for the first time by the Civil Procedure Code, 275 1859, where the form of remedy under section 19 of Act VI of 1854 was incorporated as section 15 of that Act which stood as follows: "No suit shall be open to objection on the ground that a merely declaratory decree or order is sought thereby, and it shall be lawful for the civil Courts to make binding declarations of right without granting consequential relief.
" In 1862 the provisions of the Civil Procedure Code of 1859 were extended to the courts established by Charters when the Supreme Courts were abolished and the present High Courts were established.
In 1877 the Civil Procedure Code, 1859 was repealed and the Civil Procedure Code of 1877 was enacted.
The provision regarding declaratory relief was transferred to section 42 of the which was passed in the same year.
This section which is said to be a reproduction of the Scottish action of declaratory, has altered and to some extent widened the provisions of section 15 of the old Code of 1859.
It was argued on behalf of the appellants that, in the present case, the plaintiff was suing as a worshiper of the temple and that he was not suing as a person entitled to any legal character, or to any right as to any property and so the suit was barred by the provisions of section 42 of the .
Upon this argument we think that there is both principle and authority for holding that the present suit is not governed by section 42 of the .
In Fischer vs Secretary of State for India in Council, (1) Lord Macnaghten said of this section: "Now, in the first place it is at least open to doubt whether the present suit is within the purview of section 42 of the .
There can be no doubt as to the origin and purpose of that section.
It was intended to introduce the provisions of section 50 of the Chancery Procedure Act of 1852 (15 & 16 Vict.
c. 86) as interpreted by judicial decision.
Before the Act of 1852 it was not the practice of the Court in ordinary suits to make a declaration of right except as introductory to relief which it proceeded to administer.
But the present suit is one to which no objection could have been taken before the Act of 1852.
It is in substance a suit to have the true construction of a statute declared and to have an act done in contravention of the statute rightly understood pronounced void and of no effect.
That is not the sort of declaratory decree which the framers of the Act had in their mind.
" In Pratab Singh vs Bhabuti Singh,(1) the appellants sued for a declaration that a compromise of certain preemption suits and decrees passed thereunder made on their behalf when they were (1) 26 I.A. 16.
(2) 40 I.A. 182.
276 minors were not binding on them, having been obtained by fraud and in proceedings in which they were practically unrepresented.
The Subordinate Judge having decreed the suit on appeal the memo bers of the Court of the Judicial Commissioner differed upon the question whether the declaration sought should be refused as a matter of discretion under section 42 of the .
Before the Judicial Committee it was contended for the, respondent that the suit having been filed for the purpose of obtaining a declaratory decree only was bad in form inasmuch as it did not pray that the decree should be set aside; but that, assuming that it was rightly framed in asking only for a declaratory decree, the Court had a discretion as to the granting or refusing such a declaration.
The Judicial Committee observed that section 42 of the did not apply to the case and that it was not a question of exercising a discretion under that section; and they gave to the appellant a decree setting aside the decree complained of and declaring that the agreement of compromise and the decree complained of were not binding upon the appellants or either of them and that they were entitled to such rights as they had before the suit was dismissed on December 15, 1899.
It appears to us that a decree of the character which has been sought by the plaintiff in this case is not one as to which the additional powers conferred by the Act of 1852 were required I by the Court of Chancery.
The injury complained of was that the Court has, by recording the compromise in O.P. No. 3 of 1950, deprived the deity of its present title to certain trust properties.
The relieve which the plaintiff seeks is for a declaration that the compromise decree was null and void and if such a declaration is granted the deity will be restored to its present rights in the trust properties.
A declaration of this character, namely, that the compromise decree is not binding upon the deity is in itself a substantial relief and has immediate coercive effect.
A declaration of this kind was the subject matter of appeal in Fischer vs Secretary of State for India in commercil(1) and falls outside the purview of section 42 of the and will be governed by the general provisions of the Civil Procedure Code like section 9 or 0. 7, r. 7.
On behalf of the respondents reliance was placed on the decision of the Judicial Committee in Sheoparsan Singh vs Ramnandan Prasad Singh(1).
In that case, the plaintiffs had prayed for a declaration that a will, probate of which had been granted was not genuine and the Judicial Committee pointed, out that under section 42 a plaintiff has to be entitled to a legal character or to a rig It, as to property and that the plaintiffs could not predicate this of themselves as they described themselves in the plaint as entitled to the estate in case of an intestacy, whereas, as things stood, there was no intestacy, since the will had been affirmed by a Court exercising 26 I.A. Cal.
694 (P.C.) 277 appropriate jurisdiction.
The suit was, indeed, nothing more than an attempt to evade or annul the adjudication in the testamentary suit.
The suit was held to fail at the very outset because the plaintiffs were not clothed with a legal character or title which would authorise them to ask for the declaratory decree sought by their plaint.
There is no reference in this case to the previous decision of the Judicial Committee in Fischer vs Secretary of State for India in Council(1).
In our opinion, the decision of the Judicial Committee in Sheoparsan Singh vs Ramnandan Prasad Singh(1) should be explained on the ground that the will which was sought to be avoided had been affirmed by a Court exercising appropriate jurisdiction and as the propriety of that decision could not be impeached in subsequent proceedings, the plaintiffs could not sue, not being reversions.
The legal position is also well established that the worshipper of a Hindu temple is entitled, in certain circumstances, to bring a suit for declaration that the alienation of the temple properties by the de jure Shebait is invalid and not binding upon the temple.
if a Shebait has improperly alienated trust property a suit can be brought by any person interested for a declaration that such alienation is not binding upon the deity but no decree for recovery of possession can be made in such a suit unless the plaintiff in the suit has the present right to the possession.
Worshippers of temples are in the position of cestuui que trustent or beneficiaries in a spiritual sense (See Vidhyapurna Thirthaswami vs Vidhyanidhi Thirthanswami (3).
Since the worshippers do.
not exercise the deity 's power of suing to protect its own interests, they are not entitled to recover possession of the property improperly alienated by the Shebait, but they can be granted a declaratory decree that the alienation is not binding on the deity (See for example, Kalyana Venkataramana Ayyangar vs Kasturiranga Ayyangar(4) and Chidambaranatha Thambiran vs Nallasiva Mudaliar)(5).
It has also been decided by the Judicial Committee in Abdur Rahim vs Mahomed Barkat Ali(3) that a suit for a declaration that property belongs to a wakf can be maintained by Mahomedans interested in the wakf without the sanction of the Advocate General, and a declaration can be given in such a suit that the plaintiff is not bound by the compromise decree relating to wakf properties.
In our opinion, section 42 of the is not exhaustive of the cases in which a declaratory decree may be made and the courts have power to grant such a decree independently of the requirements of the section.
It follows, therefore, in the present case that the suit of the plaintiff for a declaration that the compromise decree is not binding on the deity is maintainable as falling outside the purview of section 42 of the .
(1) 20 I.A. 16.
(2) I.L.R.43 Cal.
694 (P.C) (3) I.L.R.27Mad.435, Mad. 212.
(5) I.L.R. (6) 55 I.A. 96.
278 The next question presented for determination in this case is whether the compromise decree is invalid for the reason that the Commissioner did not represent the deity.
High Court has taken the view that the Commissioner could not represent the deity because section 20 of the Hindu Religious & Charitable Endowments Act provided only that the administration of all the endowments shall be under the superintendence and control of the Commissioner.
Mr. Babula Reddy took us through all the provisions of the Act but he was not able to satisfy us that the Commissioner had authority to represent the deity in the judicial proceedings.
It is true that under section 20 of the Act the Commissioner is vested with the power of superintendence and control over the temple but that does not mean that he has authority to represent the deity. ;in proceedings before the District Judge under section 84(2) of the Act.
As a matter of law the only person who can represent the deity or who can bring a suit on behalf of the deity is the Shebait, and although a deity is a juridical person capable of holding property, it is only in an ideal sense that property is so held.
The possession, and management of the property with the right to sue in respect thereof are, in the normal course, vested in the Shebait, but where, however, the Shebait is negligent or where the Shebait himself is the guilty party against whom the deity needs relief it is open to the worshippers or other persons interested in the religious endowment to file suits for the protection of the trust properties.
It is open.
in such a case, to the deity to file a suit through some person as next, friend for recovery of possession of the property improperly alienated or for other relief.
Such a next friend may be a person who is a worshipper of the deity or as a prospective Shebait is legally interested in the endowment.
In a case where the Shebait has denied: the right of the deity to the dedicated properties, it is obviously desirable that the deity should file the suit through a disinterested next friend, nominated by the court.
The principle is clearly stated in Pramath Nath vs Pradymna Kumar.(1) That was a suit between con tending shebaits about the location of the deity, and the Judicial Committee held that the will of the idol on that question must be respected, and inasmuch as the idol was not represented otherwise than by shebaits, it ought to appear through a disinterested next friend appointed by the Court.
In , the present case no such action was taken by the District Court in O. P. No. 3 of 1950 and as there was no representation of the deity in that judicial proceeding it is manifest that the compromise decree cannot be binding upon the deity.
It was also contended by Mr. P. Rama Reddy on behalf of respondent No.: I that the compromise decree was beyond the, scope of the proceedings in O.P. No. 3 of 1950 and was, therefore, in.
valid.
In our opinion, this argument is well founded and must prevail.
The proceeding was brought under section 84(2) of the old Act (Act II of 1927) for setting aside the order of the Board dated October 5, 1949 declaring the temple of Sri Kodandaramaswami as a temple (1) I.L.R. C.) 279 defined in section 6.
17 of the Act and for a declaration that the temple was a private temple.
After the passing of the new Act, namely Madras Act 19 of 1951, there was an amendment of the original petition and the amended petition included a prayer for a further declaration that the properties in dispute are the personal properties of the petitioner 's family and not the properties of the temple.
Such a declaration was outside the purview of section 84(2) of Madras Act 11 of 1927 and could not have been granted.
We are, therefore, of the opinion that the contention of respondent No. is correct and that he is entitled to a declaratory decree that the compromise decree in O.P. No. 3 of 1950 was not valid and was not binding upon Sri Kodandaramaswami temple.
We have gone into the question of the validity of the compromise decree because both the parties to the appeal invited us to decide the question and said that there was no use in court remanding the matter to the trial court on this question and the matter will be unduly protracted.
For the reasons expressed, we hold that the decree passed by the trial court should be set aside and the plaintiff respondent No. I should be granted a declaratory decree that the compromise decree in O.P. No. 3 of 1950 on the file of the District Court Nellore is not valid and binding on Sri Kodandaramaswami temple.
Subject to this modification, we dismiss this appeal.
The parties will bear their own costs throughout.
Appeal dismissed.
| The appellants filed an original petition in the District Court under section 84(2) of the Madras Hindu Religious Endowments Act, 1927 for setting aside an order of the Endowments Board that a temple was a public temple and for a declaration that it was a private temPle.
The Commissioner of the Endowments 'Board and: a worshippewere the contesting respondents to the petition.
Pending its dispo sat the 1927 Act was repealed by the Hindu Religious and Charles ble Endowments Act of 1951.
After the passing of the new Act the petition was amended by the addition of a prayer for a further dec laration that the properties in dispute were the personal property of the appellants ' family.
Thereafter, a compromise decree between the appellants and the Commissioner wag passed.
by which it was declared that the temple was a public temple, that the properties were the personal properties of the appellants but that the appeal ants were liable to make annual payments in cash and kind to the temple for its maintenance. 'The worshipper, who was not a part, to the compromise decree, filed the present suit for a declaration that the Compromise decree was not binding on the temple.
On the questions whether: (i) the suit was not barred by the provisions of section 42 of the , and (ii) the compromise decree was invalid.
HELD: (i) Section 42 of the is not exhaustive of the cases in which a declaratory decree may be made an courts have power to grant such a decree independently of the requirements of the section.
The relief sought for in the present case ,was for a declaration that the compromise decree was null and voice Such a declaration is in itself a substantial relief and has imme diate coercive effect and the deity would be restored to its right in the trust properties.
The suit fell outside the purview of section 4 and would be governed by the general provisions of the Civil Procedure Code and was therefore maintainable even though the worshiper was not suing as a person entitled to any legal character or the any, right as to any property as required by section 42 of the .
[276 E; 277 F G] Case law referred to.
(ii) The compromise decree was not valid and binding on the, temple, because, the deity was not a party to it through any representative.
271 Though under section 20 of the 1927 Act the Commissioner was ves ted with the power of superintendence and control over the temple, it does not mean that he has authority to represent the deity in proceedings before the District Judge under section 84(2) of the Act.
Further, the compromise decree was beyond the scope of the proceedings, because, a declaration that the properties in dispute were the 'Personal. properties of the appellants ' family and not of the temple, was outside the purview of section 84(2).
[278 A B, F, H]
|
ivil Appeal No. 220 I of 1978.
From the judgment and order dated the 13th September, 1978 of the Central Govt.
, Ministry of Finance Department 'of Revenue, New Delhi in order No. 819 of 1978.
V. J. Taraporavala, J. B. Dadachanji and Shri Narain for the appellants.
N.C. Talukdar and R.N. Poddar for the Respondent.
The Judgment of the Court was delivered by BALAKRISHNA ERADI, J.
This appeal by special leave is directed against an order dated August 3, 1978 passed by the Government of India under Section 16 of the Central Excise and Salt Act, 1944 (hereinafter referred to as the Act), rejecting a Revision Petition filed by the present appellant and confirming the view taken by the Appellate Collector of Excise, Bombay, that the appellant herein is not entitled to the benefit of the exemption from duty of excise conferred by a Notification No. 4/68 CE dated January 20, 1968.
The appellant Company which has its factories at Sion East and Andheri East in Bombay is engaged in the manufacture of various process chemicals required for the Textile industry.
Amongst the process chemicals so manufactured by them are substances known as emulsifiers and wetting out agents.
These products fall within the scope of Tariff Item 15AA of the First Schedule to the Act, which reads: "Organic Surface Active Agents (other than soap); Surface Active preparations and washing preparations, whether or not containing soap.
" For use as raw material for the manufacture of the emulsifiers wetting out agents, the appellant Company had purchased a total quantity of 1,64,500 kgs.
Of organic surface active agents from another company called 'The Industrial General Products Private 624 Limited '.
The aforesaid organic surface active agents sold to the appellant by the Industrial General Products Private Limited had not been subjected to the levy of excise duty inasmuch as the said supplier Company was eligible for exemption from payment of excise duty on account of the fact that the goods were manufactured by it without the aid of power.
Emulsifiers/wetting out agents, etc.
intended for use in any industrial process were exempted from the levy of duty under Entry 15AA of the First Schedule to the Act, subject to certain conditions, by a Notification dated January 20, 1968 issued by the Government of India.
The relevant part of that Notification is in the following terms: "The Central Government has exempted the excisable goods specified in column (2) of the Table hereto annexed and falling under this Item from the whole of the duty of excise leviable thereon subject to the conditions laid down in the corresponding entries in column (3) of the said Table.
TABLE Sl.
Description Conditions No. (1) (2) (3) 1. . . 2. . . 3. . . 4.
Emulsifiers, wetting out If in respect of surface agents, softness and active agents used in the other like preparations manufacture of such intended for use in any emulsifiers, wetting out industrial process.
agents, softners and other like preparations the appropriate amount of the duty of excise or the additional duty under section 2A of the Indian Tariff Act 1934 (32 of 1934), has already been paid or where such surface active agents are purchased from the open market on or after the 20th day of January, 1968.") 625 It is common ground that the organic surface active agents A used by the appellant as raw material for the manufacture of emulsifiers/wetting out agents were purchased by it.
subsequent to the 20th day of January 1968.
The Central Excise authorities originally treated the manufactured product, namely the emulsifiers etc.
as exempt from levy of duty by virtue of the Notification dated January 20, 1968.
But, subsequently, by a notice dated August 6, 1974, issued by the Superintendent of Central Excise, Inspection Group No. 1, Bombay Division V, the appellant Company was directed to show cause why an amount of Rs. 1,21,709.57 should not be recovered from the Company by way of excise duty in respect of the period August 1973 to February 1974 on the ground that the said amount represented escaped duty in respect of the emulsifiers/ wetting out agents manufactured by the petitioner Company during the aforesaid period.
In reply to the said notice, the appellant Company objected to the said demand contending that it was entitled to the benefit of exemption from levy of duty in respect of the manufactured products under the Notification dated January 20, 1968 inasmuch as surface active agents used in the manufacture of the emulsifiers/wetting out agents had been purchased by the appellant from the open market after the 20th day of January 1968.
This contention was rejected by the concerned Assistant Collector.
He took the view that, in order to attract the exemption provided for in the aforesaid Notification, duty should actually have been paid in respect of the surface active agents used as raw material and since the appellant had purchased the raw material from a manufacturing unit which was exempt from the levy of excise duty for the reason that the manufacture was carried out by it without the aid of power, the conditions prescribed in the Notification were not fulfilled.
The said order was confirmed by the Appellate Collector of Central Excise, Bombay, before whom the matter was carried in appeal by the present appellant.
While upholding the view taken by the Assistant Collector that the benefit of the exemption granted by the Notification would be available only in cases where the raw material, namely, the surface active agents had been subjected to duty at the primary stage, the Appellate Collector went further and held that the purchase of the aforesaid raw material effected by the appellant from M/s. Industrial General Products Private Limited could not be regarded as "purchased from the open market" and that for this 626 additional reason also, the appellant was ineligible to claim the benefit of the exemption.
A Revision Petition filed by the appellant before the Government of India was rejected by the order (Exh. 'A ') dated August 3, 1978, wherein the Central Government took the view that "purchases made from a particular manufacturer, the production from whose factory is exempt from payment of duty, being manufactured without the aid of power, cannot be treated at par with purchases made from the open market".
It is against this order of the Government of India that the appellant has come up to this Court with this appeal.
The language used in Columns (2) and (3) of the Table appended to the Notification dated January 20, 1968 is simple and unambiguous.
It shows that the benefit of the exemption will be available in respect of the emulsifiers/wetting out agents provided that either of the following two conditions is fulfilled: (a) Excise duty (inclusive of additional duty under section 2A) should have been already paid in respect of the surface active agents used as raw material in the manufacture of the emulsifiers, wetting out agents, etc. (b) The surface active agents used as raw material for the manufacture of the emulsifiers/wetting out agents should have been purchased from the open market on or after the 20th day of January, 1968.
The first of the aforementioned conditions was obviously not satisfied in the present case since the surface active agents were purchased by the appellant Company from a manufacturer who was exempt from payment of excise duty on account of the fact that the process of manufacture was being carried out without the aid of power.
The appellant Company contends that the second of the aforesaid conditions, namely, that the surface active agents should have been purchased from the open market on or after the 20th day of January 1968 was fully satisfied in the present case, and hence it was entitled to the benefit of the exemption granted by the Notification, That the appellant had purchased the surface active agents used in the manufacture of the emulisifiers/wetting out agents subsequent to the 20th day of January, 1968 is undisputed.
The purchases of the raw material had been made by the appellant from 627 the Industrial General Products Private Limited.
The short question to be considered is, whether those transactions of purchase effected by the appellant from the Industrial General Products Private Limited can be regarded as purchases "from the open market"? In determining the eligibility of a person for the benefit of the exemption conferred by the Notification on the basis of the fulfillment of the second of the aforementioned conditions, it is wholly irrelevant to enquire whether duty of excise had already been paid in respect of the surface active agents purchased and utilised as raw material for the manufacture of the emulsifiers/wetting out agents.
The sole question to be examined is, whether the surface active agents used in the manufacture of the emulsifiers were purchased "from the open market" on or after the 20th day of January, 1968 ? The Assistant Collector as well as the Appellate Revisional Authorities have taken the view that the exemption granted by the Notification will get attracted only if the surface active agents used as raw material had been already subjected to levy of duty at the primary stage.
In our opinion, the said view is based on an erroneous interpretation of the provisions contained in item 4 of the Table appended to the Notification.
The condition that the duty of excise should have already been paid on the raw material (surface active agents) has no application to cases covered by the second part of Column (3) of Sl.
No. 4 of the Table, namely, cases where the surface active agents were purchased from the open market on or after the 20th day of January, 1968.
That brings us back to the question, whether the purchases effected by the appellant from M/s. Industrial General Products Private Limited were purchases "from the open market"? Having due regard to the context in which the expression "open market ' ' has been used in the Notification, it would be wholly wrong to understand the said expression "open market" as connoting only a market yard, bazar or a shopping complex where goods are offered for sale.
Industrial chemicals (which have to he ordinarily purchased in bulk for use as raw material in the manufacture of secon dary products) are not commodities that are usually exposed for sale in bazars and shops.
Such bulk purchases of chemicals etc., are effected by placing orders with the concerned manufacturing units.
In our opinion, if the transactions of sale and purchases are effected under conditions enabling every person desirous of purchasing the goods in question to place orders with such manufac 628 turing unit and obtain supplies, they will constitute purchases "from the open market".
We may in this context refer with advantage to the following observations of Swinfen Eady, J. in Inland Revenue Commissioners vs Clay(l), where the Court of appeal had to consider the scope of the expression "open market" occurring in section 25 (1) of the Finance Act, 1910 (10 Edw. 7, c. 8): "The market is to be the open market, as distinguished from an offer to a limited class only, such as the members of the family.
The market is not necessarily an auction sale.
The section means such amount as the land might be expected to realize if offered under conditions enabling every person desirous of purchasing to come in and make an offer, and if proper steps were taken to advertise the property and let all likely purchasers know that the land is in the market for sale.
" We fully agree with these observations.
In the present case, it was open to every person desirous of purchasing the surface active agents to place orders with the manufacturing Company, namely, M/s. Industrial General Products Private Limited, and obtain the supply on payment of the price at the prevailing rate.
The sales by the said Company were not to a limited class only.
Hence, the purchases of the surface active agents effected by the appellant from M/s. Industrial General Products Private Limited ' have to be treated as purchases made "from the open market.
" The denial to the appellant of the benefit of the exemption provided for by the Notification was, therefore, clearly illegal.
Accordingly, we allow this appeal, set aside the orders passed by the Government of India, the Appellate Collector, Bombay and the Assistant Collector of Central Excise, Bombay, and declare that the appellant Company is entitled to the benefit of the exemption granted by the Notification dated January 20, 1968 in respect of the emulsifiers, wetting out agents, softners etc., manufactured by the Company for use during the relevant period (August 1973 to February 1974).
The respondent shall pay costs to the appellant Company in this appeal.
N.K.A. Appeal allowed.
| The Bombay Provincial Municipal Corporations Act, 1949 came into operation in the city of Poona on 15th of February, 1950.
Section 127(2) thereof authorised the Corporation to impose octroi and other taxes, while section 149 prescribed the procedure to be allowed in levying taxes.
In the year 1957, the Corporation in order to boost industrial development and to encourage the industrialists to establish industries in the city, decided to give certain concession in the nature of exemption from octroi duty.
Pursuant to this objective the Corporation made rule 62 B in Chapter VIII to the Schedule of the said Act in 1957, which envisaged the creation of an "Industrial Estate or Area", by which was meant the area which the Corporation may from time to demarcate as the area in which industries can be suitably located in the interest of industrialisation of the city.
Under this rule no levy of octroi was to be made for a period of twelve years.
Later on, the Corporation framed extensive new octroi Rules under their resolution dated 7th of August, 1962.
Rule 5(8) of the new Rules provided for exemption in respect of levy of octroi.
The Corporation had been levying octroi on the materials received by the appellants.
The appellants sought exemption under rule S(8).
The Corporation rejected their claim for exemption of octroi on the ground that exemption can only be granted if the area within which the concern was situated was declared as industrial area and demarcated for the purpose.
Being aggrieved, the appellants filed petitions under Article 226 of tho Constitution in the High Court for the issue of a writ of Mandamus requiring the respondent Corporation to define and demarcate the area where their factories were situated as industrial area, within the meaning of rule 5(8), and to exempt them from payment of octroi.
During the pendency of these petitions rule 5(8) was repealed.
The appellants amended the writ petitions and further contended that (1) that the repeal of rule 5(8) was illegal and/or ultra vires and, therefore, rule S(8) still continues to be effective and (2) that in any event they were entitled to get the benefit of rule 62 B which had not been repealed.
The High Court repelled both the contentions and held that old rule 62B and the new rule 730 5(8) were repealed and that there was no legal flaw.
It however took the view that despite the repeal of Rule S(8) the appellant could still get the relief under rule 5(8) because if the proviso attached to the repealing rule the area in question was not demarcated as industrial estate or area for the purpose of rule S(8) and that it was solely in the discretion of the Corporation to demarcate an area as industrial estate.
It consequently dismissed the writ petitions.
In the appeals to this Court it was contended on behalf of the appellants (I) that the disputed area had been included in the development plan under the Bombay Town Planning Act, 1954 before the promulgation of rule S(8) and had thus automatically become an industrial estate or area for the purposes of that rule.
(2) The Corporation had refused to grant exemption to the appellants on the arbitrary ground that the concern of the appellants was not a new one.
(3) There had been violation of Article 14 of the Constitution in as much as some industries in similar situations have been granted exemption while the appellants have been deprived of the benefit of rule S(8) and (4) While denying the benefit of rule S(8) the Corporation had taken into consideration extraneous or irrelevant considerations.
Dismissing the appeals ^ HELD: 1 (i) No area had been declared as industrial area under the Development plan before 1957 and in fact it was only after the enforcement of the development plan on 15th of August, 1966 that the disputed area became an industrial area under the Bombay Town Planning Act.
[735 C D] (ii) A bare perusal of rule 5(8) makes it apparent that for the purpose of the exemption from octroi, an industrial estate or area means the area which the Corporation may from time to time demarcate for the purpose of the rule as the area in which industries can be suitably located for the interest of industrialisation of the City.
Therefore, the demarcation made under the Town Planning Act will not be a demarcation for the purpose of rule S(8) and unless there is a demarcation as contemplated by rule S(8) the appellants cannot claim exemption from octroi.
The view taken by the High Court is fully warranted by rule S(8) of the octroi Rules.
[735 E G] 2.
The purpose of the Town Planning Act is to plan the town and to keep industrial areas away from the residential or commercial areas and that no industries could be set up in an area other than the industrial area declared in pursuance of the Act.
The purpose of demarcation as industrial estate or area under rule S(8) is for the giving of incentive and impetus to industries in a particular area.
[736 B C] 3.
An analysis of the preamble to the new octroi Rules makes it clear that rule 62 B relating to octroi was repealed by implication.
It is noteworthy that chapter VIII does not contain any rule relating to octroi, except rule 62 B which did not find a place in the preamble.
All rules relating to octroi and enacted under the 1901 and the 1925 Acts were also repealed without exemption.
Another pointer is available in the fact that octroi was made the subject matter of a new and comprehensive set of rules which not only dealt with the matters 731 covered by the rules contained in chapter VIII and specifically mentioned in the A preamble but also the one covered by rule 62 B, namely the matter of exemption of goods from octroi in areas considered suitable for industrialisation.
The promulgation of rule 5(8) as a part of an exhaustive set of new rules, has the effect of a repeal of rule 62 B by necessary implication, although not in express terms.
[737 D G] 4.
The considerations which have weighed with the Corporation for denying the benefit of exemption from octroi to the appellants cannot be said to be either irrelevant or extraneous.
These are within the ambit of rule S(8) of the octroi Rules.
[739 B]
|
Appeals Nos. 225, 226, 228, 229 and 248 of 1955.
Appeals from the judgments and orders dated October 5, 1953, in Misc.
Judicial Cases Nos. 418/52 and 124/53 and October 8, 1953.
, in T. section No. 106/53, 565 Misc.
Judicial Cases Nos.
188/53 and 235/53 of the Patna High Court.
R. Patnaik, for the appellant (in C. A. No. 225/55).
R. C.Prasad, for the appellants (in C. As.
Nos. 226, 228, 229 & 248/55).
Mahabir Prasad, Advocate General for the State of Bihar, Tribeni Prdsad Sinha and section P. Varma, for the respondents (in C. As.
225, 226, 228 & 229/55).
Mahabir Prasad, Advocate General for the State of Bihar and section P. Varma, for the respondent (in C. A. No. 248/55).
April 15.
The Judgment of the Court was delivered by ' section K. DAS, J.
This is a batch of five appeals which have been heard together and the principal question for decision in these appeals is the constitutional validity of the Bihar Hindu Religious Trusts Act,, 1950 (Bihar I of 1951), hereinafter referred to as the Act.
Four of these appeals arise out of writ proceedings taken in the High Court of Patna on petitions made under articles 226 and 227 of the Constitution.
One of them, namely, Civil Appeal No. 228 of 1955, arises out of a suit which was originally instituted in the Court of the Subordinate Judge of Patna but was later transferred to the High Court by an order made by it tinder article 228 of the Constitution.
The Petitioners in the writ petitions and the plaintiffs in the suit challenged the constitutional validity of the Act on certain grounds to which we shall presently refer.
The petitions and the suit were contested by the State of Bihar and/or the President, Bihar State Board of Religious ,trusts, who are now respondents before us.
The High Court in three separate judgments, two dated October 5, 1953, and the third dated October 8, 1953, held that the Act was a valid piece of legislation and on that main finding dismissed the writ petitions and the suit.
The petitioners and the plaintiff ,, appellants before us, applied for and obtained certificates from the High Court under article 132 of the Constitution to the effect that the cases involved substantial ques 566 tions of law as to the interpretation of the Constitution and the appeals have been brought to this Court in pursuance of those certificates.
The facts lie within a very narrow compass.
In Civil Appeal No. 225 of 1955 the appellant is Mahant Moti Das, and he alleged that he was the Mahant of a math or astral situate in village Parbatta, district Monghyr, in Bihar, that he was a follower of the religion founded by Sri Kabir Sahib, that the properties of the asthal were treated as private properties of the mahants and that the President of the Bihar State Board of Religious Trusts constituted under the Act had no authority to serve him with a notice under section 59 of the Act, inasmuch as the Act was ultra vires and unconstitutional and, in any event, did not apply to his math or asthal.
In Civil Appeal No. 226 of 1955 the appellant Mahant Ram Das similarly alleged that he was the mahant of a math or asthal situate in village Bhuthari in the same district of Monghyr, that he was a "bairagi sadhu " and follower of Ramanandi Laskari Sri Vaishnava Sampradaya, that he was the absolute owner of the properties belonging to the math and that the President, Bihar State Board of Religious Trusts, had no authority to issue a notice to him asking him to furnish statements and accounts of the properties in his possession.
In Civil Appeal No. 228 of 1955 the appellants made similar allegations in their plaint and challenged the " vires " of the Act, mentioning as their cause of action the date on which the assent of the President of India to the Act was first published in the Bihar Gazette.
In Civil Appeal No. 229 of 1955 the appellant Mahant Mahabir Das stated that he was the Mahant of a asthal known as Bisanpur Asthal situate in the self same district.
He also received a notice from the President, Bihar State Board of Religious Trusts, to furnish statements and accounts, and he challenged the vires of the Act on similar grounds.
In Civil Appeal No. 248 of 1955 Mahant Ram Krishna Das alleged that the temple in question, known as Bhikam as Thakurbari in the town of Patba, was constructed by one Benidasji with his own money and he installed certain deities therein.
567 The allegation was that the temple and the properties thereof did not constitute a ' religious trust ' within the meaning of that expression in the Act and further that the Act was ultra vires the Constitution inasmuch as it infringed some of his fundamental rights.
The defence in all these cases was that the Act was valid, and applied to the asthals or temple in question and the properties thereof.
The principal argument presented before us on behalf of the appellants is that the Act is bad on the ground that its several provisions infringe the appellants ' fundamental rights guaranteed under (a) article 14; (b) article 19 (1)(f); and (e) articles 25, 26 and 27 of the Constitution.
The Act has also been impugned on the ground that it imposes an Unauthorised tax and also contravenes article 133 of the Constitution.
At this stage, it is necessary to advert to the object or purpose of the Act and set out the relevant provisions thereof The Act was passed by the Bihar Legislature and received the assent of the President,, which assent was published in the Bihar Gazette on February 21, 1951.
The long title of the Act and the preamble give the object of the Act.
The long title says that it is an "Act to provide for the better administration of Hindu Religious Trusts and for the protection and preservation of properties appertaining to such trusts." The preamble repeats the same object or purpose, and makes it further clear that the Act is meant to provide for the better administration of Hindu Religious Trusts in the State of Bihar.
Section I gives the short title, and provides for extent and commencement, the Act having come into force on August 15, 1951.
Section 2 is the definition section, and the word 'Hindu ' in the Act means a person professing any religion of Hindu origin and includes a Jain and a Buddhist, but does not include a Sikh.
The expressions " religious trust " and " trust property " are defined in the following way : "Section 2 (1).
I religious trust ' means any express or constructive trust created or existing for any purpose recognised by Hindu Law to be religious, pious or charitable, but shall not include a trust created 568 according to the Sikh religion or purely for the benefit of the Sikh community and a private endowment created for the worship of a family idol in which the public are not interested ; (p) I trust property ' means the property appertaining to a religious trust Section 3 states: " This Act shall apply to all religious trusts, whether created before or after the commencement of this Act, any part of the property of which is situated in the State of Bihar.
" Section 4 was amended by Bihar Act 16 of 1954, and it provides for necessary amendment or repeal, as the case may be, of certain earlier Acts dealing with public religious trusts and charitable endowments, such as, the (20 of 1863), the (6 of 1890) and the Charitable and Religious Trusts Act, 1920 (14 of 1920).
Sub section (5) of section 4 has an important bearing on one of the questions before us and must be quoted in full : "Section 4 (5).
The , and section 92 of the Code of Civil Procedure, 1908, shall not apply to any religious trust in this State, as defined in this Act." Chapter II of the Act deals with the constitution of the Board.
Section 5 provides for the constitution of the Bihar State Board of Religious Trusts.
Section 5(3) states that the Board shall be a body corporate and shall have perpetual succession and a common seal with power to acquire and hold property, both moveable and immovable.
Section 7 makes provision for the appointment of the President and the members of the first Board and their terms of office.
Section 8 contains the terms of the constitution of the second and every subsequent Board.
Chapter IV refers to the appointment and qualification of the Superintendent of the religious trusts.
The chapter further provides for the appointment of officers and servants for the Board.
Chapter V relates to the power and duties of the Board.
Section 28 (1) provides that the general superintendence of all religious trusts in the State shall be vested in the 569 Board and the Board shall do all things reasonable and necessary to ensure that such trusts are properly supervised and administered and that the income ' thereof is duly appropriated and applied to the objects of such trusts and in accordance with the purposes for which such trusts were founded and for which they exist.
Section 28 (2) enumerates in great detail the powers and duties of the Board in regard to certain matters.
Section 28(2)(e), for example, states that the duty of the Board shall be to cause inspection to be made of the property and the office of any religious trust including accounts and to authorise the Superintendent or any of its members, officers or servants for that purpose.
Section 28(2)(g) empowers the Board to give directions for the proper administration of a religious trust in accordance with the law governing such trust and the wishes of the founder in so far as such wishes can be ascertained.
Section 32 empowers the Board to settle a scheme for the proper administration of religious trusts.
Chapter VI refers to the establishment of regional trusts committees and the powers and duties imposed on such committees.
Chapter VIII refers to transfer of immovable properties and borrowing of money by trustees.
Section 44 of this chapter states that no transfer made by a trustee, of any immovable property of a religious trust by way of sale, mortgage, or lease for a term exceeding three years shall be valid unless made with the previous sanction of the Board.
Section 45 prohibits a trustee from borrowing money for the purpose of any religious trust without the previous sanction of the Board.
Chapter X relates to trustees and their duties.
Section 59 of this chapter imposes a duty on the trustee to furnish particulars of the religious trust.
Section 60 relates to the budget of religious trusts and submission of such budgets to the Board and the Board may alter or modify the budget in such manner and to such extent as it thinks fit.
Chapter Xi relates to audit of accounts and recovery of irregular expenses from the trustees in default.
Chapter XIII provides for the creation of a trust fund which is to be vested in the 72 570 Board.
Section 70 states that for the purpose of defraying the expenses incurred in the administration of the Act the trustee of every religious trust shall pay to the Board such fee, not exceeding five per centum of its net income as the Board may from time to time with the previous sanction of the State Government determine.
Chapter XVI provides for the dissolution or supersession of the Board.
Section 80 states that if in the opinion of the State Government the Board makes default in the performance of the duties imposed on it or exceeds or abuses its powers, the State Government may declare the Board to be in default and direct that the Board shall be superseded.
Section 81 provides that where an order of supersession has been passed, all the members of the Board shall vacate their offices as such members and all the powers and duties to be performed by the Board shall be performed by such person as the State Government may direct.
Section 81 empowers the State Government to make rules and section 83 empowers the Board to make bye laws not inconsistent with the Act and the rules made thereunder.
We proceed now to consider the contentions urged on behalf of the appellants.
The first contention is that the provisions in sections 2, 5, 6, 7 and 8 infringe article 14 of the Constitution.
It is pointed out that the definition of the word ' Hindu ' in section 2 does riot include Sikhs; and section 5 constitutes a Board for religious trusts other than Jain religious trusts, and also two separate Boards one for Swetambar Jain religious trusts and the other for Digambar Jain religious trusts.
It is further pointed out that under sections 6, 7 and 8 the constitution of the Board for religious trusts other than Jain religious trusts differs in material particulars from the constitution of the two Boards for Jain religious trusts.
The submission is that there is inequality of treatment as between Hindu religious trusts on one hand and Sikh religious trusts on the other, the latter having been excluded from the purview of the Act; secondly, there is inequality of treatment even as between Hindu religious trusts and Jain religious trusts, though both come under the Act.
We do not 571 think that there is any substance in this contention.
The provisions of article 14 of the Constitution had come up for discussion before this Court in a number of earlier cases (see the cases referred to in Shri Ram Krishna Dalmia vs Shri Justice section R. Tendolkar (1)).
It is, therefore, unnecessary to enter upon any lengthy discussion as to the meaning, scope and effect of the Article.
It is enough to say that it is now well settled by a series of decisions of this Court that while article 14 forbids class legislation, it does not forbid reasonable classification for the purposes of legislation, and in order to pass the test of permissible classification, two conditions must be fulfilled, namely, (1) that the classification must be founded on an intelligible differential which distinguishes persons or things that are grouped together from others left out of the group and (2) that differentia must have a rational relation to the object sought to be achieved by the statute in question.
The classification may be founded on different bases such as, geographical, or according to objects or occupations and the like.
The decisions of this Court further establish that there is a presumption in favour of the constitutionality of an enactment and the burden is upon him who attacks it to show that there has been a clear transgression of the constitutional guarantee ; that it must be presumed that the legislature understands and correctly appreciates the needs of its own people and that its laws are directed to problems made manifest by experience and that its discriminations are based on adequate grounds; and further that the legislature is free to recognise degrees of harm and may confine its restrictions to those cases where the need is deemed to be the clearest.
It is not disputed before us, and this has been pointed out by the High Court, that there are some differences between Hindus, Sikhs and Jains in some of the essential details of the faith which they profess and the religious practices they observe; the Sikhs have no caste or priests, though they have grantis who officiate at marriages and other ceremonies; they do not believe in the Vedas, Puranas or Shastras, at least not in the same (1) ; 372 way as the Hindus believe in them.
The Jains also do not recognise the divine authority of the Vedas and do not practise sradhs or ceremonies of the dead, nor do they recognise the spiritual authority of the Brahmins (Maine 's Hindu Law, 11th Edition, p. 82).
It has been further pointed out that there are also organizational differences in the matter of religious trusts between Hindus, Sikhs and Jains.
There are not many Sikh religious trusts in Bihar, and their organization is essentially different.
Jains consist of two main branches Swetambar Jains and Digambar Jains and each branch has a separate central organisation.
Section 8 of the Act recognises these differences; for example, there is an assembly ' of Swetambar Jains known as Shree Sangh and under section 8(2)(c) of, the Act the Shree Sangh is entitled to elect five per .
sons to the Board of Swetambar Jain Religious Trust.
Similarly, Digambar Jains also have an assembly known as the Digambar Samaj and under section 8(3)(c) of the Act this assembly is entitled to elect five persons to the Board for Digambar Jain Religious Trust.
In view of these differences it cannot be said that in the matter of religious trusts in the State of Bihar, Sikhs, Hindus and Jains are situated alike or that the needs of the Jains and Hindus are the same in the matter of the administration of their respective religious trusts; therefore, according to the well established principles laid down by this court with regard to legislative classification, it was open to the Bihar Legislature to exclude Sikhs who might have been in no need of protection and to distinguish between Hindus and Jains.
Therefore, the contention urged on behalf of the appellants that the several provisions of the Act contravene article 14 is devoid of any merit.
The next contention urged on behalf of the appellants is that the provisions in Chapter V, and in particular sections 28 and 32, violate the fundamental right guaranteed to the appellants under article 19(1)(f) of the Constitution, namely, their right to acquire, hold and dispose of the trust properties.
This argument before us has proceeded on the footing that the properties which the appellants bold are trust properties within 573 the meaning of the Act ; but we must state here that the appellants have also alleged that the properties are their private properties, to which aspect of the case we shall advert later.
Chapter V of the Act, and in particular section 28 thereof, lays down the powers and duties of the Board.
To some of these powers and duties we have already made a reference earlier.
Section 32 gives power to the Board, of its own motion or on application made to it in that behalf by two or more persons interested in any trust, to settle schemes for proper administration of the religious trust.
There are other sections in the chapter which give the Board power to enter into contracts and to borrow money, etc., for carrying out any of the purposes of the Act or to give effect to the provisions thereof.
Under section 58 every trustee must carry out all directions which may from time to time be issued to him by the Board under any of the provisions of the Act.
The powers given under section 28 include the power to prepare and settle the budget, to cause inspection to be made of the property and the office of any religious trust, to call for information, reports, returns, etc., to give directions for the proper administration of a religious trust in accordance with the law governing such trusts and the wishes of the founder, to remove a trustee from his office in certain circumstances, and to control and administer the trust fund, etc.
The argument before us is that the position of a maharani or shebait of a Hindu religious trust is a combination of office and proprietary right and under the provisions of the Act the mahant or shebait practically loses his right of management and is reduced to the position of a mere servant of the Board; this, it is contended, is violative of the appellants ' fundamental right under article 19(1)(f).
In Angurbala Mullick vs Debabrata Mullick (1) Mukherjea, J., delivering the majority judgment of this Court, has said that the exact legal position of a, shebait may not be capable of precise definition, but its implications are fairly well established.
It is now settled that the relation of a shebait in regard to (1) , 1133.
574 debutter property is not that of a trustee to trust property under the English law.
Mukherjea, J., said : " In English law the legal estate in the trust property vests in the trustee who holds it for the benefit of cestui que trust.
In a Hindu religious endowment on the other hand the entire ownership of the dedicated property is transferred to the deity or the institution itself as a juristic person and the shebait or mahant is a mere manager.
But though a shebait is a manager and not a trustee in the technical sense, it would not be correct to describe the shebaitship as a mere office.
The shebait has not only duties to discharge in connection with the endowment, but he has a beneficial interest in the debutter property. .
In almost all such endowments the shebait has a share in the usufruct of the debutter property which depends upon the terms of the grant or upon custom or usage.
Even where no emoluments are attached to the office of the shebait, he enjoys some sort of right or interest in the endowed property which partially at least has the character of a proprietary right.
Thus, in the conception of shebaiti both the elements of office and property, of duties and personal interest, are mixed up and blended together ; and one of the elements cannot be detached from the other.
It is the presence of this personal or beneficial interest in the endowed property which invests shebaitship with the character of proprietary rights and attaches to it the legal incidents of property.
" It is to be remembered that even before the passing of the Act here impugned, there was statutory machinery for enforcing the obligations and duties imposed Upon mahant or shebait.
Section 92 of the Code of Civil Procedure provided that in the case of an alleged breach of any express or constructive trust created for public purposes of a charitable or religious nature or where the direction of the court was deemed necessary for the administration of any such trust, the Advocate General, or two or more persons having an interest in the trust and having obtained the consent in writing of the Advocate General, might institute 575 a suit to obtain a decree (a) to remove any trustee, (b) appointing a new trustee, (c) vesting any property in a trustee, (d) directing accounts and enquiries, (e) declaring what proportion of the trust property or of the interest therein shall be allocated to any particular object of the trust, (f) authorising the whole or any part of the trust property to be let, sold, mortgaged or exchanged, (g) settling scheme and/or (h) granting such further or other relief as the nature of the case might require.
The section therefore provided an important machinery for enforcing the obligations and duties imposed on trustees and the jurisdiction given to the court was of a very wide extent.
Now, the right guaranteed under article 19(1)(f) is subject to cl.
(5), thereof, which says inter alia that nothing in sub clause (f) shall prevent the State from making any law imposing reasonable restrictions on the exercise of the right conferred by the said sub clause in the interests of the general public.
We are of the view, in agreement with that of the High Court, that the restrictions imposed by the Act on the power of the trustees are really intended, as the preamble of the Act states, for the better administration of Hindu religious trusts in the State of Bihar and for the protection and preservation of properties appertaining to such trusts.
It is indeed true that the Act provides a better and more speedy remedy for the enforcement of the obligations and duties imposed on the trustees than the lengthy and cumbrous procedure of a suit under section 92 of the Civil Procedure Code.
The Board is vested with summary powers in various matters, but the control is to be exercised for the better and more efficient administration of the trust and for the protection and preservation of the trust properties.
It is germane to refer in this connection to sub section
(1) of section 28 which states that the Board shall do all things reasonable and necessary to ensure that the religious trusts are properly supervised and administered and that the income thereof is duly appropriated and applied to the objects of such trusts and in accordance with the purposes for which such trusts were founded.
Section 576 60 (2) no doubt empowers the Board to alter or modify the budget of any religious trust in such manner and to such extent as it thinks fit ; but sub section
(6) of section 60 makes it clear that nothing contained in the section shall be deemed to autborise the Board to alter or modify any budget in a manner or to an extent inconsistent with the wishes of the founder, so far as such wishes can be ascertained, or with the provisions of the Act.
Section 28 (2) (h) gives the Board power to remove a trustee from his office in certain contingencies; but sub section
(3) of section 28 says that an order of removal passed by the Board under el.
(h) of sub section
(2) shall be communicated to the trustee concerned and such trustee may within 90 days of the communication of such order apply to the District Judge for varying, modifying or setting aside the order.
Section 28 (2) (j) empowers the Board to sanction the conversion of any property of a religious trust into another property if the Board is satisfied that such conversion is beneficial for the trust; there is, however, an important proviso that no such conversion shall be sanctioned unless the Board so resolves by a majority which includes at least three fourths of its members and the resolution is approved by the District Judge.
Even with regard to the settling of a scheme under section 32 there is a safeguard under sub section
(3) thereof, which says that the trustee or any person interested in the trust may within three months of the publication of the scheme make an application to the District Judge for varying, modifying or setting aside the scheme.
These and similar other safeguards clearly indicate Act, and we are of the view that having regard to the position of a trustee as respects the trust property which he holds and the object or purpose of the Act,the restrictions imposed are really for the purpose of carrying out the objects of the trust and for better administration, protection and preservation of the trust properties ; they are, therefore, reasonable restrictions in the interests of the general public within the meaning of el.
(5) of article 19 of the Constitution.
In 577 this respect, the impugned provisions of the Act differ from those provisions of the Madras Hindu Religious and Charitable Endowments Act, 1951, and the Orissa Hindu Religious Endowments Act, 1939, as amended by the Amending Act 11 of 1952, which came under consideration of this Court in The Commissioner, Hindu Religious Endowments, Madras vs Sri Lakshmindra Thirtha Swamiar of Shri Shirur Mutt (1) and Mahant Shri Jagannath Ramanuj Das vs The State of Orissa (2), and were held to be invalid on the ground that they were not reasonable restrictions within the meaning of el.
(5) of article 19 of the Constitution.
The third contention of the appellants rests upon articles 25 and 26 of the Constitution.
The appellants have invoked in aid article 25 (1) which says inter alia, that subject to public order, morality and health, all persons have the right freely to profess, practice and propagate religion.
Article 26 is also relied on for the contention that every religious denomination or any section thereof has a, right (a) to establish and maintain institutions for religious and charitable purposes and (b) to manage its own affairs in matters of religion.
It is difficult to see how any of the provisions of the Act can be said to interfere with the right guaranteed by article 25, viz., freedom of conscience and the right freely to profess, practice and propagate religion.
Learned counsel for the appellants has not been able to point out to us any particular provision of the Act which interferes with such a right.
On behalf of the appellants it has been submitted that the power to alter or modify the bud get relating to a religious trust or the power to give directions to a trustee may be exercised by the Board in such a way as to affect the due observance, of religious practices in a math or temple so as to constitute an encroachment on the right guaranteed under article 25, and learned counsel for the appellants had placed reliance on The Commissioner, Hindu Religious Endowments, Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutt (1), for his submission that (I) ; 73 (2) ; 578 freedom of religion in our Constitution is not confined to religious beliefs only, but extends to religious practices as well subject to the restrictions which the Constitution itself has laid down.
The answer to this submission is two fold : we have pointed out earlier that the power to alter the budget is subject to cl.
(6) of section 60 of the Act and the Board is nit authorised to alter or modify the budget in a manner or to an extent inconsistent with the wishes of the founder or with the provisions of the Act.
The power to give directions to the trustee is also subject to a similar restriction, namely, the directions must be for the proper administration of the religious trust in ' accordance with the law governing such trust and the wishes of the founder in so far as such wishes can be ascertained and are not repugnant to such law.
The keynote of all the relevant provisions of the Act is the due observance of the objects of the religious trust and not its breach or violation.
Secondly, as was observed in The Commissioner, Hindu Religious Endowments, Madras vs Shri Lakshmindra Thirtha Swamiar of Shri Shirur Mutt(1), at p. 1030, " an apprehension that the powers conferred. may be abused in individual cases does not make the provision itself bad or invalid in law ".
With regard to article 26, cls.
(a) and (b), the position is the same.
There is no provision of the Act which interferes with the right of any religious denomination or any section thereof to establish and maintain institutions for religious and charitable purposes; nor do the provisions of the Act interfere with the right of any religious denomination or any section thereof to manage its own affairs in matters of religion.
Learned counsel for the appellants has drawn our attention to Sri Venkataramana Devaru vs The State of Mysore, (2), where following the earlier decision in The Commisssioner, Hindu Religious Endowments, Madras vs Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutt (1), it was observed that matters of religion included even practices which are ,regarded; by ' the community as part of its religion.
Our attention has also been drawn (I) (2) ; 579 to Ratilal Panachand Gandhi vs The State of Bombay in which it has been held that a religious sect or denomination has the right to manage its own affairs in matters of religion and this includes the right to spend the trust property or its income for religion and for religious purposes and objects indicated by the founder of the trust or established by usage obtaining in a particular institution.
It was further held therein that to divert the trust property or funds for purposes which the charity commissioner or the court considered expedient or proper, although the original objects of the founder could still be carried out, was an unwarranted encroachment on the freedom of religious insti tutions in regard to the management of their religious affairs.
We do not think that the aforesaid decisions afford any assistance to the appellants.
Granting that matters of religion ' include practices which a religious denomination regards as part of its religion, none of the provisions of the Act interfere with such practices; nor do the provisions of the Act seek to divert the trust property or funds for purposes other than those indicated by the founder of the trust or those established by usage obtaining in a particular institution.
On the contrary, the provisions of the Act seek to implement the purposes for which the trust was created and prevent mismanagement and waste by the trustee.
In other words, the Act by its several provisions seeks to fulfill rather than defeat the trust.
In our opinion, there is no substance in the argument that the provisions of the Act contravene articles 25 and 26 of the Constitution.
Lastly, the appellants have challenged the validity of section 70 of the Act,the relevant portion of which states: expenses incurred or to be incurred in the administration of this Act, the trustee of every religious trust shall, in each financial year, pay to the Board such fee, not exceeding five per centum of its net income in the last preceding financial year, as the Board may, from time to time, with the previous sanction of the State Government, determine." (I) [1954] S.C.R. 1055.
580 The argument is that section 70 imposes an unauthorised tax.
The point is, we think, concluded by our decision in Mahant Sri Jagannath Ramanuj Das vs The State of Orissa (1) where the distinction between a tax and a fee for legislative purposes under our Constitution was pointed out and with regard to an identical imposition under section 49 of the Orissa Hindu Religious Endowments Act, 1939, it was held that the contribution levied was a fee and not a tax.
It was observed there at p. 1054: " The collections made are not merged in the general public revenue and are not appropriated in the manner laid down for appropriation of expenses for other public purposes.
They go to constitute the fund which is contemplated by section 50 of the Act.
We are further of opinion that an imposition like this cannot be said to be hit by article 27 of the Constitution.
What is forbidden by article 27 is the specific appropriation of the proceeds of any tax in payment of expenses for the promotion or maintenance of any particular religion or religious denomination.
The object of the contribution under section 49 is not the fostering or preservation of the Hindu religion or of any denomination within it; the purpose is to see that religious trusts and institutions wherever they exist are properly administered.
It is the secular administration of the religious institutions that the legislature seeks to control and the object, as enunciated in the Act, is to ensure that the endowments attached to the religious institutions are properly administered and their income is duly appropriated for purposes for which they were founded or exist.
As there is no question of favouring any particular religion or religious denomination, article 27 could not possibly apply.
" These observations apply with equal force to the present case.
It has also been argued that section 55 (2) of the Act con travenes article 133 of the Constitution and is accordingly invalid.
Section 55 is in these terms: 55 (1).
"Unless otherwise provided in this Act, an appeal shall lie to the High Court against every order passed by the District Judge under this Act.
(I) ; 581 (2) No appeal shall lie from any order passed in appeal under this section.
" We do not think that section 55 (2) of the Act overrides or is intended to override article 133 or any other Article of the Constitution relating to appeals to the Supreme Court.
Such appeals must undoubtedly lie to the Supreme Court, provided the necessary requirements for such appeals are fulfilled.
It is, we think, obvious that the Act cannot affect the jurisdiction of the Supreme Court.
We now come to that part of the case of the appellants in which they claim the properties to be their private properties or, in the alternative, the trusts to be private trusts.
The High Court has pointed out that in M. J. C. 418 of 1952 out of which has arisen Civil Appeal No. 225 of 1955, though there was an assertion that the properties were not trust properties, there was a counter affidavit on behalf of the State of Bihar that the asthal in question was a public asthal and the properties appertaining thereto trust properties within the meaning of the Act.
In M. J. C. 124 of 1953 out of which has arisen Civil Appeal No. 226 of 1955 there was a similar claim that the mahant of the asthal was the absolute owner of the properties belonging to the math.
In Suit No. 34 of 1952/106 of 1953 out of which has arisen Civil Appeal No. 228 of 1955 there was a prayer for adjournment in order to enable the plaintiffs (now ap pellants before us) to file a petition to amend the plaint, and the purpose of the amendment sought to be made was to claim that the institutions in question were of a private charater and the Act had no application to them.
This prayer was disallowed by the High Court on the ground that the amendment sought to be made would alter the whole character of the suit.
In M. J C. 188 of 1953 out of which has arisen Civil Appeal No. 229 of 1955 the claim was that there was no trust,.
express or implied.
In M. J. C. 235 of 1953 out of which has arisen Civil Appeal No. 248 of 1955 there was a counter affidavit on behalf of the State of Bihar that the temple in question was a public temple and the Act applied to it.
In all these cases the High Court has 582 taken the view, rightly in our opinion, that the questions whether the trusts are public or private trusts or the properties are private or trust properties are questions which involve investigation of complicated facts and recording of evidence and such investigation could not be done on writ proceedings.
In the one suit which was tried in the High Court the question did not arise as no amendment was allowed.
Therefore, in these cases there are no materials on which the question as to the nature of the trust can be determined, though in Civil Appeal No. 343 of 1955 (1) in which also judgment is being delivered today, we have held that having regard to the preamble to the Act, the provisions in section 3 and the provisions of sub section
(5) of section 4 the definition clause of 'religious trust ' in the Act must mean public trusts express or constructive, recognised by Hindu law to be religious, pious or charitable.
That finding, however, is of no assistance to the appellants in the present cases.
The fate of these cases must depend on the sole question whether the Act is constitutionally valid or not.
We have held that the Act is constitutionally valid.
In the result we hold that the appeals are without any merit.
They are accordingly dismissed with costs.
Appeals dismissed.
| The appellants as the Mahants of the respective maths or asthals were served with notices under section 59 of the Bihar Hindu Religious Trusts Act, 195o, by the President, Bihar State Board of Religious Trusts, asking them to furnish statements and accounts of the properties in their possession.
They challenged the constitutional validity of the Act by proceedings taken in the High Court on the grounds (1) that sections 2, 5, 6, 7 and 8 of the Act infringe article 14 Of the Constitution, inasmuch as there was inequality of treatment as between Hindu religious trusts on one hand and Sikh religious trusts on the other, the latter having been excluded from the purview of the Act, and that there was inequality of treatment even as between Hindu religious trusts and Jain religious trusts, though both came under the Act; (2) that the provisions of ch.
V of the Act and in particular sections 28 and 32 violate article 19(1)(f) of the Constitution, as under those provisions the mahant or Shebait practically loses his right of management and is reduced to the position of a mere servant of the Board; (3) that the provisions of the Act contravene articles 25 and 26 of the Constitution, as the power to alter or modify the budget relating to a religious trust or the power to give directions to a trustee may be exercised by the Board in such a way as to affect the due observance of religious practices in the math or temple; (4) that section 70 imposes an unauthorised tax, and (5) that section 55(2) contravenes article I33 of the Constitution.
Held, (1) that in view of the fact that in the matter of religious trusts in the State of Bihar, there are differences between Sikhs, Hindus and jains and that the needs of jains and Hindus are not the same in the matter of the administration of 564 their respective religious trusts, it is open to the Bihar Legislature to exclude Sikhs who might have been in no need of protection and to distinguish between Hindus and jains.
Accordingly, SS. 2, 5, 6, 7, and 8 of the Act do not infringe article 14 Of the Constitution.
It is well settled that while article 14 forbids class legislation, it does not forbid reasonable classification for the purposes of legislation, and in order to pass the test of permissible classification, two conditions must be fulfilled, namely, (1) that the classification must be founded on an intelligible differentia which distinguished persons or things that are grouped together from others left out of the group and (2) that that differentia must have a rational relation to the object sought to be achieved by the statute in question.
Shri Ram Krishna Dalmia vs Shri Justice section R. Tcndollkar, ; , relied on.
(2) that having regard to the position of a trustee in respect of the trust property which he holds and the object or purpose of the Act, the restrictions imposed in Ch.
V of the Act are really for the purpose of carrying out the objects of the trust and for the better administration, protection and preservation of the trust properties, and are reasonable restrictions in the interests of the general public within the meaning Of cl.
(5) Of article 19 of the Constitution.
(3) that the Act does not contravene articles 25 and 26 of the Constitution, as the provisions of the Act relating to the power of the Board to alter the budget and to give directions to the trustee are subject to restrictions, namely, that they must be for the proper administration of the religious trust ; and, further, none of the provisions interfere with " matters of religion " including practices which a religious denomination regards as part of its religion.
(4) that section 70 Of the Act is a valid provision as it only provides for the levy of a fee for the purpose of defraying the expenses incurred or to be incurred in the administration of the Act and is not a tax.
Mahant Sri jagannath Ramanuj Das vs The State of Orissa, ; , followed.
(5) that section 55(2) Of the Act does not contravene article I33 Of the Constitution as it does not override or is not intended to override article 133 or any other Article of the Constitution relating to appeals to the Supreme Court.
|
ivil Appeal No. 1451 of 1968.
Appeal from the judgment and decree dated March 11, 1965 of the Andhra Pradesh High Court in A.S. Nos. 93 and 169 of 1957.
Rajeshwara Rao and B. Parthasarathi, for the appellant.
D. Munikanniah and A.V.V. Nair, for the respondent.
The Judgment of the Court was delivered by Ramaswami, J.
This appeal is brought by certificate from the judgment of the High Court of Andhra Pradesh dated March 11, 1965 in A.S. Nos. 93 and 169 of 1957.
The appellant was a firm of dealers in pulses at Vijayawada.
It was sending pulses like green gram and black gram to other States viz.: Bombay, Bengal, Madras and Kerala by rail in the course of their business.
The consignments were addressed to 'self ' and the railway receipts were endorsed in favour of Banks for delivery against payments.
The purchasers obtained the railway receipts after payments and took delivery of the goods.
The total turnover of the business of the appellant for the year 1949 50 was Rs. 17,05,144 2 2.
Of the said turnover a sum of Rs. 3,61,442 7 3 represented the turnover of sales effected outside the then Madras State.
For the assessment year 1949 50 the Deputy Commercial Tax Officer collected sales tax on the total turnover without exempting the value of the sales effected outside the State.
The appellant was permitted to pay sales tax under(r. 12 of the Madras General Sales Tax (Turnover and Assessment) Rules.
The appellant submitted monthly returns and paid sales tax without claiming any such exemption till the end of January, 1950.
But in, the returns for the months of February and March, 1950 the appellant claimed exemption on sales effected outside the State.
The appellant submitted a consolidated return exhibit A 18 to the Deputy Commercial Tax Officer on March 30, 1950 claiming exemption in respect of a sum of Rs. 10,37,334 7 9 being the value of the sales effected outside the 745 State or the period commencing from April 1, 1949 and ending January 31, 1950.
The Deputy Commercial Tax Officer fixed the taxable turnover of the appellant at Rs. 17,05,14 4 2 2 and issued a notice exhibit A 23 dated October 24, 1950 to show cause why the appellant should not be assessed accordingly.
The appellant was thereafter held liable to pay tax amounting to Rs. 26,642 14 0 on a net turnover of Rs. 17,05,144 2 2.
The appellant preferred an appeal to the Commercial Tax Officer and a revision petition to the Board of Revenue, Madras but was unsuccessful.
The appellant, therefore brought a suit for the recovery of Rs. 21,270 13 0 being the amount of tax illegally collected from him together with interest, contending that the sales effected outside the State could not be taxed under article 285 (1)(a) of the Constitution of India.
The State of Madras contested the suit on the ground that the sales were taxable as they fell within the purview of explanation 2 to section 2(h) of the Madras General Sales Tax Act, 1939 hereinafter referred to.
as the Act).
The Subordinate Judge held that for the period from April 1, 1949 to January 25, 1950 the appellant was not entitled to impeach the assessment on the turnover relating to sales outside the State.
As regards the period from March 26, 1950 to March 31, 1950 the Subordinate Judge took the view that the past of the turnover relating to, outside sales was not liable to salestax but as there was a single order of assessment for the entire period the entire assessment was illegal.
Again the judgment of the Subordinate Judge both the appellant and the respondent filed appeals A.S. No. 93 of 1957 and A.S. No. 169 of 1957 to the High Court of Andhra Pradesh.
But its order dated April 18, 1960 in Appeal No. 169 of 1957 the High Court called for a finding from the trial court as to whether the appellant was able to prove the facts entitling him to invoke the explanation to article 286(1)(a).
By its order dated July 21, 1962 the trial court submitted a finding to the effect that in view of the decision of the Supreme Court in India Copper Corporation Ltd. vs The State of Bihar(1) the burden of proof was not on the appellant and that the finding will have to be given in its favour.
But by its order dated March 5, 1963 the High Court directed the Subordinate Judge to record a finding after considering the evidence adduced by the appellant as to whether the goods in question were delivered for consumption within the delivery States.
In its order dated March 22, 1963 the trial court, after considering the evidence given by the appellant 's witnesses came to the conclusion that the deliveries were not made for purposes of consumption within the delivery States only.
The High Court by a common judgment dated March 11, 1965 in A.S. No. 93 and 169 of 1957 held that the appellant could not claim the benefit under article 286(1)(a) of the Constitution in the (1) 12S.T.C. 56.
746 absence of evidence as to how the wholesalers disposed of the goods after obtaining delivery and therefore the entire turnover for the year 1949 50 would be assessable to tax.
In the result A.S. No. 169 of 1957 flied by the respondent was allowed and A.S. No. 93 of 1957 filed by the appellant was dismissed.
The Madras General Sales Tax Act, 1939 was enacted in exercise of the legislative authority conferred upon the Provincial Legislatures by Entry 48 of List II read with section 100(3) of the Government of India Act, 1935.
The explanation to section 2(h) of this Act is as follows: "Notwithstanding anything to the contrary in the Indian the sale or purchase of any goods shall be deemed, for the purpose of this Act, to have taken place in this Province, wherever the contract of sale or purchase might have been made.
(a) If the goods.
were actually in this Province at the time when the contract of sale or purchase in respect thereof was made or, (b) in case the contract was for the sale or purchase of future goods by description, then, if the goods are actually produced in this Province at any time after the contract of sale or purchase in respect thereof was made." Under Entry 48 of List II of the Government of India Act, 1935the Provincial Legislatures could tax sales by selecting some fact or circumstances which provided a territorial nexus with the taxing power of the State even if the property in the goods sold passed outside the Province or the delivery under the contract of sale took place outside the Province.
Legislation taxing sales depending solely upon the existence of a nexus, such as production or manufacture of the goods, or presence of the goods in the Province at the date of the contract of sale, between the sale and the legislating Province could competently be enacted under the Government of India Act, 1935.
[see Tata Iron & Steel Ca.
Ltd. vs The State of Bihar(1) and Poppatlal Shah vs The State of Madras ( 2 ) ].
By article 286 of the Constitution certain fetters were placed upon the legislative powers of the States as follows: "(1) No law of a State shall impose, or authorise the imposition of, a tax on the sale or purchase of goods where such sale or purchase takes place (1) ; (2) [19531 S.C.R. 677.
747 (a) outside the State; or (b) in the course of the import of the goods into, or export of the goods out of, the territory of India.
Explanation.
For the purposes of sub clause (a), a sale or purchase shall be deemed to have taken place in the State in which the goods have actually been delivered as a direct result of such sale or purchase for the purpose of consumption in that State, notwithstanding the fact that under the general law relating to sale of goods the property in the goods has by reason of such sale or purchase passed in another State.
(2) Except in so far as Parliament may by law otherwise provide, no law of a State shall impose, or authorise the imposition of, a tax on the sale or purchase of any goods where such sale or purchase takes place in the course of inter State trade or commerce; Provided that the President may by order direct that any tax on the sale or purchase of goods which was being lawfully levied by the Government of any State immediately before the commencement of this Constitution shall, notwithstanding that the imposition of such tax is contrary to the provisions of this clause, continue to be levied until the thirty first day of March, 1951.
(3) No law made by the Legislature of a State imposing, or authorising the imposition of, a tax on the sale or purchase of any such goods as have been declared by Parliament by law to be essential for the life of the community shall have effect unless it has been reserved for the consideration of the President and has received his assent." Therefore, by incorporating section 22 of the Madras Act read with article 286, notwithstanding the amplitude of the power otherwise granted by the charging section read with the.
definition of 'sale ', a cumulative fetter of triple dimension was imposed upon the taxing power of the State.
The Legislature of the Madras State could not since January 26, 1950, levy a tax on sale of goods taking place outside the State or in the course of import of the goods into, or export of the goods out of, the territory of India, or on sale of any goods where such sale took place in the course of inter State trade or commerce.
By the Explanation to article 286(1)(a) which is incorporated by section 22 of the Madras Act a sate is deemed to take place in the State in which the goods are actually delivered as a. direct result of such sale for the purpose 748 of consumption in that State even though under the law relating to sale of goods the property in the goods has by reason of such sale passed in another State.
In the State of Bombay and Anr.
vs The United Motors (India) Ltd.(1) it was held that since the enactment of article 286(1)(a) a sale described in the Explanation which may for convenience be called an "Explanation sale" is taxable by that State alone in which the goods sold are actually delivered as a direct result of sale for the purpose of consumption in that State.
With a view to impose restrictions on the taxing power of the States under the pre Constitution statutes, amendments were made in those statutes by the Adaptation of Laws Order.
As regards the Madras Act the President issued on July 8, 1952 the Fourth Amendment inserting a new section, section 22 in that Act.
It runs as follows: "Nothing contained in this Act shall be deemed to impose or authorise the imposition of a tax on the sale or purchase of any goods where such sale or purchase takes place (a) (i) outside the State of Madras, or (ii) in the course of import of the goods into the territory of India or of the export of the goods out of such territory, or (b) except in so far as Parliament may by law otherwise provide, after the 31st March., 1951, in the course of inter State trade or commerce, and the provisions of this Act shall be read and construed accordingly.
Explanation : For the purposes of cl.
(a)(i) a sale or purchase shall be deemed to have taken place in the State in which the goods have actually been delivered as a direct result of such sale or purchase for the purpose of consumption in that State, notwithstanding the fact that under the general law relating to sale of goods the property in the goods has by reason of such sale or purchase passed in another State.
" By this amendment the same restrictions were engrafted on the pre Constitution statute as were imposed by article 286 of the Constitution upon post Constitution statutes.
As regards the sales for the period from April, 1949 to January 25, 1950 it was admitted before the Deputy Commercial (1) ; 749 Tax Officer that the goods were actually in the Madras State at the time the contract of sale was concluded.
It was for this reason that the Deputy Commercial Tax Officer negatived the claim which the appellant made in respect of those sales.
It appears that in the trial court the appellant challenged the constitutional validity of explanation to section 2(h) of the Act.
But in view of the decision of this Court in the Tata Iron & Steel Co 's case(1) and Poppatlal Shah 's case(2) counsel on behalf of the appellant did not seriously dispute the validity of the assessment in regard to sales from April 1, 1949 to January 25, 1950.
With regard to the period from January 26, 1950 to March 31, 1950 the contention of the appellant ' is that the High Court was in error in holding that the burden of proof was on the appellant to show that there was not only delivery of goods for consumption within the delivery States but there was actual consumption of the goods in those States.
In our opinion the argument is well founded and must be accepted as correct.
In India Copper Corporation 's case(3) it was pointed out by this Court that if the goods were as a direct result Of a sale delivered outside the State of Bihar for the purpose of consumption in the State of first delivery, the assessee would be entitled to the exemption from sales tax by virtue of the Explanation to Art 286(1)(a) of the Constitution and it would not be necessary for the assessee to prove further that the goods so delivered were actually consumed in the State of first destination.
In the present case the Subordinate Judge has, upon a consideration of the evidence adduced by the parties stated in his report dated June 27, 1962 that the intention of the appellant was that the sale and delivery should be for the purpose of consumption in the delivery States.
It is true that in his subsequent report dated March 22, 1963 the Subordinate Judge gave a different finding.
But it is obvious that the subsequent report of the Subordinate Judge is vitiated because the principle laid down by this Court in India Copper Corporation 's case(3) has not been taken into account.
Having regard to the evidence adduced by the appellant in this case we are satisfied that the part of the turnover which related to sale from 2, January 26, 1950 to March 31, 1950 was not liable to sales tax and the levy of sales tax from the appellant to this extent is illegal.
The next question arising in this appeal is whether the assessment order of the Deputy Commercial Tax Officer for the year 1949 50 is illegal in its entirety notwithstanding the fact that the State Government had a right to levy sales tax on outside sales (1) ; (2) ; (3) 12 S.T.C. 56. 750 which were effected prior to January 26, 1950.
It was argued for the appellant that the assessment must be treated as one and indivisible and if a part of the assessment is illegal the entire assessment must be deemed to be infected and treated as invalid.
In support of this argument reference was made to the decision of this Court in Ram Narain Sons Ltd. vs Assistant Commissioner of Sales Tax(1) in which this Court observed as follows: "The necessity for doing so; is, however, obviated by reason of the fact that the assessment is one composite whole relating to.
the pre Constitution as well as the post Constitution periods and is invalid in toto.
There is authority for the proposition that when an assessment consists of a single undivided sum in respect of the totality of the property treated as assessable, the wrongful inclusion in it of certain items of property which by virtue of a provision of law were expressly exempted from taxation renders the assessment invalid in toto." The Court cited with approval a passage from the judgment of the Judicial Committee in Bennett & White (Calgary) Ltd.and Municipal District of Sugar City No. 5(2).
"When an assessment is not for an entire sum, but for separate sums, dissected and earmarked each of them to a separate assessable item, a Court can sever the items and cut out one or more along with the sum attributed to it, while affirming the residue.
But where the assessment consists of a single undivided sum in respect of the totality of property treated as assessable, and when one component (not dismissible as 'de minimis ') as on any view not assessable and wrongly included, it would seem clear that such a procedure is barred, and the assessment is bad wholly.
That matter is covered by authority.
In Montreal Light, Heat & Power Consolidated vs City of Westmount(3) the Court (see especially per Anglin, C.J) in these conditions held that an assessment which was bad in part was infected throughout, and treated it as invalid.
Here their Lordshis are of opinion, by parity of reasoning, that the assessment was invalid in toto.
" Applaying the principle to the special facts are circumstances of the case the Court set aside the orders of assessment and directed that the case should be remanded to the Assessment Officer for reassessment of the appellants in accordance with law.
The same principle was applied but with a different result in the later case (1) 6 S.T.C. 627 at 637.
(2) at p. 816.
(3) 751 the State of Jammu & Kashmir vs Caltex (India) Ltd. (1) in which the question arose as regards the validity of an assessment of sales tax of all retails sales of motor spirit.
The Petrol Taxation Officer assessed the respondent to pay sales tax for the period January 1955 to May, 1959 under section 3 of the Jammu & Kashmir Motor Spirit (Taxation of Sales) Act, 2005.
The respondent applied under section 103 of the Constitution of Jammu & Kashmir and a single Judge of the High Court held that the respondent was liable to pay sales tax only in respect of the sales which took place during the period January to September, 1955 and issued a writ restrainig the appellants from levying tax for the period October, 1955 to May, 1959.
On appeal a Division Bench of the High Court quashed the assessment for the entire period.
On appeal to this Court it was held that though there was one order of assessment for the period January 1, 1955 to May 1959 the assessment could be split up and dissected and the items of sale could be separated and taxed for different periods.
It was pointed out that the sales tax was imposed in the ultimate analysis on receipts from individual sales or purchases of goods effected during the entire period, and, therefore, a writ of mandamus could.
be issued directing the appellant not to realise sales tax with regard to transactions of sale during the period from September 7, 1955 to May, 1959.
A similar question arose for determination in an American case [Frank Rattarman vs Western Union Telegraph Co.(2)].
The question in that case was "whether a single tax, assessed under the Revised Statutes of Ohio, section 2778, upon the receipts of a telegraph company which receipts were derived partly from inter state commerce and partly from commerce ' within the State but which were returned and assessed in gross and without separation or apportionment, is wholly invalid, or invalid only in the proportion and to the extent that the said receipts were derived ,from interstate commerce".
It was held unanimously by the Supreme Court of the United States that the assessment was not wholly invalid but it was invalid only in proportion to the extent that such receipts were derived from interstate commerce.
It was observed that where the subjects of taxation can be separated so that that which arises from interstate commerce can be distinguished from that which arises from commerce wholly within the State, the Court will act upon this distinction, and will restrain the tax on interstate commerce.
while permitting the State to collect that upon commerce wholly within its own territory.
The principle of this case has been consistetly followed in American cases: [see Bowman vs Continental Company(3)].
This case has been cited with approval by this Court in The State of Bombay (1) 17 S.T,C. 612.
(2) ; (3) C.I./69 4 752 vs The United Motors (India) Ltd.(1) wherein it was observed that the same principle should be applied in dealing with taxing statutes in this country also.
In the present case we are of opinion that though there is a single order of assessment for the period from April 1, 1949 to March 31, 1950 the assessment could be split up and dissected and the items of sale separated and taxed for different periods.
It is quite easy in this case to ascertain the turnover of the appellant for the pre Constitution and post Constitution periods for these figures are furnished in the plaint by the appellant himself.
It is open to the Court in these circumstances to sever the illegal part of the assessment and give a declaration with regard to that part alone instead of declaring the entire assessment void.
For these reasons we hold that the appellant should be granted a declaration that the order of assessment made by the Deputy Commercial Tax Officer for the year 1949 50 is invalid to the extent that the levy of sales tax is made on sales relating to.
goods which were delivered for the purpose of consumption outside the State for the period from January 26, 1950 to March 31, 1950.
The result is that the appellant is entitled to a refund of the amount illegally collected from him for the period from January 26, 1950 to March 31, 1950.
The trial court has already found that the appellant is entitled to claim exemption with regard to.
turnover for this period to the extent of Rs. 3,34,107 15 6 and the tax payable on this sum is Rs. 5,220 7 0.
The appellant is.
therefore, entitled to a decree for the refund of Rs. 5,220 7 0.
The appellant is also entitled to interest at 6% per annum from the date of suit till realisation of this amount.
For these reasons we allow this appeal and set aside the judgment of the Andhra Pradesh High Court dated March 11, 1965 in A.S. Nos. 93 and 169 of 1957 and allow this appeal to the extent indicated above.
There will be no order with regard to costs.
R.K.P.S. Appeal allowed.
(1) ; at 1097.
| The first respondent entered into an agreement to sell his properties to the appellant.
Disputes relating to completion of the sale were referred to arbitration.
An award was made directing the first respondent to execute the documents in respect of the transfer by him within one month from the date of the receipt of the confirmation or approval according to law, failing which the appellant was at liberty to get it executed and registered through court.
The award was made a rule of the court on November 30, 1949 and a decree on the basis of the award was granted.
The first respondent left India 'for Pakistan so.me date after November 22, 1969.
The appellant moved the Deputy Custodian of Evacuee Property for confirmation of the transfer under section 38 of the Administration of Evacuee Property Ordinance, 1949 or under section 40 of the .
The Deputy Custodian accorded confirmation, but the Additional Custodian set aside the order of the Deputy Custodian.
The appellant filed an application for execution of the decree on the 'basis of the award to which objections were filed by the Custodian.
The District Judge held that on the date of the decree transfer of properties could not be effected unless confirmed by the Custodian, The appellant 's appeal to the High Court was dismissed.
In appeal to this Court, it was contended that there could be No. bar to.
the execution of the decree based on the award, since the respondent 's properties were never declared to be evacuee properties either under Central Ordinance 27 of 1949 or Central Act 31 of 1951 and that they did not vest in the Custodian unless they were so declared after appropriate proceedings.
Dismissing the appeal, HELD: Under the provisions of section 38(1) of Central Ordinance 27 of 1949 and section 40(1) of Central Act 31 of 1951, transfer of property was ineffective unless confirmed by the Custodian even if a person became an evacuee after the date of transfer.
It was not necessary that the property should have been declared or notified to be evacuee property before those provisions were attracted.
[800 D] In the present case the respondent had become an evacuee within the meaning of section 2(d) of the Ordinance and the Act.
The Additional Custodian declined to confirm the transfer made by the respondent and therefore the condition precedent for a valid transfer remained unsatisfied.
Further, even according to the award the confirmation or approval of the Custodian had to be obtained before the transfer of documents were to be executed and completed in accordance with law.
It was incumbent on the 797 appellant to obtain the confirmation order before he could ask for any further steps to be taken by the courts in the matter of execution and registration of the transfer deed.
[800 H]
|
minal Appeal No. 48 of 1958.
Appeal by special leave from the judgment and order dated July 4, 1956, of the Calcutta High Court, 321 in Criminal Revision No. 1005 of 1955 arising out of the judgment and order dated July 21, 1955, of the Additional Sessions Judge, Asansol, in Criminal Appeal No. 125 of 1955.
H. J. Umrigar and Sukumar Ghose, for the appellants.
section M. Bose, Advocate General for the State of West Bengal, A. C. Mitra, D. N. Mukherjee and P. K. Bose, for the respondent.
B. Sen, P. K. Chakravarty and B. N. Ghosh, for the interveners.
November 25.
The Judgment of the Court was delivered by SARKAR J.
There are five appellants before us.
Four of them were employees of a company called the Indian Iron & Steel Co., Ltd. and the fifth an outsider.
The appellants were convicted by a Magistrate of Asansol in West Bengal, of an offence under section 27 of the , hereinafter referred to as the Act, for having instigated and incited others to take 'art in an illegal strike.
Each appellant was sentenced to simple imprisonment for three months.
On appeal by the appellants, the learned Additional Sessions Judge of Asansol, confirmed the order of the learned Magistrate.
A petition to the High Court at Calcutta against the order of the learned Additional Sessions Judge by way of revision also failed.
The appellants have now appealed to this Court with special leave.
The respondent to this appeal is the State of West Bengal and the Company has been allowed to intervene.
The Company owns a factory at Burnpur near Asansol in which there is a Sheet Mill.
The factory was declared by the Government to be a public utility service.
There was a slow down strike in the Hot Mill section of the Sheet Mill.
The Company thereupon issued charge sheets to some of its workers, including the four appellants in its employment, for taking part in the slow down strike and instigating others to join it as also for other misconduct and 322 after an enquiry, dismissed these four appellants from service.
On such dismissal the slow down strike gained in strength.
Thereupon, on April 8, 1953, the Company issued a notice to the workers of the Hot Mill the relevant portion of which is set out below: "The workers of the Hot Mills (Sheet Mills) are hereby notified that unless they voluntarily record their willingness to operate the plant to its normal capacity they will be considered to be no longer employed by the Company, after which the Company will recruit other labour to man the Plant.
The workers must record their willingness before Friday, 10th April, 2 0 p.m., otherwise action as stated above will be taken.
" As a result of this notice forty workers of the Hot Mill recorded their willingness but the rest, who were about three hundred in number, did not make any response at all.
In fact, on April 11, 1953, the workers in the entire Sheet Mill numbering about one thousand and three hundred, went on a sit down strike which lasted till April 20, 1953.
On April 25, 1953, the Company issued another notice to the workers which is set out below: " In accordance with General Manager 's Notice dated the 8th April, 1953, you have been considered to be no longer employed by the Company after 2 p.m. on Friday, 10th April, 1953, as you did not record your willingness before that date and time to operate the Plant to its normal capacity.
Your formal discharge from Company 's service bad been kept pending in order to assure to the fullest that no one who wanted to work normally, was being discharged on circumstantial assumptions.
Now, however, there are no further reasons to believe that every one concerned has not all necessary information about the facts of the case and every opportunity to form a correct and legitimate opinion on the utterly irresponsible attitude adopted by some of the workers.
A copy of the notice dated the 22nd April, 1953, issued by the Directorate of Labour, Government of 323 West Bengal, which has already been widely circulated, is attached herewith, in English with translations in Bengali, Hindi and Urdu.
You are, therefore, hereby given a final Notice that if by 11 a.m. on 28th April, 1953, you do not record your willingness to operath the Plant to its normal capacity, your name will be removed from the Company 's Roll and your discharge will become fully effective with all the implications of a discharge on grounds of serious breach of discipline. ' and your place will be filled by promotion from amongst the existing men or by engaging new men." After this notice the workers of the entire factory, except those engaged in essential services, went on a strike on April 27,1953, which lasted for twenty two hours.
On May 19, 1953, the Company filed a complaint under section 27 of the Act with the sanction of the Government granted on May 2, 1953.
Out of this complaint the present appeal arises.
The respondent 's case is that the strikes of April 11, to April 20, 1953, and April 27, 1953, were illegal and the appellants had instigated them.
The appellants have not in this Court challenged the finding of the Courts below that the strikes took place and that they had instigated them, but they contend that the strikes were not illegal.
Section 27 of the Act provides that a person who instigates or incites others to take part in, or otherwise acts in furtherance of a strike, which is illegal under the Act, commits an offence.
The respondent 's case is that the strikes were illegal under section 24(1) of the Act which provides that a strike or a lock out shall be illegal if it is commenced or declared in contravention of section 22.
There is no dispute that the strikes were in contravention of section 22.
The appellants rely on section 24(3) of the Act under which a strike declared in consequence of an illegal lock out shall not be deemed to be illegal and say that the strikes had been in consequence of an illegal lock out by the Company of the three hundred workers of the Hot 324 Mill by the notices of April 8, and April 25.
It is clear that if there was such a lock out, it was illegal under section 24(1) for it would be clearly in contravention of section 22.
The question then is, was there a lock out by the Company? The learned Advocate for the appellants first contends that the notices use the same words as are used in the definition of a lock out in section 2(1) of the Act and therefore by those notices the Company locked out the men.
We think that this argument is unfounded.
The definition so far as is material reads, " lock out means the refusal by an employer to continue to employ any number of persons employ ed by him.
" In the notices the words are " considered to be no longer employed " while the definition uses the words " refusal by the employer to continue to employ." Therefore, the words are not the same.
Furthermore, the words used in the notices and in the definition have to be read in their respective contexts.
For reasons to appear later, the words used in the notices meant a discharge of the employees from service while the words used in the definition do not contemplate such a discharge of the workmen.
The Courts below have come to the finding that by these notices the three hundred workers of the Hot Mill were discharged on April 10, 1953, and had not been locked out.
The learned Advocate for the appellants says that in this the Courts were wrong.
He puts his arguments in two ways.
First, he says that the notices did not effect a discharge till April 28, 1953, and they had in the meantime resulted in a lockout of the workers from April 10, 1953, in the sense that their services had not been terminated but they had not been allowed to attend to their duties.
Then he says that even if the notices effected a discharge, then also there was a lock out, for a discharge is equally a lock out within the meaning of its definition in the Act as the prevention by an employer of the workers from attending to their duties without discharging them, is.
Did the notices then effect a discharge ? We agree with the Courts below that they did.
The learned 325 Advocate for the appellants contends that the two notices taken together make it perfectly clear that there was no discharge of any employee prior to 11 a. m. of April 28, 1953.
He says that the notice of April 25, shows that the notice of April 8, did not effect any discharge, for, the first mentioned notice ,jays that the formal discharge had been kept pending and it also required the workers to record their willingness to operate the plant to its normal capacity by 11 a. m. on April 28, and further stated that failing this their names would be removed from the Company 's roll and their discharge would become fully effective.
We are unable to read the notices in the way suggested.
The notice of April 8, clearly stated that unless the workers notified their willingness to operate the plant to its normal capacity by 2 p. m. on April 10, they would be considered to be no longer in the employment of the Company.
It plainly meant that on their failure to record the willingness by the time mentioned, the workers would cease to be in the employment of the Company, that is, in other words, discharged.
Taken by itself, we do not think it is capable of any other meaning.
We are also unable to agree that there is anything in the notice of April 25, which would show that a different meaning ought to be put on the words used in the notice of April 8, than they normally bear.
The later notice also states that the workers bad been considered to be no longer employed from April 10.
Hence it maintains that the workers had been discharged on April 10.
It no doubt says that the formal discharge had been kept pending but that only means, as is clear from the last paragraph of the notice, that the names of the workers had not been removed from the Company 's roll.
The word "formal" must have its due meaning; it emphasises that the real discharge had already taken place.
We may also state that it has not been contended before us that there can be no discharge till a worker 's name is removed from the roll and, without more, we do not think that we would have accepted that contention if made.
The removal of the name of a worker from the roll follows his discharge and that is 42 326 what was meant by the statement in the notice " that the formal discharge had been kept pending.
" The circumstances which led to the issuing of the notice of April 25 also show that the workers had actually been discharged on April 10.
What had happened was that the Labour Minister of the Government of West Bengal had intervened in the dispute between the Company and its workers.
He met the workers and on April 21, 1953, that is, after the termination of the first of the two strikes, suggested certain terms for the settlement of the dispute.
His suggestion was that " if the workers of the Hot Mills, who stand discharged from 2 p.m. of April 10, 1953, as a consequence of their disregarding the notice issued on 8th April, 1953, report themselves for duty immediately and record their willingness to operate the plant to its normal capacity, the Government would recommend their reinstatement to the Management.
" A copy of this suggestion was forwarded to the Company by the Government with a request to implement the recommendations contained in it with a further request to give the suggestion a wide publicity.
The company circulated the Labour Minister 's suggestion among the workers and to comply with his request to implement it, it issued the notice of April 25, to which a copy of the suggestion was attached.
It is, therefore, clear that all that the Company intended to do by the notice of April 25, was to comply with the Government 's suggestion and so to cancel the discharge of the workers of the Hot Mill which had already taken effect and reinstate them in their former employments if the workers carried out their part of the suggestion.
This notice, therefore, does not support the contention that the workers had not been discharged till April 28, 1953.
We may also state that there is no evidence that prior to 2 p.m. of April 10, 1953, any employee had been prevented by the Company from attending to his duty.
The next question is whether a discharge of employees by an employer amounts to a lock out.
It is said that the words used in the definition of a lock out, 327 namely, "the refusal by an employer to continue to employ any number of persons employed by him ' cover the discharge of employees by an employer.
The contention so raised was rejected by the Labour Appellate Tribunal in Presidency Jute Mills.
Co. Ltd. vs Presidency Jute Mills Co. Employees Union (1).
We are in entire agreement with the view there expressed.
It seems to us that to construe the definition as including a discharge would be against the entire tenor of the Act and also against the meaning of a lock out as understood in industrial relations.
By virtue of section 22 of the Act, in a public utility ,service no worker can go on strike nor can an employer lock out his workmen without giving notice of strike or of lock out within six weeks before the strike or lock out as the case may be or within fourteen days of such notice or before the date fixed in such notice or during the pendency of any conciliation proceedings before a conciliation officer and seven days after the conclusion thereof.
Section 23 prohibits strikes and lock outs in other industrial establishments during the pendency of conciliation proceedings before a Board and for seven days thereafter.
Section 24(1) makes a strike and a lock out in contravention of sections 10, 22 and 23, illegal.
Section 24(2) provides that a strike declared in consequence of an illegal lock out and a lock out declared in consequence of an illegal strike shall not be illegal.
Section 25 prohibits the spending of money on illegal strikes and lock outs.
The Act therefore treats strikes and lock outs on the same basis; it treats one as the counterpart of the other.
A strike is a weapon of the workers while a lock out that of the employer.
A strike does not, of course, contemplate the severance of the relation of employer and employed; it would be strange in these circumstances if a lock out did so.
Under the provisions of section 22, a lock out cannot be declared in a public utility service immediately; it can be declared only after the date fixed in the notice and cannot be declared within fourteen days of the giving of the notice.
Now, if a discharge is included in a (1) 328 lock out, an employer in such a service cannot discharge his employee, except after the time specified.
Now, that would often make it impossible for the employer to carry on his business.
It is conceivable that an employee may be guilty of such misconduct that his immediate discharge is essential.
Indeed.
, there is no reason to think that such cases would be very infrequent.
In such a case if an employer is prevented on pain of being made criminally liable under section 27 from discharging the employee forthwith, irreparable mischief may be caused to his works or serious personal injury to himself or his other employees.
We have no reason to think that the Act intended such a result.
Again, if a lock out included a discharge, then there would be a conflict between sections 22 and 23 on the one hand and section 33 on the other.
As has already been stated, sections 22 and 23 prohibit a lock out of workers during the pendency of the conciliation proceedings, therein mentioned, and seven days thereafter.
According to the interpretation suggested by the learned Advocate for the appellants, during this time no worker could at all be discharged for a lock out includes a discharge, it being remembered that the prohibition in the section is absolute.
Under section 33 however, an employer is prohibited during the pendency of a conciliation proceeding, from discharging a workman concerned in the dispute for any misconduct connected with such dispute save with the express permission of the authority before whom the proceeding is pending.
So if a lock out includes a discharge, under sections 22 and 23 there can be no discharge during the conciliation proceedings while under section 33 there could be one with the permission of the authority conducting the proceeding.
If a discharge amounted to a lock out, an absurd result would thus be produced.
By an amendment made on October 2, 1953, certain provisions have been introduced into the Act which would show clearly that a lock out as defined in section 2(1), which section has been left unaltered by the amendment, was never intended to include a discharge of 329 workmen.
We refer first to section 2(oo) by which a new definition was introduced in the Act which, so far as is necessary for the present purpose, is in these words: Retrenchment means the termination by the employer of the service of a workman for any reason whatsoever otherwise than as a punishment inflicted bY way of disciplinary action.
If lock out includes a discharge, then retrenchment as defined in section 2(oo) would also clearly be a lock out.
Obviously, if that were so, then retrenchment would not have been separately defined.
Again, tinder section 25F, also introduced into the Act by the amendment, a workman may be retrenched by paying him wages for a month, the compensation provided, and on notice to the Government.
If retrenchment was a form of lockout, then there would clearly be a con flict between sections 22 and 23 on the one hand and section 25F on the other.
Section 2(oo) and section 25F were, no doubt, not in the Act at the date of the notices with which we are concerned, but since section 2(1) was not amended it must be taken that its meaning remained after the amendment what it was before.
Since the amendment made it clear that section 2(1) did not include a retrenchment, it follows that that definition did not include a retrenchment prior to the amendment.
If it did not then include a retrenchment, neither could it include a discharge, for, plainly, a retrenchment is but one form of discharge.
It, therefore, seems to us that the words " refusal by an employer to continue to employ any number of persons employed by him " in section 2(1) do not include the discharge of an employee.
We feel no difficulty in taking this view, for it does not seem to us that the words "refusal to continue to employ" in section 2(1) plainly include a discharge.
These words have to be read with the rest of the definition and also the word lock out.
The other parts of the definition contemplate no severance of the relation of employer and employed.
The word " lock out ", as stated in the Presidency Jute Mills Co 's case (1), in its dictionary sense means refusal on the part of an employer to furnish work to his operatives except on conditions to (1) 330 be accepted by the latter collectively.
Therefore, inour opinion, the rules of interpretation do not prevent us from giving to the words used in the definition the meaning " a refusal by the employer to allow any number of persons employed by him to attend to their duties without effecting a termination of service as was done in the Presidency Jute Mills Co 's case (1), which would avoid one part of the Act coming in conflict with another.
The last point raised is about the propriety of the sanction.
Section 34(1) of the Act provides, No court shall take cognisance of any offence punishable under this Act save on complaint made by or under the authority of the ap.
propriate Government.
The learned Advocate for the appellants relying on Gokalchand Dwarkadas Morarka vs The King (2), where a provision somewhat similar to section 34(1) was considered by the Judicial Committee, contended that the sanction granted in the present case by the Government of the West Bengal to file the complaint against the appellants was bad as it had been granted without reference to the facts constituting the offence.
It is true that the sanction does not on the face of it refer to the facts constituting the offence.
There is, however, ample evidence in this case, which we did not understand the learned Advocate for the appellants to challenge and which clearly establishes that the entire facts connected with the offence had been placed before the sanctioning authority and the sanction had been granted on a consideration of them.
The Judicial committee in the case above mentioned itself observed that the sanction would be good if it was proved by evidence that it had been granted after all the necessary facts had been placed before the sanctioning authority though these facts might not have been stated on the face of the sanction itself.
It therefore seems to us that the sanction in the present case is unobjectionable.
We feel, therefore, that the appeal must fail.
We think it right however in the circumstances of this case and in view of the long lapse of time since the (1) (1948) L.R. 75 I.A. 30.
331 case started, to modify the sentence passed.
In our view, a sentence of simple imprisonment for the period already served and a fine of Rs. 100 with simple imprisonment for a period of fifteen days in default of payment of the fine for each appellant will be sufficient in this case and we order accordingly.
Subject to this modification of the sentence, this appeal is dismissed.
Appeal dismissed.
| C, who was the Karta of the Hindu undivided family con sisting of his wife, three sons and himself, was a partner in six managing agency firms in six Mills, and the income received by him as partner 'was being assessed as that of the Hindu undivided family for the purposes of income tax.
On December 31, 1945, C, acting for his three minor sons and himself, and his wife entered into an oral agreement for a partial partition, with effect from January 1, 1946, by which C gave a certain share to his daughter in the managing agency commission from two of the six managing agencies held by the family and the balance together with the share* in the other managing agencies was divided into five equal shares between C, his wife and sons.
The agreement was subsequently recorded in a document dated September II, 1946, which recited, inter alia: " By this partition we decided that whatever commission fell due till 31 12 45 and which is received after 31 12 45 should be kept joint and in respect of the commission which accrues from 1 1 46 and received after that date each of us become absolute owner of his one fifth share and therefore from the date, i.e., from 1 1 46 these commissions cease to be the joint property of our family.
" For the assessment years 1947 48 and 1948 49, C claimed that the income from the managing agency firms should no longer be treated as the income of the Hindu undivided family but as the separate income of the divided members, but the Income tax authorities rejected the claim on the grounds that by the document in question the division was of the income and not of the assets from which the income was 297 derived and since income tax was payable at the moment of time when income accrued, this income must be taken to have accrued to the Hindu undivided family: Held, that inasmuch as there was no other effective mode of partitioning this asset and further in view of the finding that the partition was not a pretence, the asset must be treated as divided for purposes of income tax law and the income was not assessable as the income of the Hindu undivided family.
|
Civil Appeal No. 1512 of 1971.
Appeal by Special Leave from the Judgment and order dated the 8th/9th December, 1970 of the Gujarat High Court in Sales Tax Reference No. 3/70.
section T. Desai and M. N. Shroff for the Appellant.
V. section Desai, Vimal Dave and Miss Kailash Mehta, for the Respondent.
The Judgment of the Court was delivered by GOSWAMI, J.
This is an appeal by special leave against the Judgment of the Gujarat High Court dated 8th/9th December, 1970.
The respondent (hereinafter to be described as the assessee) entered into a contract with the Public Works Department of the Government of Gujarat on September 6, 1965 for manufacture and supply of kiln burnt bricks to the said Department for the construction of the Capital Project, Ghandhinagar.
Large quantities of bricks were manufactured and supplied under the contract and the applicant received payment for the same in accordance with the agreed rates.
The assessee made an application under section 52 of the Bombay Sales lax Act, 1959, on November 19, 1967, to the Deputy Commissioner of Sales Tax, to determine the question whether the said supplies of bricks by the assessee to the Public Works Department were sales or works contract.
The Deputy Commissioner held the supplied of bricks by the assessee as sales.
The assessee then appealed to the Tribunal against that order.
The Tribunal following the ratio of the decision of this Court in Chandra Bhan Gosain vs The State of orissa and others(1) came to the conclusion that the supplies of bricks were sales.
At the instance of the assessee, the Tribunal referred the following question of law to the High Court: "Whether on the facts and in the circumstances of the case the transaction envisaged by the contract entered into by the applicant with the Public Works Department of the Govern (1) 14 S.T.C. 766: 119641 2 S.C.R. 879.
160 ment of Gujarat on 6th September 1965 for the manufacture and supply of kiln burnt bricks to the said Department and the supply of bricks to the said Department in terms of their running Bill No. XI dated 28th October 1967 is a sale or a works contract ? The High Court answered the question in favour of the assessee holding that the transaction was a works contract.
In coming to that conclusion the High Court hold as follows: In our opinion the decision of the Supreme Court in Chandra Bhan Gosai 's case (supra) is clearly distinguishable on facts.
The contract in that case though prima facie word cd as regards the relevant clauses in similar fashion as the contract in the instant case is in fact cast in a different mould and it would be difficult to hold in the light of the special features and characteristics of the contract with which we are concerned that the decision of the Supreme Court in that case would completely govern the facts of this case.
" Mr. section T. Desai, the learned counsel for the appellant submits that the present case is squarely governed by the decision in Chandra Bhan Gosain 's case (supra) and the High Court is wrong in holding to the contrary.
Mr. V. section Desai learned counsel appearing on behalf of the assesee, on the other hand submits that the High Court is right in distinguishing the present case in view of certain distinguishing features of the contract With which we are concerned.
It is well settled that whether a particular transaction is a contract of sale or works contract depends upon the true construction of all the terms and conditions of the document when there is one.
The question will depend upon the intention of the parties executing the contract.
As we have observed ill our judgment in State of Gujarat vs Variety Body Builders(1) which we have just delivered there is no standard formula by which one can distinguish a contract of Sale from contract for work and labour.
The question is not always easy and has for all time vexed jurists all over.
The distinction between a contract of sale of goods and a contract for work and labour is often a fine one.
A contract of sale is contract whose main object is the transfer of the property in and the delivery of the possession of a chattel as a chattel to the buyer.
(Halsbury 's Laws of England Third Edition Volume 34 page 6.) The contract with which we are concerned in this appeal is found in a tender for the supply of materials containing a memorandum of the conditions.
The nature of work is described as manufacturing and supplying kiln burn bricks for construction of Gandhinagar .
The question will depend upon the true construction of the tender which on acceptance is treated here as the contract containing all the terms and conditions agreed upon between the two parties.
In the tender the assessee stated I/We chairman Sabarmati Rati Udyog Sahakari Mandi (1) 161 Ltd., the undersigned do hereby tender for the supply of the materials described in the Schedule attached herewith subject to the conditions annexed.
The schedule described materials as bricks and also stated quantities to be delivered", and "rate at which to be supplied".
The tender is described as "Supply of Materials Tender".
Although the above nomenclature, by itself, is not decisive, we find that the same is justified by the principal terms governing the contract to which we will presently refer. ` "Clause 6:The contractor shall give notice to the Executive Engineer or his Assistant of his intention of making delivery of materials and on the materials being approved, receipt shall be granted to him by the Executive Engineer or by his Assistant and no materials which is not so approved shall be considered to have been delivered.
Clause7: on the completion of the delivery of materials, the contractor shall be furnished with a certificate to that effect, but the delivery shall not be considered to be complete until the contractor shall have removed all rejected materials, and shall have the approved materials, stacked or placed in such position as may be pointed out to him.
Clause 8: The materials to be supplied shall be of the best quality and in strict accordance with the specification and the contractor shall receive payment for such materials only as are approved and passed by the Executive Engineer or his Assistant .
Should the Executive Engineer consider that any of the materials delivered are not of the best quality are not in strict accordance with the specification but that they may be accepted and made use of it shall be within his full discretion to accept the same at such reduced rates as he may fix thereon.
Clause 9: In the event of the material being considered by the officer in the charge OF the work to be inferior to that described in the specifications, the contractor shall on demand in writing, forthwith to remove the same at his own cost and in the event of his failure to do so, within such period as may be named by the Executive Engineer or his Assistant, the said officer may have such reject ed material removed at the contractor 's risk and expense, the expense so incurred being deducted from any sums due or which may become due to the contractor.
13 833 Sup.
C1/76 162 Clause 11: The contractor shall supply at his own expense all tools, plants and implements required for the due fulfilment of his contract, and the materials shall remain at his risk till the date of final deli very, except such portion as shall have been in the meantime removed for use by the Executive Engineer or his Assistant.
Clause 13:This contract shall not be sublet without the written permission of the Executive Engineer.
In the event of the contractor subletting his contract without such permission he shall be considered to have thereby committed a breach of the contract and shall forfeit his security deposit, and shall have no claim for any compensation for any loss that may accrue on account of the collection of the materials or engagements entered into.
Clause 16:No guarantee can be given that the total number of quantities of material indicated in the Schedule of the contract will be ordered during the period of the contract.
But, the Executive Engineer shall purchase from the contractor all such materials as are detailed in the Schedule which he may require to purchase during the period of the contract.
Clause 17:No claim or claims made by the contractor for increased rates on the grounds that the market or other rates included in the contract, have risen during the period of his contract, will be recognized that is to say, the contractor is bound to complete the work and or to supply materials at the rates mentioned in the contract.
Clause 22:ALL rates quoted by the contractors arc inclusive of sales tax and the contractor will pay the same himself, Clause24: The contractor hereby declares that the articles sold to the buyer under this contract shall be of the best quality (and workmanship) and shall be strictly in accordance with the specifications and particulars contained in the Schedule and accompaniments hereof and the contractor hereby guarantees that the said articles would continue to conform to the description and quality aforesaid for the period shown in the Schedule from the data of delivery of the said articles to the purchaser and that notwithstanding that fact that 163 the purchaser may have inspected and approved, the said articles if during the aforesaid period stated in the Schedule the said articles be discovered not to conform to the description and quality aforesaid or have deteriorated and the decision of the purchaser in that behalf shall be final and conclusive.
The purchaser will be entitled to reject the said articles on such portion thereof as may be discovered not to conform to the said description and quality on such rejection the articles will be at the sellers ' risk and all the provisions herein contained relating to rejection of goods, etc.
shall apply.
The cont tractor shall if so called upon to do, replace the articles etc.
Or such portion thereof as is rejected by the purchaser otherwise the contractor shall pay to the purchaser such damages as may arise by any of the breach of the condition herein contained, nothing herein contained shall prejudice any other right of the purchaser in that behalf under this contract or otherwise.
" Amongst some of the general conditions of the contract, we find the following: "Clause3: All the necessary arrangements of raw materials, equipment water, coal, labour etc.
required for supply and manufacture of bricks shall have to be made by the contractor at his own cost.
The Government shall give only land for excavating soil for manufacture of bricks to the contractors free of rent from the land reserved by the.
Government for this purpose.
The land shall have to be handed over back to the Government after the manufacturing of the brick work is completed.
* * * * Clause 10:The contractor shall have no right to sell these bricks, brick bats, chharas or any other mate rials manufactured on this site to any other private parties.
If, however, it is found that the materials have been sold by him to private parties or other bodies, he shall have to pay to Department at the rate of 10% of the value of materials at the tender rates.
" While giving the specifications Item No. l herein refers to "manufacturing and supplying of 1 Class kiln burnt bricks of standard size including stacking in regular consignments etc.
as directed".
164 Mr. V. section Desai brings to our notice the common as well as the distinguishing features of this case and of Chandra Bhan Gosain 's case (supra).
According to him the common features are the following: The land was given free for manufacture of bricks in both the cases.
The materials shall remain at the contractor`s risk till the date of final delivery.
in Chandra Bhan Gosain`s case (supra) the contractor could not sell the bricks to third parties without previous permission of the company .
Here also the contractor has no right to sell the bricks etc.
but if he does sell he will have.
to pay 10 percent of the value of the materials at the tender rates.
Both the Clauses are, therefore, permissive Clauses and are substantially the same.
In both the contracts the contracting parties have used the words such as sell, purchase, deliver or rate of supply etc.
in the contract.
In Chandra Bhan Gosain`s case (supra) dealing;, with those very common features this Court observed as follows: "lt may be presumed that it was understood that in quoting his rate for the bricks, the appellant would take into account the free supply of earth for making the bricks.
Again what was supplied to the company by the appellant was not the earth which he got from it but bricks, which, we think, are something entirely different.
It could not have been in intended that the property in the earth would continue in The company in spite of its conversion into such a different thing as bricks.
Further we find that the contract provided that the bricks would remain at the appellant`s risk till delivery to the company.
Now, obviously bricks could not remain at the appellants risk unless they were his property.
Another Clause provided that the appellant would not be able to sell the bricks to other parties without the permission of the company.
Apparently, it was contemplated that without such a provision the appellant could have sold the bricks to others.
Now he could not sell the bricks at all unless they belonged to him.
Then we find that in the tender which the appellant submitted and the acceptance of which made the contract, he stated, "I/we hereby tender for the supply to the Hindus than Steel Private Ltd.
Of the materials described in the undermentioned memorandum.
The memorandum described the materials as bricks, and also stated the 'quantities to be delivered ' and the 'rate at which materials are to be supplied '.
All these provisions plainly show that the contract was for sale of bricks.
If it were so, the property in the bricks must have been in the appellant and passed from him to the subject matter.
From the above extract, it is clear.
that the decision in Chandra Bhan Gosain 's case (supra) will govern the present case where terms and conditions are almost identical so far as relating to the relevant subject matter.
165 Mr. Desai, however, took pains to point out certain distinguishing features of the present case such as maintenance of qualified Executive Engineer for supervision of work subject to removal at the instance of the Government; restriction on employment of children under 12 years; labour welfare provisions regarding wages; workmen 's compensation, etc.; provisions in relation to prevention of cruelty to animals; non payment of royalty for excavating earth; use of tube wells standing on the Government site manner of execution of the work regarding moulding and drying and provision against subletting which shall constitute a breach of the contract resulting in forfeiture of security deposit.
All the above terms relate to a stage in the process of proper and efficient manufacturing of bricks and are not inconsistent in a contract of sale.
These terms do not appear to impinge on the character of the contract as one for sale of the bricks manufactured.
The Government in its overall interest and anxiety for general welfare could insist on compliance with certain beneficial legal measures.
It could also insist on certain terms which will ensure efficient production of the material.
Provision against subletting when the land was given free by Government is also understandable.
All the above features do not negate the concept of a contract of sale of the bricks that are ultimately manufactured.
The true test in this case is whether in making the contract to brick produced was transferred as a chattel for consideration and we are clearly of opinion that this has taken place in this case.
The property in the bricks was entirely of the assessee.
He had not only to manufacture that but also to stack them for facilitating delivery.
The essence of the contract was, therefore.
the delivery of the bricks after manufacture.
The present case cannot be distinguished from the decision of the Chandra Bhan Gosain`s case (supra).
We are, therefore, clearly of opinion that the contract in this case is a contract of sale and not a works contract.
The assessee is, therefore liable to sales tax.
The question is answered accordingly.
The High Court was not right in answering the question in favour of the assessee.
The decision of the High Court is set aside.
The appeal is allowed with costs.
S.R. Appeal allowed.
| The assessee made a full disclosure of his income and claimed expenses incurred for the maintenance of his immature rubber plantations as deductions.
The Agricultural Income Tax Officer, after considering the matter, allowed such deductions as he thought proper.
The appellant Commissioner, in exercise of his revisional powers under section 34, Kerala Agricultural Income Tax Act, 1950, issued notice to the respondent (widow of the assessee) proposing to revise the assessment on the ground that the deductions allowed were excessive.
The appellant, after considering the respondent 's objections, held that the deductions allowed were excessive and remanded the matter to the Agricultural Income Tax Officer for fresh disposal according to law.
At the instance of the respondent, the question whether the appellant had jurisdiction to pass the order under section 34 was referred to the High Court, and the High Court, on the view that it was a case of re opening escaped assessment held, relying on Maharajadhiraj Sir Kameshwar Singh vs State of Bihar, , that the power of revision vested in the Commissioner under section 34 could not be invoked for the purpose of assessing income that had escaped assessment, and that such income could be assessed only by resorting to the procedure prescribed by section 35.
within the time limit prescribed therein.
Allowing the appeal to this Court, ^ HELD:(1) Every case of under assessment is not a case of escaped assessment.
The Agricultural Income Tax Officer may have committed an error in allowing the deductions to the extent he did, but he did so after applying his mind to the claims.
This is not a case where the officer omitted to assess any item of income disclosed in the assessee 's return as in the case relied on by the High Court and as in kamal Singh vs C.I.T.
Therefore, it is not a case of reopening escaped assessment.
[662F H] Deputy Commissioner of Agricultural Income tax and Sales Tax, Quilon and another vs Dhanalakshmi Vils Cashew Co., (1969) 24 S.T.C. 491, followed.
(2) Since it is not a case of escaped assessment, the appellant had jurisdiction to make the order under section 34.
[663B]
|
vil Appeal Nos.
1016 25 of 1988.
From the Judgment and Order dated 19.
1. 1987 of the Customs Excise and Gold (Control) Appellate Tribunal, New Delhi in Appeal Nos.
CD(SB) (T) 1776, 1777, 1797 to 1799, 1800, 1911, 2263, 2264 and 2265 of 1986 D in Order Nos.
68 to 77 of 1987 D. Kuldip Singh, Additional Solicitor General, Pramod Swarup and Mrs. Sushma Suri for the Appellant.
V Lakshmi Kumaran, Madhava Rao, V. Krishnamurthy, K. Karanjawala, Mrs. M. Karanjawala and Ms. Indu Malhotra for the Respondents.
The Judgment of the Court was delivered by PG NO 372 SABYASACHI MUKHARJI, J.
These appeals under section 130E of the (hereinafter called 'the Act ') arise from the decision of the Customs, Excise and Gold (Control) Appellate Tribunal, New Delhi [hereinafter called 'CEGAT ').
Section 130E(b) permits appeal to this Court from any order of the said Tribunal relating, among other things, to the date mansion of any question having a relation to the rate of duty of customs or to the value of goods for purposes of assessment.
The appeals are at the instance of the revenue authorities, namely, the Collector of Customs, Bombay.
The respondent No. l/importer is a company of small scale sector in Punjab and manufactures various kinds of yarns.
It is stated that on 19th May, 1984, the respondent No. 1 imported consignment of wool materials valued at Rs.3,75,079 and claimed the benefits under Notification No. 240/76 cus.
The respondent also claimed that the wool materials were wool waste, hence, the goods in question were not liable to customs duty.
It is stated that on 6th November, 1984, an Expert Committees, comprised of Deputy Chief Chemist, AssisTant Collector and Senior Scientific Officer was set up for the examination of the goods in question.
The Expert Committee,: after examination opined that the wool goods were other than wool waste, hence, the goods were liable to duty of customs.
On or about 2nd January, 1985, the department issued a notice to the respondents calling upon them to show cause as to why action under section Ill(d) & {m) and section 112 of the and section 3 of the import and Export Central) Act, 1942 should not be taken against them.
The respondents submitted the reply to the notice.
The Additional Collector of Customs examined the whole case and adjudicated on 19th March, 1986 and the respondents were charged with the violation of the import Control Regulations.
The Additional Collector of Customs held that the classification of the goods should be under the heading 53.01/05 and also found the import to be unauthorised.
Accordingly, the goods in question were confiscated but he gave option to the respondents to redeem the goods on payment of Rs.90,000 as fine.
The respondent No. l/importer preferred an appeal to the Appellate Tribunal, New Delhi, against the order of the Assistant Collector.
Bombay, and the Appellate Tribunal, New Delhi, after going through the provisions of the Act and the notification allowed the appeal and set aside the order of the Additional Collector on 19th January 1987.
The question involved in these appeals before the CEGAT and the question involved herein in these appeals is, whether these goods are wool wastes and, as such, entitled to the benefit of exemption under the aforesaid notification.
As it is apparent from the Tribunal 's order, PG NO 373 the assessee or the dealer contends that these are wool wastes.
The consignments were examined on percentage basis.
On examination, it was found, however, that these items contained long length of slivers/tops etc.
A thorough examination of these consignments was, therefore, ordered to verify the actual description of the goods.
A technical panel was constituted for the purpose consisting of the Deputy Chief Chemist, Bombay, as Chairman, the Assistant Collector of Customs and a Senior Scientific Officer of the Office of the Textile Committee as the members.
Based on the panel 's findings, show cause notices were issued to the importers that the goods appeared to be other than wool wastes, there were long lengths of slivers/tops or deliberately broken tops which could be easily joined at the end to prepare them ready for spinning.
The importers were charged with the violation of the Import Control Regulations and asked to explain why action should not be taken under sections 111(d) and (m) of the Act.
and also why the goods should not be charged to duty under heading 53.01 and now 53.01/05(1) of the Customs Tariff Schedule read with Customs Notification No. 154 Cus dated 4th July, 1979 at the rate of 40% + auxiliary duty at 10% + additional duty of customs at Rs.9.375 per kg.
under item No. 43 of the Central Excise Tariff Schedule read with the relevant notification.
As mentioned hereinbefore: adjudication proceedings were held by the Additional Collector of Customs.
Bombay.
In the said adjudication proceeding the members of the technical panel were cross examined by counsel.
The Additional Collector held that the goods were not wool waste but processed woollen products other than Wool tops/raw wool and were classifiable under heading 53.01/05 [1].
In other words, he found that since the goods were found to be not wool wastes, the licenses produced for wool waste were not acceptable and, therefore.
the imports were unauthorised.
Accordingly, the confiscation of the goods were ordered but option to redeem the goods on payment of fine was permitted.
This order as mentioned hereinbefore was challenged before the CEGAT.
The Tribunal noted the history of the case and addressed itself to the points at issue. 'the question before the Tribunal was whether the goods were wool waste or processed woollen products other than wool tops/raw wool.
The revenue 's case was that the goods could not be treated as wool wastes.
lt may be reiterated that the goads were held to be not entitled to duty exemption under the relevant customs notificAtion in issue.
The Tribunal went into the details of the report of the export panel.
That report recognised that it was not possible to give opinion by visual observations of the material and that there was no PG NO 374 specification laid down for the same by the I.S.I. or International Standard Organisations.
The Tribunal noted that the question would have to be understood on the basis of trade understanding.
We are of the opinion that when no statutory definition is provided in respect of an item in the or the Central Excises Act, the trade understanding, meaning thereby the understanding in the opinion of those who deal with the goods in question is the safest guide.
See Union of India vs Delhi Cloth & General Mills, [ 1963] Suppl 1 SCR 586; South Bihar Sugar Mills Ltd. etc.
vs Union of lndia & Ors.
; , ; Dunlop lndia Ltd. vs Union of lndia and Ors., [l976} 2 SCR 98; in re: Colgate Palmolive (India) Pvt. Ltd., [l979} ELT 567; Commissioner of Sales tax, U.P. vs M/s.
S.N. Bros, Kanpur; , and also the famous observations of Justice Cameron in His Majesty The King vs Planters Nut and Chocolate Co. Ltd., {1951} CLR (Ex) 122.
Dealing with the transactions in question, the Tribunal noted that the goods in the present case, had been indented and supplied as wool wastes.
Attention of the Tribunal was also drawn to the explanatory notes to the Customs Cooperative Counsel Nomenclature (for short C.C.C.N.) which stated at page 738 that wool waste could be of different types arising at different stages on processing of wool and in spinning of wool, that Iap .and silver ends could comprise wool waste, that these could be carded or combed wool waste and that wool wastes might be used for spinning.
The Tribunal noted that nowhere had it been laid down that wool wastes comprising of pieces of sliver should not exceed 3 meters in length or that it should be packed in gunny bags and not in machine pressed bales.
Some reliance was placed on a letter dated 5th July, 1981 from S.C.S. India Pvt. Ltd. to Deluxe Spinning Agency, Bombay that lap and sliver (broken pieces) could comprise wool waste.
Wool tops would have lengths ranging from 250 to 1166 meters.
But in the peasant case, the material was about 4 meters only.
Some reliance was also placed on two letters to L.W.S. from the Principal Scientific Officer, Punjab Test House, Ludhiana, regarding the definition of wool tops and soft waste which was set out in the order of the Tribunal.
It is not necessary for our present purpose to set out the definition in extenso.
But this definition of materials disproved the revenue 's contention that pieces of sliver, as in this case, of 4 or 5 meters length were directly spinnable and were not wool wastes.
There was cross examination of the Deputy Chief Chemist and that cross examination also does not support the revenue 's case.
lt is true that the Additional Collector of Customs, Bombay by his order dated 19th March, 1986 had PG NO 375 rejected the defence put forth by the dealer and held that the goods were not wool wastes but were "processed woollen products other than wool tops/raw wool" and were classifiable under heading 53.01/05(1) of the Customs Tariff Schedule.
But the question is whether he was right in so doing.
It appears that the goods varied in length from 4 meters and above.
It also appears that the goods were found by the Committee to be cut pieces of slivers which were parallely laid, homogeneous and of even thickness and that these were nothing but cut pieces of wool tops, which could be considered to have arisen during the process of manufacture of yarn from wool tops in order to quality as soft waste viz. small cut ends of wool tops/slivers.
It may be relevant in this connection to refer to the Board 's Tariff Advice which suggested that wool wastes may consist of free fibres and clippings, cuttings etc.
These should~d not consist of long lengths of yarn or of rovings or slivers.
The Tribunal was of the view that rovings, slivers/tops of short lengths or ends alone could be considered as wool wastes.
The wool contents of the present disputed consignments are more than 98% or completely wool and it is not mixed with any other wastes.
The lengths of samples were not less than 3 meters but ranged between 3 to 30 meters or even more.
lt was, therefore, urged that these could not be treated appropriately as wool wastes.
The Tribunal, however, noted that the experts produced by the importers are said to have based their views on their experience, no literature or evidence regarding accepted trade practice with regard to any technical literature has been produced.
The experts had no occasion to see the goods in dispute.
lt appeared before the Tribunal when the consignment was examined for the first time, the customs staff reported that the goads could be considered as wool wastes.
The expert panel 's report was not unanimous. 'The report did not say that the subject goods were the result of deliberate cutting of slivers.
lt said that the fibres were of varying, different lengths.
But the majority report considered that the goods were not wastes apparently on the basis of the length of the fibres being above 3 meters.
The term "wool waste" could cover slivers provided these were not deliberately cut and were not of uniform length.
The evidence produced in support of the contention that slivers upto, and even more than ~5 meters in length could be considered as wastes was, without justification, ignored.
The Tribunal noted all these.
lt is clear that the goods comprised fibres of uniform~ length, the result of deliberate cutting.
That was the basis on which the Additional Collector proceeded but there was no evidence to that effect.
After taking ail these factors and sub mission into consideration, the Tribunal came to the conclusion that PG NO 376 these are classed as "wool waste".
The propriety and the validity of this finding are under challenge.
Learned Additional Solicitor General appearing for the appellant contended that the Tribunal has ignored vital material and relevant factors.
He submitted that Technical Committee 's report about the expression wool waste", CCCN 's observations and the Board 's Tariff Advice had been ignored.
We are unable to accept this criticism advanced on behalf of the revenue.
The short question involved before the Tribunal and the validity of which is under challenge in these appeals is, whether the goods in question are wool wastes or not.
If these are then these are entitled to exemption under the relevant notification and if these are not wool wastes, these are not entitled to exemption.
The expression "wool wastes" is not defined in the relevant Act or in the notification.
This expression is not an expression of article It may be understood as in most of financial measures where the expression are not defined not in a technical or any preconceived basis but on the basis of trade understanding of those who deal with these goods as mentioned hereinbefore.
The Tribunal proceeded on that basis.
The Tribunal has not ignored the Technical Committee 's observations.
We have noted in brief the Tribunal 's handling of that report.
The tribunal has neither ignored the observation of CCCN nor the Board 's Tariff Advice.
These observations have been examined in the light of the facts and circumstances of the case.
One of the basic factual disputes was long length of sliver tops.
Having regard to the long length, we find that the Tribunal was not in error.
Whether a particular item and the particular goods in this case are wool wastes.
should be so considered or not is primarily and essentially a essentially a question of fact The decision on such a question of fact must be arrived at without ignoring the material and relevant facts and bearing in mind the correct legal principles.
Judged by these yardsticks the finding of the Tribunal in this case is unassailable.
We are, however, of the view that if a fact finding authority comes to a conclusion within the above parameters honestly and bona fide, the fact that another authority be it the Supreme Court or the High Court may have a different perspective of that question, in our opinion, is no ground to, interfere with that finding in an appeal from such a finding.
In the new scheme of things, the Tribunals have been entrusted with the authority and the jurisdiction to decide the questions involving determination of the rate of duty of excise or of the value of goods for purposes of assessment.
An appeal has PG NO 377 been provided to this Court to over see that the subordinate Tribunals act within the law.
Merely because another view might be possible by a competent Court of law is no ground for interference under section l30E of the Act though in relation to the rate of duty of customs or to the value ot goods for purposes of assessment, the amplitude of appeal is unlimited.
But because the jurisdiction is unlimited, there is inherent limitation imposed in such appeals.
The Tribunal has not deviated from the path of correct principle and has considered all the relevant factors.
If the Tribunal has acted bona fide with the natural justice by a speaking order, in our opinion, even if superior Court feels that another view is possible, that is no ground for substitution of that view in exercise of power under the clause (b) of section l30E of the Act.
In the facts and in the circumstances, in our opinion, the Tribunal has acted within jurisdiction.
The Tribunal has taken all relevant and material facts into consideration.
The Tribunal has not ignored any relevant and material facts.
The Tribunal has not applied any wrong principles of law.
Therefore, the decision of the Tribunal is unassailable even in the appeal before this Court.
In the premises, the appeals preferred herein are rejected.
No order as to costs.
R.S.S. Appeals dismissed.
| A seat in the P.G. course in M.D. in the G.N. Medical College, Gwalior, fell vacant due to the death of a student.
The appellant, Dr. Sanjay Pradhan, staked a claim to this seat under rule 10 of the Madhya Pradesh Selection for Post Graduation Courses (Clinical, Para clinical and Non clinical Courses) in Medical Colleges of Madhya Pradesh Rules, 1984.
Inasmuch as the vacancy arose towards the end of the academic year, the authorities took no steps to fill it up.
The appellant 's writ petition was dismissed By the M.P. High Court.
The High Court construed the words 'filled up in that year ' in r. 10 as meaning that a vacancy in any particular academic year must be filed up in that year.
One seat in the P.G. Course in M.S., which was occupied by Dr. Smt.
Dhurupkar, was transferred from Medical College, Jabalpur, to Medical College, Bhopal, with a view to accommodate her.
The appellant, Dr. Sanjay Kumar, moved the authorities seeking admission against that seat contending that the seat had become available in terms of r. 10.
The authorities disallowed his claim.
His writ petition was dismissed by the High Court in limine holding that the seat occupied by Dr. Smt.
Dhurupkar had been transferred with her and hence the seat, in fact, was not available.
It was submitted before this Court that the High Court has consistently been taking a view that it has the power as well as the duty to issue an appropriate writ, direction or order for the 'backlog ' of seats to be filled up whenever it finds that the authorities have acted in violation of the norms prescribed by the relevant rules and a deserving candidate has been wrongly denied admission to such a professional course of studies.
PG NO 281 PG NO 282 Dismissing the appeals, it was, HELD: (1) Rule 10 must be interpreted by the written text.
If the precise words used are plain and un ambiguous, the Court is bound to construe them in their ordinary sense and give them full effect.
The argument of inconvenience and hardship is a dangerous one and is only admissible in construction where the meaning of the statute is obscure and there are alternative methods of construction.
Where the language is explicit its consequences are for parliament, and not for the Courts, to consider.
[287C D] (2) On a plain construction, rule 10 stipulates that if a seat falls vacant for any reason, and due to inaction on the part of the authorities the seat is not filled up in the academic year to which it pertains, there is no question of the vacancy being carried forward to the next academic year.
[288A B] (3) Normally, the question of a seat being filled up must arise at the commencement of the academic year or soon thereafter.
When a seat falls vacant in any particular academic year there is a corresponding duty cast on the authorities to take immediate steps to fill up the same.
There is no question of a right of admission to a seat falling vacant in the midst of or towards the end of, the academic year.
[288C] (4) it is conceded by learned counsel appearing for the State Government that there is no provision which empowered the State Government to transfer a seat in the M.S. course in MD/MS reserved for a medical college to another medical college.
It must therefore follow that the High Court was obviously wrong in holding that the seat occupied by Dr. Smt.
Dhurupkar had been transferred with her when the seat was, in fact, available.
[285C D] (5) On the construction placed on r. 10 of the Rules, the appellants are not entitled to any relief.
Obviously, the seat that became vacant in the academic year 1986 87 cannot now be filed in terms of section 10.
[295B] (6) It is impressed upon the State Government the desirability of taking immediate steps under rule 10 of the Rules to fill up the vacancy in the P.G. Course in MD/MS or the Diploma course of studies in a particular discipline, the moment the seat in that discipline is available in any particular academic year.
[295C D] PG NO 283 (7) The State Government should ensure that the authorities charged with the duty of granting admission to students under rule 10 of the Rules act with due promptitude, and should not by their lethargy or inaction deprive or otherwise meritorious candidate admission to such a higher course of studies to which he was otherwise entitled.
Perhaps, the solution lies in making a suitable provision in the Rules providing for a reasonable period, say fifteen days, within which the authorities ought to exercise their power under rule 10 of the Rules, failing which the seat available would be deemed to have been filled by the candidate placed first in the waiting list strictly according to merit.
[295D E] King Emperor vs Bensari Lal Sarma, LR (1945) 72 IA 57; Dr. Mrs. Urmilla Shukla vs State of M.P., Misc.
Petition No. 297/83 decided by M.P. High Court on 17.4.84; Rekha Saxena vs State of M.P., [l985] MPLJ 142; Dr. Sunil Gajendragadkar vs State of M.P. (Misc.
Petition No. 57/85 decided by M.P. High Court on 11.3.85.
|
ivil Appeal No. 1248 of 1978.
From the Judgment and Order dated 9.3.1977 of the Madras High Court in T.C. Petition No. 362 of 1975.
B.B. Ahuja and Ms. A. Subhashini for the Appellant.
A.T.M. Sampath and P.N. Ramalingam for the Respondent.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, CJ.
This is an appeal by special leave from the judgment and order of the Madras High Court dated 9th March, 1977.
The appeal involves the assessment of income tax under the Income Tax Act, 1961 (hereinafter referred to as 'the Act ') for the assessment year 1966 67.
The assessee is an individual who carried on business in distribution of films for the assessment year 1966 67.
The assessee filed a return of income on 12th July, 1968 declar ing "No loss".
Subsequently, the assessee filed a revised return on 4th January, 1969 declaring a net loss of Rs.9,490.
The Income Tax Officer called for wealth state ments from the assessee The wealth statements did not reveal that the assessee had invested any amount in the plot of land in T. Nagar.
However, a raid made in the premises of E.V. Saroja and K.R. Sadayappan revealed the information that the assessee along with Smt.
P.S.S. Ekammai Achi and A.L.N. Perianna Chettiar had purchased a plot of land in T. Nagar on 13.4.1965 from Smt.
K.V. Saroja.
The plot was purchased in the name of the assessee 's son Sri Ramakrish nan.
In the assessment, it was stated that the total consid eration was Rs.80,000 out of which Rs.25,000 was the payment in respect of the portion purchased in the name of Sri Ramakrishnan.
The examination of all the materials including the document revealed that the total 258 consideration was Rs. 1,40,000.
The on money payment made by the assessee on behalf of his son was Rs. 18,750 for which the assessee could not adduce evidence to prove the nature and source of investment.
This sum of Rs. 18,750 was treated by the Income Tax Officer as the undisclosed income of the assessee and he initiated penalty proceedings under section 271(1)(c) of the Act for concealment of income and referred the case to the I.A.C. for disposal as the minimum penalty leviable exceeded Rs. 1,000.
The I.A.C. imposed a penalty of Rs. 18,750 being equal to the income concealed holding that the assessee had not discharged the burden cast upon him by the Explanation to section 271(1)(c) of the Act in not adducing any evidence that the plot was purchased by the assessee 's son out of his own funds and against the asses see 's own.
statement recorded on 9.10.1972 that the on money payment was made by him.
The assessee filed an appeal to the Tribunal and contended that in case of rejection of asses see 's explanation for the source, the addition could not be held to be the concealed income of the assessee, and relied on certain principles laid down by the courts.
The Tribunal allowed the appeal.
It is necessary to refer to relevant portions of the Tribunal 's order in respect of which certain contentions were urged before us.
The Tribunal in its order observed, inter alia, as follows: "We have considered the rival submissions.
At first we were impressed by the argument of the Departmental Representative that it is a fit case for the levy of penalty.
However, when we find that the assessee had at no time given any false or different particulars about this property in his return of income or at any time during the assessment proceedings, there cannot be any question of his having filed any incor rect particulars and more so of the income.
The Departmental Representative was unable to point out any occasion when the assessee has stated before the Income Tax Officer during the assessment proceedings that he had purchased the property only for Rs.80,000.
On the other hand, when he was asked to state the consideration of the property during the examina tion, he accepted that there were two agreements but the real consideration was Rs. 1,40,000.
That being so, we are unable to accept that the assessee had been wilfully negli gent or fraudulent in this regard.
Then the question arises as to any concealment in the addition made by the Department as income from undisclosed sources.
Here, the assessee 's case was that he had prepared a sort of cash statements to show that there 259 was some cash available for this purpose.
The Department 's case was that this was only a cash statement and this state ment sufferred from certain defects, viz., the absence of drawings for personal expenses and even the so called sur plus followed by utilisation for other expenses.
No doubt, the Income Tax Officer may be justified to say that not only the explanation is not convincing but false, because there was no cash available to the assessee for payment towards the extra money paid.
However, rejection of explanation even on the ground of falsity will not mean that the addition represented the assessee 's income and more so of the con cealed income of the assessee.
In fact, the assessee has not accepted the addition before the Income Tax Officer though he has not gone on appeal for reasons best known to him.
Whatever it is, there was no acceptance that the addition represented the concealed income.
Having regard to all these, we are of the view that the assessee 's case falls within the ratio of the decisions in C.I.T. vs Anwar Ali, and C.I.T. vs Khoday Ramarao & Sons, In view of what we have expressed above, we find no reasons to sustain the penalty.
Accordingly, we cancel the penalty.
" The penalty was set aside.
Aggrieved by the said order the revenue moved the Tribunal under section 256(1) of the Act to refer the following questions of law to the High Court: "(i) Whether on the facts and in the circumstances of the case the Appellate Tribunal was right in canceling the penalty levied u/s 271(i)(c) in the assessee 's case? (ii) Whether having regard to the provisions of Explanation to Section 27 1(1)(c) the Appellate Tribunal 's cancellation of penalty is sustainable in law and on the materials on record? (iii) Whether the Appellate Tribunal 's view that the addi tion of Rs. 18,750 did not represent the concealed income of the assessee is based on valid and relevant consideration and is reasonable view to take on the facts of this case?" The Tribunal refused to refer the questions stated hereinbefore.
The respondent moved the High Court u/s 256(2) of the Act.
The High 260 Court was of the opinion that no question of law arose and ob served, inter alia, as follows: "It appears that the consideration mentioned in the said deed was Rs.80,000.
Finally, as a result of a search con ducted in the premises of R.V. Saroja as well as the asses see himself certain documents were seized, which showed that the actual consideration was Rs.1,40,000 and not Rs.80,000.
In this regard, it was explained that even if it was consid ered that the purchase consideration admitted by the asses see was not adequate, surplus cash balance and the addition al payment, if any, should be deemed to have been come out of such surplus fund and not out of any undisclosed fund.
The Income Tax Officer found himself unable to accept the said explanation for the reason that the statements of receipts and payment filed by the assessee only enabled him to reasonably connect some of the payments, but the said statement could not serve the purpose of a regular cash book disclosing such cash balance, under the assessee 's personal expenses were not shown in the statement.
If these were taken note of, the surplus, if any, would be wiped off.
In the end, he came to the conclusion that the assessee had not accounted for the full consideration for the plot purchased by him in the name of his son and that the balance of the consideration should have been met out of income from undis closed sources." According to the High Court, no question of law arose.
Aggrieved thereby, the revenue moved this Court and obtained leave under Article 136 of the Constitution.
The short point is: In the facts and circumstances of this case and in the light of law as it stood at the relevant time, has the assessee been able to discharge his onus to prove the question which arose in view of the Explanation intro duced by the Finance Act, 1964, section 271 of the Act.
The said Explanation provides as follows: "Explanation where the total income returned by any person is less than 80% of the total income (hereinafter in this Explanation referred to as the correct income) as assessed u/s 143 or 144 or section 147 '(reduced by the expenditure in curred bona fide by him for the purpose of making or 261 earning any income included in the total income but which has been disallowed as a deduction), such person shaH, unless he proves that the failure to return the correct income did not arise from any fraud or any gross or wilful neglect on his part, be deemed to have concealed the partic ulars of his income or furnished inaccurate particulars of such income for the purposes of cl.
(c) of this subsection .
" It was explained by this Court in CIT vs Mussadilal Ram Bharose, that under the law as it stood prior to the amendment of 1964, the onus was on the revenue to prove that the assessee had furnished inaccurate particulars or had concealed the income.
Mr. Ahuja, appearing for the revenue, urged before us that difficulties were found in proving the positive element required for concealment under the law prior to the amendment and this had to be estab lished by the revenue.
He drew our attention to the observa tion of this Court at p. 20 of the report where this Court reiterated that the effect of the Explanation was that where the total income returned by any person was less than 30% of the total income assessed, the onus was on such person to prove that the failure to file the correct income did not arise from any fraud or any gross or wilful neglect on his part and unless he did so he should be deemed to have con cealed the particulars of his income or furnished inaccurate particulars for the purpose of section 271(1) of the Act.
The position, therefore, is that the moment the stipulated difference was there, the onus to prove that it was not the failure of the assessee or fraud of the assessee or neglect of the assessee that caused the difference shifted to the assessee, but it has to be borne in mind that though the onus shifted, the onus that was shifted was rebuttable.
This Court has explained the position at page 22 of the report as follows: "The position, therefore, in law is clear.
If the returned income is less than 80% of the assessed income, the presump tion is raised against the assessee that the assessee is guilty of fraud or gross or wilful neglect as a result of which he has concealed the income but this presumption can be rebutted.
The rebuttal must be on materials relevant and cogent.
It is for the fact finding body to judge the rele vancy and sufficiency of the materials If such a fact finding body, bearing the aforesaid principles in mind, comes to the conclusion that the assessee has discharged the onus, it becomes a conclusion of fact.
" 262 Mr. Ahuja and Mr. Sampath both relied on this decision to contend what was the position in law.
Relying on this decision, Mr. Sampath appearing for the assessee sought to urge that in the instant case, the Tribunal had found that there was explanation for the excess and that was the end of the matter.
No question of law arose thereafter, according to him.
It is true that the presumption that arose was rebuttable presumption that there was concealment of income and if there was cogent material to rebut the evidence that was acceptable then presumption would not stand.
In the instant case, the falsity of the explanation given by the assessee has been accepted by the Tribunal.
The Tribunal stated that in the instant case no doubt the Income Tax Officer was justified to say that not only the explanation was not convincing, but false because there was no cash available to the assessee for payment of the extra money paid.
Therefore, no explanation was forwarded as to where from the extra money came.
If that was the position and the presumption was further that the assessee was guilty of fraud, then the subsequent presumption followed that the assessee concealed the income and that can be only rebutted by cogent and reliable evidence.
No such attempt in this case was made.
In that view of the matter, in our opinion, it cannot be said that in this case the Tribunal was justi fied in rejecting the claim and penalty may be imposed.
The presumption raised as aforesaid, that is to say that the assessee was guilty of fraud or wilful neglect as a result of which the assessee has concealed the income, would be there.
This presumption could have been rebutted by cogent, reliable and relevant materials.
There was none, at least neither the tribunal nor the High Court has indicated any.
If that is the position, the High Court, in our opinion, was in error in not correctly applying the principles laid down by this Court in C.I.T. vs Mussadilal Ram Bharose, (supra) and the principles of law applicable in a situation of this type to the facts of this case and, therefore, the decision is not sustainable.
In the instant case there was no contro versy that the amount was not the income of the year in question.
In the aforesaid view of the matter, we set aside the judgment and order of the High Court and direct reference on the aforesaid question of law to the High Court.
Let a statement of the case on the aforesaid question be forwarded by the Tribunal within four months from this date, and the High Court dispose of the reference as quickly as possible.
The appeal is allowed and is disposed of in those terms.
The cost of this appeal will be the cost in the reference.
P.S.S. Appeal allowed.
| Under the Explanation added to section 271(1)(c) of the Income Tax Act 1961 by the Finance Act, 1964, the assessee, in a case where the total income returned was less than 80 per cent of the total income assessed, was to he deemed to have concealed the particulars of his income unless he proved that the failure to return the correct income did not arise from any fraud or gross or wilful neglect on his part.
In his return of income for the assessment year 1966 67 the assessee respondent declared certain loss.
The wealth statements called for did not disclose investment in lands.
Later it was found that he had purchased a plot in his son 's name.
In the assessment it was stated that the total consid eration was Rs.80,000 out of which Rs.25,000 was the payment in respect of the portion purchased for his son.
The exami nation of the material and the document revealed that the total consideration was Rs. 1,40,000.
The on money payment made by him on behalf of his son was Rs. 18,750.
Since the assessee could not adduce evidence to prove the nature and source of investment the ITO treated the sum as the undisclosed income and initiated penalty proceedings under section 271(1)(c) of the Act for concealment of income and referred the case to IAC.
The IAC imposed a penalty equal to the income concealed holding that the assessee had not discharged the burden cast upon him by the Explanation.
In appeal, the Tribunal set aside the penalty on the ground that the assessee had at no time given any false or different particulars about this property in his return of income or at any time during the assessment proceedings and, therefore, there could not he any question of his having filed any incorrect particulars; that since the assessee had not stated in the assessment proceedings that he had pur chased the pro 256 perty only for Rs.80,000, and during the examination and accepted that though there were two agreements but the real consideration was Rs. 1,40,000, it could not be said that he had been wilfully negligent or fraudulent in this regard; that as regards concealment, his explanation was that there was some cash available for purchase of the plot, and that no doubt the Income Tax Officer might be justified to say that not only this explanation was not convincing but false the rejection of explanation even on the ground of falsity would not mean that the addition represented the assessee 's income and more so of the concealed income.
It also refused to refer to the High Court the questions of law preferred by the revenue.
In the appeal by the Revenue under section 256(2) of the Act the High Court found that there was no proof to show that the said sum of Rs. 18,750 represented the income of the relevant year and accordingly held that no question of law arose.
Allowing the appeal by special leave, the Court, HELD: 1.
The High Court was in error in not correctly applying the principles of law laid down by this Court in C.I.T. vs Mussadilal Ram Bharose, to the facts of the case.
The decision, therefore, was not sustainable.
[262F] 2.1.
The presumption that could be raised against the assessee under section 271(1)(c) of the Act, as it stood at the relevant time, that he was guilty of fraud or gross or wilful neglect resulting in concealment of income was a rebuttable presumption and if there was cogent material to rebut the evidence that was acceptable, the said presumption would not stand.
1261E; 262B] 2.2.
In the instant case, the falsity of the explanation given by the assessee had been accepted by the Tribunal in as much as it had stated that the Income Tax Officer was justified to say that not only the explanation was not convincing but false because there was no cash available to the assessee for payment of the extra money paid.
Therefore, no explanation was forwarded as to where from the extra money came.
If that was the position and the presumption was further that the assessee was guilty of fraud, then the subsequent presumption followed that he had concealed the income.
[262B D] 2.3.
The presumption thus raised against the assessee that he was guilty of fraud or wilful neglect as a result of which he had concealed the 257 income, would be there.
This presumption could have been rebutted By cogent, reliable and relevant materials.
No such attempt was made in the case.
It could not, therefore, be said that the Tribunal was justified in rejecting the claim.
[262E F] [Statement of the case to be forwarded by the Tribunal within four months and the High Court to dispose of the reference as quickly as possible.] [262G]
|
iminal Appeals Nos. 248 to 251 of 1968.
Appeals from the judgment an order dated August 13, 1968 of the Calcutta High Court in Criminal Appeals Nos.
425 to 428 of 1968.
L.M. Singhvi and section P. Nayar, for the appepant (in all the appears).
The respondent did not appear.
The Judgment of the Court was delivered by Ray, J.
These appeals are by certificate from the, judgment dated 13 August, 1968 of the High Court at Calcutta holding that 8 60 the memorandum of appeals from an order of, acquittal were barred by Article 114 of the .
The appeals were directed against orders of acquittal passed by the Presidency Magistrate, Calcutta on 4 April, 1968.
The four petitions of appeal were presented in the High Court on 1 July, 1968 by the learned Advocate authorised by the, Vakalatnama executed by the Assistant Registrar of Companies, West Bengal described as the appellant in all the_ petitions.
The Assistant Registrar of Companies, West Bengal filed petitions of complaint before the Chief.
Presidency Magistrate, Calcutta alleging that the certain officers/directors of the Standard Paint Works (P) Ltd. of 44 Beadon Row, Calcutta mentioned therein were guilty of offence for non compliance with provisions contained in the by reason of default in filing Annual Return of the Company together with the Annual Accounts and Balance sheet.
Section 210 of the requires annual accounts and balance, sheet of the company to be filed within the time mentioned in the section.
If any person being a director of the company fails to take all reasonable steps to comply with the provisions of section 210, he shall, in respect of each offence.
be punishable with imprisonment for a term which may extend to six months, or with fine which may extend to one thousand rupees, or with both.
The complainant in filing the petitions of complaint prayed for exemption of personal appearance under proviso to section 247 of the Code of Criminal Procedure read with section 621(1)A of the .
The Presidency Magistrate passed the orders of acquittal in all the cases.
Section 417 of the Code of Criminal Procedure speaks of appeal in case of acquittal.
Sub section (3) of that:section is as follows "If such an order of acquittal is passed in any case instituted upon complaint and the.
High Court, on an.
application made to it by the complainant.
in this behalf, grants special leave to appeal from the order of acquittal, the complainant may present such an appeal to the High Court".
Section 417 (4) of the Code of Criminal, Procedure states that no application under sub section (3) for the grant of special leave to appeal from an order of acquittal shall be entertained by the High Court after the expiry of 60 days from the date of the order of acquittal.
No 8 application was made to the High Court in cornpiance with section 417 (3) of the Code of Criminal Procedure.
861 On behalf of the appellant it was contended both in the High, Court and in this Court that the appeals were preferred under section 624B of the .
Section 624B is as follows "Notwithstanding anything contained in the Code of Criminal Procedure, 1898, the Central Government may, in any case arising out of this Act, direct any company prosecutor or authorise any other person either by name or by virtue of his office, to present an appeal from an order of acquittal passed by any Court other than a High Court and an appeal presented by such prosecutor or other person shall be deemed to have been validly presented to the appellate Court.".
The contention on behalf of the appellant that the right of appeal is conferred by section 624B of the is unacceptable.
Section 624B only speaks of the Central Government directing or authorising any person to present an appeal from the order of acquittal.
Section 417(1) of the Code of Criminal Procedure enacts that in case of acquittal the State Government may direct the Public Prosecutor to present an appeal to the High Court.
Section 624B of the empowers the Central Government to present appeals through persons mentioned in that section.
Presentation of appeal by the Central Government is a similar provision to section 417(1) of the Code of Criminal Procedure.
Chapter XXXI of the Code of Criminal Procedure relates to, appeals.
Appeal is a creature of statute.
The right to appeal is governed by the Code of Criminal Procedure. , Section 404 of the Code of Criminal Procedure states that no appeal shall lie from any judgment or order of a Criminal Court except as provided for by the Code of Criminal Procedure or by any other law for the time being in force.
Section 624B of the does not confer any right of appeal from any order passed by a Criminal Court in respect of any offence under the provisions of the .
The right to appeal to the High Court in the present cases of acquittal is governed by section 417 of the Code of Criminal Procedure.
Article 114 of the requires appeal under sub section (3) of section 417 of the Code of Criminal Procedure to be filed within 30 days from the date of the grant of special leave.
No application for the grant of special leave to appeal from an order of acquittal was made within 60 days from that order of acquittal.
The orders of acquittal were passed on 4 April, 1968.
862 The petitions of appeal were presented on 1 July, 1968.
The appeals were rightly not entertained by the High Court because first there was no application for grant of special leave under section 417(3) of the Code of Criminal Procedure; secondly, the appeals were incompetent without grant of special leave, and thirdly these were barred by limitation.
An appeal under section 417(3) against acquittal is competent only when there is special 'leave granted by the High Court.
On obtaining special leave the appeal is thereafter filed within 30 days of the grant of leave to escape the mischief of the period of limitation under Article 114 ,.of the .
A provision in the which confers right of appeal is section 483.
It speaks of appeals from orders made and the decisions given in the matter of winding up of the companies by the Court and it enacts that such appeals shall lie to the same Court to which, in the same manner in which, and subject to the same ,conditions under which, appeals lie from any order or decision of the Court in cases within its ordinary jurisdiction.
Section 624B is not such a section which can be said to be conferring a right of appeal.
Section 624B only mentions as to the person through whom appeal is presented.
The appeals therefore fail and are dismissed.
V.P.S. Appeals dismissed.
| Section 12 of the West Bengal Act XII of 1952 provides: " Nothing in this Act shall apply to any proceedings pending on the date of the commencement of the West Bengal Criminal Law Amendment (Special Courts) Amending Ordinance 1952 in any court other than a Special Court".
On appeal taken by the appellants to the High Court of Cal cutta against their conviction by the First Special Tribunal Calcutta constituted under the Criminal Law Amendment Ordinance of 1943 the High Court set aside the conviction on the ground, inter alia that the Special Tribunal was not properly constituted.
The High Court directed that the accused should be retried in accordance with law by a court of competent jurisdiction, it being left to the State Government to decide whether actually the trial should be proceeded with or not.
On the 30th July 1952 the West Bengal Act XII of 1952 came into force following an Ordinance laying down similar provisions which amended in certain respects the provisions of the West Bengal Criminal Law Amendments (Special Courts) Act of 1949.
In August 1952 three Special Courts were constituted by a notification of the Government of West Bengal, one of them being described as West Bengal Second Special Court.
The case against the appellants was allotted to this second court for trial.
It was contended on behalf of the appellants that section 12 of the West Bengal Act XII of 1952 was a bar to the trial of the pre sent case under the Act and that under the orders of the High Court passed in the appeals it was the original case which was commenced before the First Special Tribunal Calcutta under Central Ordinance XXIX of 1943 which was being retried by the Special Court constituted under West Bengal Act of 1952.
The present case was pending before the High Court on the 9th April 1952 which was the date of the commencement of the West Bengal Ordinance preceding the Act and to such cases the provisions of the Act had been made expressly inapplicable by section 12 and that the present case was nothing but a continuation of the original case which was tried by the First, Spe 1026 cial Tribunal Calcutta under the Ordinance of 1943 and against the decisions of which appeals were taken to the High Court.
Held, (repelling the contention) that what was pending before the High Court on the 9th April, 1952 were the appeals taken by the appellants (and their co accused) against the judgment of the First Special Tribunal Calcutta constituted under the Central Ordinance XXIX of 1943 and in order to attract the operation of section 12 it was necessary to show that the proceedings which were pending before the Special Court under West Bengal Act XII of 1952, were pending before a Court other than a Special Court on 9th April 1952.
The expression "proceedings in a court other than a Special Court" occurring in section 12 means and refers to proceedings relating to The trial of a case in the original court and not to proceedings in appeal.
The object of the legislature in enacting section 12 was that cases pending before an ordinary or a non special court at the date when the Ordinance came into existence and which were being tried in the ordinary way should not be brought to trial or tried by the Special court in spite of the provisions of the new section 4 (1) introduced by the Ordinance into the Act.
This reason manifestly could have no application to appellate proceedings for there could be no question of cases pending in appeals being allotted to special courts for trial.
How the case was to proceed further, if the appellate court directed a rehearing would depend entirely on the order which the appollate court passed and was competent in law to pass.
Accordingly, as the High Court did not acquit the accused or make an order of discharge but simply set aside the conviction and sentence directing the retrial of the cases by a competent court, the only court which was competent to try these cases would be the Special Court under Act XII of 1952 and its jurisdiction could not be ousted as the order of the High Court itself proceeded on the footing that no trial could be held by the Tribunal constituted under Ordi nance XXIX of 1943.
|
Civil Appeal No. 1004 of 1988.
From the Judgment and Order dated 2.12.1987 of the High Court of Calcutta in Civil Order No. 2506 of 1987.
509 S.N. Kacker, N. Choudhary and Rathin Das for the Appellant.
A.P. Chatterjee, Deepak Mitra and G.S. Chatterjee for the Respondents.
The Judgment of the Court was delivered by SHARMA, J.
The jurisdiction of the City Civil Court, Calcutta to entertain a suit being T.S. No. 520 of 1983 filed by the respondent No. 1 is under challenge in the present appeal, on the ground that the correct value of the suit is beyond the pecuniary jurisdiction of the Court.
The plaintiff respondent No. 1 has alleged that he is a partner of a partnership business along with his brothers defendant Nos. 1 and 2.
Originally it was a proprietary business belonging to Abdul Samad, father of the plaintiff and defendant Nos. 1 and 2, and was later converted into a partnership firm by a regular deed.
During his life time the business was under the control of Abdul Samad, but on his death the defendants Nos. 1 and 2 have effectively taken charge of the business and excluded the plaintiff.
A suggestion to re constitute and partnership made and repeated by the plaintiff has been ignored.
In reply to the plaintiff 's letter seeking information the defendant No. 2 petitioner has stated in his letter to the plaintiff that he (the plaintiff) has no interest in the firm.
In paragraph 11 of the plaint it is stated that he has on enquiry discovered that the defendants nos.
1 and 2 have been falsely representing before the Income Tax department, inter alia, that a new deed of partnership had been executed on 15.1.1979 to be effective from 1.1.1979 in which the plaintiff has no interest.
The Income Tax Officer passed an order on 26th December 1981 on the basis of the false allegations made by the defendants.
The plaintiff has challenged the aforementioned partnership deed of 1979.
In paragraph 16 of the plaint the amount of profit from the business has been described as "huge".
In the prayer portion of the plaint the plaintiff prayed for declaring the partnership deed of 1979 as illegal and void and for passing a decree for dissolution of the partnership firm and for accounts.
The valuation of the suit was put as Rs.150 being the sum of Rs.50 for declaration, Rs. 50 for rendition of accounts and another sum of Rs. 50 for profit to the share of the plaintiff arising out of the business.
Court fee was accordingly paid.
The defendants No. 1 and 2, besides denying the plaint allegations made by the plaintiff, challenged the valuation given by the plaintiff as grossly undervalued and arbitrary.
The issues relating to the correct valuation and pecuniary jurisdiction of the court to enter 510 tain the suit were taken up as preliminary issues and were decided in favour of the plaintiff.
The defendants challenged the order by a civil revision application before the Calcutta High Court which was dismised.
The defendant No. 2 has now come to this Court against the High Court 's order.
Special leave is granted.
Mr. Kacker, the learned counsel for the appellant, has contended that it is manifest that relief to the tune of lacs of rupees has been claimed by the plaintiff in the suit.
He said that the plaintiff has laid claim to a sum of Rs.1,26,796.72 besides another sum of over Rs.84,000 as his share in the profit for a particular period by reference to the proceeding of the Income Tax department mentioned in paragraph 11 of the plaint, and it is, therefore, preposterous on his part to suggest in paragraph 19 of the plaint that it could be tentatively valued at Rs.50 only.
According to the defence case which is challenged as incorrect by the plaintiff, the plaintiff requested for and was allowed a larger share 'in the well established and reputed business of auctioneer known as "Russell Exchange" and its assets and goodwill as well as the amount lying in the Habib Bank, Karachi Branch, solely and absolutely '.
The "Russell Exchange" building is a very valuable property near Park Street in the city of Calcutta.
A copy of the Profit and Loss Account for the calendar year 1979 attached by the plaintiff to the additional affidavit filed on his behalf before this Court mentions figures in lacs.
Mr. Arun Prakash Chatterjee, the learned counsel for the plaintiff respondent No. 1, has argued that the suit is governed for the purpose of court fees by section 7(iv)(f) of the Court Fees Act, and the plaintiff has the absolute right to put on the plaint any value he wishes to and the court has no jurisdiction to examine the matter.
In other words, it is the sweet will of the plaintiff to choose any figure he likes and thus decide finally the court which shall have jurisdiction to entertain the suit without reference to the subject matter of the litigation, the nature and extent of the relief claimed or any other factor.
He has relied upon the decision of this Court in Smt.
Tara Devi vs Sri Thakur Radha Krishna Maharaj, , and Meenakshisundaram Chettiar vs Venkatachalam Chettiar, ; Reference was also made to Krishnaji Hari vs Gopal Narayan, AIR 1936 Bombay 166 and Ishwarappa vs Dhanji, AIR 1932 Bombay 111.
Mr. Chatterjee claimed that the different High Courts in the country have consistently confirmed this right of the plaintiff and he has not discovered any decision to the contrary.
511 5.
We are afraid, the interpretation put by the learned counsel on the decisions of this Court is not correct and cannot be accepted.
None of the two cited judgments relied upon by Mr. Chatterjee helps him.
It is true that in a suit for accounts the plaintiff is not obliged to state the exact amount which would result after taking all the accounts and he may, therefore, put a tentative valuation upon the suit, but he is not permitted to choose an unreasonable and arbitrary figure for that purpose.
At page 392 of the judgment in Meenakshisundaram Chettiar vs Venkatachalam Chettiar, (supra) this Court while taking note of the plaintiff 's right to give a tentative valuation on the suit, observed: "The plaintiff cannot arbitrarily and deliberately under value the relief." In Smt.
Tara Devi vs Sri Thakur Radha Krishna Maharaj, , the view was reiterated thus at page 70: ". .
The plaintiff however, has not been given the absolute right or option to place any valuation whatever on such relief and where the plaintiff manifestly and deliberately under estimates the relief the court is entitled to examine the correctness of the valuation given by the plaintiff and to revise the same if it is patently arbitrary or unreasonable . ." 6.
So far as the opinion of the High Courts is concerned, it is not uniform.
The argument, "that the plaintiff can give an arbitrary valuation in the plaint, and that the court is bound to accept that" made on behalf of the plaintiff before the Allahabad High Court in Aizaz Ahmad vs Nazirul Hasan, AIR 1935 Allahabad 849, was rejected, after observing that there was some authority for the extreme view as urged in two Calcutta decisions but later a different view was taken by the said Court as also by the Allahabad Court.
In Attar Singh vs Manohar Singh, ILR (1947) Nagpur 933, the plaintiff non applicant before the High Court filed a suit for dissolution of partnership and accounts valuing at Rs.150 as has been done in the case before us.
The defendant 's objection to the valuation was rejected by the trial court "on the ground that the court was powerless to challenge the valuation put by the plaintiff on the relief claimed in the suit.
" The Full Bench decision in Mata Ram vs Daulat, ILR (1938) Nagpur 588 (F.B.) was attempted to be distinguished on the basis that it was a case covered by section 7(iv)(c).
of the Court Fees Act and not by section 7(iv)(f).
The 512 High Court while repelling the argument pointed out that the principle underlying both the clauses (c) and (f) of section 7(iv) is substantially the same and the Full Bench decision governed the case.
Accordingly it was held that when the valuation put by the plaintiff appears to be arbitrary and unreasonable the court may reject it and leave the plaintiff to correct the valuation or have the suit rejected.
Similar was the view of the Patna High Court in suits covered by section 7(iv)(c) in Salahuddinhyder vs Dhanoolal, [1945] ILR XXIV Patna 334, and Shama Pershad Shahi vs Sheopershad Singh XLI, I.C. 95 (Patna).
In Gouri Lal and others vs Raja Babu, AIR 1929 Patna 626, the respondent filed a suit praying for accounts from appellant No. 1.
Rejecting his claim to put any valuation under section 7(iv)(f) of the Court Fees Act the High Court observed that when a plaintiff is required to place the valuation on his claim he must state a valuation which need only be approximately correct but qualified it by saying that, "it must not be arbitrary or manifestly inadequate.
It is true that in a suit for accounts the correct amount payable by one party to the other can be ascertained only when the accounts are examined and it is not possible to give an accurate valuation of the claim at the inception of the suit.
The plaintiff is, therefore, allowed to give his own tentative valuation.
Ordinarily the Court shall not examine the correctness of the valuation chosen, but the plaintiff cannot act arbitrarily in this matter.
If a plaintiff chooses whimsically a ridiculous figure it is tantamount to not exercising his right in this regard.
In such a case it is not only open to the Court but its duty to reject such a valuation.
The cases of some of the High Courts which have taken a different view must be held to be incorrectly decided.
The learned counsel for the parties have placed before us the materials on the record at considerable length and we do not have any hesitation in holding that the valuation put by the plaintiff (respondent before us) on the plaint is arbitrary and unacceptable.
We, however, do not propose to examine the matter further and remit this question to be reconsidered by the trial court.
While examining the issue it will be open to the trial court to take into consideration the statement in the plaint that the plaintiff has been ousted from the partnership business.
If the court comes to the conclusion that the tentative valuation of the suit would be beyond its pecuniary jurisdiction, it shall pass an appropriate order under Order VII of the Code of Civil Procedure.
The appeal is accordingly allowed with costs payable by the plaintiff respondent.
G.N. Appeal allowed.
| % The respondent assessee a P.W.D. contractor had undertaken certain contract works on behalf of the Public Works Department for repair of roads.
The assessee was assessed on the purchased turnover of sand, bricks etc.
which were used for the execution of the work.
The assessment was upheld by the Appellate Assistant Commissioner.
In the second appeal preferred by the assessee the Tribunal found that it was necessary under section 5A of the Kerala General Sales Tax Act, 1963 to have consumption of the 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, and held that when a P.W.D. contractor was using articles for constructing a sea wall or repairing public roads there was consumption of a commodity for the manufacture of another commodity and allowed the appeal.
The High Court upheld the decision of the Tribunal and rejected the revision preferred by the Revenue.
In the Special Leave Petitions to this Court, it was contended on behalf of the Petitioner Revenue, that if no manufacturing process was involved, the case would fall within the scope of section 5A(1)(a) of the Act because the statutory provisions spoke not only of goods consumed in the manufacture of other goods for sale but also goods 'consumed otherwise '.
Dismissing the Special Leave Petitions. ^ HELD: Section 5 A (1)(a) speaks of goods consumed in the 490 manufacture of other goods for purposes other than sale.
[493F] In the instant case, the user must be in the other commodity and the expression 'consumed otherwise ' must be so construed.
When a P.W.D. contractor is using articles for constructing or repairing a public road there was consumption of a commodity for the manufacture of another commodity.
[493F] Deputy Commissioner, Sales Tax (Law) Board of Revenue (Taxes) Ernakulam vs Pio Food Packers, ; ; Ganesh Prasad Dixit vs Commissioner of Sales Tax, Madhya Pradesh, ; and Deputy Commissioner of Sales Tax (Law), Board of Revenue (Taxes), Ernakulam vs Thomas Stephen & Ors.
Ltd., SLP(C) Nos.8747 49/1987, referred to.
|
ivil Appeal No. 2311 of 1986.
From the Judgment and Order dated 30.1.1986 of the Delhi High Court in S.A.O. No. 326 of 1980.
Rajinder Sachhar, Aruneshwar Gupta and Sunil Malhotra for the Appellant.
D.K. Kapoor, Indu Goswamy and Harish N. Salve for the Respondents.
The order in question was passed by the High Court in second appeal.
In order to appreciate the controversy in this appeal, it is necessary to refer to certain facts.
In 1947 three rooms and a courtyard in Prem ises Nos.
22 16 2222, Gali Inder Chammar Teliwara, Delhi as an Evacuee Property was given on tenancy to the appellant by the Custodian of the Evacuee property.
In 1956, the entire property was jointly purchased by the father of the respond ent and Smt.
Sham Kaur from the Custodian of the Evacuee property.
Sham Kaur had paid 50 per cent of the consid eration money, i.e., Rs.25,700 towards the sale amount.
It was a joint purchase.
Sham Kaur died in 1975 and her legal heirs became the co landlords of the disputed prem ises.
In June 1975 the father of the respondents had filed an Eviction Petition against the appellant on the ground that the premises in question was required bona fide by the landlord under section 14(1)(e) of the Delhi Rent Control Act, 1958, hereinafter called the said Act.
Legal heirs of Smt.
Sham Kaur were, however, not impleaded as parties.
On 28th of October, 1976 the First Additional Rent Controller, Delhi dismissed the suit for eviction.
Several grounds had been taken in defence by the appellant herein before the First Additional Rent Controller.
It was contended, inter alia that the respondent had no locus standi to file the petition and that the respondent was not the sole owner of the premises in occupation of the appellant.
It was further contended that there was no relationship of landlord and tenant between the parties in view of the aforesaid conten tion.
Other owners had not been joined as parties and as such the suit was not maintainable, it was submitted.
It was further urged that the permission granted by the Slum Au thority was invalid.
Service of a proper notice dated 12th July, 1972 was denied.
The respondent had filed reply to the opposition by the appellant.
The First Additional Rent Controller held that there was proper service of the notice.
But the validity of the notice was challenged on the ground that the premises were previously evacuee property.
A cer tificate of sale had been issued in favour of one Sunder Singh and the respondent.
The respondent had admitted that the sale certificate was issued in the joint name of Smt.
Sham Kaur, widow of Sunder Singh and the respondent.
It was stated that the premises were let out to the appellant by the Custodian of the Evacuee Property and he had not entered into any separate agreement of lease and the terms of the lease were never settled in the presence of the respondent.
In view of this admission it was held that 71 Smt.
Sham Kaur and the appellant both became owners of the property in question and both had become landlords of the premises in suit.
It was argued that the other co owner ceased to be landlord of the premises because rent was continuously paid to the respondent.
The First Additional Rent Controller held against the respondent in respect of this contention.
He was of the opinion that one of the co landlords could receive payment on behalf of the other.
Receipt of rent by one landlord would not by itself make him the exclusive owner when the premises were in fact owned by more than on owner.
The First Additional Rent Controller held that in the premises the respondent alone could not terminate the tenancy of the appellant.
The First Additional Rent Controller distinguished the decision of this Court in Sri Ram Pasricha vs Jagan Nath, ; The First Additional Rent Controller held that one co owner could not terminate the tenancy when the property was owned by joint owners.
The First Additional Rent Controller also found that the landlord being respondent herein was not able to prove that there was no reasonably suitable accommodation with him.
It was also held that his bona fide reasonable requirement was not proved.
Aggrieved by the aforesaid order of the First Additional Rent Controller the respondent herein went up in appeal before the Rent Control Tribunal, Delhi.
The Rent Control Tribunal noticed that the ground for eviction taken up by the respondent was under section 14(1)(e) of the Act.
The property in dispute had been let out for residential purpose and was bona fide required by the respondent for himself and members of his family residing with him.
The Tribunal no ticed that the respondent had a large family comprising of 3 sons and 5 daughters and the accommodation with him was insufficient and he had no reasonably suitable accommodation with him.
The Rent Control Tribunal after taking into considera tion the judgment of Shri Jaspal Singh, Additional District Judge, Delhi, in connection with the suit filed by Smt.
Sham Kaur for specific performance of the agreement to sell came to the conclusion that the bona fide of the requirement was established.
The premises was let out according to Tribunal for the residential purpose and it was bona fide required by the landlord for his requirement and for the members of his family and that he had no other sufficiently reasonable accommodation with him to satisfy his needs.
On the question whether one co owner could institute the suit for the evic tion in the facts and circumstances of the case, the Tribu nal came to the conclusion that he could.
On the question of the property being let out for residential or 72 commercial purposes after analysing the evidence that the use of the property had been all along residential and the property had been used only for residential purpose, the Tribunal was of the view that it would not be proper to accept the position that the purpose of letting was residen tial cum commercial.
On the question of the bona fide requirement the Tribu nal took into consideration the members of the family of the respondent and noted that the evidence was that the family consisted of respondent himself, his wife, 3 sons, all of which were married and 5 daughters.
Though the daughters of the respondent were married the Tribunal came to the conclu sion that the respondent as landlord had a right to ask for accommodation for the daughters occasional visits.
It has also not been proved according to the Tribunal that the sons of the respondent were not staying with him and therefore their requirement had also to be taken into consideration.
Thereafter, taking into consideration need for a pooja room, one sitting room and one barsati and keeping in view the large family of the respondent the Tribunal came to that conclusion that the property in view of the present family dependents of the respondent was bona fide required.
On the question whether one co owner being able to maintain the action for eviction, the Tribunal came to the conclusion in view of the decision of this Court in Sri Ram Pasricha vs Jagannath (supra) and the decision of this Court in Kanta Goel vs B.P. Pathak and others; , , in the facts and circumstances of the case that the respond ent landlord as a co owner alone could have maintained the eviction petition.
Aggrieved thereby there was a further second appeal by the appellant to the High Court.
The High Court on 30th January, 1986 dismissed the second appeal.
The High Court held that the action for eviction was justified in view of section 14(1)(e) of the Act and the need of the landlord was bona fide and further the High Court affirmed the view that a co owner in the facts and circumstances of the case was entitled to maintain an action for eviction.
The High Court, therefore, rejected the second appeal.
Aggrieved thereby the tenant is before this Court in appeal under Article 136 of the Constitution.
Two conten tions were urged by Mr. Rajinder Sachhar appearing on behalf of the tenant.
It was submitted that in the absence of the other co owner, Smt.
Sham Kaur, the suit for eviction was incompetent.
It was secondly urged that the bona 73 fide need was not properly proved and the High Court was in error in upholding the order of eviction on this ground.
The first question was gone into by this Court in the decision of Sri Ram Pasricha vs Jagannath (supra).
There the plain tiff respondent was a co owner of the suit properties.
He had filed a suit for the eviction on grounds of default in payment of rent and personal requirement.
The Trial Court and the Lower Appellate Court decreed the suit having held that the plea of reasonable requirement by the members of the family for whose benefit the premises were held was established.
A single Judge of the High Court reversed the decision but the Division Bench restored the Trial Court 's order.
There was an appeal by the tenant defendant.
This Court held that the co owner was as much an owner of the entire property as any sole owner of the property was.
This Court reiterated that jurisprudentially it was not correct to say that a co owner of the property was not its owner.
He owned every part of the composite property along with others and it could not be said that he was only a part owner or a fractional owner of the property.
The position would change only when partition would take place and therefore, this Court found that it was not possible to accept the submis sion that the plaintiff in that case who admittedly was a landlord and co owner of the premises was not the owner of the premises within the meaning of section 13(1)(f) of the West Bengal Premises Tenancy Act, 1956.
It may be mentioned incidentally that in essential respects the provision of section 13(1)(f) of the West Bengal Premises Tenancy Act is similar or pari materia to section 14(1)(e) of the Act.
It is not necessary, this Court reiterated, to establish that the plaintiff was the only owner of the property for the purpose of section 13(1)(f) of the West Bengal Act as long as he was the co owner of the property being at the same time the acknowledged landlord of the defendants.
This plea of the defendant tenant, this Court found, could not there fore be accepted.
This Court was of the opinion that the plea pertained to the domain of the frame of the suit as if the suit was bad for non joinder of other plaintiff such a plea should have been raised, according to this Court, for whatever it was worth at the earliest opportunity.
It was not done in that case.
This however is not the position in the instant case before us.
This plea was taken in defence and raised as an issue before the Additional Rent Control ler.
Secondly, it was held by this Court that the relation ship between the parties being that of the landlord and tenant, only the landlord could terminate the tenancy and institute the suit for eviction.
The tenant in such a suit is estopped from questioning the title of the landlord under section 116 of the Evidence Act.
He could not deny that the landlord had title to the premises at the commencement of the tenancy.
Under the general law, in a suit between 74 landlord and tenant the question of title to the leased property was irrelevant.
It is, therefore, inconceivable to throw out the suit on account of non pleading of other co owners as such.
There had been clear acknowledgment and admission in that case of the defendants and on concurrent findings of this Court held the action was valid.
The same principle was reiterated by this Court in Kanta Goel vs B.P. Pathak (supra).
In that case a portion of the first floor of a building was let out by the owners to the appellant before this Court.
The owner died leaving 3 sons and a daughter.
The first respondent who was in occupation of a government allotment was required by government to vacate these premises.
He took proceedings under section 14A of the Delhi Rent Control Act, 1958, against the tenant of the other portion of the first floor and after evicting that tenant kept those premises vacant.
Thereafter, he again took proceedings under section 14A against the appellant.
The other respondents did not join with the first respondent.
The first respondent claimed that he became the sole owner of the first floor under the will of his father followed by a partition between himself and his brother.
The appellant contended that the respondent was not the sole owner and that the other respondents should have been made parties to the proceedings.
The Rent Controller overruled the appel lant 's contention and ordered eviction.
The High Court impleaded the other respondents and confirmed the order of eviction.
In appeal to this Court, it was contended that, (1) the 1st respondent was not the appellant 's landlord; (2) the premises were not in the 1st respondent 's name and had not been let out by him; (3) the co heirs should have been impleaded before the Controller; (4) the Controller should have allowed the appellant to contest the owner 's will; and (5) Section 14A could be used twice over for eviction of tenants from more than one premises.
Allowing the appeal, this Court held that on reading in the context of the Rent Control Law, the simple sense of the situation was that there should be a building which is let out, a landlord who collected rent and a tenant who paid it.
The appellant, as the tenant, had been paying rent to the 1st respondent.
The latter, together with the other respondents constituted the body of landlords and by consent, implicit or otherwise, the 1st respondent was collecting rent on behalf of all.
He therefore functioned as a landlord and was entitled to institute proceedings qua landlord. 'In his name ' and 'let out ' by him read in the spirit of the provision and without violence to the words of the section clearly convey the idea that the premises must be owned by him directly and the lessee must be under him directly, 75 which is the case, where the 1st respondent as heir steps into the shoes of his father who owned the building.
He represents the former owner and lessor falls within section 14A of the Act.
The accent on 'name ' is only to pre empt the common class of benami evasions.
It was further held that a co owner is as much the owner of the entire property as any sole owner.
Therefore, there was no substance in the conten tion that the absence of the other co owners disentitled the other co owners from suing for eviction.
In the High Court, the other co owners who were parties did not object to the claim of the 1st owner to the first floor on the strength of the will.
The objection to the will was not a serious objec tion.
The other finding is not relevant for the present purpose.
In Kanta Goel case (supra) this Court followed the decision in Sri Ram Pasricha vs Jagannath (supra).
This Court left open the question as to what would happen if some of the co owners wanted the tenant to continue contrary to the relief claimed by the claimant co owner.
Relying on the two aforesaid decisions in the facts of this case, in so far as the ratio of the two decisions was concerned, Mr. Rajind er Sachhar contended that as yet there is no principle established by this Court that any one of the co owners could maintain an action for eviction.
In the instant case, it was contended that it was on record that a suit had been filed by Smt.
Sham Kaur against the respondent for specific performance of an agreement to sell a portion of the proper ty and for direction to him to execute the sale deed with respect to a portion of the premises bearing Nos.
22 16 to 2222.
That suit was decreed by Shri Jaspal Singh, Additional District Judge, Delhi and Sunder Singh was ordered to exe cute the sale deed in favour of the co owner Smt.
Sham Kaur.
The High Court however recorded that the case of the parties was that there was an appeal against the judgment and decree and the same was pending and the portion with respect to which the direction has been given was not the portion which is in occupation of the tenant and which is the subject matter of this eviction petition.
It appears that even according to the decree this portion, i.e., 3 rooms and the courtyard in question which is the subject matter of dispute in the instant case, falls in the share of Sunder Singh who had filed the eviction petition.
Furthermore, there is no evidence that other cotenant the widow, Smt.
Sham Kaur or her representatives wanted the appellant to continue.
This in our opinion falls within the ratio of Kanta Goel vs B.P. Pathak (supra) where this Court clearly held that when the other co owner did not object to the eviction one co owner could maintain an action for eviction even in the absence of other co owner.
Here also Smt.
Sham Kaur and her heirs did not object to 76 the claim for eviction made by the respondents herein.
In that view of the matter and in the circumstances of this case, we are of the opinion that the ratio of the said case will apply and this suit will be maintainable even in the absence of all the owners to the eviction proceedings.
In Tej Bhan Madan vs II Additional District Judge and others; , this Court reiterated that there can be a denial of the title by the tenant of his landlord without the tenant renouncing his character as such where, for instance, he sets up a plea of jus tertii.
But the implication of the ground on which the denial of the title was made was that if the tenant appellant could not have denied the vendor 's title by virtue of the inhibitions of the attornment, he could not question the vendee 's title either.
The tenant did himself no service by this stand.
This Court reiterated that the principle that the tenant cannot deny the title of the landlord in its basic founda tions, means no more than that under certain circumstances law considers it unjust to allow a person to approbate and reprobate.
The law is that the estoppel of a tenant under section 116 of the Evidence Act was a recognition and statu tory assimilation of the equitable principles underlying the estoppel in relation to tenants.
In this case the rent had all along been collected by the respondent.
On the question of bona fide it was contended before us by Mr. Sachhar that in the High Court, immediately prior to the filing of the petition the landlord had rented out a few rooms on the ground floor, as such it pleaded that there was no bona fide.
This point, the High Court noted, was not raised in the first appeal.
Furthermore, it was not specifi cally raised in the pleadings.
Therefore, the High Court found that it was not proper for the parties to raise this question in the second appeal.
The High Court was right and we cannot interfere on this ground.
The High Court was also invited to interfere with the findings of fact as to the bona fide nature of the need of the landlord.
The High Court 's attention was drawn on the finding of the 1st Addl.
Rent Controller contained in paragraph 11 of the judgment wherein it was held that the landlord was having reasonably suitable accommodation.
That plea had been reversed, it was contended, without going into the merits of the case by the Tribunal.
The High Court however noted that during the pendency of the second appeal an application was filed on behalf of the appellant tenant seeking that certain events subsequent to the passing of the impugned judgment may be permitted to be brought on record.
The application was directed to be considered at the time of the hearing of the appeal before the High Court.
The High Court appointed one Advocate as the Local Commissioner to visit the 77 premises and give his report regarding three rooms on the ground floor of the premises in dispute which according to the appellant had fallen vacant and was then in the occupa tion of the landlord.
The landlord 's case was that the rooms were in occupation of the legal heirs of the tenants.
It was pleaded that those rooms could not be used for residential purposes as they were merely meant to be used as stores.
The Commissioner appointed by the High Court filed a report which corroborated the stand of the landlord respondent.
The High Court had considered all this.
In that view of the matter it was not possible for the High Court to have fur ther interfered with the findings of the appellate court.
Our attention was drawn to certain observations of this Court in Vinod Kumar Arora vs Surjit Kumar, [1987] 3 Supreme Court Cases 711.
We do not find that the High Court has committed any error in following the principles enunciated in that decision.
Indeed, interference by the High Court with the finding recorded by the First Appellate Court would have in this case been unwarranted.
There was nothing so far as the service of notice was concerned.
In view of the principle enunciated by this Court in V. Dhanapal Chettiar vs Yesodal Ammal, ; we are of the opinion that in the facts and circumstances of the case, the respondentappellant was entitled to maintain this eviction petition alone and he had proved the grounds for eviction and that his need was bona fide and that he had no other suitable accommodation in his possession.
In the premises, there is no merit in this appeal.
The appeal fails and is accordingly dismissed with costs.
N.V.K. Appeal dismissed.
| In 1947 three rooms and a courtyard in an evacuee 's property were given on tenancy to the appellant by the Custodian of Evacuee Property.
In 1956 the entire property was jointly purchased by the father of the respondent and a lady.
The lady died in 1975 and her legal heirs became the co landlords of the disputed premises.
In June 1975, the father of the respondents filed an eviction petition against the appellant on the ground that the premises was required bona fide by the landlord under section 14(1)(e) of the Delhi Rent Control Act, 1958.
The legal heirs of the joint purchaser viz the lady, were, however, not impleaded as parties.
The appellant contested this petition alleging that the respondent had no locus standi to file the petition, that the respondent was not the sole owner of the premises in occupation of the appellant, that there was no relation ship of landlord and tenant existing between the parties, that as other owners were not joined as parties the eviction petition was not maintainable, and further that the permis sion granted by the Slum Authority was invalid.
The Addi tional Rent Controller held that one of the co landlords could receive payment on behalf of the other and that re ceipt of rent by one landlord would not by itself make him exclusive owner when the premises were in fact owned by more than one owner and consequently the respondent alone could not terminate the tenancy of the appellant.
He further held that one coowner could not terminate the tenancy when the property was owned by joint owners and that the respondent landlord was not able to prove that there was no reasonable suitable accommodation with him and that his claim for bona fide reasonably requirement was not proved.
He accordingly dismissed the suit for eviction.
68 Aggrieved by the order of the Additional Rent Control ler, the respondent filed an appeal before the Rent Control Tribunal.
The Tribunal held that the respondent was entitled to claim the premises on the ground of bona fide requirement for the use of his family, and that the property had all along been used for residential purposes and that it would not be proper to accept the view that the purpose of letting out was residential cure commercial On the question whether one coowner could maintain the suit for eviction the Tribu nal held that in the circumstances of the case the respond ent landlord as a co owner alone could have maintained the eviction petition.
The appellant filed a second appeal and the High Court rejected the same on the ground that the action for eviction was justified in view of section 14(1)(e) of the Act, and that the need of the landlord was bona fide, and further the High Court affirmed the view that a co owner in the facts and circumstances of the case was entitled to maintain an action for eviction.
In the appeal by special leave to this Court it was contended on behalf of the appellant tenant that in the absence of the other co owner the suit for eviction was incompetent, and that the bona fide need was not properly proved and the High Court was in error in upholding the order of eviction on this ground.
Dismissing the appeal, HELD: 1.
When the other co owner did not object to the eviction one co owner could maintain an action for eviction even in the absence of the other co owner.
[75D] In the instant case, the direction given by the Court in the suit for specific performance of an agreement to sell filed by Smt.
Sham Kaur against the respondent landlord, was not with respect to the portion of the property which was in the occupation of the tenant appellant and which was the subject matter of the eviction petition.
The three rooms and the courtyard in question, the subject matter of dispute, fails in the share of Sunder Singh respondent who had filed the eviction petition.
Furthermore there is no evidence that Smt.
Sham Kaur or her representatives wanted the appellants to continue.
[75E G] Kanta Goel vs B.P. Pathak and others; , ; Sri Ram Pasricha vs Jagan Nath ; referred to.
The law is that the estoppel of a tenant under sec tion 116 of the Evidence Act was a recognition and statutory assimilation of the equitable principles underlying the estoppel in relation to tenants.
[76D] In the instant case, the rent had all along been col lected by the respondent from the appellant.
[76D] Tej Bhan Madan vs II Additional District Judge and others; , , referred to.
The High Court noted that the plea of the appellant that immediately prior to the filing of the petition, the landlord had rented out a few rooms on the ground floor, was not specifically raised in the pleadings nor in the first appeal, and rightly held that it was not proper to raise this question in the second appeal.
[76E F] 4.
The High Court appointed an Advocate as Local Commis sioner to visit the premises and give his report.
The report corroborated the stand of the landlord respondent.
In that view of the matter it was not possible for the High Court to have further interfered with the findings of the Appellate Court.
[77B] Vinod Kumar Arora vs Surjit Kurnar ; referred to.
The respondent was, therefore, entitled to maintain the eviction petition alone and he had proved the grounds for eviction and that his need was bona fide and that he had no other suitable accommodation in his possession.
[77E] V. Dhanpal Chettiar vs Yesodai Ammal, ; , referred to.
|
Civil Appeal No. 1265 of 1969.
From the Judgment and order dt.
3 1 1969 of the Andhra Pradesh High Court in Writ Petition No. 2763 of 1968.
section V. Gupte, Att.
General of India, K. N. Bhatt and R. N. Sachthey for the Appellant.
P. A. Chowdhary and B. Kanta Rao for Respondent No. 1.
The Judgment of the Court was delivered by CHANDRACHUD, C.J.
Respondent 1, Shri N. G. Ranga, was declared elected to the Lok Sabha on April 28, 1967 in a bye election .
From Srikakulam Constituency, defeating respondent No. 3, Shri B. Rajagopalarao.
The Election Commission of India, the appellant herein, called upon respondent 1 by a notice dated July 7, 1967 to show cause why he should not be disqualified for failure to lodge the account of his election expenses within the time and in the manner required by law.
Accepting the explanation submitted by Respondent 1, the appellant condoned the delay caused in submitting the account of election expenses and sent a communication dated August 167 1967 informing respondent 1 that it was decided not to take any further action in the matter.
Respondent 2, who is a voter in the Srikakulam constituency, thereafter submitted a petition to the President of India under Articles 84, 101,102,103 and 104 of the Constitution alleging that respondent 17 who was a sitting member of the Lok Sabha, had become subject to the disqualification mentioned in Article 1 102(1).
The President, exercising his powers under Article 103(2) of the Constitution, sought the opinion of the appellant by an order dated May 18, 1968.
The appellant issued a notice dated June 6, 1968 to respondent 1 calling upon him to submit his reply to the allegations contained in respondent 2 's petition to the President.
On June 26, 1968 respondent l filed writ petition No. 2763 of 1968 in the High Court of Andhra Pradesh asking for a writ Prohibition forbidding the appellant from taking further steps pursuant to the June 6 notice and for a declaration that the appellant had no jurisdiction to inquire into the petition submitted by respondent 2 to the President of India.
By its Judgment dated January 3, 1969 the High Court allowed the writ petition and issued a writ of Prohibition as prayed for.
It has granted to the Election Commission certificate of fitness under Article 133(1)(e) of the Constitution to appeal to this Court.
213 The narrow question for consideration is whether the appellant had jurisdiction to issue the notice to respondent 1 calling upon him to submit his explanation in regard to the allegations contained in the petition presented by respondent 2 to the President of India who, in turn, had referred the petition for the opinion of the appellant.
Article 103 of the Constitution read thus at the relevant time: "103(1) If any question arises as to whether a member of either House of Parliament has become subject to any of the disqualifications mentioned in clause (1) of Article 102, the question shall be referred for the decision of the President and his decision shall be final.
(2) Before giving any decision on any such question, the President shall obtain the opinion of the Election Com mission and shall act according to such opinion.
" Upon the presentation of a petition by respondent 2 to the President of India, alleging that respondent 1 had become subject to the disqualifications mentioned in Article 102(1) of the Constitution, 2 question clearly arose as to whether respondent 1 had truly become subject to any of the disqualifications mentioned in that Article.
By clause (2) of Article 103, the President was bound to obtain the opinion of the appellant before giving his decision on the question.
Not only that, but the President was further bound to act according to the opinion given by the appellant.
The President therefore acted both in the exercise of constitutional authority and in the discharge of his constitutional obligation in referring the question raised by respondent 2 's petition for the opinion of the appellant.
The next question for consideration is whether, on receiving the President 's communication asking for its opinion, the appellant committed any error of law or acted beyond its jurisdiction in seeking the explanation of respondent 1.
The Representation of the People Act 43 of 1951, "the Act", confers extensive powers on the Election Commission in regard to inquiries pertaining to questions referred by the President for its opinion under Article 103 of the Constitution.
Section 146(1) of the Act provides, in so far as material, that where in connection with the tendering of any opinion to the President under Article 103, the Election Commission considers it necessary or proper to make an inquiry and if it is satisfied that on the basis of documents produced by the parties it cannot come to a decisive opinion on the matter which is being inquired into, it shall have for the purposes of inquiry the powers which a civil court has while trying a suit in respect, inter alia, of summoning and enforcing the attendance of 214 any person, examining him on oath, the discovery and production of any document and receiving evidence on affidavits.
Sub section (2) of section 146 which is more to the point provides: "The Commission shall also have the power to require any person, subject to any privilege which may be claimed by that person under any law for the time being in force, to furnish information on such points or matters as in the opinion of the Commission may be useful for.
Or relevant to, the subject matter of the inquiry.
" We see no doubt that the Election Commission, by reason of these provisions, had the power and authority to require respondent 1 to furnish information on matters which were relevant to the subject matter of the inquiry, namely, the allegations contained in the petition presented by respondent 2 to the President of India.
Article 103(2), as it stood then, required the President to obtain the opinion of the Election Commission before deciding the question referred to in clause (1) of that Article.
The President was bound to act according to the opinion given by the Commission.
By the Forty second Amendment, Article 103(2) requires the President to consult the Election Commission.
The Amended Article expressly confers power on the Commission to make, for that purpose, "such inquiry as it thinks fit".
The implication of the unamended Article was in truth and substance the same, namely, that since the Commission was charged with the obligation to tender its opinion to the President, it had the power to make such inquiry as it thought fit in order to enable it to express its opinion, which under the law as it stood then, was binding on the President.
The Forty second amendment expressed clearly what was necessarily implicit in the old provision.
If the Constitution envisages that the Commission should have the power to make such inquiry as it thinks fit even when its opinion is not binding on the President who is merely required to "consult" the Commission it cannot be that the Commission could tender its binding opinion without the right and, nay the duty, of making the necessary inquiry.
Respondent 1 rushed to the High Court some what hurriedly, thinking probably that the appellant having already condoned the delay which had occurred in filing the return of the election expenses, he had not incurred or become subject to any disqualification as mentioned in Article 102(1) of the Constitution and therefore the appellant had no justification for calling upon him to submit his explanation.
That however is a different thing from saying that either the President of India or the appellant exceeded his or its jurisdiction when the 215 former referred the matter for the opinion of the latter and the latter sought an explanation from respondent 1.
The appellant could and should have in the first instance verified from its own record whether there was any justification for the grievance made by respondent 2.
But in giving to respondent 1 an opportunity to submit his explanation.
the appellant, far from acting beyond the scope of its statutory and constitutional powers, acted in conformity with the principles of natural justice.
Article 103 (1) gives finality to the President 's decision which, under the old provision, had to be in conformity with the opinion of the Election Commission.
Before giving an opinion which thus had finality, the Commission acted but fairly in asking respondent 1 to submit his say.
As stated above, it had the power to ascertain what explanation respondent I had to give an answer to respondent 2 's allegations.
The High Court misdirected itself in reaching the conclusion that the appellant acted beyond its jurisdiction in issuing the notice to respondent 1 calling upon him to submit his explanation in regard to the allegations made by respondent 2 in his petition to the President.
According to the High Court, "facts leading to disqualification under section 10A" of the Act, "cannot be the subject matter of inquiry and decision under Article 103 of 'the Constitution '?.
It is impossible to accept this statement of law in view of the express provision contained in Article 103(1) (a) that if any question arises as to whether a member of either House of Parliament has become subject to any of the disqualifications mentioned in Article 102(1), the question shall be referred for the decision of the President.
Article 102(1) provides by sub clause (e) that a person shall be disqualified for being chosen as, and for being, a member of either House of Parliament if he is so disqualified by or under any law made by Parliament.
By section 10(A) of the Act, the Election Commission has the power to declare a person to be disqualified if it is satisfied that he has failed to lodge an account of election expenses within the time and in the manner required by or under the Act and has no good reason or justification for the failure.
A declaration of disqualification made in pursuance of power conferred by section 10(A) is a declaration made by the Election Commission under a law made by Parliament.
It, therefore, attracts Article 102(1)(e) and consequently Article 103(1) of the Constitution.
The High Court thereafter proceeded to hold that the question whether respondent 1 had become subject to any disqualification under section 10(A) of the Act did not arise on the facts stated in the petition by respondent.
We do not see our way to accepting this statement.
216 Though respondent 2 was not in a position to make a categorical assertion in his petition that respondent 1 had incurred a specific disqualification he did make allegations generally in regard to disqualifications said to have been incurred by respondent 1.
Upon the making of these allegations a question arose or contemplated by Article 103(1)(a) of the Constitution and the President had to obtain the opinion of the Election Commission on that question.
Respondent 2 's petition could not have been rejected by the President without reference to the Election Commission on the ground that the allegations made by respondent 2 were unfounded or unsubstantial.
A similar question arose before this Court in Brundaban Nayak vs Election Commission of India and Anr.(1) Article 191(1) of the Constitution provides that a person shall be disqualified for being chosen as, and for being, a member of the Legislative Assembly or Legislative Council of a State if, inter alia, he is so disqualified by or under any law made by Parliament.
Article 192(1), as it then stood, provided that if any question arises as to whether a member of a House of the Legislature of a State has become subject to any of the disqualifications mentioned in clause (1) of Article 191, the question shall be referred for he decision of the Governor and his decision shall be final.
By Article 192(2) the Governor had to obtain the opinion of the Election Commission before giving his decision and he was also under an obligation to act according to the Commission 's opinion.
These provisions correspond to Articles 102 and 103 respectively with which we are concerned.
While dealing with an argument as to whether it could be said that the question as contemplated by Article 192(1) had arisen, Gajendragadkar, C.J. speaking on behalf of the Court observed that the first clause of Article 192(1) P did not permit of any limitations and that all that the clause required was that a question should arise.
How the question arose, by whom it was raised and under what circumstances it was raised were not relevant for the purpose of the application of the clause.
The Court took notice of the fact that complaints made to the Governor could be frivolous or fantastic, but it held that if they were of such a character, the Election Commission would have no difficulty in expressing its opinion that they should be rejected.
That however did not mean that a question as contemplated by Article 192(1) did not arise.
Lastly it was urged in that case that it is the Governor and not the Election Commission who had to hold the enquiry since the Constitution required the Governor to decide the particular question.
This contention was rejected on the ground that it was the opinion of the (1) ; 217 Election Commission which in substance was decisive and therefore it was legitimate to assume that when the complaint received by the Governor was forwarded by him to the Election Commission, the latter had the power and the jurisdiction to go into the matter which meant that it had the authority to issue notice to the person against whom the complaint was made, calling him to file his statement and produce evidence in support of his case.
The High Court was in error in seeing "nothing" in this decision which was contrary to its view.
; For these reasons we allow the appeal filed by the Election Commission and direct that the writ petition filed in the High Court by respondent 2 shall stand dismissed.
There will be no order as to costs.
S.R. Appeal allowed.
| The Rajasthan Land Reforms and Resumption of Jagirs Act, 1952 which provide for the resumption of jagir lands and other measures of land reforms, contains a comprehensive scheme for the determination of the amount of dues and debts recoverable by the State from the Jagirdar in respect of the jagir lands and their deduction from the amount of compensation payable to him.
Sections 22 to 31 read together provide for the continuance of the Jagirdar 's liability to the payment of arrears of revenue, ceases and other dues which were due from him in respect of the jagir lands for any period prior to the date of resumption or the jagir, out of the compensation payable to him.
A duty has been cast on the jagirdar to mention, in the statement of his claim for compensation the amount of dues and debts recoverable from him under section 22(1)(e).
Section 32(1) makes it obligatory on The Jagir Commissioner to provisionally determine the amount of compensation unrecoverable from the Jagirdar under section 22(1)(e) and serve a copy of the provisional order on the Government, the Jagirdar and every other interested person.
It is only after giving all or them a reasonable opportunity that the Jagir Commissioner can make a final order.
The order so made under section 32(2) would be final in respect of the amounts mentioned in it.
Section 34 provides for the deduction of the amounts determined by the Commissioner, from the compensation payable to the Jagirdar under section 26.
Section 35 deals with payment of compensation.
Section 39 provides for appeals against and decision of the Jagir Commissioner, to the Board of Revenue according to which the decision of the Board in the appeal shall be final.
Section 46 provides that no order mad by any officer or authority under the Act shall be called in question in any civil or revenue court.
Under the provisions of the Act, the lands belonging to the respondent, who was a. Jagirdar in the State of Rajasthan, vested in the State.
When the Jagir Commissioner took up the question of deciding the compensation payable to the respondent, the State filed a claim that a certain amount was recoverable from the compensation payable to the Jagirdar on account of revenue dues etc.
But since the State was not able to give a proper account of the dues, the Jagir Commissioner made an order that the amount claimed by the State could not be deducted.
The Board of Revenue dismissed the State Government 's appeal any, therefore, the order of the Jagir Commissioner became final.
In the meanwhile, when the Tehsildar sought to recover the dues from the respondent, he raised an objection that since the Jagir Commissioner 's order became final the Government was not competent to claim that amount.
The 96 Tehsildar rejected the objection.
In the respondent 's appeal, the Board of Revenue quashed the order of the Tehsildar on the ground that the State Government did not furnish the required particulars in spite of several opportunities given to it when the matter was before him and that the Jagir Commissioner was light in rejecting the claim of the State.
It also held that since his order became final, proceedings to have the recovery of the dues under the Land Revenue Act, Where without jurisdiction.
The High Court dismissed the writ petition filed by the State Government.
It held that The determination of the dues and debts recoverable by the State from the Jagirdar was a matter which was required to be settled by the Jagir Commissioner and that by virtue of section 46 of the Act, a Civil or Revenue Court had no jurisdiction in respect of it.
On the question whether the Jagir Commissioner 's order was final and whether any Civil or Revenue Court had jurisdiction to reopen it, as it related to a matter which was required to be settled or decided or dealt with by the commissioner.
Dismissing the appeal, ^ HELD: The High Court was right in raising the bar of section 46 and holding that no Civil or Revenue Court had jurisdiction in respect of the controversy as it was a matter which had in fact been finally decided by the Jagir Commissioner and the Board of Revenue under the provisions of the Act.
The belated attempt by the State to get over.
the bar by instituting proceedings under section 229 or section 257 A of the Rajasthan land Revenue Act was illegal and was rightly set aside by the Board.
The objection against it had no merit and had rightly been rejected by the High Court.
[104D E] The provisions of the Act are quite adequate and comprehensive and read with the relevant rules, provide for the determination and recovery of the amounts due from the Jagirdar on account of the Jagir lands.
This had to be so, because when the Act provides for the resumption of the jagir lands it is fair and reasonable that it should make provision for the determination and recovery of the amount recoverable from the Jagirdar.
The provisions of that Act are a comprehensive code concerning the liability of the Jagirdar.
[103D E] There is no force in the contention that the resolution of the Jaipur State Council was a final adjudication of the liability of the Jagirdar and that, being in the nature of a decree, the Jagir Commissioner 's order was illegal.
The Jagirdar denied any knowledge of the resolution.
When the Jagir Commissioner undertook the enquiry, the State did not produce the resolution and, therefore, he dismissed the claim of the State.
[104F H, 105A B] There is also no force in the contention that section 34 is not a bar to civil action because in a given case the amount of compensation might fall short of the amount recoverable from the Jagirdar.
Such possibility could not arise in this case.
The compensation payable to the Jagirdar was far in excess of his liability to the State.
The Act casts a duty on the Jagir Commissioner to take necessary steps for the adjustment of the recovery and further recovery of the balance, if any, that might remain outstanding against the Jagirdar there could, therefore, be no occasion for the recovery of any balance of revenue does by civil action in this case.
[105C F] 97 Ullal Venkatrava Kini vs Louis Souza AIR ; G. Venkatachala Odavar vs Ramachandra Odavar & Anr., AIR 1961 Mad, 423 Kulandaiswami Madurai & Ors.
vs Murugayya Madurai & Ors., ; Rameshwar Prasad & Ors.
vs Satya Narain & Ors.
AIR 1954 All 115, Gurbasappa Mahadevappa vs Neel Kanthappa Shivappa AIR 1951 Bom.
136; A. R. Sarin vs B. C. Patil & Anr.
AIR 1951 Bom.
423; Shivshankar Prasad Shah & Ors.
vs Baikunth Nath Singh & Ors. ; held inapplicable.
|
minal Appeal Nos.
1091 1 1 of 1977.
From the Judgment and Order dated 28 5 1975 of the Calcutta High Court in Criminal Revision Nos. 304, 371 and 318/75 respectively.
A.P. Chatterjee, G. C. Chatterjee and Mrs. Mukti Moitra for the Appellants in all the appeals.
A.K. Sen, Miss Uma Bannerjee and section Swarup for Respondent in Crl.
A. No. 6 1 1 of 1 9 7 7.
The Judgment of the Court was delivered by GOSWAMI, J.
These appeals by certificate are from the common judgment of the Calcutta High Court of 28th May, 1975 disposing of three Criminal Misc.
Revisions Nos. 304, 318 and 371 of 1975.
There is a common question of law and will be disposed of by this judgment.
Briefly the facts are as follows A complaint was made against the accused by Shri J. F. C. Mc.
Mohan, Dock Manager, Calcutta Port Commissioners, to the, South Port Police Station alleging offences under Sections 120 B/420/379/ 466/468/471.
I.P.C. against several accused including the respondents who happened to, be public servants at the material time.
The State Government issued a Notification No. 3165 J on 8 4 1970 under Section 4 of the West Bengal Criminal Law Amendment (Special Courts) Act (hereinafter referred to as, the Act) allotting the said case for trial to the Third Additional Special Court, Calcutta constituted under the provisions of the said Act for trial of the offences mentioned in the schedule to that Act.
There is no dispute about the particular order of allotment of the case to the, Special Court under the said Act.
Following the Notification of April 8, 1970 the State of West Bengal through Ranajit Roy, Sub Inspector of Police, filed a complaint before the Third Additional Special Court, Calcutta on 11 9 1970 detailing all the allegations against the accused and indicating the material facts that transpired in the course of the investigation of the case.
The Special Court, Judge after perusal of the complaint and hearing the Public Prosecutor took cognizance of the case under Sections 409/109 and 409/34, I.P.C. which are offences mentioned in the schedule of the 384 Act.
The learned Judge thereupon issued processes against the respondent and other accused.
In due course trial commenced.
, The, prosecution after examining 70 witnesses closed its case on May 2, 1974.
The Court framed charges against four accused including the respondent and discharged the remaining two accused by a lengthy order with.
reasons on 26 2 1975.
Charges were framed under various sections including Sections 409 & 420 read with 120 B, I.P.C. The respondent moved the Calcutta High Court in revision for quashing the trial on March 25, 1975.
The High Court allowed the Petition on 28th of May, 1975 and granted certificate to appeal to this Court under Article 134(1) (c) of the Constitution on March 26, 1976.
Hence these appeals.
The High Court accepted the contention of the respondent that no legal and valid cognizance of the offence war, taken by the learned Judge,.
Special Court and, therefore, the entire proceedings became vitiated and hence were quashed.
The, High Court in disposing of the matter in this way followed two earlier Division Bench decisions of the said Court in Sudhir Chandra Bhattacharjee vs The State, Criminal Appeals Nos. 23 to 26 of 1961 decided on 29th March, 1967 and Shyama Saran Das Gupta vs The State, decided on 11th April, 1975.
The question that falls for decision in these appeals, relates to the cognizance of the offence& by the Special Judge under the Act.
As the preamble shows, the Act provides for the more speedy trial and more effective punishment of certain offence& specified in the schedule thereto.
Section 4(1) of the Act provides that notwithstanding anything contained in the Code of Criminal Procedure 1898 or in any other law, the offences specified in the schedule shall be triable by Special Courts only : Provided that when trying any case a Special Court may also try any offence other than an offence, specified in the schedule, with which the accused may under the Code of Criminal Procedure, 1898, be charged with the same trial.
There is, however, no dispute that the offences charged are exclusively triable by the Special Court.
Section 5 of the Act which is material for our purpose may be read "A Special Court may take cognizance of offence in the manner laid down in clauses (a) & (b) of subsection (1) of Section 190 of Code of Criminal Procedure, 1899 without the accused being committed to his Court for trial, and its trying the accused persons, shall follow the procedure proscribed by the Code of Criminal Procedure, 1898, for the trial of warrant cases by Magistrates, instituted otherwise than on a police report.
" This Section underwent some changes by two amendments in 1956 and ' 1960.
Prior to theamendments, Section 5(1) did not contain the words "in the mannerlaid down in clauses (a) & (b) of subsection (1) of the Code of Procedure, 1898" and the words "instituted otherwise than on a police report.
" We are not concerned in these appeals with, the amendment of 1956 by which the words "instituted otherwise man an a police report were inserted.
385 It may be of interest to note that in a case under the unamended Section before the Special Court this Court had to deal with the question of cognizance canvassed before it in Ajit Kumar Palit vs State of West Bengal(1).
This Court held on the terms of the provisions of the unamended section 5(1) of the Act as follows : "The word "cognizance" has no esoteric or mystic significance in criminal law or procedure.
It merely means become aware of and when used with reference to a Court or Judge, to take notice of judicially.
It was stated in Gopal Marwari vs Emperor(2) by the learned Judges of the Patna High Court in a passage quoted with approval by this Court in R. R. Chari vs State of Uttar Pradesh (s) that the word, 'cognizance ' was used in the Code to indicate the point when the Magistrate or Judge.
takes judicial notice of an offence, and that it was a word of indefinite import, and is not perhaps always used in exactly the same sense.
As observed in Emperor vs Sourindra Mohan Chuckerbutty ( 4) "taking cognizance does not involve any formal action; or indeed action of any kind, but occurs as soon as a Magistrate, as such, applies his, mind to the suspected commission of an offence. .
It appears to us therefore that as soon as a special judge receives the orders of allotment of the case passed by the, State Government it becomes vested with jurisdiction to try the case and when it receives the record from the Government it can apply its mind and issue notice to the accused and thus start the trial of the proceedings assigned to it by the State Government.
" The above decision of this Court could have concluded the matter, but it is pointed out by Mr. A. K. Sen, appearing on behalf of the respondent that in view of the amendment of Section 5(1) of the Act by the West Bengal Act XXIV of 1960 introducing the words "in, the manner laid down in clauses (a) and (b) of subsection (1) of Section 190 of the Code of Criminal Procedure, 1898", the legal position has completely changed.
He submits that it is now obligatory for the Special Judge to examine the complainant under Section 200, Cr.
P.C. prior to taking cognizance of the offence.
Since in the present case, proceeds the argument of Mr. Sen, the Special Judge took cognizance merely on the complaint of the Sub Inspector of Police, without proceeding in accordance with Section 200, Cr.
P.C., the entire proceedings are vitiated.
We are unable to accede to the above submission of Mr. Sen.
It is true that the amendment has introduced the manner of taking cognizance in accordance with Section 190(1) (a) & (b), Cr.
P.C. appearing in Chapter XV of the Criminal Procedure Code, 1 898, but the legislature in this amendment.
at the same time, has advisedly omitted to include (1) [1963] Supp.
(1) S.C.R., 953 at 965 966.
(2) A.I.R. 1943 Pat.
(3) ; , 320.
(4) Cal.
412, 416.
386 Section 200, Cr.
P.C. and the other provisions of the next Chapter which is Chapter XVI dealing with "complaints to Magistrates".
It is clear that under Section 4(2) of the, Act, the, allotment by, the State Government to the Special Judge of a case involving of scheduled offences vests the necessary jurisdiction ill the Special Judge to proceed to trial and is, therefore, equivalent to that Court 's taking cognizance of the offence (See Ajit Kumar Palit 's case (Supra).
Because of the amendment of Section 5 (2) in 1960, it may be now open to the Special Judge to apply his judicial mind to the complaint apart from allotment of the case in order to come to a decision as to whether he is satisfied on the materials laid before him at that stage to take cognizance of the offence and proceed to trial: If he chooses to examine the complainant or any witnesses before issuing process against any accused, there is nothing in law to prevent him from doing so.
If he doe not do so and is satisfied on perusal of the complaint after allotment of the case by the Government that an offence has been disclosed against definite persons, no valid objection could be taken against his taking cognizance on the written complaint without complying with the provision of Section 200,Cr.
P.C. No, grievance can be made then that the Special Judge has not examined the complainant under Section 200, Cr.
P.C. prior to issuing of process.
Section 200, Cr.
P.C., in terms, comes into play after taking cognizance of an offence by a Magistrate (See Gopal Das Sindhi and others vs State of Assam and another(1).
There is, therefore, no merit in the submission that taking cognizance, of the offence in this case is invalid for which the whole trial is vitiated.
The words "in the manner laid down in clauses (a) and (b) of Subsection (1) of Section 190 of the Criminal Procedure Code, 1898" do not automatically introduce the provisions of Section 200, Cr.
P.C. of Chapter XVI, nor do the above words in Section 5 (2) of the Act mandatorily compel the Special Judge to resort to the provisions of Chapter XVI.
Apart from this, Chapter XVI in terms refers to "complaints to Magistrates" and thereby excludes Special Judges who are to, be guided, by the special provisions of the, special Act in the matters provided therein.
There, is nothing in Section 5(1) of the Act even after the amendment in 1960 to compel the Special Judge to comply with the provisions of Section 200, Cr.
The objection of the respondents to the trial is on the score of the invalidity of the cognizance taken by the Special Judge on perusal of the written complaint after allotment of the case by the Government for the sole reason that the complainant had not been examined under Section 200, Cr.
P.C. prior to issuing of process.
The objection is clearly untenable for the reasons given above.
The appeals are therefore allowed and the judgment of the High Court is set aside.
Since the case is an old one, trial before the Special Judge shall be expedited.
S.R. (1) A.I.R. 1961 S.C., 986,988 & 989.
Appeals allowed.
| The appellant along with another accused deceived several desperate unemployed youngmen, received various sums of Rs. 1200 by false pretences that they would secure jobs for them through politically influential friends and other make believe representations.
The offence of cheating under a. 420 was made out and all the 3 courts concurrently convicted both the accused.
The appellant was sentenced to 3 years rigorous imprisonment.
The appellant is an unemployed youngman around 28 years old and used to work as a Junior Assistant in the Andhra Pradesh Secretariat.
This Court granted special leave limited to the question of sentence.
Allowing the appeal partly, HELD : (1) The pre sentencing provision in section 248(2) Cr. P. C. has a penological significance of far reaching import which has been lost on the trial magistrate.
Reform of the black letter law is a time lagging process.
At an the three tiers the focus was on the serious nature of the crime and no ray of light on the criminal or on the pertinent variety of social facts surrounding him penetrated the forensic mentation.
[153 D, E] (2)Since the whole territory of punishment in its modern setting is virtually virgin so far as our country is concerned, the court went into the subject in some incisive depth for the guidance of the subordinate judiciary.
[155 G] (3)Progressive criminologists in the world agree that the Gandhian diagnosis of offenders as patients and his conception of prisons as hospitals mental and moral is the key to the pathology of delinquency and the therapeutic role of punishment.
The whole man is a healthy man and every man is born good.
Criminality is a curable deviance.
If every saint has a past every sinner has a future and it is the role of law to remind both of this.
[155 B C] (4)Man is subject to more stresses and strains in this age than ever before and a new class of crimes arising from restlessness of the spirit and frustration of ambitions has erupted.
White collar crime, as in the present case, belong% to this disease of man 's inside.
Barbarity and injury recoils as injury so that if healing the mentally or morally maimed or malformed man is the goal, awakening the inner being more than torturing through exterior compulsions, holds out better curative hopes.
The infliction of harsh and savage punishment is thus a relic of past and regressive times.
Today sentencing should be a process of re shaping a person who has deteriorated into criminality and the modern community has a primary stake in the rehabilitation of the offender as a means of social defence.
Therefore, a therapeutic, rather than a terrors outlook should prevail in our criminal courts.
[156 E, H, 157 C D] Tejani AIR 1974 S C 228, 236; Jagmohan Singh ; and Santa Singh , referred to.
(5)There is a great discretion vested in the judge while imposing sentence.
The Judge must exercise this discretionary power, draw his inspiration from the humanitarian spirit of the law living down the traditional precedents which have winked at the personality of the crime doer and been swept away by the features of the crime.
Unfortunately, the Indian Penal Code still lingers in the somewhat compartmentalised system of punishment viz., imprisonment, 154 simple or rigorous, fine and, of course, capital sentence.
There is a wide range of choice and flexible treatment which must be available with the Judge if he is to fulfil his tryst with curing the criminal in a hospital setting.
Rule of thumb sentences of rigorous imprisonment or other are too insensitive to the highly delicate and subtle operation expected of a sentencing judge.
Release on probation, conditional sentences, visits to healing centres, are all on the cards.
[161 E H 162 A] (6)In the present case the crime is doubly bad and throws light on how gullible youngmen part with hard earned money in the hope that political influence indirectly purchased through money can secure jobs obliquely.
But the victims of the crime must be commiserated with and in such white Collar offences it is proper to insist upon reparation of the victims apart from any other sentence.
The Court, therefore, directed the appellant to pay a fine of Rs. 1200/ which was directed to be made over by the Trial Court to P.W. 1 who was victim in the present case.
[162 E FG] (7)The appellant is a youngman of 28 years.
He has a degree in Oriental Languages and another in Commerce.
He was working as a Junior Assistant in the Government Secretariat and has now lost the post consequent on the conviction.
This is a hard lesson in life.
The socioeconomic circumstances of the man deserve notice.
His parents are old and financially weak.
His parents, sisters and younger brothers are his dependents.
The younger brother is also unemployed.
These factors suggest that the economic blow, if the appellant is imprisoned for long, will be upon his brother at College and other members of his family.
He had not committed any previous crime.
The court rejected the prayer of the appellant for release on probation on the ground that the appellant had a deliberate plan behind the crime operated in partnership upon 4 or more persons and that his age is such that he cannot be called immature, The court, however, reduced the sentence to 18 months.
The court also recommended that (a) he should not be given work of a monotonous, mechanical, degrading type, but of a mental, intellectual or like type mixed with a little manual labour.
This would ensure that the person does work more or less of the kind he used to; (b) the appellant must be paid a reasonable fraction of remuneration by way of wages for the work done, as unpaid work is bonded labour and humiliating; (c) the appellant should be allowed to participate in sports and games, and take to artistic activity and/or meditational course.
He should be given such opportunities by the Jail authorities as would stimulate his creativity and sensitivity.
(d) a guarded parole release every 3 months for at least a week.
[162 H, 163 A E] Humanitarian winds must blow into the prison barricades.
Jail reforms from abolition of convict 's costume and conscript labour to restoration and fraternal touch, are on the urgent agenda of the nation.
Our prisons should be correctional houses, and not cruel iron aching the soul.
[164 C] The court observed that the State should not hesitate to respect the personality in each convict in the spirit of the preamble to the Constitution and not to permit the colonial hangover of putting people behind the bars and then forget about them.
[164 F] R. vs King and R. vs Ironfield , referred to.
|
N: Criminal Appeal No. 255 of 1973.
Appeal by Special Leave from the Judgment and Order dated 16 7 73 of the Rajasthan High Court in S.B. Crl.
No. 309/73.
A. N. Mulla and B. P. Singh for the Appellant.
Sobhag Mal Jain and section K. Jain for the Respsondent.
The Judgment of the Court was delivered by FAZAL ALI, J.
This appeal by special leave is directed against a judgment of the Rajasthan High Court by which the conviction of the appellant under Section 494 I.P.C. and sentence of two years rigorous imprisonment and fine of Rs. 2,000/ have been upheld.
The facts of this case have been detailed in the judgments of the courts below and it is not necessary to repeat them.
Suffice it to say that the accused Gopal Lal married the complainant Kanchan sometime in the year, 1963 and a child was born out of this wedlock.
Soon thereafter the parties appeared to have fallen out and parted company.
While the first marriage was subsisting Gopal Lal contracted a second marriage which according to the custom prevalent amongst Tellis is a valid marriage commonly known as nata marriage.
This marriage was contracted on 20th of March, 1969.
The complainant Kanchan, the first wife having come to know about this marriage filed a complaint on the 22nd March, 1969, on the basis of 1173 which appellant was prosecuted and ultimately convicted as mentioned above.
Mr. A. N. Mulla, learned counsel for the appellant, had submitted two points before us.
In the first place it was contended that in view of the provisions of Section 17 of the , the second marriage being a void marriage, the provisions of Section 494 I.P.C. are not attracted at all.
We have given our anxious consideration to this argument but we are of the opinion that the argument is wholly untenable.
Section 494 runs thus: "Whoever, having a husband or wife living, marries in any case in which such marriage is void by reason of its taking place during the life of such husband or wife, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine.
Exception This section does not extend to any person whose marriage with such husband or wife has been declared void by a court of competent jurisdiction, nor to any person who contracts a marriage during the life of a former husband or wife, if such husband or wife, at the time of the subsequent marriage, shall have been continually absent from such person for the space of seven years, and shall not have been heard of by such person as being alive within that time provided the person contracting such subsequent marriage shall before such marriage takes place, inform the person with whom such marriage is contracted of the real state of facts so far as the same are within his or her knowledge".
The essential ingredients of this offence are: (1) that the accused spouse must have contracted the first marriage.
(2) that while the first marriage was subsisting the spouse concerned must have contracted a second marriage and (3) that both the marriages must be valid in the sense that the necessary ceremonies required by the personal law governing the parties had been duly performed.
It may also be noticed that Section 494 I.P.C. would come into play only if the second marriage becomes void by virtue of the fact 1174 that it had taken place in the life time of one of the spouses.
Thus, it is not possible to accede to the contention of Mr. Mulla that merely because the second marriage was void under Section 17 of the hence Section 494 I.P.C. would not be attracted.
Section 17 of the runs thus: "Any marriage between two Hindus solemnized after the commencement of this Act is void if at the date of such marriage either party had a husband or wife living; and the provisions of sections 494 and 495 of the Indian Penal Code shall apply accordingly".
What Section 17 contemplates is that the second marriage must be according to the ceremonies required by law.
If the marriage is void its voidness would only lead to civil consequences arising from such marriage.
Section 17 makes it absolutely clear that the provision has to be read in harmony and conjunction with the provisions of Section 494 of the Penal Code which has been extracted above.
Section 17 clearly provides that provisions of Sections 494 and 495 of the Penal Code shall apply accordingly.
In other words though the marriage may be void under Section 17, by reason of the fact that it was contracted while the first marriage was subsisting the case squarely falls within the four corners of Section 494 and by contracting the second marriage the accused incurs the penalty imposed by the said statute.
Thus the combined effect of Section 17 of and Section 494 I.P.C. is that when a person contracts a second marriage after the coming into force of the said Act, while the first marriage is subsisting he commits the offence of bigamy.
(Emphasis ours).
This matter no longer res integra as it concluded by a decision of this Court in Bhaurao Shankar Lokhande and Anr.
vs State of Maharashtra & Anr.(1) This Court while considering the question of bigamy qua the provisions of Section 17 observed as follows: "Section 17 provides that any marriage between two Hindus solemnized after the commencement of the Act is void if at the date of such marriage either party had a husband or wife living, and that the provisions of sections 494 and 495 I.P.C. shall apply accordingly.
The marriage between two Hindus is void in view of section 17 if two conditions are satisfied: (i) the marriage is solemnized after the commencement of the Act; 1175 (ii) at the date of such marriage, either party had a spouse living.
If the marriage which took place between the appellant and Kamlabai in February 1962 cannot be said to be 'solemnized ', that marriage will not be void by virtue of section 17 of the Act and section 494 I.P.C. will not apply to such parties to the marriage as had a spouse living".
The word 'solemnize ' means, in connection with a marriage, 'to celebrate the marriage with proper ceremonies and in due form ', according to the Shorter Oxford Dictionary.
It follows, therefore, that unless the marriage is 'celebrated or performed with proper ceremonies and in due form ' it cannot be said to be 'solemnized '.
It is therefore essential, for the purpose of section 17 of the Act that the marriage to which section 494 I.P.C. applies on account of the provisions of the Act should have been celebrated with proper ceremonies and in due form".
It was thus pointed out by this Court that Section 17 of the requires that the marriage must be properly solemnized in the sense that the necessary ceremonies required by law or by custom must be duly performed.
Once these ceremonies are proved to have been performed the marriage become properly solemnized and if contracted while the first marriage is still subsisting the provisions of Section 494 will apply automatically.
In a decision of this Court in Kanwal Ram & Ors.
vs The Himachal Pradesh Administration the earlier case was noticed by the Court and relied upon.
The matter has also been fully discussed in Priya Bala Ghosh vs Suresh Chandra Ghosh.
In view of the authorities of this Court, therefore, the following position emerges: where a spouse contracts a second marriage while the first marriage is still subsisting the spouse would be guilty of bigamy under Section 494 if it is proved that the second marriage was a valid one in the sense that the necessary ceremonies required by law or by custom have been actually performed.
The voidness of the marriage under Section 17 of the is in fact one of the essential ingredients of Section 494 because the second marriage will become void only because of the provisions of Section 17 of the .
In these circumstances, therefore, we are unable to accept the contention of Mr. Mulla that the second marriage being void Section 494 will have no application.
It was next contended by Mr. Mulla that there is no legal evidence to show that the second marriage which is said to 1176 be a nata marriage was actually performed.
We are afraid, we are unable to go into this question because three courts have concurrently found as a fact that the parties were governed by custom of nata marriage and the two essential ceremonies of this marriage are: (1) that the husband should take a pitcher full of water from the head of the prospective wife; (2) that the wife should wear chura by the husband.
There is evidence of P.Ws. 2, 3, 4 and 5 who have proved fact that these ceremonies had been duly performed in their presence.
That there was such a custom which requires these ceremonies was admitted by D.Ws. 3 and 5 who were examined by the appellant.
The evidence led by the prosecution has been accepted by the High Court and the courts below and after perusing the evidence we are not in a position to hold that the finding of facts arrived by the courts below are wrong in law or perverse.
From the evidence led by the prosecution, therefore, it has been clearly established that the second marriage which was performed by the appellant Gopal Lal with Gopi was a valid marriage according to the custom of the nata marriage prevalent in the Telli community to which the appellant belonged.
This being so and the validity of the first marriage not having been disputed, Section 494 I.P.C. applies in terms and the appellant must be held to have committed the offence of bigamy as contemplated by Section 494 I.P.C. Lastly, Mr. Mulla pressed this appeal on the question of sentence.
Bigamy is a serious offence and the maximum punishment under Section 494 is seven years.
Therefore, where the offence of bigamy is proved the Court cannot take a very lenient view.
In the instant case the appellant was sentenced to two years and a fine of Rs. 2,000/ .
It appears that the appellant has already paid a fine of Rs. 2,000/ .
In these circumstances, therefore, we feel that the ends of justice will be met by reducing the sentence of imprisonment from two years to one year but maintaining the sentence of fine.
With this modification the appeal is dismissed.
The appellant will now surrender and serve out the remaining portion of the sentence.
S.R. Appeal dismissed.
| The respondents were charged with an offence under section 302, I.P.C. The prosecution case was that on the night of occurrence (which was a moonlight night) the deceased and the prosecution witnesses attended a drama in the Ramlila Grounds of the village and when the deceased, after taking two samosas and tea, was returning home some time past midnight, the respondents shot him dead and that this was seen by them from a distance of 150 yards from the scene of occurrence.
The trial court, believing the prosecution version, convicted the respondents.
On appeal the High Court rejected the prosecution story and acquitted both the respondents.
The State came in appeal to this Court by special leave.
Dismissing the appeal, ^ HELD: It is well settled that this Court, in special leave, would not normally interfere with an order of acquittal unless there are cogent reasons for doing so or unless there is a gross violation of any procedure of law which results in serious miscarriage of justice.
[2H] Having regard to the glaring defects in the prosecution story this is not a case in which this Court should interefere with the order of acquittal.
[3B] In the present case, though it was a moon lit night according to the almanac the moon would have covered three fourths distance on the night of occurrence.
Even in the moonlight it would have been difficult for the witnesses to identify the assailants; even if they did, the possibility of mistake in identification could not be completely excluded.
According to an authority, when the moon is at the quarter, it is possible to recognise persons at a distance of from 21 ft; in bright moonlight at from a distance of 23 to 33 ft. and at the very brightest period of the full moon at a distance of from 33 to 36 ft.
In tropical countries the distance for moonlight may be increased.
Therefore, it would not have been possible for the eye witnesses to identify the assailants from a distance of 150 yards.
[3E G] After the assailants had given a call and fired at the deceased the witnesses would not have flashed the torch light, as suggested by the prosecution, and exposed themselves to the risk of being shot at.
Even if the torches were lighted, in view of the distance, it would not have been possible for the witnesses to identify the assailants with certainty.
[4B] Secondly, the medical evidence had shown that the stomach of the deceased was empty and the large intestines too were empty.
Therefore, the evidence 2 of the witnesses that the deceased took two samosas after the drama at midnight and before the attack is completely falsified by medical evidence.
Another prosecution witness stated that the deceased having had stomach ulcers never took any food at night.
Apparently until the deposition of the first witness was complete the prosecution did not realise the gravity of the statement made by him and deliberately introduced a change on a vital issue which by itself is an important circumstance throwing doubt on the prosecution case.
While witnesses may lie, circumstances would never.
Tho evidence of the doctor, based on conclusive evidence cannot be belied.
[4F H]
|
: Criminal Appeal No. 12 of 1979.
Appeal by Special Leave from the Judgment and order dated the 6th October, 1978 of the Punjab and Haryana High Court in Criminal Appeal No. 735 of 1978 and Murder Reference No. 6/78.
1065 Frank Anthony and Sushil Kumar for the Appellants.
R. section Sondhi and Hardev Singh for the Respondent.
The Judgment of V. R. Krishna Iyer and D. A. Desai, JJ. was delivered by Krishna Iyer, J. A. P. Sen, J. gave a dissenting opinion.
KRISHNA IYER, J. Death sentence on death sentence is Parliament 's function.
Interpretative non application of death sentence when legislative alternatives exist is within judicial jurisdiction.
The onerous option to spare the lives of the appellants to be spent in prison or to hand them over to the hangman to be jettisoned out of terrestrial life into "the, undiscovered country from whose bourn no traveller returns" is the crucial function this Court has to exercise in the present appeal.
Sir Winston Churchill, in his oft quoted observation, said: The mood and temper of the public with regard to the treatment of crime and criminals is one of the most unfailing tests of the civilization of any country.
"(1) Without academic aura and maukish sentimentalism the court has to rise to principled pragmatism in the choice of the penal strategy provided by the Penal Code.
The level of culture is not an irrelevant factor in the punitive exercise.
So we must be forwarned against deeply embedded sadism in some sectors of the community, demanding retributive death penalty disguised as criminal justice a trigger happy pathology curable only by human rights literacy.
But the dignity of man, a sublime value of our Constitution and the heart of penological humanisation, may find expression through culturisation of the judicial art of interpretation and choice from alternatives.
If the court reads the text of section 302 Penal Code, englightened by the fundamental right to life which the Father of Nation and the( ') founding fathers of the Constitution made manifest, the judicial oath to uphold the Constitution will unfold profound implications beyond lip service to Form VIII of the Third Schedule and this lofty obligation and cultural constitutional be hest validates our exploration of the meaning of meanings wrapped in the uncharted either/or of the text of section 302 I.P.C.
It is right to state, to set the record straight, that this Court has in Rajendra Prasad 's case(3).
, exposed the disutility and counter culture of an obsolescent obsession with crime as distinguished from crime doer and the sentencing distortion that develops almost into a paranoid preoccupation with death dealing severity as the saviour of society in the land of the (1) Sentencing and Probation, National College of the State Judiciary, Reno, Neveda p.68.
(2) Acharya Kripalani and the Lok Nayak have condemned death penalty publicly (3) [1979] 3 S.C.R.78.
12 409 SCI/79 1066 Buddha and the Mahatma and in a world where humanity has protested against barbaric executions by State agencies even with forensic 'rites ' Courts read the Code, not in judicial cloisters but in the light of societal ethos.
Nor does the humanism of our Constitution holistically viewed subscribe to the hysterical assumption or facile illusion that a crime free society will dawn if hangman and firing squads were kept feversishly busy.
We may remind the intractable retentionists that the British Royal Commission, after studying statistics from six abolitionist countries, namely, Switzerland, Belgium.
The Netherlands, Norway, Sweden and Denmark, observed: "The evidence that we ourselves received in these countries was to the effect that released murderers who commit further crimes of violence are rare, and those who become useful citizens are common." No Indian is innocent of the insightful observations of the Father of the Nation over 40 years ago in the Harijan : " I do regard death sentence as contrary to ahimsa.
Only he takas life who gives it.
All punishment is repugnant to ahimsa.
Under a state governed according to the principles of ahimsa, therefore, a murderer would be sent to a penitentiary and there given every chance of reforming himself.
All crime us a kind of disease and should be treated as such.
"(l) With this exordial exercise we may get back to the macabre episode in this appeal which has blown up into four murders, typical of the syndrome of village violence triggered off by tremendous trifles when viewed in retrospect.
When a psychic stress, left to smoulder and r flame up, is fuelled by factions and firearms, social irritants and economic discontents, ubiquitous in rural India, it suddenly flares as showdowns and shootings, taking many precious lives in haywire fury.
The solution for explosive tensions and return to tranquility is curing the inner man through proven meditational, mental moral neural technology, elimination of social provocation and economic injustice and of addiction to inebriants which dement the consumer.
Timely vigilance of policing agencies to nip in the bud burgeoning confrontations and prompt and potent enforcement of the Arms Act the failure to do which makes weapons freely available also account for escalating violence.
social autospsy of murders is more significant than the medical post mortem of cadavers or the forensic close up of crime after it has occurred.
The escapation of violence cannot be arrested (l) Harijan, March 19, 1937 1067 by inert police presence going into action after tragic clashes, but only A by a holistic ministering to the inner man as well as collective consciousness.
It is obvious, yet obscure, that a crime firee society is beyond the gift of severe judges or heavy handed policemen.
And the myopic view that public cxecutions backed by judicial sentence 's will perform the funeral of all criminals and scare away potential offenders is a die hard superstition of sociologically and psychologically illiterate legalism which sacrifices cultural values, conveniently turns away from the history of the futility of capital penalty over the ages and unconsciously violates the blobal reality that half the world has given up death penalty de jure or de facto, without added calamity, and the other half is being educated out of this State practised lethal violence by powerful human rights movements at once secular and spiritual.
These observations, not meant to be polemical or pontifical, gain functional relevance as we proceed to narrate the minimal facts, as found by the High Court, since we have set our face against reopening evidentiary re appreciation after concurrent findings have already been rendered by the courts below.
Punjab villagers are good agriculturists and know the value or water for golden harvests.
The scene of the four murders, the victims and the villians, the main witnesses to the case and the prosecution scenario take us to the village Sarhali Mandan in Amritsar District which has irrigation facilities and consequent irritation potential.
A new scheme, regulating the turns for taking irrigation water" was introduced, about the time of occurrence which affected the accused and benefitted Kapur Singh, a leading prosecution witness.
This switch in irrigationed turn sparked off friction Had it been wholesomely resolved by imaginative official handling this murder, perhaps, could have been obviated.
Many murders in the Punjab have been caused by social bungling regarding of water which tragically convert the passion for production of the farmer into passion for removal of the obstructor by murder.
Governments have some times been deaf and dumb about this etiology.
A stitch in time saves nine, is good criminology.
Away, the dispute on the turn of water between the two was settled by a patchwork mediation which did not finally extinguish the fires of fury earlier ignited.
For a group, mainly of prosecution witnesses, was making merry with alcohol in the afternoon of October 13, 1977 at the house of Karaj Singh, a prosecution witness, when one of the appellants Jarnail Singh went in.
His unwelcome presence resulted in frayed tempers, heated tantrums and beating of the 3rd appellant.
The latter bent on reprisal for the flagellation and humiliation, waited till sundown 1068 and returned armed with friends and weapons from outside.
Abuses were the provocative invitation for the fracas.
The tipsy response brought the opposite party out.
Jarnail Singh, the 3rd appellant, who was the victim of the earlier beating, ignited the attack by instigation and his party went into violent action.
Guns boomed, dangs, dived, three men and later a fourth,, feel dead and the curtain was drawn after the catastrophe was complete.
Probably, the accused party was also drunk.
And alcohol makes men beside themselves and buries sanity.
The role of intoxicating drinks and drugs in aggressive behaviour and explosive crime has not been the subject of sufficient criminological research in the country.
Impressionistically speaking, half of violent crime, explosive sex and reckless driving, has its 'kick ' in alcohol and the gains of 'prohibition ' have new dimensions.
That apart, in the case on hand, the High Court analysed the evidence, liberally applied the rule of benefit of doubt and climaxed its judgments with sentences of death and imprisonment for life on the various accused who were eventually held guilty.
We are concerned only with those who received capital penalty, and the court expressed itself thus on this momentous issue of death sentence: As both Dalbir Singh and Kulwant Singh, accused, fired at Jagir Singh, Sardul Singh and Piara Singh who were absolutely unarmed recklessly and without provocation of any kind, the sentence of death awarded to each of them by the learned Additional Sessions Judge is also hereby affirmed.
" We propose to deal only with this punitive crisis limited to its lethal aspect.
The judgment under appeal is a hint of the judicial confusion even in this grave area of death penalty.
True, the jurisprudence of sentencing in Free India has been a Cinderella and the values of our Constitution have not adequately humanized the punitive diagnostics of criminal courts, which sometimes, though rarely, remined us of the torturesome and trigger happy aberrations of the Middle Ages and some gory geographic segments, soaked in retributive blood and untouched by the correctional karuna of our constitutional culture.
But after Ediga Annama 's case(l), the law of punishment under section 302 I.P.C. has been largely settled by this Court and the High Courts are bound thereby.
Rajendra Prasad 's case (supra) and Bishnu Deo Shaw 's(2) case, have indubitably laid down the normative cynosure (1) [1974] 4 S.C.C.443 (2) ; 1069 and until over ruled by a larger bench of this court that is the law of A the land under article 141.
To discard it is to disobey the Constitution and such subversiveness of the rule of law, in a crucial area of life and death, will spell judicial disorder.
One thing is clear.
Counting the casualties is not the main criterion for sentencing to death; nor recklessness in the act of murder.
The sole focus on the crime and the total farewell to the criminal and his social personal circumstances mutilate sentencing justice.
We express ourselves in this explicit fashion since the deep rooted Raj criminological prejudices still haunt Free India 's courts and govern our mentations from the grave.
To day, the law is what Rajendra Prasad (supra), in its majority judgment, has laid down and that has been done at unmistakable length, Willy nilly, that binds judges and parties alike.
The problem in the present case, going by those canons, is easy of resolution.
Death sentence in this case is indefensible.
We can surely understand how the courts below have fallen into this fatal error.
The forensic exercise at the sentencing stage, despite the purposeful section 235(2) Cr.P.C., has been a functional failure because of the casual way the punishment factors are dealt with, as if the nature of the crime was the sole determinant of the punishment.
We have explained in Rajendra Prasad 's case how the prosecution must make out, by special factors, why me graver penalty should be inflicted.
Evidence may be led and arguments addressed by both sides, but in practice b. 235(2) has been frustratingly ritualised.
Nor do we think that the court 's attention been drawn to Ediga Annamma 's case.
The two recent decisions of this Court could not have been within the ken of the Court because they were delivered later.
Be that as it may, one has only to read the ratio in these three cases side by side with facts of the present case to hold that death Ir penalty is unmerited.
Here, the earlier provocation came from the deceased 's side by beating up Appellant No. 3.
The parties, including the prosecution group, were tipsy.
There had been antecedent irrigation irrigation between them.
There was no prepalanned, well laid attack, hell bent on liquidating the enemy.
A quarrel over turn af water; a pacification pro tempore; an afternoon exuberance with jocose and bellicose potions, beating up one appellant leading to a reprisal vi et armis.
In Rajendra Prasad 's case (supra) the court, in its majority judgement, observed: "It is not the number of deaths caused nor the situs of the stabs that is telling on that decision to validate the non 1070 application of its ratio.
It is a mechanistic art which courts the cadavers to sharpen the sentence oblivious of other crucial criteria shaping a dynamic, realistic policy of punishment.
Three deaths are regrettable, indeed terrible.
But it is no social solution to add one more life lost to the list.
In this view, we are satisfied that the appellant has not received reasonable consideration an the question of the appropriate sentence.
The criteria we have laid down are clear enough to point to the softening of the sentence to one of life imprisonment.
A family feud, an altercation, a sudden passion, although attended with extra ordinary cruelty, young and malleable age, reasonable prospect of reformation and absence of any conclusive circumstances that the assailant is a habitual murderer or given to chronic violence these catena of circumstances bearing on the offender call for the lesser sentence.
" The other criteria have been set out at some length in the same judgment and, going by them, there is hardly any warrant for judicial extinguishment of two precious Indian lives.
Section 302 of the Penal Code, read with Section 354(3) of the Criminal Procedure Code, demands special reasons for awarding the graver sentence, and to borrow the reasoning in Rajendra Prasad 's case. "Special reasons ' necessary for imposing death penalty must relate, not to the crime as such but to the criminal.
The crime may be shocking and yet the criminal may not deserve death penalty.
The crime may be less shocking than other murders and yet the callous criminal, e.g. a lethal economic offender, may be jeopardizing societal existence by his act of murder.
Likewise, a hardened murderer or dacoit or armed robber who kills and relishes killing and raping and murdering to such an extent that he is beyond rehabilitation within a reasonable period according to cur rent psycho therapy or curative techniques may deserve the terminal sentence.
Society survives by security for ordinary life.
If officers enjoined to defend the peace are treacherously killed to facilitate perpetuation of murderous and often plunderous crimes social justice steps in to demand penalty dependent on the totality of circumstances.
" 1071 We see no need to expand on the narrow survival of death sentence in our Code confined to those exceptional situations explained in Rajendra Prasad 's case.
It is heartening, though unheeded that the framers of the Code themselves state d: "We are convinced that the Death penalty should be very sparingly inflicted.
To a great majority of mankind nothing is so dear as life.
"( ') Death sentence on death sentence is the upsurge of world opinion and Indian cultural expression.
In Shanti Parva of the Mahabharata, Prince Satyavana in the discussion on the capital penalty says: "Destruction of the individual by the king can never be a virtuous act.
By killing the wrong doer the king kills a large number of innocent persons, wife, father, mother and children are killed.
A wicked person is seen to imbibe good conduct from a pious person.
Good children spring from wicked persons.
The extermination of the wicked is hot in consonance with eternal law.
"(2) while such unanimity in sublimity may not, by itself, repeal the legislated text, judicial dispensers do not behave like cavemen but breath the fresh air of finer culture.
The sentences of death in the present appeal are liable to be reduced to life imprisonment.
We may add a footnote to the ruling in Rajendra Prasad 's case.
Taking the cue from the English legislation on abolition, we may suggest that life imprisonment which strictly means imprisonment for the whole of the man 's life, but in practice amounts to incarceration for a period between 10 and 14 years may, at the option of the convicting court, be subject to the condition that the sentence of imprisonment shall last as long as life lasts where there are exceptional indications of murderous recidivism and the community cannot run the risk of the convict being at large.
This takes care of judicial apprehensions that unless physically liquidated the culprit may at some remote time repeat murder.
G Another sombre fact of history, not often stressed in court sentences save by judges like Douglas and Thurgod Marshall, is that the gallows swallow, in most cases, the social dissenter, the political (1) Indian Penal Cod Objects and reasons.
(2) Chapter 13, ShantiParva, Mahabharata, translated by Shri K. G. Subrahmanyam, Advocate in "Can The State kill its Citizens" Pub.
by M L. J. Office Madras.
1072 protester, the poor and the under priviliged, the member of minority groups or one who has turned tough because of broken homes, parental neglect or other undeserved adversities of childhood or later.
And a sobering thought which eminent judge and jurist M. C. Chagla told the country over the national T.V. the other day judicial error leading to innocent men being executed in not too recondite a reality.
Evidence in court and assessments by judges have human limitations.
It is worth recalling that a Full Bench of the Madras High Court in Athapa Goundan 's case (AIR 1937 Mad. 695) sentenced him to death.
He was duly executed as also several others on the ratio of that ruling.
This Full Bench decision was, however, over ruled 10 years later by the Privy Council in Had it been done before Goundan was gallowed many judicial hangings could have been halted.
But dead men tell no tales and judicial 'guilt ' has no temporal punishment.
Parenthetically, it may be right to observe, before we conclude, that modern neurology has unrevelled through research the traumatic truth that agressive behaviour, even brutal murder, may in all but not negligible cases be traced to brain tumour.
In such cases cerebral surgery, not hanging until he is dead, is the rational recipe.
This factor is relevant to conviction for crime, but more relevant to the irrevocable sentence of death.
We allow the appeal in regard to appellants Nos.
One and Two and reduce their death sentence to one of life imprisonment.
SEN, J.
I do not see, any reason to differ from the view expressed by me in my dissenting opinion in Rajendra Prasad 's case( ').
I Still adhere to the view that it is not within the province of the Court while dealing with an appeal confined to sentence under Art 136, to curtail the scope of death sentence under section 302 I.P.C., 1860, nor is it constitutionally or legally permissible for this Court while hearing such an appeal to lay down that on grounds of compassion and humanism the sentence of death on a conviction for murder under section 302, as a rule of universal application, be substituted by a sentence of imprisonment for life, irrespective of the gravity of the clime as the surrounding circumstances i.e., virtually abolish the extreme penalty.
The question of abolition of capital punishment is a difficult and controversial subject, long and hotly debated and it has evoked during the past two centuries strong conflicting views, as was pointed out by me in Rajendra Prasad 's case (supra).
The question whether (1) ; 1073 the scope of death sentence should be curtailed or not is for the Parliament to decide.
The matter is essentially of political expediency and, as such, it is the concern of the statesman and, therefore, the domain of the Legislature, and not the Judiciary.
Section 302 I.P.C., 1860, confers upon the Court a discretion in the matter of the punishment to be imposed for an offence of murder and the Court has to choose between a sentence of death and a sentence of imprisonment for life; while under section 354(3) Cr.P.C., 1973, the Court is enjoined with a duty to record 'special reasons ' in case the extreme penalty is awarded.
But the question whether the death sentence should be awarded or not must, in my view, be left to the discretion of the Judge trying the accused and the question of sentence must depend upon the facts and circumstances obtaining in such case.
When a sentence of death is passed it is subject to confirmation by the High Court under section 366(1) of the Code and the accused also has right of appeal to the High Court under 5.
374(2) against the sentence.
Thereafter an appeal lies to this Court by special leave under article 136 on the question of sentence.
It would therefore, be manifest that it is neither feasible to define nor legally permissible for this Court to limit or circumscribe the connotation of the expression 'special reasons ' occurring in section 354(3) of the Code so as to bring about a virtual abolition of the death sentence.
E With greatest respect, the majority decision in Rajendra Prasad 's case (supra) does not lay down any legal principle of general applicability.
A decision on a question of sentence depending upon the facts and circumstances of a particular case, can never be regarded as a binding precedent, much less 'law declared ' within the meaning of article 141 of the Constitution so as to bind all Courts within the territory of India.
According to the well settled theory of precedents every decision contains three basic ingredients: (i) findings of material facts, direct and inferential.
An inferential finding of facts is the inference which the Judge draws from the direct, or perceptible facts, (ii) statements of the principles of law applicable to the legal problems disclosed by the facts; and (iii)judgment based on the combined effect of (i) and (ii) above.
H for the purposes of the parties themselves and their privies, ingredient No. (iii) is the material element in the decision for it determines 1074 finally their rights and liabilities in relation to the subject matter of the action.
It is the judgment that estops the parties from reopening the dispute.
However, for the purposes of The doctrine of precedents ingredient No. (ii) is the vital element in the decision.
This indeed is the ratio decidendi(l).
It is not every thing said by a Judge when giving judgment that constitutes a precedent.
The only thing in a Judge decision binding party is the principle upon which the case is decided and for this reason it is important to analyse a decision and isolate from it the ratio decidendi.
In the leading case of Qualcast (Wolverhampton) Ltd. vs Haynes(2) it was laid down that the ratio decidendi may be defined if a statement of law applied to the legal problems raised by the facts is found, upon which the decision is based.
The other two elements in the decision are not precedents.
The judgement if not binding (except directly on the parties themselves), nor are the findings of facts.
This means that even where the direct facts of an earlier case appear to be identical to those of the case before the Court, the Judge is not bound to draw the same inference as drawn in the earlier case One would find that in the decision in Rajendra Prasad 's case, there are no rationes decidendi, much less any ratio decidendi.
In a minority opinion, I emphasised the need for judicial restraint and the duty to avoid encroachment on the powers conferred upon Parliament.
In my view, the assessment of public opinion on this difficult an(l complex question was essentially a legislative, not a judicial, function.
The majority expressed their personal distaste for the capital punishment, butteressed by the belief that it served no useful purpose.
They asserted that the capital punishment was morally unacceptable to the contemporary society and found it shocking to their conscience and sense of justice.
The deliberate extinguishment of human life by the State for an offence of murder, they reasoned on metaphysical theories of punishment, was a denial of human dignity.
They concluded by stating that the death penalty was usually inflicted only on a few, i.e., the poor and down trodden who are outcastes of a society which led to the irresistible inference that the punishment was not fairly applied.
This may be a 'progressive ' stance, which is out of place in a judicial pronouncement, which ought to be based on the facts and circumstance of the case and the law applicable.
But the professed view does not stem from a firm belief in dignity of human life for they themselves advocate the death penalty for certain classes of offenders, (I) R. J. Walker & M. G. Walker, The English Legal System, Butterworths 1972 3rd Edn., pp. 123 124.
(2) L. R. 1075 namely (I) white collar offenders, (2) anti social offenders, and (3) hardened murderers.
This show that the majority was not against the capital punishment in principle.
On the facts before them they commuted the sentence of death to a sentence of imprisonment for life, and the decision cannot, therefore, be construed as laying down a ratio decidendi.
Testing the majority decision in Rajendra Prasad 's case (supra) in light of theory of precedents as expounded above it seems to me clear that it does not lay down many legal principle applied to any legal problem disclosed by the facts and, therefore the majority decision cannot be said to have 'declared any law ' within the meaning of article 141 so as to bind all Courts in the country.
General observations made in the context of sentencing jurisprudence will have to be regarded as the view of the Judge/Judges concerned and not 'law declared by this Court under article 141 of the Constitution.
And attempt to limit or circumscribe the connotation of 'special reasons ' mentioned in section 354(3) of the Code of Criminal Procedure by indulging in classification of murders such as white collar offences and non white collar offences or laying down so called guidelines for imposition of the extreme penalty, would amount to unwarranted abridgement of the discretion legally vested in the trial court and constitutionally upheld by this Court.
If the general observations on sentencing jurisprudence made in Rajendra Prasad 's case (supra) are to be regarded as 'law declared By this Court ' within the meaning of article 141 so as to bind all Court 's in the country, then the observation or the so called guideline as to the effect " 'special reasons ' necessary for imposing death penalty must relate, not to the crime as such but to the criminal" occurring in the majority judgment, it must be pointed out, if I may say so, with respect, would be unwarranted and contrary to section 302 of the Indian Penal Code read with section 354(3) of the Code of Criminal Procedure.
Section 302 of the Indian Penal Code gives a choice while section 354(3) of the Code merely requires 'special reasons ' to the indicated for imposing the death penalty.
Nothing is stated whether the 'special reasons ' should relate to the criminal or the crime.
In the absence of any specific indication in that behalf 'special reasons ' would relate both to the crime and the Criminal.
Previously, perhaps more attention was being paid to the nature, gravity and the manner of committing the crime, though extenuating factors concerning the criminal, his age, criminal tendencies etc.
were not ignored.
In the majority judgment in Rajendra Prasad 's case (supra), nothing new has been said except that more emphasis on factors concerning the criminal is indicated.
But in the great enthusiasm for doing so, the pendulum has swung to 1076 the other extreme and the guideline given is that the 'special reasons ' must relate "not to the crime as such but to the criminal" for which there is no warrant in section 354(3) of the Code of Criminal Procedure.
I may also venture to say, the obsession to get the death penalty abolished from the Statute Book, i.e., Indian Penal Code, 1860, is so great that an interdict against it is surprisingly spelt out from the Constitution itself because right to life has been regarded as 'very valuable, sacrosanct and fundamental ' therein, though in Jagmohan Singh 's case(1) this Court by unanimous judgment of five Judges held that the death penalty and the judicial discretion vested in the Court regarding its imposition on an accused are constitutionally valid.
That decision, it may incidentally be pointed out, has adverted to the "well settled principles" which have all these years governed the exercise of proper judicial discretion.
In my view, therefore, so long as the extreme penalty is retained on the Statute Book, it would be impermissible for any Judge to advocate its abolition in judicial pronouncements.
The forum for that is elsewhere.
There is increasing concern today about the judiciary transgressing its limits by usurping the function of the legislature.
Many critics think that the courts should 'apply ', but not 'make ', the law and that they should not intrude into the field of policy making.
The problem appears to the also acute in the United States of America.
In a recent article, a learned writer(2) views the complex situation with deep concern, stating: "Today many Americans do resent all ever more activist judiciary.
Beware, warns a vocal group of scholars: The Imperial Presidency might have faded, but now an Imperial Judiciary has the Republic in its clutches ' ' (Emphasis supplied) .
" He then goes on to say: "For all their power, Judges remain remarkably unaccountable and unknown." Mr. Justice Robert Jackson, Associated Justice of` the Supreme Court of the United States in the Roosevelt and Truman years, delineates the correct picture: "We are not final because we are infallible, but we are infallible because we are final.
" In the end, that means relying on Judges themselves to exercise self restraint.
(1) ; (2) Evan Thomas, "Have the Judges Done Too Much?" Time Essay, Time January 22, 1979, pp.
49 SO.
1077 Reverting to the appeal before me, I cannot say that the award of death sentence to any of the two appellants, Dalbir Singh and Kulwant Singh was not proper or uncalled for.
Though the dispute was over the 'turns of water ', that would hardly furnish any jutification for the commission of the pre planned triple murder.
The appellant Dalbir Singh fired two gun shots hitting the deceased Sardul Singh on the chest, resulting in his instantaneous death.
When the deceased Jagir Singh stooped forward to lift Sardul Singh, he was fired at by the appellant Kulwant Singh with his gun which hit him on the forehead.
This also resulted in his immediate death.
When the deceased Piara Singh came forward to rescue Jagir Singh, both the appellant Kulwant Singh and Dalbir Singh again fired at him from their guns, as a result of which he fell down and succumbed to his injuries on the spot.
Thereafter, both the appellants continued firing their guns at the complainant 's party and Kapoor Singh PW 14 and no other alternative but to bring out his licensed gun from his house.
Thereupon, both sides started firing and a number of persons sustained gun shot injuries on their person.
Baga Singh, lambardar of the village in the midst of this firing appeared on the scene and made an attempt to pecify both the sides, but he also received gun shot injuries as a result of which he died two days later.
The dastardly act of the appellants resulted in the loss of three precious lives.
That leaves out of account the fourth, Baga Singh, who made a dying declaration that he had also been shot by the appellants, but the High Court felt that he might have been caught between the cross fire which subsequently ensued after the three had fallen.
These were nothing but intentional, coldblooded and brutal murders.
In my view, the High Court was justified in confirming the death sentences passed under section 368(a) of the Code, being satisfied that there were "special reasons" within the meaning of section 354, sub section
(3) of the Code of Criminal procedure, 1973, I would say that on the facts and circumstances of the case, the award of death sentence to the two appellants was neither 'erroneous in principle ' nor was 'arbitrary or excessive ', or 'indicative of an improper exercise of discretion '.
nor my part, I have no sympathy for these trigger happy gentlemen and the sentence imposed on them is well merited.
I would, therefore, dismiss the appeal leaving the appellants to Executive clemency.
N.V.K Appeal allowed.
| Section 7 of the Tamil Nadu Land Reforms (Fixation of Ceiling on Land) Act 1961, provides that on and from the date of commencement of the Act no person shall, except as otherwise provided in the Act, but subject to the provisions of Chapter VIII, be entitled to hold land in excess of the ceiling area.
Section 22 provides that where on or after the date of commencement of the Act (6th April, 1960) but before the notified date (2nd October, 1962) any person has transferred any land held by him by sale, gift etc.
the Authorised officer within whose jurisdiction such land holding of the major part thereof is situated may, after notice to such person and other persons affected by such transfer or partition and after such inquiry as he thinks fit to make, declare tho transfer or partition to be void if he finds that the transfer or the partition, as the case may be, defeats any of tho provisions of the Act.
Tho alienations in all the cases took many forms ranging from stridhana to bona fide sale and they were executed between the date of commencement of the Act and notified date.
The Land Tribunal held that the alienations were void because but for the alienations the holders would have had the lands in excess of the ceiling prescribed by the Act.
On the interpretation of section 22 of the Act, the High Court was of the view that the section covered only those sham, nominal and bogus transfers which are intended to defeat the provisions of the Act and which are inconsistent with the object provided in section 7.
It was also held that transactions entered into in anticipation of the Ceiling Act would not be hit by the provisions preventing such transfers except where they were mala fide or colourable; and that tho the word "defeat" in section 22 should be taken as having been used to import a sinister motive.
It was therefore held that under section 22 the Authorised officer is entitled to declare as void only those transfers which are sham and nominal entered into with the avowed object of defeating the provisions of the Act without any bona fide intention to transfer title.
^ HELD: (1) If any transfer defeats the provisions of the Act by reducing the extent of surplus land in excess of the ceiling available from any person such transaction, bona fide or not, is void in the matter of computation of the permissible area and the surplus area.
The Authorised officer is within his power if he ignores it as void for purposes of section 22, section 7 and other ceiling related provisions.
[1132C] 1122 (2) Looking at the words of section 22 in the light of the scheme of prohibition of transfers to preserve the surplus land for distribution there is no justification for importing into section 22 more than its words convey.
The section says what it means.
A simple scan of the provision reveals that any transfer, gift, surrender, settlement or other alienations may be declared void by the Authorized Officer, if he finds that the transfer or the partition defeats any of the provision of this Act.
The trichotomy is obvious: There must be a transfer or other n alienation; it must have taken place during the period mentioned in the section; it must have the effect of defeating any of the provisions of the Act.
if these three elements are present, the Authorised officer must void the transfer.
There is no rule for importing a fourth principle that the transfer should be sham, nominal or bogus nor is there any additional consideration that if the transfer is bona fide for family necessity or other urgency then it is good even though it defeats the provisions of the Act.
The provision seeks to provide social justice for the landless and it defeats the purpose if, by the interpretative process, soft justice to large land holders is brought about.
[1130B D] (3) The literal meaning of the section is that any transfer or other alienation mentioned in it which reduces or impairs the otherwise available extent of surplus land beyond the ceiling defeats the provisions of the Act.
This is the plain meaning of the section which gives no room for doubt or justification for importation of any further condition like sham, bogus etc.
(4) The High Court was wrong in its view that the Act being confiscatory one, the public authority "invested with the power to enquire into and to invalidate a transfer should act reasonably, and that such a power should be construed beneficially in favour of the subject who is affected by the statute.
" The approach of the High Court is inept and inapplicable when once considers agrarian reform legislation whose avowed purpose is to take away as much extent of land as policy dictates so that distribution thereof among the landless may be achieved.
When a whole legislation is geared to deprivation of property, rules which have frowned upon confiscatory legislation cannot apply at all.
The jurisprudential principles in such a situation cannot be the same as have been inherited from a culture which postulates the State vs the subject.
[1126E G] (5) While dealing with welfare legislation of so fundamental 3 character as agrarian reform, the Court must constantly remember that the statutory pilgrimage to destination social justice should be helped, not hampered, by judicial interpretation.
It is true that Judges are constitutional invigilators and statutory interpreters; but they are also responsive and responsible to Part IV of the Constitution.
The judiciary, in its sphere, shares the revolutionary purpose of the constitutional order and when called upon to decode social legislation it must be animated by the goal oriented approach.
[1123E H]
|
Appeal No. 198 of 1954.
Appeal from the judgment and order dated October 16, 1952, of the former Nagpur High Court in Misc. Petn.; No. 1231 of 1951.
M. section K. Sastri, for the appellant.
H. L. Khaskalam, B. K. B. Naidu and I. N. Shroff, for the respondent.
64 502 1960.
November 18.
The Judgment of the Court was delivered by IMAM, J.
This is an appeal from the judgment of the Nagpur High Court dismissing the appellants petition under articles 226 and 227 of the Constitution of India.
The High Court certified under article 132(1) of the Constitution that the case involved a substantial question of law as to the interpretation of the Constitution.
Hence the present appeal.
The appellant was the Ruler of the State of Baster.
After the passing of the Indian Independence Act, 1947, the appellant executed an Instrument of Accession to the Dominion of India on August 14, 1947.
Thereafter, he entered into an agreement with the Dominion of India popularly known as "The Stand Still Agreement".
On December 15, 1947, he entered into an agreement with the Government of India whereby he ceded the State of Baster to the Government of India to be integrated with the Central Provinces and Berar (now the State of Madhya Pradesh) in such manner as the Government of India thought fit.
Con sequently the Governments in India came to have exclusive and plenary authority, jurisdiction and powers over the Baster State with effect from January 1, 1948.
The Legislature of the State of Madhya Pradesh passed the Madhya Pradesh Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) Act, 1950 (Madhya Pradesh Act 1 of 1951), hereinafter referred to as the Act, which received the assent of the President of India on January 22, 1951.
The preamble of the Act stated that it was one to provide for the acquisition of the rights of proprietors in estates, mahals, alienated villages and alienated lands in Madhya Pradesh and to make provisions for other matters connected therewith.
Under section 3 of the Act, vesting of proprietary rights in the State Government takes place on certain conditions,, mentioned in that section, being complied with.
The definition of 'proprietor ' is stated in section 2 cl.
(m) and it is "in relation to 503 (i) the Central Provinces, includes an inferior proprietor, a protected thekadar or other thekadar, or protected headman; (ii) the merged territories, means a maufidar including an ex Ruler of an Indian State merged with Madhya Pradesh, a Zamindar, Ilaquedar, Khorposhdar or Jagirdar within the meaning of wajib ul arz, or any sanad, deed or other instrument, and a gaontia or a thekadar of a village in respect of which by or under the provisions contained in the wajib ul arz applicable to such village the maufidar, the gaontia, or the thekadar, as the case may be, has a right to recover rent or revenue from persons holding land in such village;".
The definition of 'mahal ' is stated in section 2(j) and it is "mahal", in relation to merged territories, means any area other than land in possession of a raiyat which has been separately assessed to land revenue, whether such land revenue be payable or has been released, compounded for or redeemed in whole or in part;".
Before the High Court the appellant contended that he was still a Sovereign Ruler and absolute owner of the villages specified in Schedules A and B of his petition under articles 226 and 227 of the Constitution.
He urged that his rights had been recognized and guaranteed under the agreements entered into by him with the Government of India.
The provisions of the Act, therefore, did not apply to him.
It was further contended that the provisions of the Act did not apply to a Ruler or to the private property of a Ruler which was not assessed to land revenue.
He relied on article 6 of the Instrument of Accession and the first paragraph of article 3 of the Merger Agreement.
The High Court held that if the petitioner 's rights under article 6 of the Instrument of Accession and article 3 of the Merger Agreement had been infringed it was clear from the provisions of article 363 of the Constitution that interference by the courts was barred in disputes arising out of these two instruments.
The High Court was also of the opinion that article 362 of the Constitu tion was of no assistance to the appellant.
504 After referring to the definition of the word 'proprietor ' in the Act, the High Court was of the opinion that the word 'maufidar ' in section 2(m) of the Act had not been used in any narrow or technical sense.
A 'maufidar ' was not only a person to whom a grant of maufi lands had been made but was also one who held land which was exempt from the payment of "rent or tax".
It accordingly rejected the contention on behalf of the appellant that the word 'maufidar ' is necessarily confined to a grantee from the State or Ruler and therefore a Ruler could not conceivably be a maufidar.
The High Court also rejected the contention on behalf of the appellant that as he was a "Ruler" within the meaning of that expression in article 366(22) of the Constitution he did not come within the expression 'ex Ruler ' as contained in the definition of the word 'proprietor ' in the Act.
The expression 'Ruler ' as defined in article 366(22) of the Constitution applied only for interpreting the provisions of the Constitution.
The expression 'ex Ruler ' given in the Act must therefore be given the ordinary dictionary meaning.
According to Shorter Oxford English Dictionary, 'Ruler ' means "one who, or that which, exercises rule, especially of a supreme or sovereign kind.
One who has control, management, or head ship within some limited sphere".
The High Court accordingly took the view that although the appellant did exercise such a rule in the past he ceased to exercise it in his former Domain after the agreements of accession and merger had come into operation.
Accordingly the appellant must be regarded as an ex Ruler and as he was also a maufidar he fell within the definition of the word 'proprietor ' in the Act.
The question whether the villages mentioned in Schedules A and B of the petition under articles 226 and 227 of the Constitution fell in any of the categories, "Estates, Mahals, Alienated lands", was also considered by the High Court.
In its opinion they did not fall within the category of Estates or Alienated lands but they did fall within the category of Mahals.
According to the definition of 'Mahal ' in section 2(j) of the Act the same must be separately assessed to land 505 revenue.
According to the appellant they had not been assessed to land revenue but this was denied on behalf of the State of Madhya Pradesh.
The High Court was of the opinion that in these circumstances it was for the appellant to establish that the villages in question had never been assessed to land revenue but no evidence had been led to this effect.
On the contrary, according to the High Court, it would appear from the documents on the record that the villages known as 'Bhandar villages ' had been assessed to land revenue.
As the rest of the villages in Schedule A and the villages in Schedule B, upto the date of the High Court judgment, had not been recognized as the private property of the appellant by the Government of India as required by the second and third paragraphs of the Merger Agreement, the appellant could not assert his ownership over them.
The High Court, accordingly, dismissed his petition under articles 226 and 227 of the Constitution.
Two questions in the main were urged before us (1) whether the appellant is a proprietor within the meaning of that expression in the Act and (2) whether the villages in question came within the definition of the word 'mahal ' contained in the Act.
On behalf of the appellant it had also been urged that the Act could not defeat the rights of the appellant guaranteed under article 3 of the Merger Agreement.
It seems clear to us, however, that in view of the provisions of article 363(1) of the Constitution any dispute arising out of the Merger Agreement or the Instrument of Accession is beyond the competence of the courts to enquire into.
The High Court rightly decided this point against the appellant.
With reference to the first point we would first consider whether the appellant is an ex Ruler for the purposes of the Act.
That he is so factually cannot be denied, since he ceded his State to the Government of India to be integrated with the Central Provinces and Berar (now the State of Madhya Pradesh) in such manner as the Government of India thought fit.
He further ceded to the Government ' of India full and exclusive authority, jurisdiction and powers in relation 506 to the governance of his State when he agreed that the administration of that State would be transferred to the Government of India as from January 1, 1948.
The question is whether his recognition for the purposes of the Constitution as Ruler by virtue of the provisions of article 366(22) of the Constitution of India continues his status as a Ruler for purposes other than the Constitution.
article 366(22) states: " "Ruler" in relation to an Indian State means the Prince, Chief or other person by whom any such covenant or agreement as is referred to in clause (1) of article 291 was entered into and who for the time being is recognised by the President as the Ruler of the State, and includes any person who for the time being is recognised by the President as the successor of such Ruler".
Article 291 refers to the privy purse payable to Rulers.
It states: "Where under any covenant or agreement entered into by the Ruler of any Indian State before the commencement of this Constitution, the payment of any sums, free of tax, has been guaranteed or assured by the Government of the Dominion of India to any Ruler of such State as privy purse (a) such sums shall be charged on, and paid out of, the Consolidated Fund of India; and (b) the sums so paid to any Ruler shall be exempt from all taxes on income.
" Article 291 refers to any covenant or agreement entered into by the Ruler of any Indian State before the commencement of the Constitution.
The covenant or agreement referred to in this Article certainly includes the Instrument of Accession and the Merger Agreement.
The effect of the Merger Agreement is clearly one by which factually a Ruler of an Indian State ceases to be a Ruler but for the purposes of the Constitution and for the purposes of the privy purse guaranteed, he is a Ruler as defined in article 366(22) of the Constitution.
There is nothing in the provisions of article 366(22) which requires a court to recognise such a person as a Ruler for purposes outside the Constitution.
In our opinion, the High Court rightly held that 507 the appellant was an ex Ruler and that article 366(22) of the Constitution did not make him a Ruler for the purposes of the Act.
As the appellant was an 'ex Ruler ', he was within the class of persons who were by name specifically included in the definition of 'proprietor ' and therefore clearly within the scope of the Act.
That the appellant was not only an ex Ruler but a maufidar appears to us to be clear.
The ordinary dictionary meaning of maufi is "Released, exempted, exempt from the payment of rent or tax, rent free" and maufidar is "A holder of rent free land, a grantee".
It was common ground in the High Court that the villages in question were exempt from the payment of rent or tax.
In our opinion, the High Court rightly took the view that the expression 'maufidar ' was not necessarily confined to a grantee from a State or a Ruler of a State.
A maufidar could be a person who was the holder of land which was exempted from the payment of rent or tax.
In our opinion, the appellant certainly came within the expression 'maufidar ' besides being an ex Ruler ' of an Indian State merged with Madhya Pradesh.
It is, however, contended on behalf of the appellant that the most important part of the definition was the concluding portion where it was stated that in the case of a maufidar he must be a person who by or under the provisions contained in the wajib ul arz applicable to his village, had the right to recover rent or revenue from persons holding land in such village.
It was contended that even if the appellant was a maufidar, there was nothing to show that with reference to any village held by him it was entered in the wajib ul arz, that he had a right to recover rent or revenue from persons holding land in such village.
In the petition under articles 226 and 227 of the Constitution, filed by the appellant in the High Court, it was nowhere asserted that even if he was regarded as a maufidar it was not entered in the wajib ul arz with respect to any of his maufi villages that he had a right to recover rent or revenue from persons holding land in such villages.
From the judgment of the High 508 Court it would appear that no such argument was advanced before it.
In the application for a certificate under article 132(1) of the Constitution we can find no mention of this.
In the statement of the case filed in this Court also there is no mention of this fact.
There is thus no material on the record to establish that the appellant as a maufidar had no right to recover rent or revenue from persons holding land in his villages.
The burden was on the appellant to prove this fact which he never attempted to discharge.
It is impossible therefore to accept this contention on behalf of the appellant raised for the first time before us in the course of the submissions made on behalf of the appellant.
Regarding the second point arising out of the definition of 'Mahal ', the High Court definitely found that the petitioner had given no evidence to establish that the villages in question were not assessed to land revenue.
On the contrary, at least with reference to the Bhandar villages documents on the record showed that these villages had been assessed to land revenue.
Since it was a question of fact whether the villages had been assessed to land revenue, which was denied on behalf of the State of Madhya Pradesh, the High Court rightly held that the contention of the appellant in this respect could not be accepted.
As for the other villages, in Schedules A and B of the petition of the appellant under articles 226 and 227 of the Constitution the High Court, in our opinion, rightly held that the petition was not maintainable as these villages had not yet been recognised by the Government of India as the private property of the appellant.
In our opinion, the appeal accordingly fails and is dismissed with costs.
Appeal dismissed.
| While this appeal by special leave, relating to an industrial dispute was pending in this Court a Director of the appellant employer and a representative of the respondents employees made an application to the Court praying that an order might be passed in terms of a compromise since an agreement was alleged to have been entered into by the appellants and the respondents.
Some of the respondents contested this compromise and the court sent issues to the Tribunal for finding whether the alleged com promise actually took place between the parties, and if so, was it valid.
The Tribunal returned findings to the effect that the compromise did actually take place and was valid.
Those findings were contested in the appeal.
Held, that a compromise agreement seeking to settle an industrial dispute which was still pending decision in this Court would not contravene the provisions of section 23 of the Payment of Wages Act which contemplated rights not likely to be modified or reversed in any judicial proceedings.
The procedure prescribed by section 6 C of the U. P. and the provisions thereof did not affect the powers of this Court, or the competence of the parties, to amicably settle a dispute pending before it.
The procedure for obtaining an order in terms of the com promise entered into between the parties pending the appeal in this Court is prescribed by its own rules and the provisions of section 2(t) of the U. P. and rule 5(1) of the Rules made thereunder have no application to such case.
|
Special Leave Petition (Civil) No. 7213 of 1987.
From the Judgment and Order dated 19.5.
1987 of the Andhra Pradesh High Court in W.A. No. 672 of 1987.
P.P. Rao and P.P. Singh for the Appellant.
567 The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This petition arises out of the judgment and order of the High Court of Andhra Pradesh.
Sree P.P. Rao, learned counsel for the petitioner submits that the order of release was bad because the authorised officer had no power to review the previous order nor he had the power to release the property of the landlady without even giving an opportunity to the petitioner.
In the facts of this case as noted by the High Court, we are unable to entertain these contentions.
We are unable to accept the contention that the Government cannot review its own order.
It is well settled law of this Court that in case of bona fide need subsequent events must be taken into account if they are relevant on the question of release or possession of the premises in question.
On a previous occasion the Government had declined to release the premises, later on .the representation made by the landlady the Government changed its decision.
The landlady had filed an application for releasing the premises in her favour, but the same was initially rejected on 25.9.1978.
Again the landlady made a further representation stating certain additional and fresh circumstances, that is to say, that her son was not allowing her to live with him in another house belonging to her.
The Government took into account the subsequent events and passed the order on 19.3.
1980 releasing the premises in favour of the landlady.
We do not see how to take cognizance of such subsequent events releasing the premises can be described an order in nullity in the facts of this case.
The next contention was that the petitioner was an allottee of the premises by virtue of his being in service but the petitioner was really a tenant of the premises in question.
The Government informed the petitioner to make alterna tive arrangements or seek accommodation.
The Government issued several notices on 24.11.1978, 22.5.1979, 12.7.1979, 27.9.1970 and 17.1.1980 to the petitioner and these facts have been stated and have also been taken note of by the High Court in the judgment under challenge.
In spite of the said notices given to the petitioner who was an allottee and who was informed about the requirement of the landlady, the petitioner did not choose to move out from the premises.
In the meantime, the petitioner has retired from service in 1986 and a long time has passed now.
In this case we do not think it can be said that the order was bad because the petitioner was initially not given an opportunity to show cause.
Actually the petitioner had enough opportunity.
In the premises, the special leave petition fails and we do 568 not find any ground to interfere with the order of the High Court.
Having regard to the facts that the petitioner had acquired government accommodation and he has stayed in the premises in question for sometime, we allow him to make alternative arrangement by 31.12.1987.
The order for evic tion will not be executed until 31.12.1987 provided the petitioner files an undertaking in this Court within four weeks from today to vacate and hand over the premises in question.
H.L.C. Petition dismissed.
| The appellant was placed under detention on September 8, 1986, consequent upon an order of detention passed by the District Magistrate, Beed under section 3(2) of the on his being satisfied that it was neces sary to do so 'with a view to preventing him from acting in any manner prejudicial to the maintenance of public order '.
He was served with the grounds of detention alongwith copies of the relevant documents on September 14, 1986.
He ad dressed a representation to the Chief Minister, State of Maharashtra on September 22, 1986 through the Superintend ent, Central Jail, Aurangabad, who forwarded the same to the State Government, Home Department which received it on September 26, 1986, and on the same day forwarded it to the District Magistrate for his comments.
On October 3, 1986, the District Magistrate returned the representation along with his comments and the same were received in the Home Department on October 6, 1986.
The State Government had, in the meanwhile, accorded its approval to the impugned order of detention under section 3(4) of the Act on September 18, 1986.
On October 6, the appellant made another representation to the Advisory Board against the order of detention.
669 The Advisory Board met on October 8, 1986, considered the representation and forwarded its report to the State Govern ment on October 13 recommending confirmation of the order of detention.
Thereafter, the representation made by the appel lant was processed in the Home Department along with the report of the Advisory Board and forwarded to the Chief Minister 's Secretariat where the same was received on Octo ber 23, 1986.
The representation remained undisposed in the Chief Minister 's Secretariat and was put up before him on November 17, 1986 and he rejected the same.
Upon these facts, the appellant moved the High Court by a petition under article 226 of the Constitution for the grant of a writ of habeas corpus on the next day i.e. on November 18, 1986 contending that his continued detention was uncon stitutional and void inasmuch as there was inordinate, unexplained delay on the part of the detaining authority to consider and dispose of his representation which was in violation of the constitutional safeguards enshrined in article 22(5) read with section 8 of the .
The writ petition was dismissed by the High Court inter alia on the ground of defective pleadings regarding the delay in Chief Minister 's Secretariat in dealing with the representation.
In the appeal by special leave, the District Magistrate in his counter affidavit denied that there was any unreason able delay in the disposal of the representation and submit ted that no such ground regarding unreasonable delay was taken in the High Court in the writ petition, and was raised for the first time before this Court, presumably on the reasoning of the High Court.
In the other counter affidavit the Desk Officer, Home Department (Special) explained the reasons for the delay in the Chief Minister 's Secretariat asserting that the Chief Minister remained preoccupied with very important matters of the State during the period from October 23, 1986 to November 17, 1986 and therefore it was not possible for him to have dealt with the representation earlier.
Allowing the appeal, HELD: 1.The continued detention of the appellant was illegal and he must be set at liberty forthwith.
[679G] 2.1 It is incumbent on the State to satisfy the Court that the detention of the petitioner/detenu was legal and in conformity not only with the mandatory provisions of the Act but also strictly in accord with the constitutional safe guards embodied in article 22(5).
[674F] 670 2.2 The constitutional right of the detenu to make a representation guaranteed by article 22(5) is a valuable right and is not a mere formality.
It includes by necessary impli cation the constitutional right to a proper consideration of the representation by the authority to whom it is made.
[677E] In the instant case, there were two representations made by the appellant, one to the Chief Minister dated September 22, 1986 and the other to the Advisory Board dated October 6, 1986.
While the Advisory Board acted with commendable despatch in considering the same at its meeting held on October 8, 1986 and forwarded its report on October 13, 1986, it was not till November 17, 1986 that the Chief Minister look at it.
There was no reason why he could not deal with it with all reasonable promptitude and diligence.
The explanation that he remained preoccupied with very important matters of the State, which involved tours as well as Cabinet meetings, was no explanation at all.
There was therefore, failure on the part of the Government to dis charge its obligations under article 22(5).
[676H 677B; 679F, 679E, 676G] 2.3 The constitution of an Advisory Board under section 9 of the Act does not relieve the State Government from the legal obligation to consider the representation of the detenu as soon as it is received by it.
The two obligations of the Government to refer the case of the detenu to the Advisory Board and to obtain its report on the one hand, and to give an earliest opportunity to him to make a representation and consider the representation on the other, are two distinct obligations independent of each other.
There is thus a duty cast on the Government to consider the representation made by the detenu without waiting for the opinion of the Adviso ry Board.
[677E, G, D] Narendra Purshotam Umrao vs B.B. Gujral & Ors.
; , referred to.
The failure of the Government in the instant case to consider the representation without waiting for the opinion of the Advisory Board renders the continued detention of the appellant invalid and constitutionally impermissible.
[678F] 3.
In return to the rule nisi issued by this Court or the High Court in a habeas corpus petition, the proper person to file the same is the District Magistrate who had passed the impugned order of detention, and he must explain his subjective satisfaction and the grounds therefore and if for some good reason the District Magistrate is not avail able, the 671 affidavit must be sworn by some responsible officer like the Secretary or the Deputy Secretary to the Government in the Home Department who personally dealt with or processed the case in the Secretariat or submitted it to the Minister or other officer duly authorised under the Rules of Business framed by the Governor under article 166 of the Constitution to pass orders on behalf of the Government in such matters.
[674F 675A] Niranjan Singh vs State of Madhya Pradesh ; ; Habibullah Khan vs State of West Bengal, ; Jagdish Prasad vs State of Bihar & Anr., ; and Mohd. Alam vs State of West Bengal, ; , referred to.
In the instant case, no one has filed any affidavit to explain the delay in the Chief Minister 's Secretariat.
The counter affidavit filed by the District Magistrate contains a bare denial that there was any unreasonable delay in the disposal of the representation.
As regards the delay in the Secretariat he adverts to the affidavit filed by the Desk Officer, Home Department and asserts that it reveals the different steps that were taken.
There is in fact no expla nation offered as regards the delay in the disposal of the representation in the Secretariat.
[678G 679C] 4.
It was an improper exercise of power on the part of the High Court in disallowing the writ petition on the ground of imperfect pleadings.
The rule that a petitioner cannot be permitted to raise grounds not taken in the peti tion at the hearing cannot be applied to a petition for grant of a writ of habeas corpus.
It is enough for the detenu to say that he is under wrongful detention, and the burden lies on the detaining authority to satisfy the Court that the detention is not illegal or wrongful and that the petitioner is not entitled to the relief claimed.
[674DE] In the appeal the appellant having raised the ground of delay in disposal of his representation in Chief Minister 's Secretariat it was the duty of the State Government to have placed all the material along with the counter affidavit.
[679B]
|
ivil Appeal No. 2789 of 1980.
From the Judgment and Order dated 29.5.1980 of the Punjab and Haryana High Court in Civil Revision No. 2 16 of 1980.
R.F. Nariman and D.N. Misra for the Appellant.
989 Rakesh Sahney, K.M.M. Khan and Vineet Kumar for the Respondent.
The Judgment of the Court was delivered by section RATNAVEL PANDIAN, J.
This appeal by special leave under Article 136 of the Constitution is against the judg ment and order dated 29.5.1980 in Civil Revision No. 216 of 1980 passed by the High Court of Punjab and Haryana at Chandigarh.
The respondent herein being the owner of the tenanted premises (i.e. two sheds) filed a petition for ejectment before the Rent Controller against the tenant, the appellant herein on the ground that the tenant had not paid the rent from 1.5.74.
The monthly rent for the premises was orginally Rs.950.
According to the landlord under the provisions of Haryana Urban (Control of Rent and Eviction) Act, 1973 (hereinafter referred to as the 'Act ') the rent of the demised premises was liable to be increased from Rs.950 to Rs. 1142 per mensem.
The landlord gave notice to the tenant to pay the rent at the enhanced rate of Rs. 1142 per mensem with effect from 26th June 1974 but the tenant defaulted in making the payment of rent and as such he was liable to be ejected from the premises on the ground of nonpayment of rent.
The tenant resisted the application stating that the landlord was not entitled to claim enhanced rent at the rate mentioned in the ejectment application under the provisions of the Act and no legal notice was served on him claiming the arrears of rent and he had already paid the rent upto March 1975 by means of cheques and he had tendered the arrears of rent together with interest and cost as assessed by the Rent Controller on 5th December 1977 and hence the sole ground of his ejectment from the demised premises was no longer available to the landlord.
In the replication the landlord denied that the tenant had paid the rent to him for the period from May 1974 to 30th November 1977 @ Rs.1142 per mensem.
In the alternative, he claimed that the rent to the extent of Rs.36,100 was due to him from the tenant @ Rs.950 per mensem for the period 1st May 1974 to 30th June, 1977 and that the tenant having defaulted in making the payment was liable to be ejected.
It may be stated that the applica tion for eviction was filed on 7.6.77.
The Rent Controller held that the landlord was not entitled to recover the rent @ Rs. 1142 p.m. but only @ Rs.950 p.m. as agreed between the parties and he had failed to pay the rent from 1.4.75.
On the basis of the above finding the Rent Controller directed the eject 990 ment of the tenant from the premises by granting two months ' time.
This order of the Rent Controller, on appeal, was con firmed by the Appellate Authority.
On being aggrieved with the Order of the Appellate Authority, the tenant preferred a Civil Revision Petition before the High Court under Sub section (6) of Section 15 of the Act.
On behalf of the tenant, it was urged before the High Court on the strength of Clause 'C ' of Rule 4 and Clause (1) of Rule 5 of the Haryana Urban (Control of Rent and Eviction) Rules 1976 framed under Section 23 of the Act that since in the appli cation for ejectment no specific amount of arrears due was mentioned, the application was not maintainable.
The High Court rejected this plea observing thus: "Admittedly, no such objection as to the non compliance of the said rules was taken either in the written statement or before the Rent Controller, inasmuch as it was not raised even before the Appellate Authority.
Moreover, it has not been shown that any prejudice was caused to the tenant on account of this non compliance on the part of the landlord.
Under these circumstances, no such plea can be available to the tenant in this revision petition for the first time particularly when it does not affect the merits of the case nor has it caused any prejudice to him.
" Thereafter, coming to the question of arrears of rent, the High Court found thus: "Moreover, the tenant clearly stated on 5th December 1977 that according to him, the total amount, due from him at the rate of Rs.950 p.m. from 1st April 1975 to 31st May 1977 was Rs.24,700 out of which Rs.21,696 had already been paid by him to the landlord, which he subsequently failed to prove by leading evi dence.
Under these circumstances, since the tenant failed to prove the payment of the arrears of rent as claimed by him in his statement recorded on 5th December 1977 he was liable to ejectment on the ground of non payment of rent as provided under Section 13(2)(i) of the Act.
" On the above finding, the Revision Petition was dis missed.
Hence this present appeal.
We shall point out at this juncture that the amount of Rs.21,696 991 which the tenant claims to have paid includes a sum of Rs. 18,844.14 which was found by the Rent Controller and the Appellate Authority as arrears of rent.
Mr. R.F. Nariman, learned counsel appearing on behalf of the appellant/tenant assails the impugned judgment of the High Court on two legal grounds; firstly, that the High Court has ignored to note that the statutory obligation cast on the Rent Controller as per the proviso attached to Sec tion 13(2)(i) of the Act requiring him to calculate and determine the quantum of arrears of rent even at the first instance has not been complied with and secondly that the application for ejectment was not in accordance with the mandatory provisions of Rule 4(c), 5(1) and 6 of the Rules framed under the Act and as such the impugned judgment is liable to be set aside on both the grounds.
We shall now take the first ground of attack.
Before dealing with the point of law involved, it may be necessary to extract the relevant portion of Section 13(2)(i) of the Act with its first proviso with which we are concerned.
"13(2) A landlord who seeks to evict his tenant shall apply to the Controller, for direction in that behalf.
If the Controller, after giving the tenant a reasonable opportu nity of showing cause against the application, is satisfied (i) that the tenant has not paid or tendered the rent due from him in respect of the building or rented land within fifteen days after the expiry of the time fixed in the agreement of tenancy with his landlord or in the absence of any such agreement by the last day of the month next following that for which the rent is payable.
Provided that if the tenant, within a period of fifteen days of the first hearing of the application for ejectment after due service, pays or tenders the arrears of rent and inter est, to be calculated by the Controller, at eight percenturn per annum on such arrears together with such costs of the application, if any, as may be allowed by the Controller, the tenant shall be deemed to have duly paid or tendered the rent within the time aforesaid.
" The answer to the first legal question mainly turns on the 992 interpretation of the proviso to Section 13 which refers to the following essential conditions namely: 1.
There must be an application for ejectment before the Court; 2.
The tenant, within a period of fifteen days of the first hearing of the application after due service, pays or tenders: (a) the arrears of rent; and (b) the interest to be calculated by the Controller at eight per cent per annum on such arrears together with such costs of the application, if any as may be allowed by the Controller; If the above said two conditions are satisfied, then the tenant shall be deemed to have duly paid or tendered the rent within the time required by law.
The last paragraph of Section 13(2) enjoins that where the above second condition of the proviso is not fulfilled the Controller shall make an Order directing the tenant to put the landlord in possession of the building and where he is satisfied that the rent has been paid the application of the landlord must be rejected.
Therefore, the sole question which has to be determined in the case on hand is whether or not the deposit made by the appellant was legally valid.
On facts, the Rent Control ler, the Appellate Authority and the High Court found that the appellant/tenant has not deposited the actual rent due payable by him except a part of it namely Rs.2902.96 along with the interest of Rs.261.27 and the cost of Rs.35 totall ing to Rs.3199.23 which deposit was less by Rs.18844.14 even calculated at the rate of Rs.950 per mensem.
In fact, the learned counsel who appeared for the appellant/tenant before the Appellate Authority has conceded the arrears of rent which fact is found in paragraph 6 of the Order of the Appellate Authority reading thus: "The learned counsel for the appellant frankly conceded before me that he did not challenge the finding of the Court below that the re spondent was in arrears of rent in the amount of Rs. 18,844 on the date he tendered the arrears of rent together with interest and costs assessed by the Rent Controller.
" 993 An attempt on the part of the tenant that he had paid that amount has been totally rejected by all the Courts.
Only on the above finding, the Courts below held that the tenant had not deposited the full and valid rent actually due but only a small part of it and as such it is manifest that the second condition enjoined by the proviso was not fulfilled at all and on that ground alone it could be held that the deposit was not valid one.
The learned counsel, Mr. R.F. Nariman drew our attention to two judgments of this Court in Sheo Narain vs Sher Singh, ; and Sham Lal (dead) by Lrs.
vs Atme Nand Jain Sabha (Regd.), Dal Bazar, ; In our considered view both these decisions cannot be of any as sistance to the appellant in the present case because the points for determination that arose in those two cases were different.
Mr. R.F. Nariman then advanced an argument that a statu tory duty is cast under Section 13(2)(i) of the Act on the Rent Controller to calculate and determine the arrears of rent as well as the interest to be paid by the tenant within a period of 15 days of the first hearing of the application for ejectment after due service, but since the Controller has failed to discharge that obligation no eviction can be ordered particularly when there is a dispute with regard to the quantum of arrears of rent.
From the judgment on appeal, it seems that a contention substantially identical to the one presently made was advanced before the High Court which repelled the same holding thus: "Going through the whole scheme of the Act, there is no provision that the Rent Controller should decide at the first date of hearing the amount due as arrears of rent . . . . .
If this argument of the learned counsel for the peti tioner is accepted, in that situation the tenant will have another opportunity for making the payment of the arrears due from him, which, as stated earlier, is neither the scheme of the Act nor is in consonance with the language used in the proviso to Section 13(2)(i).
On the first date of hearing, it is the duty of the tenant to calculate the ar rears of rent, which according to him are due from him and which he intends to tender on the first date of hearing . . . . . .
Since payment of rent is obligatory on the tenant and that too within the time prescribed in Section 13(2)(i) of the Act, it is for him to calculate the rent which is in arrears and pay the same as provided by the statute.
" 994 After a careful scrutiny of the Section 13(2)(i) and the first proviso annexed thereto, we see no force in the sub missions of the learned counsel that there is any statutory duty cast on the Rent Controller even in the first instance to determine and calculate the arrears of rent and the interest but on the contrary the proviso requires the tenant to pay or tender the actual arrears of rent within 15 days of the first hearing of the application for ejectment after due service alongwith the interest to be calculated by the Controller at 8 per cent per annum on such arrears together with such costs of the application, if any, as may be al lowed by the Controller.
What the proviso requires is that the Controller has to calculate the interest at 8 per cent per annum on such arrears of rent and determine the costs of the application, if any.
If the argument of the learned counsel is to be accepted then in every case the Rent Con troller has to hold an enquiry at the first instance and determine the arrears of rent even on the first date of hearing which is in the nature of things not possible with out any evidence, nor is it contemplated under the scheme of the Act.
When there is a statutory obligation on the tenant either to pay or tender the arrears of rent within a period of 15 days of the first hearing of the application for ejectment after due notice it is for him to calculate the exact arrears of rent due and to pay or tender the same and if the tenant tails to do so he is deemed to have not paid or made the valid tender of the rent.
Hence we hold that this argument advanced on behalf of the appellant is miscon ceived and fallacious.
For the reasons aforementioned, we hold that there is no merit in the first contention.
We shall now examine the second legal contention with reference to Rules 4(c), 5(1) and 6 of the Rules under the Act which rules read as follows: 4.
Application for eviction.
Section 13 Application under section 13 of the Act, shall besides the particulars mentioned in Rules 5 and 6 contain the following particulars name ly: (emphasised) (a) xxxxxxxxxx (b) xxxxxxxxxx (c) The amount of arrears due and the period of default.
995 5(1) Applications Section 4 and 13(1) In addition to the particulars mentioned in rules 3, 4 and 6 as far as these may be applicable, every application made under this Act shall contain simple and concise narrative of the facts which the party by whom or on whose behalf the statement of pleading is made, believes to be material to the case and which he either admits or believes that he will be able to prove.
(emphasised) 6.
Particulars to be furnished to the Controller Section 21(1) Every landlord and every tenant of a building or rented land shall furnish to the Controller, or any person authorised by him in that behalf, the follow ing particulars namely: (emphasised) (a) name and number of the building or rented land, if any, or its description and bound aries sufficient to identify it; (b) street and municipal ward or division in which the building or rented land is situated; (c) name and address of the landlord, if the particu lars are furnished by the tenant and name of the tenant, if the particulars are furnished by the landlord; (d) whether the building is a residential, non residential or a scheduled building; and (e) nature of amenities provided by the land lord to the tenant Mr. R.F. Nariman laid stress on the word "shall" occur ring in the above rules particularly Rule 4(c) and contended that these rules are mandatory in character and so the non compliance would amount to violation of the imperative (i.e. mandatory) provisions of these rules.
According to him the respondent/landlord has not specified the 'amount of arrears due ' in strict substantial compliance of Rule 4(c) and as such the present application for ejectment has to be thrown.out.
The answer to the above contention depends upon whether these rules are mandatory or directory which ques tion has to be adjudged in the light of the intention of the legislature as disclosed by the object, purpose and scope of the statute.
No doubt, if the statute is mandatory , 996 the things done not in the manner or form prescribed have no effect or validity, but if it is directory, the non compli ance may not lead to any serious and adverse consequence.
A valuable guide for ascertaining the intention of the Legis lature is found in Maxwell "The Interpretation of Statutes" (Twelfth Edition) Chapter 13 at page 3 14) under the caption "Intentions attributed to the legislature when it expresses none" reads thus: "Passing from the interpretation of the lan guage of statutes, it remains to consider what intentions are to be attributed to the legis lature on questions necessarily arising out of its enactments and on which it has remained silent. . . . . . .
It is impossible to lay down any general rule for determining whether a provision is imperative or directory." Lord Cambell in Liverpool Borough Bank vs Turner, ; at pp. 507,508 observed: "No universal rule can be laid down for the construction of statutes as to whether manda tory enactments shall be considered directory only or obligatory with an implied nullifica tion for disobedience.
It is the duty of Courts of Justice to try to get at the real intention of the Legislature by carefully attending to the whole scope of the statute to be construed.
" Lord Penzance in Howard vs Bodington, at p. 211 said: "I believe, as far as any rule is concerned, you cannot safely go further than that in each case you must look to the subject matter; consider the importance of the provision that has been disregarded, and the relation of that provision to the general object intended to be secured by the Act; and upon a review of the case in that aspect decide whether the matter is what is called imperative or only directo ry." In 'Craies on Statute Law ' (Sixth Edition) at page 63, the following quotation is found: 997 "When a statute is passed for the purpose of enabling something to be done, and prescribes the formalities which are to attend its per formance, those prescribed formalities which are essential to the validity of the thing when done are called imperative or absolute; but those which are not essential and may be disregarded without invalidating the thing to be done, are called directory" See Montreal Street Rly.
Co. vs Normandin, ; With reference to non compliance of the directory enact ment in 'Craies on Statute Law ' it is said at page 261: "But on the other hand, if a statute is merely directory, it is immaterial, so far as relates to the validity of the thing to be done, whether the provisions of the statute are accurately followed out or not.
" See also 'On the Construction of Statutes ' by Crawford.
In Woodward vs Sarsons, at page 746 it is explained as to what is called an absolute enactment or mandatory enactment as follows: "An absolute enactment must be obeyed or fulfilled exactly, but it is sufficient if a directory enactment be obeyed or fulfilled substantially.
" In Seth Bikhraj Jaipuria vs Union of India, [1962] 2 SCR p. 880 a question arose whether Section 175(3) of the Government of India Act, 1935 which requires that contracts on behalf of the Government of India shall be executed in the form prescribed is mandatory or directory.
The Supreme Court at page 893 expressed its view as follows: "Where a statute requires that a thing shall be done in the prescribed manner or form but does not set out the consequences of non compliance, the question whether the provision was mandatory or directory has to be adjudged in the light of the intention of the legisla ture as disclosed by the object, purpose and scope of the statute.
If the statute is manda tory, the thing done not in the manner or form prescribed can have no effect or validity; if it is directory, penalty may be incurred for non compliance, but the act or thing done is regarded as good." 998 In Raza Buland Sugar Co. Ltd. vs Municipal Board, Ram pur; , , certain questions arose for consider ation whether the whole of Section 131(3) of U.P. Municipal ities Act was mandatory or the part of it requiring publica tion in the manner laid down in Section 94(3) of the said Act i.e. in a Hindi Newspaper was merely directory; Wancboo, J as he then was speaking for the majority said: "The question whether a particular provision of a statute which on the face of it appears mandatory, inasmuch as it uses the word "shall" as in the present case is merely directory cannot be resolved by laying down any general rule and depends upon the facts of each case and for that purpose the object of the statute in making the provision is the determining factor.
The purpose for which the provision has been made and its nature, the intention of the legislature in making the provision, the serious general inconvenience or injustice to persons resulting from whether the provision is read one way or the other, the relation of the particular provision to other provisions dealing with the same subject and other considerations which may arise on the facts of a particular case including the language of the provision, have all to be taken into account in arriving at the conclu sion whether a particular provision is manda tory or directory.
" See also K. Kamaraja Nadar vs Kunju Thevar and Others, and Ch.
Subbarao vs Member, Election Tibunal, Hyderabad, 13.
It is apposite to refer to the observation of this Court in Hari Vishnu Kamath vs Syed Ahmad Ishaque, ; dealing with this problem: "It is well established that an enactment in form mandatory might in substance be directory and that the use of the word "shall" does not conclude the matter.
" Reference may be had to (1) State of U.P. & Ors.
vs Babu Ram Upadhya, ; and (2) Ajit Singh vs State of Punjab, ; The word "shall" in its ordinary import is obligatory.
Nevertheless, the word "shall" need not be given that conno tation in each and 999 every case and the provisions can be interpreted as directo ry instead of mandatory depending upon the purpose which the legislature intended to achieve as disclosed by the object, design, purpose and scope of the statute.
While interpreting the concerned provisions, regard must be had to the context, subject matter and object of the statute in question.
On a close scrutiny of the relevant rules referred supra in the light of the above principles of statutory interpre tation, we are of the view that the non compliance of rule 4(c) i.e. the non mentioning of the quantum of arrears of rent, does involve no invalidating consequence and also does not visit any penalty.
From the above discussion we hold that the rules 4(c), 5(1) and 6 are not mandatory but only directory.
In that view, we see no force in the contention of the learned counsel that the non mentioning of the amount of arrears of rent due in the application for ejectment has adversely affected the proceedings of this case and as such the appli cation for ejectment is liable to be dismissed on that score.
Accordingly, we reject this contention also.
In the present case, the tenant himself was well aware of the amount of arrears of rent due about which we have already mentioned in the earlier portion of this judgment.
The present objection as to the non compliance of the rules admittedly was not taken either in the written statement or before the Rent Controller or before the Appellate Authori ty.
For the first time such a contention was raised before the High Court which has tightly rejected the same, observ ing thus: "It has not been shown that any preju dice was caused to the tenant on account of this non compliance on the part of the land lord.
" We are in full agreement with the above view of the High Court as no prejudice is writ large in the present case because proof of prejudice is also one of the necessary criteria besides non compliance of the provision to invali date the Act complained of as held by Chinnappa Reddy, J in Dalchand vs Municipal Corporation, Bhopal and Another, In the result, both the contentions raised by the appellant fail.
For the reasons hereinbefore mentioned, the appeal is dismissed with costs.
Y.L. Appeal dis missed.
| This is a tenant 's appeal filed after obtaining Special Leave from the Court.
The Respondent landlord of tenanted premises (i.e. two sheds) filed a petition for ejectment of the appellant from the premises in question before the Rent Controller.
According to the Respondent landlord the monthly rent payable by the appellant was Rs.950 p.m. which was liable to be enhanced under the provisions of Haryana Urban (Control of Rent and Eviction) Act, 1973 from Rs.950 to Rs.1142 p.m.
Accordingly, the respondent caused a notice to be given to the appellant claiming rent @ Rs. 1142 w.e.f. 26.6.1974 till June 1977 and since the appellant defaulted in making payment of the rent, he was liable to be ejected from the demised premises.
The tenant denied that the rent was liable to be enhanced as claimed by the landlord.
He further asserted that he had already paid rent upto March 1975 by means of cheques and that he had tendered the ar rears of rent together with interest and costs as assessed by the Rent Controller on 5.12.1977.
On this reasoning he urged that he was not liable to be evicted on the ground taken in the Petition.
The landlord in the replication denied the receipt of rent for the period from May 1974 to November, 1977 @ Rs.1142 p.m. Alternatively he claimed that the rent to the extent of Rs.36,100 was due to him from the appellant @ Rs.950 p.m. from 1st May, 1974 to June 30, 1977.
The Rent Controller held that the landlord respondent was not entitled to recover the rent @ Rs.1142 p.m. but only Rs.950 p.m. as agreed between the parties and the appellant has failed to pay the rent from 1.4.1975.
Accordingly, the Rent Controller directed the ejectment of the appellant from the premises by granting him two months time.
987 The appellate authority having affirmed the order of the Rent Controller, the appellant filed a Civil Revision before the High Court under Sub section
(6) of Sec. 15 of the Act.
Before the High Court it was urged by the appellant that since in the application for ejectment no specific amount of arrears of rent due was mentioned as contemplated by CI.
(c) of Rule 4 and Clause (1) of Rule 5 of the Haryana Urban (Control of Rent and Eviction) Rules he could not be evict ed.
Finding no substance in the said contention, the High Court rejected the Civil Revision.
Hence this appeal.
The appellant raised two contention before this Court viz., that the High Court has ignored to note the statutory obligation cast on the Rent Controller as per the proviso attached to Sec.
13(2)(1) of the Act requiring him to calcu late and determine the quantum of arrears of rent; even at the first instance has not been complied with and (ii) that the application for ejectment was not in accordance with the mandatory provisions of Rule 4(c) 5(1) and 6 of the Rules framed under the Act.
Dismissing the appeal, this Court, HELD: The proviso to Sec. 13(2)(i) requires the tenant to pay or tender the actual arrears of rent within 15 days of the first hearing of the application for ejectment after due service alongwith the interest to be calculated by the Controller at 8 per cent per annum on such arrears together with such costs of the application, if any, as may be al lowed by the Controller.
[994B] When there is a statutory obligation on the tenant either to pay or tender the arrears of rent within a period of 15 days of the first hearing of the application for ejectment after due notice it is for him to calculate the exact arrears of rent due and to pay or tender the same and if the tenant fails to do so he is deemed to have not paid or made the valid tender of the rent.
[994D] The non compliance of Rule 4(c) i.e. the non mentioning of the quantum of arrears of rent, does involve no invali dating consequence and also does not visit any penalty.
[999B C] Rules 4(c), 5(1) and 6 are not mandatory but only directory.
[999C] If the statute is mandatory, the things done not in the manner or form prescribed have no effect or validity.
But if it is directory, the non compliance may not lead to any serious and adverse consequence.
[995H; 996A] 988 The word "shall" in its ordinary import is obligatory.
Nevertheless the word "Shall" need not be given that conno tation in each and every case and the provisions can be interpreted as directory instead of mandatory depending upon the purpose which the legislature intended to achieve as disclosed by the object, design, purpose and scope of the statute.
[998H; 999A B] No prejudice is writ large in the present case because proof of prejudice is also one of the necessary criteria besides non compliance of the provision to invalidate the Act.
[999G] Sheo Narain vs Sher Singh, ; , Not applicable.
Sham Lal (dead) by Irs.
vs Atme Nand Jain Sabha (Regd.) Dal Bazar, ; , Not applicable.
Montreal St. Rly.
Co. vs Normandin, ; , re ferred to.
Seth BikhrajJaipuria vs Union of India, ; , referred to.
Raza Buland Sugar Co. Ltd. vs Municipal Board, Rampur, ; , referred to.
K. Kamraj Nadar vs Kunju Thevar and Others, , referred to.
Subbarao vs Member, Election Tribunal, Hyderabad, ; , referred to.
State of U.P. & Others vs Babu Ram Upadhya, ; , referred to.
Ajit Singh vs State of Punjab, ; , referred to.
|
minal Appeal No. 240 of 1968.
972 Appeal by special leave from the judgment and order dated February 8, 1968 of the Punjab and Haryana High Court in Criminal Revision No. 237 of 1967.
section Lakshminarasu, for the appellant.
B. D. Sharma and R. N. Sachthey, for the respondent.
The Judgment of the Court was delivered by Vaidiafingam, J.
In this appeal, by special leave, the appellant accused challenges the judgment and order dated February 8, 1968, of the Punjab & Haryana High Court in Criminal Revision No. 237 of 1967, confirming the conviction and sentence passed against him for an offence under section 29 of the (hereinafter to be referred as the Act).
The appellant was at the relevant period a constable having roll number 857.
He was originally recruited in 1950 to the police service in the composite Punjab State; and on the formation of the State of Haryana, he was allotted to Haryana.
The appellant was posted to do duty at the police lines,, Kamal, before November 25, 1963.
It was reported by the Lines Officer on November 25, 1963 that when roll call was taken on the evening of that day at about 6.30 p.m., the appellant was found absent.
The report also refers to the absence of certain other police officers, with whom we are not concerned.
The judicial magistrate, Karnal, issued what is stated to be a notice dated January 10, 1966 to the appellant, alleging that he was found absent from duty from the police lines at the time of roll call on November 25, 1963.
He was asked to "plain why he should not be held guilty under section 29 of the Act.
The appellant stated that he would neither plead guilty nor would he admit that he remained absent from duty.
He has further stated that he was mentally upset in view of the sudden deaths of his mother and brother in law, and also due to his children being cut off from him.
He wound up, his answer by saying that he was under medical treatment in the civil hospital, Karnal, and the doctor therein sent him to Patiala.
He was tried for an offence under section 29 of the Act on the ground that he was absent from duty on November 25, 1963.
The judicial magistrate, by his order dated March 4, 1966, found the appellant guilty of the offence and sentenced him to pay a fine of Rs. 51 and in default to undergo simple imprisonment for seven days.
The learned magistrate considered the plea of the accused regarding his having undergone treatment in the civil hospital, as also the evidence of the doctor who has spoken to this fact, and held that the case of the accused requires a very sym 9 7 3 pathetic consideration.
But nevertheless the magistrate found that as the appellant was technically guilty of the offence under section 29 of the Act, with which he was charged, he has be punished Accordingly; he convicted him and imposed the fine, as stated above.
The appellant challenged his conviction and sentence 'before the learned Sessions Judge as well as the High Court, but was unsuccessful.
Though several contentions regarding the legality of the conviction have been taken by Mr. Lakshmi narasu, learned counsel nominated to represent the appellant by the Legal Aid Society of the Supreme Court Bar Association, in the view that we take regarding the prosecution being barred by limitation under section 42 of the Act, it becomes unnecessary to refer to those contentions and deal with them.
We have already referred to the fact that the allegations against the appellant related to hi absence from duty on November 25 , 1963, stated to be an offence under section 29 of the Act.
The notice issued by the judicial magistrate was on January 10, 1966.
The contention that is taken by Mr. Lakshminarasu based on section 42 of the Act is that the prosecution against the appellant has been commenced beyond the period of three months, as provided in section 42 of the Act and therefore, the trial and other proceedings leading upto the conviction of the appellant ate illegal and void.
The counsel pointed out that the act complained of was the appellant 's absence from duty at the time of the roll call on November 25, 1963.
The earliest step taken in this case for prosecuting the appellant was on January 10, 1966 when the judicial magistrate issued the notice to the apple ant calling upon him to explain why he should not be held guilty under section 29 of the Act.
That notice was issued long after the expiry of three months from the date of the commission of the offence complained of.
In fact.
Mr. Lakshminarsu argued that the date of filing 'the complaint will be the date when prosecution is commenced.
But he was willing to assume that the issue of the notice on January 10, 1966.
, is a step in the prosecution.
Even then he argued that the prosecution is barred under section 42 of the Act.
It is no doubt true that this point has not been taken as such before any of the courts; but in the statement given on February 9, 1971 regarding the propositions of law to be advanced before this Court, this contention has been specifically raised.
A copy of the said statement has been given to the counsel for State the same day.
However, the point that is raised is a pure question of law, not involving any further investigation of facts.
We therefore permitted counsel for the appellant to raise this legal contention.
974 The question therefore is whether the prosecution initiated against the appellant in this case is barred by limitation under section 42 of the Act.
" the material part of section 42, relevant for the present purpose reads as follows "All .
prosecutions against any person, which may be lawfully brought for anything clone or intended to be done under the provisions of this Act, or under the general police powers hereby given shall be commenced within three months after the act complained of shall have been committed, and not, otherwise, From the section quoted above, it will he clear that the period of three months prescribed for commencing a prosecution under the said section is only with respect to prosecution of a person or something done or intended to be done by him under the provisions of the or under the general police powers given by the Act.
It is clear that the appellants prosecution was initiated against him for.
something done under the provisions of the Act, namely, noncompliance with the requirement to be on duty as required under the, .
Therefore, under section 42 of 'the Act, the prosecution should have been commenced against the appellant within three months after the act complained of has been committed.
The act complained of was atieged to have been committed on November 25, 1963.
Even treating the notice issued by the judicial magistrate is amounting to commencement of prosecution, it took place only on January 10, 1966, long after the expiry of three months from the date of the commission of the offence.
Therefore, the prosecution, commenced against the appellant is barred by limitation under section 42 of the Act.
In this case there is no controversy that the offence with which the appellant was charged was one under section 29 of the Act and for the said offence he was tried and convicted.
Mr. B. D. Sharma, learned sounsel for the respondent State, faced with this situation urged that in the notice issued by the judicial magistrate, Karnal, to the appellant on January 10, 1966, it was specifically stated that the appellant was absent not only on November 25, 1963, but that he also continued to be absent as before.
According to the learned counsel, this clearly means that even on the date when the notice was issued to the appellant, that is, on January 10, 1966, the appellant was absent and was guilty of an offence under section 29 of the Act and hence the prosecution has cornmeal within the period mentioned in section 42 of the Act.
We are not inclined to accept this contention.
A perusal of the order of" the trial magistrate, the learned Sessions Judge and the High Court, clearly shows that the appellant was tried on the specific charge of having absented himself from duty on November 25, 975 1963.
The notice issued 'by the magistrate on January 10, 1966 also refers to the report of November 25, 1963 about the appellant 's being absent on that evening at roll call., For his absence on November 25, 1963 he was called upon to show cause why he should not be held guilty under section 29 of the Act.
Further it is also seen from the examination of the accused under section 342.
Code, of Criminal Procedure, that a specific question was put to him "It is in evidence against you that you were absent from the Police Lines Kamal on 25 11 63 and as such were marked absent at the time of Roll call.
What do you say to it ?" We may also refer to the decision of this Court in Maulud allegation against the appellant related to his absence on November 25, 1963 and it was the evidence in that regard that was put to the appellant for offering his explanation.
All the above facts clearly show that the appellant was tried and convicted for an offence under section 29 of the Act in which case the prosecution for such An offence should have been done within the time laid down thereunder.
We may also refer to the decision of this Court in Maulud Anand vs State of Uttar Pradesh(1) wherein it alas been held that if there is a prosecution of a police officer for an offence under section 29 of the Act, such a prosecution should be one within the period of limitation mentioned in section 42 of the Act.
In that case the appellant therein, a Head constable, was charged and tried, along with another person, for various offences under the Indian Penal Code, such as sections 304A and 218/109.
The other accused was acquitted but the head constable was convicted under section 218 I.P.C. One of the contentions raised by the appellant before this Court was that as the prosecution was launched against him more than three months after the commission of the ' offence, it was barred by limitation under section 42 of the Act.
This Court after a perusal of the scheme of sections 36 and 42 of the Act rejected the contention of the appellant.
This Court held that the head constable was prosecuted and convicted for offences not under the Act but under the Indian Penal Code.
To such prosecution, it was held that section 42 did not apply.
On the other hand, it was held that section 42 of the Act applies to a prosecution against a person for an offence under section 29 of the Act.
The conclusion arrived at by us that the prosecution in the case on hand is barred by section 42 of the Act is also supported by the decision quoted above.
To conclude, it is clear that the prosecution against the appellant has been commenced beyond the period of three months and as such it is barred by limitation under section 42 of the Act.
Hence (1) [1963] Supp. 2 S.C.R. 38. 9 7 6 the orders of the High Court and the two subordinate courts are set aside.
in consequence, the conviction of the appellant as well as the levy of fine are also set aside.
The appeal is allowed and fine, if collected, shall be refunded.
to the appellant.
G.C Appeal allowed.
110O Supp.
C.I.(P)/71 2500 2 6 72 GIPF.
| The appellant was a constable in the police force ' of Haryana State.
At the relevant time he was posted to do duty at the police lines, Karnal.
It was reported by the Lines Officer that he was not present at the roll call on the evening of November 25, 1963.
The Judicial Magistrate gave him a notice in January 1966 asking him to explain why he should not he held guilty under section 29 of the police 'Act 1891 being absent on the aforesaid date.
The appellant explained that he was mentally upset on account of the death of two near relatives and was himself ill.
The, Magistrate held that the appellant was technically guilty, even though his case required sympathetic consideration.
In this view he sentenced the appellant to pay a fine of Rs. 51 and in default to undergo simple imprisonment for seven days.
Appeals before the Sessions Judge and the High Court failed.
In appeal to this Court by special leave it was contended on behalf of the appellant, that since more than three months, had intervened between the commission of the alleged offence and the commencement of the prosecution, the trial was time barred by limitation under section 42 of the .
This point was raised in this Court for the first time but had been stated in the statement of propositions of law to be advanced before the Court, and a copy of the same had been supplied to the counsel for the State.
Allowing the appeal, HELD : (i) The question of limitation being purely one of law requiring no fresh investigation into facts the appellant could be permitted to raise it for the first time in this Court.
[973 H] (ii)The appellant 's prosecution was initiated against him for something done under the provisions of the Act, namely non compliance with the requirement to be on duty as required under the .
Therefore under section 42 of the Act the prosecution should have been commenced against the appellant within three months of the commission of the act complained of.
The act complained of was alleged to have been committed on November 25, 1963.
Even treating the notice issued by the judicial magistrate as amounting to commencement of prosecution, it took place only on January 10, 1966, long after the expiry of three months from the date of the commission of the offence.
Therefore the prosecution commenced against the appellant was barred by limitation under section 42 of the Act.
[974 D E] Maulud Ahmad vs State of Uttar Pradesh, [1961] Supp. 2 S.C.R. 38, distinguished.
|
Appeal No. 680 of 1976.
From the Judgment and Order dated the 17th March, 1976 of the Monopolies and Restrictive Trade Practices Commis sion, New Delhi in R.T.P. Enquiry No. 11 of 1974.
L.M. Singhvi, Ravinder Narain, Talat Ansari and Shri Narain for the Appellant.
L.N. Sinha, Sol.General, B. Datta and Girish Chandra for Respondents Nos. 1 and 2.
G.A. Shah and N. Nettar for Respondent No. 13 The Judgment of the Court was delivered by C.J.
This is an appeal under section 55 of the Monop olies & Restrictive Trade Practices Act, 1969 (hereinafter referred to as 'the Act ') against the order and judgment of the Monopolies & Restrictive Trade Practices Commission, New Delhi (hereinafter referred to as the 'Commission '), in proceedings started under section 10(a) (iv) of the Act against the appellant M/s. Hindustan Lever Ltd. (hereinafter referred to as 'the Company '), upon information furnished by Bhogilal Manilal Shah of M/s. Shah Manilal Motichand & Sons of Poona (hereinafter referred to as the 'informant ').
The informant was a redistribution stockist of the appellant company carrying on business regulated by the terms of an agreement, known as the redistribution stockists agreement of the company, found in a standard printed form, entered into with each stockist.
The agreement has 23 terms or clauses in it.
The clauses complained of are 5 and 9, which may be reproduced here: "5.The Redistribution Stockist shall use his best endeavours to maintain and in crease the trade of the Products in the said town and for this purpose he shall at all times keep and 'maintain adequate stocks of the Products in all its packings and he shall carry.
out all instructions and directions including those as to the maximum resale price which may from time to time be given by the Company or by the Company 's accredited repre sentatives in respect of the sale or resale or disposal by the Redistribution Stockist of stocks of the Products supplied to him in pursuance of this Agreement.
The Redistribution Stockist is prohibited from charging in excess of the maximum resale prices stipulated by the Company, but he may, at his discretion, charge prices lower than the said maximum resale prices.
The Redistribution 459 Stockist shall purchase and accept from the Company such stock as the Company shall at its discretion send to the Redistribution Stockist for fulfilling its obligations under this Agreement.
In order to ensure equitable and reasonable distribution of stocks at fair prices, the Redistribution Stockist shall not rebook or in any way convey, transport or despatch parts of stocks of the products received by him outside the aforesaid town except when he is so expressly directed in writing by the Company.
He shall also whenev er so required by the Company make available from the stocks of Company 's merchandise purchased by him such part as the Company directs him.
to do for purposes of resale on his behalf by the Company 's employee."
It is alleged that the two clauses, set out above found in identical agreements entered into by the Company with its stockists, whose number is quite large, constitute or autho rise restrictions which are unreasonable and illegal.
Hence, it was submitted by the respondents that it must be struck down or modified so as to make the business and trade of the appellant company and its stockists conform to the requirements of law.
The Commission had accepted the case brought to its notice by the informant and made the following order : "(1).
Clause 5 of the Agreement (Exhib it F) shall stand modified so that the follow ing shall be substituted in place thereof: "5.
The Redistribution Stockists shall use his best endeavours to maintain and in crease the trade of the products in the said town and for this purpose he shah at all times keep and maintain adequate stocks of the products in all its packings and he shall carry out the instructions and directions including those as to maximum resale price which may from time to time be given by the Company or by the Company 's accredited repre sentatives in respect of the sale or resale or disposal by the Redistribution Stockist of stocks of the products supplied to him in pursuance of this Agreement.
The Redistribu tion Stockist is prohibited from charging in excess of the maximum resale prices stipulated by the Company but he may at his discretion charge prices lower than the said maximum resale prices". "(2).
The practices of resale price maintenance and full line forcing to which original clause 5 of the agreement related, shall be discontinued and shall not be repeat ed.
(3) Clause 9 of the Agreement (Exhibit F) shall be void.
(4) The practice of area allocation to which clause 9 of the Agreement (Exhibit F) related, shall be discontinued and shall not be repeated.
460 (5) In all future price circulars or lists to be issued by the Respondents, it shall be clearly stated that the prices there in mentioned are maximum prices and that prices lower than these prices may be charged.
(6) This order shall come into force with effect from 1st July, 1976.
On or before the said date, the Respondents shall intimate all Redistribution Stockists of the modifica tions in Clauses 5 of the Agreement (Exhibit F) and the voidity of clause 9 of the Agree ment (Exhibit F)".
There was some argument before us on the question whether proceedings before the Commission were maintainable at the instance of a "complainant" who had reasons to nurse a grievance against the Company and whose motives could be questioned.
It was pointed out that the agreement of the company with the informant had been terminated.
The version of the informant was that this had been done because his firm had sold Vanaspati at the rate of Rs. 127/ per tin which was below the price of Rs. 129.05 per tin fixed by the Company.
The informant stockist said that the price had to be reduced by him to remove public discontent.
We think that the motives of the informant are quite irrelevant in such a case.
All that the Commission, and, on appeal, this Court has to examine is whether what would undoubtedly be a "practice" by the appellant company, of introducing the two clauses complained of, in its agreements with its stockists, amounted to a restrictive trade practice.
The distinction sought to be made .,on behalf of the appellant, between a practice and clauses in a contract which give a company the power to regulate trade in a manner which may constitute a restriction, appears to be inconse quential here.
We do not think that we can isolate the terms of a contract from the actual practice of the company.
It is not the case of the company anywhere that the clauses in its agreement with its stockists are to be treated as deadletter.
Its case is that they do not operate as restrictions.
The introduction of such clauses in so many agreements meant to regulate relations, either between a principal and an agent or the seller and the stockist who acquires complete proprietary rights in the stock of goods purchased, is itself a trade practice.
The simple question before us is: Can powers conferred upon the company under such clauses be exercised in such a way as to constitute restrictive trade practices?
It is true that the practice of imposing restrictions under such clauses is one thing and the practice of intro ducing such clauses is quite another thing.
Both may con stitute separate practices.
Nevertheless, the introduction of such clauses into an agreement between the manufacturer and the seller who purchases and stocks his goods is in itself something practised.
It is immaterial that the use of powers under such clauses may constitute another set of practices which depend upon the existence of 'such clauses as sources or springs.
Inasmuch as the introduction of clauses in such an agreement is a practice, taken by itself, the question whether such a practice amounts to a restric tive trade practice or not could only be decided by consid ering 461 whether the clauses could be so used as to unjustifiably restrict trade? It would be specious reasoning, in such a case, to separate the clauses in the agreement from action under the agreement and then to urge that, as evidence of action under the clauses is meagre or even absent, the clauses are innocuous and should not be modified or struck down because we are only concerned with what is actually being practised under them or with the use that is being made of such clauses and not with what is permissible or possible under the clauses of the agreement of the kind before us.
This argument seems to us to overlook the definition of "restrictive trade practice" contained in section 2(0) of the Act which lays down: "(0) "restrictive trade practice" means a trade practice which has, or may have, the effect of preventing distorting or restricting competition in any manner and in particular (i) which tends to obstruct the flow of capital or resources into the stream of pro duction, or (ii) which tends to bring about manipula tion of prices, or conditions of delivery or to affect the flow of supplies in the market relating to goods or services in such manner as to impose on the consumers unjustified costs or restrictions." 0 It is clear from a bare perusal of the above mentioned definition that it is not only the actual practice of a restriction under a clause which is struck by the provisions of the Act, but also a "trade practice" which "may have" the effect of restrictions falling within the mischief" provided for.
In other words, if the introduction of the clause in itself is a trade practice and could be used to prevent, distort or restrict competition "in any manner" it may be struck down.
A trade practice is defined by section 2(u) of the Act as follows : "(u) "trade practice" means any practice relating to the carrying on of any trade, and includes (i) anything done by any person which controls or affects the price charged by, or the method of trading of, any trader or any class of traders.
(ii) a single or isolated action of any person in relation to any trade".
This definition is wide enough to include any "trade practice" if it is in relation to the carrying on of a trade.
It cannot be argued that the introduction of the clauses complained of does not amount to an action which relates to the carrying on of a trade.
If the result of that action or what could reasonably flow from it is to restrict trade in the manner indicated, it will, undoubted ly, be struck by the provisions of the Act.
Reliance was sought to be placed by learned counsel for the appellant company on a recent decision of this Court in Tata Engineering & Locomotive Co. Ltd. vs The Registrar of the Restrictive 3 502 SCI/77 462 Trade Agreements, New Delhi(1) (hereinafter referred to as the "Telco" case) where it was held: "The definition of restrictive trade practice iS an exhaustive and not, an inclusive one.
The decision whether trade practice is restrictive or not has to be arrived at by applying the rule of reason and not on the doctrine that any restriction as to area or price will per se be a restrictive trade practice.
Every trade agreement restrains or binds persons or places or prices.
The ques tion is whether the restraint is such as regulates and thereby promotes competition or whether it is such as may suppress or even destroy competition.
To determine this ques tion three matters are to be considered.
First, what facts are peculiar to the business to which the restraint is applied.
Second, what was the condition before and after the restraint was imposed.
Third, what is the nature of the restraint and what is its actual or probable effect".
It was also held there: "The question of competition cannot be considered in vacuo or in a doctrinaire spirit.
The concept of competition is to be understood in a commer cial sense.
Territorial restriction will promote competi tion whereas the removal of territorial restriction would reduce competition.
As a result of territorial restriction there is in each part of India open competition among the four manufacturers.
If the territorial restriction is removed there will be pockets without any competition in certain parts of India.
If the dealer in Kashmir is allowed to sell anywhere in India wealthy cities like Delhi, Bombay, Calcutta will buy up trucks allocated for Kashmir and the buyer in Kashmir will not be able to get the trucks.
The other three manufacturers whose trucks are not in equal demand will have Kashmir as an open field to them without competition by Telco.
Therefore, competition will be re duced in Kashmir by the successful competition being put out of the field".
It is evident that in the Telco case this Court was considering the territorial restrictions placed upon the stockists of Telco in the Light of the special facts and circumstances of that particular case.
Each type of busi ness has, undoubtedly, its peculiarities, its own mode of operation, the special features relating to the market for it, and the requirements of distribution of particular goods which may be the subject matter of an agreement so as to secure a just and equitable distribution consistently with maintenance of freedom of competition so that prices are not artificially pushed up.
In the Telco case, the subject matter of the agreement was sale of trucks of a type in which the Telco had a monopoly inasmuch as no other firm produced trucks which were of such special quality and specifications.
Hence, there was great demand for these trucks, which were in short supply.
Again, for the mainte nance and running of those especially designed trucks the manufacturer had to provide especially trained and skilled personnel and special equipment and tools so as to enable stockists to service and repair trucks distributed.
Unless the manufacturers were able to impose restrictions upon sales outside the areas in which they had (1) ; 463 established their stockist cum servicing suppliers, they could not at all render the kind of service they were giving in addition to selling.
In other words, it was a mixed practice for purchase of trucks and provision of specialised service to the consumers, through the stockists.
On the peculiar facts and circumstances of that case, it was found that the agreements did not, on the whole, result in re stricting trade or curtailing competition.
The facts of the case before us are entirely different.
We are concerned here with a manufacturer of mixed consumer goods of different varieties.
The appellant company pro duces dehydrogenated oil (known in the market as "Vanas pati"), toilet preparations of various kinds such as soaps, shaving creams, toothpastes, and baby milk powder, and animal feeds.
The soaps manufactured by it are undoubtedly the main type of goods supplied.
But, it manufactures other type of goods too.
It can, therefore, compel stockists to by them, whether stockists want these other goods or not, if the terms of the agreement are to be held to be binding and enforceable.
The manufacturer is under no obligation to render any service in relation to maintenance of the goods supplied.
The whole trade is completely unlike that of manufacture and sale of motor trucks for which the stock ists, selling to the actual consumers, had to, as already pointed out, also have the services of the manufacturer 's trained personnel for the purposes of maintenance and repair of the vehicles supplied.
It would mount to an application of the law in a thoroughly doctrinaire fashion if we were to deduce some general principles, from the very different facts of the Telco case and attempt to apply them to those of the case now before us.
Thus, the contention advanced on behalf of the appellant, against a doctrinaire approach in such cases, really weighs against the appellant company.
In the Telco case, the agreement could not be understood without reference to the actual facts to which they were sought to be applied.
Those facts explained the nature of the special agreements for restriction or distribution of areas.
In the case before us, the problem entirely different.
This is not a case in which certain terms of the agreement require to be explained by the facts to which they were meant to be applied.
It is a Clear case in which the meanings of the clauses are decisive.
If these clauses are capable of being so used, on the meanings which appear unambiguously from them, as to undoubtedly restrict trade, the intention to so use them to restrict trade could reason ably be inferred without any difficulty.
Otherwise, why have them ? No oral evidence could be led to deduce their meaning or to vary it in view of the provisions of sections 91 and 92 of the Evidence Act.
the principles of which were we think rightly applied by the Commission.
The Telco case, on the other hand, was one in which extraneous evi dence could be led under section 92 proviso (6)of the Evidence Act which may be set out here with Section 92: "92.When the terms of any such contract, grant or other disposition of property or any matter required by law to be reduced to the form of a document, have been proved 464 according to the last section, no evidence of any oral agreement or statement shah be admit ted, as between the parties to any such in strument or their representatives in interest, for the purpose of contradicting, varying, adding to or subtracting from, its terms: Proviso (6) Any fact may be proved which shows in what manner the language of a document is related to existing fact".
The principle embodied in section 92(6) of the Evidence Act, which was applicable in Telco case (supra), is not, for the reasons given above, applicable in the case now before us.
Indeed, no attempt has been made by reference to any case law apart from the Telco case '(supra), which we have dis tinguished above, to show that extraneous evidence could have been led herein order to apply section 92 proviso (6) of the Evidence Act.
In the Telco case this provision was not directly referred to, but, we think, that it could have been applied there.
Thus, we think that the basic difficulty, placed before us by learned counsel for the appellant, in the way of examining the plain meaning and effect of clauses 5 and 9 of the Distribution Stockists agreement, does not exist at all in the case now under consideration.
We must, therefore, proceed to examine the meanings of these clauses from the point of view of what could be done by the Company under them.
If what may be done under these clauses could be a restrictive practice as defined by the Act, it was enough to vitiate them.
A clause having been introduced in an agreement entered into, as a part of the settled practice of the company, could be struck by the provisions of section 2(0) of the Act, set out above, quite apart from what is actually done under it.
We do not think that any other question is really relevant or need be considered by us at all in such a case.
It is not a case in which we could be taken through the oral evidence, as has been attempted to be done, because that is shut out by an application of provisions of sections 91 and 92 of the Evidence Act if all we need do is to interpret the agreement.
We are unable to see why these provisions do not apply here.
Not much argument appears to us to be needed to demon strate that the last sentence in paragraph 5 of the above mentioned clause places the redistribution stockist at the mercy of the company which can dictate to him what amounts of various commodities he "shall purchase and accept from the company" in the form of a total lot supplied to him.
The company need only send to the redistribution stockists what it "shah at its discretion send to the Redistribution Stockists for fulfilling its obligations under this Agree ment".
The meaning and effect are obvious here.
The intro duction of the word "shall" does not bind down the exercise of the discretion by reference to any requirements of the consumers in a particular area which the stockists may convey to the company.
Hence, if the stockists want to remain on the list of the redistribution stockists of the company.
the stockist is bound to accept and carry out the decision of the company.
Even if in view of some other practice adopted by the company 465 a power given in such wide terms was not meant to be exer cised unreasonably, its presence in the agreement would be a needless surplusage which could, whenever the company wanted it, be used to impede freedom of competition and trade.
This result was enough to make it quite objectionable.
We, therefore, think that the Commission was quite right in reframing clause 5 in the way it did.
We are unable to find any flaw in the detailed reasons given by the Commission for doing that.
The Commission rightly points out that, among agreements the registration of which is compulsory according to the provisions of Chapter V of the Act is, under section 33(1)(b) is "any agreement requiring a purchaser of goods, as a condition of such purchase, to purchase some other goods".
The last part of clause 5, as we have observed, clearly makes it necessary ,for the stockist to purchase such goods and in such combination as the company may de cide.
Hence, it would be struck by section 33(1)(b) of the Act.
It has not been shown to have been registered under the Act.
It is also submitted on behalf of the respondent that clause 5 of the agreement infringes section 33(1)(f) of the Act which requires registration of .
"any agreement to sell goods on condi tion that the prices to be charged on resale by the purchaser shall be the prices stipulat ed by the seller unless it is clearly stated that prices lower than those prices may be charged". 0 The Commission held that clause 5 of the agreement meant provision for "prices stipulated" and that it had been so treated by the company in its circulars stating that prices lower than the "maximum resale price stipulated" by the company may be charged.
If that was clear, there was no reason why the company should have attempted to clarify by means of its circulars what, according to it, the stockist is free to do under the agreement.
Even if the practice of the company by issuing circulars is established, it does not justify the retention of clause 5 in a form which can be used to compel stockists to act on the company 's behests whether reasonable or not.
On the other hand, it justifies its clarification by an alteration of it in the manner directed by the Commission so as to make the clause covering price regulation also very clear.
The order of the Commis sion modifying clause 5 only makes the position crystal clear.
Inasmuch as clause 5, even before deletion of the last sentence of it by the Commission, expressly gives the stockist the discretion to sell at lower than maximum resale prices stipulated, the agreement was not struck by section 33(1)(b) of the Act.
But, the deletion of the last sentence was essential to prevent possible misuse of the company 's powers, by resort to it, so as to even regulate prices contrary to express provisions found earlier in the clause.
Turning now to clause 9 of the agreement, we think that the Commission was right in rejecting the argument that evidence led on behalf of the company was enough to estab lish that clause 9 fell within one 466 of the "gateways" provided by section 38 of the Act.
A power to impose restrictions falling under this provision had to be justified by the company by actual proof of a public interest which could not be better served without it.
The submission that section 38 could be applied here amounts at least to a concession that a clause conferring such wide power upon the manufacturer may be so used as to amount to a restrictive practice.
It is the practice of putting in such a clause which has to be justified.
The power given to the company under clause 9 is very wide.
The manufacturer can compel the redistribution stock ists to make available to the company any stocks purchased by the stockist.
It also compels the stockist to take the permission of the company for conveying, transporting, or despatching parts of stocks of the products received by him outside a specified town except when he is so expressly directed in writing by the company.
It directly prevents him from doing so without the company 's permission.
If the stockist violates this condition the whole agreement can be revoked by the company so that the stockist loses his right to carry on business under the agreement.
If what had to be justified is not how this power is actually used, but the practice of conferring such powers upon the company by placing the stockist at the mercy of the company, the evi dence of facts showing how the power is exercised could be relevant only very indirectly.
However, if it could be shown that some facts did exist which make it imperative to confer such a power on the company for the benefit of ' the public, that may be relevant to establish the existence of a "gateway" under section 38.
But, it could certainly not be used to determine the meaning of a clause for which it is not necessary here to go beyond the language of the clause involved.
We are primarily concerned in this case, as we have repeatedly emphasized, with the clear meanings of the two clauses.
As the Commission pointed out, it is immaterial that a purchaser from outside may be able to get round clause 9 by purchasing across the counter from the stockist inside a town.
The clause itself, however, gives to the company an unreasonably wide power of deciding what is actually fair and equitable distribution.
The Commission very rightly points out that this is more properly a part of the duty of governmental authorities which may be entrusted with powers of rationing such consumers ' goods if this is found to be necessary in public interest.
However, before any question of reasonableness of a power to ration any goods is entrusted by any method to any person or authority those goods must be shown to be scarce or in Short supply.
That was the position in the Telco case (supra).
Evidence establishing such a need has not been shown to exist.
And, in any case, it has to be a very exceptional set of facts indeed which could justify lodging of such a power in the manufacturer.
The Commission has dealt with a good deal of evidence to justify its conclusion that the need to justify the lodging of such a power in the company has not been established.
We see no reason to disturb it.
Under the provisions of section 55 of the Act, an appeal lies to this Court only on one of the grounds mentioned in section 100 of the 467 Code of Civil Procedure.
It is, therefore, necessary in all such cases for counsel to clearly formulate and direct our attention to only questions of law which arise so that these may be decided.
It is not permissible to go over the whole range of evidence led as was attempted before us.
Learned counsel for the appellant when asked by us to formulate the questions of law which arise mentioned the following questions: Firstly, whether the Commission was right in applying what he described as the "per se" rule as opposed to "the rule of reason".
It was submitted that the correct rule which should have been applied is stated in Board of Trade of the City of Chicago vs United States of America, as follows (at p. 237): "Every agreement concerning trade, every regulation of trade, restrains.
To bind to restrain, is of their very essence.
The true test of legality is whether the restraint imposed is such as merely regulates and per haps thereby promotes competition, or whether it is such as may suppress or even destroy competition.
To determine that question the Court must ordinarily consider the facts peculiar to the business to which the re straint is applied; its condition before and after the restraint was imposed; the nature of the restraint, and its effect, actual or probable.
The history of the restraint, the evil believed to exist, the reason for adopt ing the particular remedy, the purpose or end sought to be attained, are all relevant facts.
This is not because a good intention will save an otherwise objectionable regulation, or the reverse; but because knowledge of intent may help the court to interpret facts and to predict consequences".
We find no objection whatsoever in adopting the rule indi cated above in cases to which it applies.
That was a case in which a rule adopted by the Board of Trade of the City of Chicago (supra) prohibiting offers to purchase during the period between the close of the call and the opening of the session on the next business day for sales of wheat, corn, oats, or rye at a price other than at the closing bid, was challenged.
Hence, questions relating to effects of the rule arose so as to determine its reasonableness.
Such questions could not be determined without examining evidence of facts to which the rule was meant to apply and findings as to how it operated.
The issue was whether the rule, having regard to the facts to which it was to be applied, offended against the Anti trust laws.
The Government 's case was thus stated by Mr. Justice Brandeis (at p. 237) : "The Government proved the existence of the rule and described its application and the change in business practice involved.
It made no attempt to show that the rule was designed to or that it had the effect of limiting the amount of (1) 62 Law.p. 231.468 grain shipped to Chicago; or of retarding or accelerating shipment; or of raising or depressing prices; or of discriminating against any part of the public; or that it resulted in hardship to anyone.
The case was rested upon the bald proposition that a rule or agreement by which men occupying positions of strength in any branch of trade fixed prices at which they could buy or sell during an important part of the business day is an illegal restraint of trade under the Anti trust Law.
But the legality of an agree ment or regulation cannot be determined by so simple a test as whether it restrains competi tion".
Apparently, Dr. Singhvi means, by his plea against the use of a "per se rule", nothing more than an assumption, that a restriction is illegal in itself, should not be made without examining its impact upon the particular trade involved.
As contrasted with any such assumption what the learned counsel describes as "the rule of reason" was stated in the earlier passage quoted above giving the nature of facts to be considered so aS to determine the context in which the restraint was imposed.
This Court accepted the correctness, in the Telco case (supra), of the approach that no bald or simple test, divorced from the context or sur rounding circumstances, should be adopted in judging the legality of a restraint upon trade.
Such a view, applicable to actual restrictions imposed, has really nothing to do with the rules relating to interpretation of documents which are used in finding out the effect and intent of words used in a document.
It is after a difficulty of interpretation, if any, is resolved and a rule or a clause in an agreement is found to have either a clear meaning or to be ambiguous that its effect can be considered.
No doubt that effect has to be examined to determine how a restraint actually imposed affects trade.
It is one thing to say that the impact of the restraint imposed on trade should be considered with refer ence to the nature of the trade or business to be regulated.
It is quite another to say that the effect cannot be gauged, sometimes, even by a bare examination of the meaning of a clause giving power to impose restraints apart from other evidence of what its actual effects are or may be.
In some cases, the effect itself is given primarily by the clear meaning of the language used in the clause which is alleged to infringe the law We do not think that any "per se rule", if we may use this somewhat quaint expression is adopted whenever a Court determines the meaning and effects of the words of a rule or a clause in an agreement.
All that the Court does in such a case is simply to interpret the clause, the effect of which may become obvious on a bare determina tion of the meaning or may be seen from other evidence too.
Where that effect is not obvious, as we have already indi cated, evidence may be led to show how the language used is actually applied to the facts to which it was meant to apply.
That is also a recognised rule of interpretation.
It is the function Of Courts to indicate and explain the vary ing facts and circumstances to which different rules of interpretation may apply.
Where meaning and intent of lan guage used is given by the words used nothing more is needed.
469 Furthermore, the Commission held that, taking into account the nature of goods or the business to be regulated by the agreement under consideration, the clauses, as they stood, were not permissible.
It had applied the rule of reason in arriving at the conclusion that, upon the facts of a business in commonly used consumer goods of several varie ties, Which are not shown to be scarce, clauses under con sideration having the obvious meaning and effect which their language carried with them, are unreasonable and illegal.
We are unable to see how any law laid down in American deci sions, dealing with Anti trust laws, or in English cases, dealing with agreements in restraint of trade, lay down rules of reason at variance with the ones we are applying here.
The rules of reason applicable to a case like the one before us may be simply stated as follows: Firstly, the meaning of the impugned clause or clauses in an agreement said to offend the law must be determined according to law; secondly, the possible effects of such a clause upon compe tition in the trade to be regulated must be determined.
We think that the Commission had rightly applied these rules and found the clauses to be capable of misuse.
We think that this was enough to vitiate the impugned clauses.
We would like to make it clear that we are really con cerned only with the law as we find it in our own statute and can only examine evidence in the light of our own law of evidence.
We think that the confusion which may be created by using terms such as "per se" rule which could perhaps be more usefully applied to indicate doctrines or to de scribe practices developed under very different sets of circumstances in other countries with statutory provisions couched in language which differs from that before us, should be avoided so far as possible.
Secondly, it was submitted that we should look at evi dence of what takes place in the trade under consideration rather than clauses 5 and 9 of the agreement we have consid ered.
We have already indicated the correct procedure in 'such cases as the one before us.
Indeed, we think that a consideration of extraneous evidence is not required at all when the practice complained of is the introduction of clauses conferring wide powers which may be used to impose restrictions contrary to the Act.
In such a case, the introduction of clauses constitutes the restrictive prac tice.
Hence, their interpretation is all that we are really concerned with here in accordance with our law.
Evidence of what is actually practised could only be relevant 1or pur poses other than a determination of the meaning and the effect which follows logically or reasonably from such determination.
Thirdly, it was submitted that, in holding clause 9 to be invalid, the purpose of "equitable distribution", which imposes a limit on the powers of the company, was overlooked by the Commission.
For the reasons already given, we do not think that this supposed limitation reasonably restricts the company 's power to decide what to distribute.
The company is left entirely to itself to decide what is "equitable distri bution".
An interpretation of a document, according to well established rules, cannot be dispensed with by labelling it as an application of a "per se" doctrine.
We think that the clause, as it stands, 470 confers too wide a power and has to be struck down wholly as unreasonable on that ground.
Fourthly, our attention was sought to be drawn to the absence of evidence of distortion of competition and the presence of evidence that competition prevails in the market despite these clauses.
We have already held such oral evidence to to really unnecessary for judging the possible effects of the clauses.
The probability of the effect is only part of the rule of reason to be applied where extrane ous evidence is admissible.
In the instant case we are only, as already indicated above, concerned with a reasonable and natural interpretation of the clauses of the agreement and their reasonably possible effects.
Fifthly, it was submitted that there was clear evidence of public benefit from an equitable distribution in actual practice so that the requirements of a "gateway" under section 38 were satisfied.
We cannot assume public benefit from a mere declaration of intention to exercise a power so as to bene fit the public.
We are not satisfied, on the evidence actually adduced and placed before us, that this power was necessary so as to benefit the public.
Furtherfore, we cannot reassess evidence.
Actual benefit to the public is a question of fact on which find ings cannot be reopened unless some error of law is revealed.
No error of law in assessing evidence is disclosed.
This is an additional reason for not disturbing the findings of fact recorded by the Commission.
Sixthly, it was submitted that the Commission had ignored the last sentence of clause 9 in interpreting it.
We have, however, considered it and find that, far from making clause 9 more acceptable and reasonable, the last part of it makes it more objectionable and unreasonable inasmuch as it enhances the powers of the Company.
Learned counsel for the appellant company has pointed out that the order of the Commission was to come into force from 1 July 1976, ' so that the appellant company had nearly four months to rewrite the agreements which are over four thousands in number.
He prays for extension of time for six months from today for executing fresh agreements.
It is not really necessary for us to fix any particular time within which the company will print or get new agreements executed on freshly printed forms in accordance with law.
That is a matter for parties themselves to each agreement to decide and work out. ' All that we need make clear is that all agreements which are operative and binding between parties will be so interpreted now as if clause 9 was not there at all and clause 5 was there only in the ,modified form which omits the last sentence from clause 5 as it originally stood.
However, if the company wants, to complete any for malities for bringing each individual agreement into line with the law as declared by this Court it may do .so; and, it will file, within six months from today an affidavit showing that it has done this.
The requirement to file 471 such an affidavit showing compliance will ensure that the company has taken due steps to inform each stockist of the correct legal position.
The time given for doing this wilt not, however, authorise it to act under those parts of the agreement which this Court has declared to be illegal.
Subject to the observations made above we uphold the Commissions order and dismiss this appeal with costs.
P.B.R. Appeal dismissed.
| According to section 2(0) of the Monopolies & Restric tive Trade Practices Act a "restrictive trade practice" means inter alia a trade practice which has, or may have, the effect of preventing, distorting or restricting competi tion in any manner.
The appellant, who was a manufacturer of consumer goods such as soaps and toilet preparations, entered into agreements with redistribution stockists for the wholesale distribution of its products.
Clause 5 of the agreement, inter alia, provides that a stockist shall keep and maintain adequate stocks and shall carry out instructions and direc tions given by the appellant.
He is prohibited from charg ing anything more than the stipulated maximum resale price.
The last part of the clause provides that "the redistribu tion stockist shall purchase and accept from the company such stock as the company shall, at its discretion, send to the redistribution stockist for fulfilling its obligations under this agreement".
Clause 9 prohibits the redistribution stockist from re booking or in any way conveying, transport ing or despatching parts of stocks of the products received by him outside the town except when he was so expressly directed in writing by the appellant.
He shall also, when ever so required by the appellant, make available from the stocks such part as the appellant directs him to do.
On a complaint made to the Monopolies & Restric tive Trade Practices Commission by one of the stockists the Commission, after examining cls.
5 and 9 of the impugned agreement, held that the practice of resale price mainte nance and full line forcing to which the original el.
5 related, shall be discontinued and shall not be repeated.
It directed deletion of the last sentence of cl. 5 and declared cl. 9 as void.
Dismissing the appeal to this Court.
HELD: The Commission was right in reframing cl. 5 in the way it did.
Deletion of the last sentence of cl. 5 was essential to prevent possible misuse of the appellant 's power so as to regulate the prices contrary to the express provisions in the clause.
(a) The last part of cl. 5 placed the redistri bution stockist at the mercy of the appellant which could dictate to him what amounts of various commodities he "shall purchase and accept from the company".
It also empowered the appellant to allocate send to the redistri bution stockist only what it "shall, at its discretion, send to the redistribution stockist for fulfilling its obliga tions" under the agreement.
[464 G] (b) The word "shall" used in the clause did not bind down the exercise of the appellant 's discretion by reference to any requirements of the consumers in a particu lar area in which the stockist might sell.
The stockist was bound to accept and carry out the appellant 's decisions.
[464 H] 2(a) The contention that though the clauses gave power to the appellant to regulate trade, in practice they did not operate as restrictions, is not well founded.
It is not possible to isolate the terms of a contract from the practice.
The appellant did not intend that the clauses in the agreement would be treated as 456 dead letter.
Although the practice of imposing restrictions under such clauses and the practice of introducing such clauses are separate practices, introduction of a clause like cl. 5 is itself a trade practice.
Moreover, even if the power given in such wide terms was not meant to be exercised unreasonably, its presence in the agreement was a needless surplusage which could be used to impede freedom of competition and trade and this made it objectionable.
[465 A] (b) Inasmuch as the introduction of clauses in an agree ment taken by itself, is a practice it would be specious reasoning to separate the clauses in the agreement from action under the agreement and then urge that the clauses are innocuous and should not be modified.
[460 H; 461 A] 3.
From the definition of "restrictive trade practice" it is clear that if the introduction of the clause in itself is a trade practice and could be used to prevent, distort or restrict competition "in any manner", it could be struck down.
The definition of "trade practice" is wide enough to include any "trade practice" if it is in relation to the carrying on of a trade.
If the result of introduc tion of a clause is to restrict trade it would be struck by the provisions of the Act.
[461 E G] 4(a) Each type of business has its peculiarities, its own mode of operation, the special features relating to the market for it and the requirements of distribution of par ticular goods, to secure a just and equitable distribution consistently with the maintenance of freedom of competition so that prices are not artificially pushed up.
[462 G] (b) The Telco case is distinguishable from the present on the ground that in that case the manufacturer who had the monopoly of special quality trucks, had to provide specially trained and skilled personnel with special equipment and tools for their maintenance and running.
Therefore, the agreements did not restrict trade or curtail competi tion.
[462 H] (c) In the instant case, the appellant could compel the stockist to buy the goods manufactured by it irrespective of whether the stockist wanted the goods or not.
The appel lant was under no obligation to render any service for the maintenance of the goods supplied.
Secondly, the present is not a case in which the terms of the agreement were required to be explained by the facts to which they were meant to be applied.
[463 C D] Tata Engineering & Locomotive Co., Ltd. vs The Registrar of Restrictive Trade Agreements ; distin guished.
If it was clear from the agreement that prices lower than the "maximum re sale price stipulated" might be charged by the stockist, then, there was no reason why it was necessary to clarify by circulars, what the stockist was free to do under the agreement.
Even if the appellant 's practice of issuing circulars was established, it did not justify retention of cl. 5 in a form which could be used to compel the stockist to act at the appellant 's behests.
The last part of cl. 5 made it necessary for the stockist to purchase such goods and in such combination as the appellant might decide.
Hence it would be struck by section 33(1)(b) of the Act.
[465 C] (b) Inasmuch as.
the original el. 5 gave the stockist the discretion to sell at lower than maximum resale prices the agreement was not struck by section 33 (1 ) (b).
But, the deletion of the sentence was essential to prevent possible misuse of the appellant 's power by resort to it.
[465 G] The Commission was justified in declaring cl. 9 as void and inoperative.
[465 H] 7(a) The power to impose restrictions falling under section 38 had to be justified by the appellant by actual proof of public interest which could not be better served without it [466 A].
(b) Clause 9 gave the appellant an unreasonably wide power of deciding what is actually fair and equitable distribution which is more a part of the duty of governmen tal authorities entrusted with powers of rationing such consumer goods in public interest.
Before any question of reasonableness of a power to 457 ration any goods is entrusted to any person or authority those goods must be shown to be scarce or in short supply and evidence establishing such a need has not been shown to exist in this case.
[466 F G] (c) The appellant was wrong in its contention that in holding cl. 9 to be invalid, the purpose of "equitable distribution" was overlooked by the Commission.
This sup posed limitation did not restrict the appellant 's power to decide what to distribute.
The appellant was left to itself to decide what is "equitable distribution".
The clause conferred too wide a power and is unreasonable.
[469 H] 9.
Under section 55 an appeal lies to the Supreme Court only on one of the grounds mentioned in section 100, C.P.C.
It is necessary for the parties to formulate questions of law that arise for decision.
[467 A] 10(a) The plea against use of "per se" rule referred to by the appellant means that on the assumption that a restriction is illegal in itself should not be made without examining its impact upon the particular trade involved.
On the other hand the "rule of reason" envisages consideration of facts of each case so as to determine the context in which the restraint was imposed.
[468 C] Board of Trade of the City of Chicago vs United States of America (b) In Telco case this Court accepted the correctness of the approach that no bald or simple test should be adopted in judging the legality of a restraint upon trade.
Such a view has nothing to do with rules _relating to inter pretation of documents used in finding out the effect and intent of words used in a document.
Whenever a court deter mines the meaning and effect of the words of a rule or a clause in an agreement it does not adopt what is termed as "per se" rule.
All that the court does in such a case is to interpret the clause, the effect of which may become obvious on a bare determination of the meaning or may be seen from other evidence.
Where that effect is not obvious, evidence may be led to show how the language used is actually applied to the facts to which it was meant to apply.
[468 D F] In the instant case, the Commission has correctly ar rived at the conclusion that the clauses were unreasonable and illegal after taking into account the relevant fac tors.
The rules of reason applicable to a case like the present are (i) the meaning of the impugned clause or clauses in an agreement must be determined according to law and (ii) the possible effects of such a clause upon competition in the trade to be regulated must be determined.
[469 B C] (c) Consideration of extraneous evidence is not required at all when the practice complained of is the introduction of clauses conferring wide powers, Which may be used to impose restrictions contrary to the Act.
In such a case the introduction of clauses constitute restrictive practice.
Evidence of what is actually practised could only be rele vant for purposes other than a determination of the meaning and the effect which follows logically or reasonably from such determination.
[469 F G] (d) No oral evidence could be led to adduce the meaning of the clauses in the agreement in view of sections 91 and 92 of the Evidence Act.
Section 92 proviso (6) is not applicable to the present case.
[464 C] (e) It is unnecessary to admit extraneous evidence as to the absence of distortion of competition.
The probability of the effect is only part of the rule of reason to be applied where extraneous evidence is admissible.
[470 B] (f) It is not possible to assume public benefit from a mere declaration of intention to exercise a power so as to benefit the public.
On the evidence adduced it was not shown that this power was necessary so as to benefit the public.
[470 D] (g) Actual benefit to the public is a question of fact on which findings cannot be reopened unless some error of law is revealed.
No error of law in assessing evidence was disclosed.
E] 458 (h) The confusion which may be created by using such terms as "per rule which could be applied to describe prac tices developed in other countries with different statutory provisions, should be avoided.
[469 D E] 10.
Proceedings before the Commission ' are maintainable at the instance of a complainant whose motives in making the complaint are quite irrelevant.
All that the Commission, and, on appeal, this Court, has to examine is whether a practice by a company of introducing clauses complained of in the agreements with the stockists, amounted to a restric tive trade practice.
[460 D]
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Subsets and Splits